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| Costilla Energy Reports Second-Quarter Results |
* Production Up 56 Percent
* Revenues Increase 44 Percent
* Current Daily Production 12,500 BOE
MIDLAND, Texas, Aug. 7 /PRNewswire/ -- Costilla Energy, Inc.
(Nasdaq: COSE) today reported a 56 percent increase in oil and natural gas
production and a 44 percent increase in oil and gas revenues for the second
quarter 1997. The results for the second quarter were a net loss of
$2.4 million, or 23 cents per share, compared with a net loss of $2.3 million,
or 44 cents per share, for the comparable period in 1996, which included an
extraordinary item for $1.6 million.
For the second quarter 1997, cash flow was $4.6 million, or 44 cents per
share, and adjusted EBITDA was $6.8 million, or 2.5 times interest expense.
Oil and gas revenues were $15.3 million versus $10.6 for 1996 and production
was 1.1 million barrels of oil equivalent (BOE) compared with 0.7 million BOE
in 1996. The Company has previously announced the sale of certain high-
operating-cost properties. The estimated production related to the properties
sold was 600 BOE per day, which resulted in a decrease in the Company's 1997
second quarter of approximately 36,000 BOE. The Companys current daily
production is approximately 12,500 BOE, excluding production from the pending
Ballard Petroleum acquisition.
For the six months ended June 30, 1997, Costilla reported oil and gas
revenues of $34.9 million, an increase of 79% over the $19.4 million reported
in 1996. Results for the six months ended June 30, 1997 were a net loss of
$0.1 million, compared with a net loss of $2.3 million in 1996, which included
an extraordinary item for $1.6 million. Cash flow for the 1997 period was
$13.5 million, or $1.29 per share, compared with $4.4 million, or 84 cents per
share for the 1996 period.
During the 1997 second quarter, the Company drilled a total of 36 wells,
of which 26 were productive. In the Permian Basin, 21 wells were drilled, of
which 13 were productive, seven wells were drilled in the Gulf Coast onshore
area, five of which were productive and eight wells were drilled in the Rocky
Mountains, all of which were productive. During the first half of 1997, the
Company drilled 67 wells, of which 52 were productive. In addition, the
Company was in the process of drilling or completing 21 wells at June 30,
1997, which were located as follows: Permian Basin - 9 wells; Gulf Coast -
9 wells; and the Rocky Mountains - 3 wells.
For the six months ended June 30, 1997, the Company produced 2.2 million
BOE and added approximately 6.0 million BOE to its reserves through its
drilling activities.
Costilla previously announced that it has agreed to acquire proved
reserves of approximately 6.0 million BOE, about 160,000 net acres of
undeveloped oil and gas properties and certain seismic data, all located in
the Rocky Mountain region, from Ballard Petroleum LLC of Billings, Montana,
for approximately $42.0 million. Closing of the acquisition is planned for
late August 1997.
The Company has received a commitment from Bankers Trust Company to
provide an acquisition facility for financing $30.0 million of the Ballard
Petroleum acquisition. In addition, the commitment will provide the Company
with a new revolving line of credit, which will replace its existing revolving
line of credit, with the availability of funds being subject to a borrowing
base determined at least semi-annually. The new credit facility will provide
for a maximum availability of $75.0 million, with an initial borrowing base of
$50.0 million. At June 30, 1997, the Company had $14.7 million borrowed
against the existing revolving line of credit, which will be renewed. In
addition, the Company will utilize funds available under the New Credit
Facility to fund the remaining portion of the Ballard Petroleum acquisition.
Costilla Energy, Inc. is an independent energy company engaged in the
exploration, acquisition and development of oil and gas properties with
operations primarily in the Permian Basin area of Texas and New Mexico, the
Gulf Coast, and the Rocky Mountain regions. The Company and its predecessor
have been in business since 1988.
Certain statements in this news release constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995. Such forward-looking statements involve known and unknown risks,
uncertainties, and other factors which may cause the actual results,
performance, or achievements of Costilla Energy, Inc. to be materially
different from any future results; performance, or achievements expressed or
implied by such forward-looking statements. Such factors include, among
others, the following; the volatility of oil and gas prices, the Company's
ability to replace its oil and gas reserves, the availability of capital
resources; the reliance upon estimates of proved reserves, operating hazards
and uninsured risks, competition, government regulation and the ability of the
Company to implement its business strategy. These factors are discussed in
more detail in the Company's prospectus for its initial public offering of
common stock.
COSTILLA ENERGY, INC.
SUMMARY FINANCIAL AND OTHER DATA
(in thousands, except per share data)
Three months ended Six months ended
June 30, June 30,
1997 1996 1997 1996
Production
Oil (MBBLS) 489 371 1,037 709
Gas (MMCF) 3,437 1,861 6,721 3,504
MBOE 1,062 681 2,157 1,293
Average Net Sales Price
Oil (per BBL) $17.46 $18.88 $18.71 $18.14
Gas (per MCF) $1.96 $1.93 $2.30 $1.88
Revenues
Oil $8,544 $7,013 $19,400 $12,866
Gas $6,735 $3,599 $15,492 $6,578
Net income (loss) $(2,415) $(2,298) $(134) $(2,286)
Per share $(0.23) $(0.44) $(0.01) $(0.44)
Cash Flow (a) $4,643 $2,143 $13,519 $4,384
Per share $0.44 $0.41 $1.29 $0.84
Adjusted EBITDA (b) $6,784 $4,506 $18,278 $8,438
Adjusted EBITDA/Interest 2.5x 2.0x 3.4x 2.1x
Weighted average shares 10,459 5,200 10,468 5,200
(a) -- Net income (loss) plus deferred taxes, depreciation, depletion and
amortization, and exploration and abandonments.
(b) -- Net income (loss) plus income taxes, interest, depreciation,
depletion and amortization, and exploration and abandonments.
COSTILLA ENERGY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
Three months ended Six months ended
June 30, June 30,
1997 1996 1997 1996
Revenues:
Oil and gas sales $15,279 $10,613 $34,892 $19,446
Other 154 (38) 920 80
Total 15,433 10,575 35,812 19,526
Expenses:
Oil and gas production 6,794 4,621 14,163 8,279
General and administrative 1,856 1,449 3,370 2,810
Exploration and abandonments 1,774 78 3,115 308
Depreciation, depletion and
amortization 4,806 2,710 9,720 4,619
Interest 2,809 2,375 5,516 4,156
Total 18,039 11,233 35,884 20,172
Income (loss) before
federal income taxes (2,606) (658) (72) (646)
Provision for federal income taxes
Current -- -- 62 --
Deferred (191) -- -- --
Income (loss) before
extraordinary item (2,415) (658) (134) (646)
Extraordinary loss
resulting from early
extinguishment of debt -- (1,640) -- (1,640)
Net income (loss) $(2,415) $(2,298) $(134) $(2,286)
Income (loss) per share:
Net income (loss) $(0.23) $(0.44) $(0.01) $(0.44)
Weighted average shares
outstanding 10,459 5,200 10,468 5,200
COSTILLA ENERGY, INC.
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands)
June 30, December 31,
1997 1996
(unaudited)
ASSETS
Current assets $21,546 $30,409
Net property, plant and equipment, at cost 151,589 126,944
Other assets 5,036 5,437
Total $178,171 $162,790
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $23,713 $20,089
Long-term debt, less current maturities 114,826 100,262
Other noncurrent liabilities 430 1,870
Stockholders' equity 39,202 40,569
Total Liabilities and
Stockholders' Equity $178,171 $162,790
SOURCE Costilla Energy, Inc.
back to topCONTACT:
Mike Grella, President & Chief Executive
Officer, of Costilla Energy, 915-683-3092; or General, Karl
Plath, 312-640-6738, or Analysts, Lisa Ferguson, 312-640-6788,
both of The Financial Relations Board
