(RTTNews) - Independent natural gas producer Cabot Oil & Gas Corp. (COG: News ) 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: News ) 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.

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