Independent natural gas producer Cabot Oil & Gas Corp. (COG) reported Monday a 42% year-over-year drop in profit for the third quarter, as higher production during the quarter was offset by lower commodity price realizations. Excluding items, adjusted earnings per share for the quarter dropped 29.3% from last year, but topped analysts' expectations by five cents.
In a statement, chairman, president and chief executive officer, Dan Dinges said, "In light of the general market conditions for natural gas, the metrics are very good. These results include a five percent increase in third quarter 2009 equivalent production over the third quarter of 2008. The production growth rate was driven by a 24.2 percent increase in the North region production for comparable year over year quarters. Weighing on the overall growth rate was the sale of our Canadian assets."
Third-Quarter Results
The Houston, Texas-based company reported net income of $38.90 million or $0.38 per share for the third quarter, down about 42% from $66.99 million or $0.65 per share in the prior-year quarter.
The results for the latest quarter primarily include a stock-based compensation expense of $3.32 million, and unrealized loss on derivatives of $0.77 million, while the year-ago quarter included a stock-based compensation income of $6.10 million and unrealized gain on derivatives of $0.79 million.
Excluding items, adjusted net income for the quarter dropped to $42.64 million or $0.41 per share from $60.10 million or $0.58 per share in the year-ago quarter. On average, twenty analysts polled by Thomson Reuters expected the company to report earnings of $ 0.36 per share for the quarter. Analysts' estimates typically exclude special items.
Operating revenues for the quarter declined to $207.2 million from $244.8 million in the same quarter last year, but topped analysts' consensus estimate of $205.30 million.
Among Cabot's Peers, Woodlands, Texas-based Anadarko Petroleum Corp. (APC) is scheduled to release financial results for the third quarter on November 2, 2009. Analysts expect the company to report a loss of $0.33 per share, on revenues of $2.00 billion for the third quarter.
Other Metrics
Cabot's revenues from natural gas production for the quarter was $177.81 million, down from $200.28 million in the year-ago quarter. Revenues from brokered natural gas dropped to $9.03 million from $23.86 million in the same quarter last year. Revenues from crude oil and condensate were $19.57 million, down from $20.0 million in the prior-year quarter. Other revenues decreased to $0.61 million from $0.68 million a year ago.
Production during the third quarter rose to 25.5 billion cubic feet of oil equivalent or Bcfe from 24.2 Bcfe in the same quarter last year. However, realized natural gas prices in the quarter were $7.40 per million cubic feet or Mcf, down from $8.66 per Mcf in the year-ago quarter. Realized oil prices declined 12% from the prior-year quarter to $87.49 per barrel from last year's $99.34 per barrel.
Income from operations for the third quarter dropped to $74.72 million from $114.72 million in the prior-year quarter. Total operating expenses for the quarter edged up to $132.87 million from $130.10 million in the year-ago quarter.
Operating expenses, including exploration costs of $14.40 million, were higher than $6.41 million in the year-ago quarter, and depreciation depletion and amortization expenses of $62.04 million were higher than $57.41 per share last year. It also includes brokered natural gas cost of $7.79 million, lower than $20.89 million in the same quarter last year.
Cabot's cash flow from operations for the quarter totaled $116.7 million, down from $148.3 million in the year-ago quarter. Meanwhile, discretionary cash flow edged down to $158.9 million from $161 million in the prior-year quarter.
Nine month Highlights
For the nine month period, Cabot reported net income of $111.98 million or $1.08 per share, down from $167.59 million or $1.68 per share in the year-ago period. Excluding special items, adjusted net income for the period dropped to $123.93 million or $1.20 per share from $187.0 million or $1.87 per share in the same prior-year period.
Operating revenue for the year-to-date period declined to $645.78 million from $713.33 million in the same period last year.
Cabot's board of directors also declared a regular dividend of $0.03 per share on the company's common stock, payable on November 25, to shareholders of record as of the close of business on November 11, 2009.
Stock Quote
COG closed Monday's regular trading session at $38.31, down $0.59 or 1.52% on a volume of 2.00 million shares, higher than the three-month average volume of 1.41 million shares. In the past 52-week period, the stock has been trading in a broad range of $17.84 to $41.58.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.