EX-99.1 CHARTER 2 pressreleasecomstockmay707.htm COMSTOCK RESOURCES, INC. PRESS RELEASE EXHIBIT 99.1 MAY 7, 2007 Comstock Resources, Inc. Press Release Exhibit 99.1 May 7, 2007
Exhibit 99.1
 
5300 Town and Country Blvd., Suite 500
Frisco, Texas 75034
Telephone: (972) 668-8800
Contact: Roland O. Burns
Sr. Vice President and Chief Financial Officer
 
Web Site: www.comstockresources.com
 
NEWS RELEASE
 
For Immediate Release

COMSTOCK RESOURCES, INC. REPORTS
FIRST QUARTER 2007 FINANCIAL AND OPERATING RESULTS

FRISCO, TEXAS, May 7, 2007 - Comstock Resources, Inc. ("Comstock" or the "Company") (NYSE: CRK) today reported financial and operating results for the quarter ended March 31, 2007.

First Quarter 2007 Financial Results

Comstock reported net income of $12.6 million or 28¢ per diluted share for the three months ended March 31, 2007 as compared to 2006's first quarter net income of $29.6 million or 68¢ per diluted share. The 2006 results include an $8.2 million unrealized gain on derivatives held for price risk management. Without the unrealized gain, net income for the first quarter of 2006 would have been approximately $23.9 million or 55¢ per diluted share.

The first quarter results reflect the success that the Company's onshore development drilling program and offshore exploration activities have had in growing production. Comstock's production in the first quarter of 2007 increased 28% to 20.0 billion cubic feet equivalent of natural gas ("Bcfe") as compared to production of 15.7 Bcfe in the first quarter of 2006. Onshore production has increased 16% and offshore production was up 42% from the first quarter of 2006. The first quarter average daily production rate of 223 million cubic feet of natural gas equivalent ("Mmcfe") also has increased 13% from the fourth quarter production rate of 198 Mmcfe per day. The production gains were offset in part by lower oil and natural gas prices. The Company's realized natural gas price averaged $6.89 per Mcf in 2007's first quarter, 14% lower than the $8.05 per Mcf in 2006's first quarter. Realized oil prices in the first quarter of 2007 averaged $54.15 per barrel, 6% lower than the $57.91 per barrel for 2006. First quarter 2007's oil and gas sales of $146.0 million increased 11% from 2006's first quarter sales of $131.7 million. Operating cash flow (before changes in working capital accounts) generated by Comstock in 2007's first quarter of $100.5 million was 10% higher than 2006's first quarter cash flow of $91.5 million. EBITDAX or earnings before interest, taxes, depreciation, depletion, amortization, exploration expense and other noncash expenses was $114.0 million in 2007's first quarter, a 14% increase from 2006's first quarter EBITDAX of $100.0 million.
 
 

 


First Quarter 2007 Drilling Results
Comstock also announced the results to date of its 2007 drilling program. In the first three months of 2007 Comstock drilled 48 wells (38.3 net). Forty-five of the wells drilled were successful and three were dry holes.

Onshore, Comstock drilled 44 (35.7 net) successful development wells in the first quarter of 2007. Comstock drilled 34 wells (27.4 net) in its East Texas and North Louisiana region which have been tested at an average per well initial production rate of 1.3 Mmcfe per day. At March 31, 2007 Comstock had six additional wells in this region that were being drilled which are part of Comstock's 115 well Cotton Valley drilling program planned in this region for 2007.

In South Texas, Comstock drilled four successful wells (2.7 net) during the first quarter of 2007, which had an average per well initial production rate of 7.5 Mmcfe per day. Two of the wells were in the Las Hermanitas field in Duval County, Texas and one well was drilled in each of the Company's Ball Ranch and Javelina fields. Comstock had two rigs drilling in this region on March 31, 2007. Comstock drilled six wells (5.6 net) in its Laurel and Maxie fields in Mississippi during the quarter. Three of these wells were tested at an average per well initial production rate of 185 barrels of oil per day and one well tested at 1.5 Mmcf of natural gas per day. Comstock had one rig drilling in the Laurel field at the end of the first quarter.

Comstock's offshore operations are conducted by its 49% owned subsidiary, Bois d'Arc Energy, Inc. (NYSE: BDE) ("Bois d'Arc").  Bois d'Arc has drilled three exploratory wells, 1.8 net to Bois d'Arc's interest and one development well (0.8 net). Bois d'Arc's OCS-G 22738 #3 well at South Timbalier block 75 is its second well to test the "Doc Holliday" prospect. To date this well has been drilled to a depth of 16,236 feet and has encountered pay in several new reservoirs. Bois d'Arc has set protective casing and is deepening the well to test additional prospective targets. Bois d'Arc's OCS-G 22648 #2 well drilled at South Marsh Island block 220 and a well drilled at Vermillion Block 50 were unsuccessful. Bois d'Arc also participated in another operator's deepwater exploratory prospect which was not successful. In addition to the deepening of the second "Doc Holliday" well, Bois d'Arc is currently drilling an exploratory well to test its "Dogbone" prospect at South Pelto block 7 and is participating in a second, non-operated deepwater test.


This press release may contain "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties which could cause actual results to differ materially from those described herein. Although the Company believes the expectations in such statements to be reasonable, there can be no assurance that such expectations will prove to be correct.

Comstock Resources, Inc. is a growing independent energy company based in Frisco, Texas and is engaged in oil and gas acquisitions, exploration and development primarily in Texas, Louisiana and the Gulf of Mexico. The Company's stock is traded on the New York Stock Exchange under the symbol CRK.

 
 
 

 
COMSTOCK RESOURCES, INC.
CONSOLIDATED OPERATING RESULTS
(In thousands, except per share amounts)
 
   
Three Months Ended March 31,
    
   
2007
    
2006
    
Oil and gas sales
  
$
146,029
    
$
131,724
    
Operating expenses:
                  
Oil and gas operating
    
27,083
      
26,295
    
Exploration
    
11,133
      
4,875
    
Depreciation, depletion and amortization
    
56,707
      
30,685
    
General and administrative
    
9,702
      
8,135
    
                   
Total operating expenses
    
104,625
      
69,990
    
                   
                   
Income from operations
    
41,404
      
61,734
    
Other income (expenses):
                  
Interest income
    
296
      
237
    
Other income
    
130
      
54
    
Interest expense
    
(8,449
)
    
(5,483
)
  
Gain (loss) on derivatives
    
—
      
8,125
    
                   
Total other income (expenses)
    
(8,023
)
    
2,933
    
                   
Income before income taxes and minority interest
    
33,381
      
64,667
    
Provision for income taxes
    
(14,824
)
    
(26,299
)
  
Minority interest in earnings of Bois d'Arc Energy
    
(5,999
)
    
(8,734
)
  
                   
Net income
  
$
12,558
    
$
29,634
    
                   
                   
Net income per share:
                  
Basic
  
$
0.29
    
$
0.70
    
Diluted
  
$
0.28
    
$
0.68
    
                   
Weighted average common and common stock equivalent shares
outstanding:
                  
Basic
    
43,364
      
42,051
    
Diluted
    
44,238
      
43,429
    

 
 
 

COMSTOCK RESOURCES, INC.
CONSOLIDATED OPERATING RESULTS
(In thousands)
 
   
Three Months Ended March 31,
    
   
2007
    
2006
    
Cash flow from operations:
                  
Net cash provided by operating activities
  
$
78,746
    
$
85,539
    
Excess tax benefit from stock based compensation
    
166
      
197
    
Increase (decrease) in accounts receivable
    
4,874
      
(13,685
)
  
Decrease in other current assets
    
(2,013
)
    
(4,512
)
  
Decrease in accounts payable and accrued expenses
    
18,771
      
23,953
    
Cash flow from operations
  
$
100,544
    
$
91,492
    
                   
EBITDAX:
                  
Net income
  
$
12,558
    
$
29,634
    
Interest expense
    
8,449
      
5,483
    
Income tax expense
    
14,824
      
26,299
    
Depreciation, depletion and amortization
    
56,707
      
30,685
    
Minority interest in earnings of Bois d'Arc Energy
    
5,999
      
8,734
    
Stock-based compensation
    
4,312
      
3,144
    
Exploration expense
    
11,133
      
4,875
    
Unrealized gain on derivatives
    
—
      
(8,828
)
  
EBITDAX
  
$
113,982
    
$
100,026
    
                   

 
   
As of March 31,
  
   
2007
    
2006
  
     
Balance Sheet Data:
                
Cash and cash equivalents
  
$
12,003
    
$
10,913
  
Other current assets
    
90,974
      
68,895
  
Property and equipment, net
    
1,857,521
      
1,431,289
  
Other
    
5,361
      
5,295
  
Total assets
  
$
1,965,859
    
$
1,516,392
  
                 
Current liabilities
  
$
147,153
    
$
103,896
  
Long-term debt
    
511,000
      
319,000
  
Deferred income taxes
    
323,507
      
262,670
  
Asset retirement obligation
    
58,113
      
39,069
  
Minority interest in Bois d'Arc Energy
    
228,006
      
177,269
  
Stockholders' equity
    
698,080
      
614,488
  
Total liabilities and stockholders' equity
  
$
1,965,859
    
$
1,516,392
  
 
 
 
COMSTOCK RESOURCES, INC.
CONSOLIDATED OPERATING RESULTS
($ In thousands, except per unit amounts)
For the Three Months ended March 31, 2007
   
Onshore(1)
  
Bois d'Arc Energy
  
Total
  
Oil production (thousand barrels)
    
251
    
368
    
619
  
Gas production (million cubic feet - Mmcf)
    
8,635
    
7,701
    
16,336
  
Total production (Mmcfe)
    
10,140
    
9,909
    
20,049
  
                     
Oil sales
  
$
12,054
  
$
21,468
  
$
33,522
  
Gas sales
    
57,793
    
54,714
    
112,507
  
Total oil and gas sales
  
$
69,847
  
$
76,182
  
$
146,029
  
               
 
    
Average oil price (per barrel)
  
$
48.03
  
$
58.33
  
$
54.15
  
Average gas price (per thousand cubic feet - Mcf)
  
$
6.69
  
$
7.10
  
$
6.89
  
Average price (per Mcf equivalent)
  
$
6.89
  
$
7.69
  
$
7.28
  
Lifting cost
  
$
14,055
  
$
13,028
  
$
27,083
  
Lifting cost (per Mcf equivalent)
  
$
1.39
  
$
1.31
  
$
1.35
  
                     
Oil and gas capital expenditures
  
$
84,251
  
$
62,753
  
$
147,004
  
                     
   
(1) Includes the onshore results of operations of Comstock Resources, Inc.
 
For the Three Months ended March 31, 2006
   
Onshore(1)
  
Bois d'Arc Energy
  
Total
  
Oil production (thousand barrels)
    
228
    
317
    
545
  
Gas production (million cubic feet - Mmcf)
    
7,369
    
5,065
    
12,434
  
Total production (Mmcfe)
    
8,740
    
6,968
    
15,708
  
                     
Oil sales
  
$
12,265
  
$
19,337
  
$
31,602
  
Gas sales
    
57,626
    
42,496
    
100,122
  
Total oil and gas sales
  
$
69,891
  
$
61,833
  
$
131,724
  
               
 
    
Average oil price (per barrel)
  
$
53.69
  
$
60.95
  
$
57.91
  
Average gas price (per thousand cubic feet - Mcf)
  
$
7.82
  
$
8.39
  
$
8.05
  
Average price (per Mcf equivalent)
  
$
8.00
  
$
8.87
  
$
8.39
  
Lifting cost
  
$
13,855
  
$
12,440
  
$
26,295
  
Lifting cost (per Mcf equivalent)
  
$
1.59
  
$
1.79
  
$
1.67
  
                     
Oil and gas capital expenditures
  
$
49,157
  
$
46,457
  
$
95,614
  
                     
 
(1) Includes the onshore results of operations of Comstock Resources, Inc.
 
COMSTOCK RESOURCES, INC.
REGIONAL OPERATING RESULTS
($ In thousands, except per unit amounts)

For the Three Months ended March 31, 2007

   
East Texas/
North Louisiana
    
South
Texas
    
Other
    
Total
Onshore
  
Oil production (thousand barrels)
    
46
      
53
      
152
      
251
  
Gas production (million cubic feet - Mmcf)
    
5,381
      
2,577
      
677
      
8,635
  
Total production (Mmcfe)
    
5,657
      
2,896
      
1,587
      
10,140
  
                                 
Oil sales
  
$
2,492
    
$
2,958
    
$
6,604
    
$
12,054
  
Gas sales
    
35,501
      
18,101
      
4,191
      
57,793
  
Total oil and gas sales
  
$
37,993
    
$
21,059
    
$
10,795
    
$
69,847
  
                                 
Average oil price (per barrel)
  
$
54.17
    
$
55.81
    
$
43.45
    
$
48.02
  
Average gas price (per thousand cubic feet - Mcf)
  
$
6.60
    
$
7.02
    
$
6.19
    
$
6.69
  
Average price (per Mcf equivalent)
  
$
6.72
    
$
7.27
    
$
6.80
    
$
6.89
  
Lifting cost
  
$
6,684
    
$
3,322
    
$
4,049
    
$
14,055
  
Lifting cost (per Mcf equivalent)
  
$
1.18
    
$
1.15
    
$
2.55
    
$
1.39
  
                                 
Oil and Gas Capital Expenditures:
                                
Leasehold costs
  
$
398
    
$
816
    
$
2,400
    
$
3,614
  
Exploratory drilling
    
—
      
2,255
      
442
      
2,697
  
Development drilling
    
54,707
      
11,677
      
10,009
      
76,393
  
Other development
    
242
      
483
      
822
      
1,547
  
Total
  
$
55,347
    
$
15,231
    
$
13,673
    
$
84,251
  
                                 
For the Three Months ended March 31, 2006

   
East Texas/
North Louisiana
    
South
Texas
    
Other
    
Total
Onshore
  
Oil production (thousand barrels)
    
29
      
56
      
143
      
228
  
Gas production (million cubic feet - Mmcf)
    
4,243
      
2,285
      
841
      
7,369
  
Total production (Mmcfe)
    
4,417
      
2,623
      
1,700
      
8,740
  
                                 
Oil sales
  
$
1,740
    
$
3,474
    
$
7,051
    
$
12,265
  
Gas sales
    
32,766
      
18,198
      
6,662
      
57,626
  
Total oil and gas sales
  
$
34,506
    
$
21,672
    
$
13,713
    
$
69,891
  
                                 
Average oil price (per barrel)
  
$
60.00
    
$
62.04
    
$
49.31
    
$
53.68
  
Average gas price (per thousand cubic feet - Mcf)
  
$
7.72
    
$
7.96
    
$
7.92
    
$
7.82
  
Average price (per Mcf equivalent)
  
$
6.02
    
$
8.26
    
$
8.07
    
$
8.00
  
Lifting cost
  
$
5,926
    
$
3,649
    
$
4,280
    
$
13,855
  
Lifting cost (per Mcf equivalent)
  
$
1.34
    
$
1.39
    
$
2.52
    
$
1.59
  
                                 
Oil and Gas Capital Expenditures:
                                
Leasehold costs
  
$
1,294
    
$
—
    
$
757
    
$
2,051
  
Exploratory drilling
    
—
      
75
      
—
      
75
  
Development drilling
    
21,056
      
—
      
17,351
      
38,407
  
Other development
    
6,641
      
—
      
1,983
      
8,624
  
Total
  
$
28,991
    
$
75
    
$
20,091
    
$
49,157