Oil and natural gas company Energen Corp. (EGN), Wednesday reported a decline in profit for the fourth quarter, reflecting lower revenues from natural gas distribution and higher operating expenses. Earnings came in short of analysts' estimates as well. Looking ahead, the company affirmed its earnings guidance for the fiscal year 2010.
The Birmingham, Alabama-based company's net income for the fourth quarter declined to $58.62 million or $0.81 per share from $65.28 million or $0.91 per share in the previous year.
On average, eight analysts polled by Thomson Reuters expected the company to report earnings of $0.87 per share for the quarter. Analysts' estimates typically exclude special items.
The company's oil and gas exploration and production unit, Energen Resources generated fourth quarter net income of $51.1 million, as compared with $60.0 million in the same period last year.
Alabama Gas Corp. reported net income that totaled $7.8 million, compared to $5.4 million in the fourth quarter of 2008, reflecting the timing of revenue recovery associated with sales to core market and large commercial & industrial customers.
Operating revenues for the quarter declined to $362.80 million from $375.79 million last year.
Revenues from oil and gas operations increased to $216.39 million from $209.70 million a year ago. Revenues from natural gas distribution declined to $146.42 million from $166.09 million in the previous year.
Total operating expenses increased to $264.88 million from $256.67 million in the prior-year quarter. Operations and maintenance expenses rose to $105.77 million from $86.61 million last year.
Depreciation, depletion and amortization expenses were $62.78 million, up from $54.77 million a year ago. Taxes other than income taxes rose to $21.23 million from $15.57 million in the previous year.
For the fiscal 2009, Energen's net income declined to $256.32 million or $3.57 per share from $321.91 million or $4.47 per share last year. Total operating revenues declined to $1.44 billion from $1.57 billion in the previous year.
Analysts estimated earnings of $3.56 per share, on revenues of $1.45 billion for the fiscal year 2009.
The company noted that its production in 2009 climbed 9% to total 111.2 billion cubic feet equivalent or Bcfe and together with a decline in total lease operating expenses, more than offset higher depreciation and administrative expenses.
Energen Resources' year-end 2009 proved reserves totaled 1.55 trillion cubic feet equivalent, down slightly from 1.58 Tcf equivalent at year-end 2008. Negative revisions totaled about 125 Bcfe, with some net 69 Bcfe related to lower natural gas prices.
James McManus, Energen chairman and chief executive officer, said, "With another strong hedge position in place in 2010 - 72% of Energen Resources' estimated production is hedged at prices above the current strip - we are looking for double-digit earnings growth in 2010 and could see a return to record earnings this year."
For fiscal year 2010, the company affirmed its earnings guidance in the range of $4.20 per share to $4.60 per share, assuming commodity prices applicable to its unhedged production to average $5.50 per Mcf for natural gas, $75 per barrel for oil and 81 cents per gallon for NGL.
The company also estimates that its total production in 2010 will increase about 3% to 114 Bcfe.
Analysts currently expect the company to report earnings of $4.41 per share on revenues of $1.61 billion for the fiscal year 2010.
EGN is currently trading at $46.45, down 0.95 or 2.00%, on a volume of 0.27 million shares on the NYSE.
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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.