Monday, St. Mary Land & Exploration Company (SM), an oil and natural gas company, reported a loss for the first quarter hurt in large part by non-cash impairments related to producing properties due to significantly lower realized prices for oil and natural gas.
Net loss for the quarter amounted to $87.6 million or $1.41 per share compared with net income of $95.0 million or $1.48 per share in the corresponding period last year.
The results for the quarter significantly included non-cash impairments of $91 million, after tax, related to producing properties. The company also recognized an impairment of materials inventory for $5.3 million, after tax.
In addition, the company recognized a non-cash benefit of $14.4 million, after tax, as a result of the decrease in the Net Profits Plan liability, which decreased during the quarter as a result of the significant decrease in forecasted oil and natural gas prices from December 31, 2008, to March 31, 2009
Adjusted net loss was $448 thousand or $0.01 per share compared with adjusted net income of $73.0 million or $1.14 per share in the same period last year. On average, ten analysts polled by Thomson Reuters expected the company to report earnings of $0.14 per share for the quarter. Analysts' estimates typically exclude special items.
Revenues slid to $199.2 million from $362.1 million in the year-ago quarter, yet exceeded the estimate of $195.98 million provided by Five Street analysts.
The company reported quarterly production of 28.4 billion cubic feet equivalent or BCFE, which was above the guidance range of 26.5 BCFE to 28.0 BCFE. Average realized prices, excluding hedging activities, were $4.00 per thousand cubic feet or Mcf of gas and $34.40 per barrel of oil during the quarter. For the same period last year, average realized prices, excluding hedging activities, were $8.53 per MCF of gas and $92.33 per barrel of oil.
Average realized prices, inclusive of hedging activities, were $6.14 per Mcf of gas and $44.16 per barrel of oil, down 29% and 42%, respectively, from the same period a year ago.
Depletion and depreciation expense rose to $3.23 per thousand cubic feet equivalent or MCFE and was well above the company's guidance range of $2.60 to $2.80. DD&A in the comparable period in the previous year was $2.48 per MCFE
Discretionary cash flow decreased to $107.4 million for the first quarter of 2009 from $198.2 million in the same period last year. Net cash provided by operating activities decreased to $125.2 million for the first quarter of 2009 from $142.7 million in the same period in 2008. The company said that a major driver of the fall year over year in each of these metrics was the significant decrease in oil and natural gas prices between those periods.
SM rose $2.06 or 10.95% and closed Monday's regular trading session at $20.88.
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