x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Virginia
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23-1184320
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(State or other jurisdiction of
incorporation or organization)
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(I.R.S. Employer
Identification No.)
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Large accelerated filer
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x
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Accelerated filer
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¨
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Non-accelerated filer
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¨ (Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Item
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Page
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Part I - Financial Information
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||
1.
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Financial Statements
|
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Condensed Consolidated Statements of Income for the Three Months Ended March 31, 2011 and 2010
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1
|
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Condensed Consolidated Balance Sheets as of March 31, 2011 and December 31, 2010
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2
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Condensed Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2011 and 2010
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3
|
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Notes to Condensed Consolidated Financial Statements:
|
||
1. Organization
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4
|
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2. Basis of Presentation
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4
|
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3. Acquisitions and Divestitures
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4
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4. Accounts Receivable
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5
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5. Derivative Instruments
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5
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6. Property and Equipment
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7
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7. Long-Term Debt
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7
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8. Additional Balance Sheet Detail
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9
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9. Fair Value Measurements
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10
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10. Commitments and Contingencies
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11
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11. Shareholders’ Equity and Comprehensive Income
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12
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12. Share-Based Compensation
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12
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13. Restructuring Activities
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13
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14. Interest Expense
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13
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15. Earnings per Share
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14
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16. Discontinued Operations
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14
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Forward-Looking Statements
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15
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2.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations:
|
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Overview of Business
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16
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Key Developments
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17
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Results of Operations
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18
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Liquidity and Capital Resources
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23
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Environmental Matters
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27
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Critical Accounting Estimates
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28
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New Accounting Standards
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28
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3.
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Quantitative and Qualitative Disclosures About Market Risk
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28
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4.
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Controls and Procedures
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29
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Part II - Other Information
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||
6.
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Exhibits
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30
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Signatures
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31
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Three Months Ended March 31,
|
||||||||
2011
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2010
|
|||||||
Revenues
|
||||||||
Natural gas
|
$ | 41,189 | $ | 47,988 | ||||
Crude oil
|
16,583 | 13,846 | ||||||
Natural gas liquids (NGLs)
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9,921 | 4,866 | ||||||
Gain on sale of property and equipment
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480 | 211 | ||||||
Other
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410 | 967 | ||||||
Total revenues
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68,583 | 67,878 | ||||||
Operating expenses
|
||||||||
Lease operating
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10,277 | 8,737 | ||||||
Gathering, processing and transportation
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4,028 | 3,231 | ||||||
Production and ad valorem taxes
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5,064 | 4,270 | ||||||
General and administrative
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13,352 | 15,025 | ||||||
Exploration
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29,548 | 6,029 | ||||||
Depreciation, depletion and amortization
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34,843 | 30,029 | ||||||
Other
|
- | 465 | ||||||
Total operating expenses
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97,112 | 67,786 | ||||||
Operating income (loss)
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(28,529 | ) | 92 | |||||
Other income (expense)
|
||||||||
Interest expense
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(13,484 | ) | (13,671 | ) | ||||
Derivatives
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1,328 | 29,877 | ||||||
Other
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144 | 1,246 | ||||||
Income (loss) from continuing operations before income taxes
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(40,541 | ) | 17,544 | |||||
Income tax (expense) benefit
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14,201 | (6,778 | ) | |||||
Net income (loss) from continuing operations
|
(26,340 | ) | 10,766 | |||||
Income from discontinued operations, net of tax
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- | 12,174 | ||||||
Net income (loss)
|
(26,340 | ) | 22,940 | |||||
Less net income attributable to noncontrolling interests in discontinued operations
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- | (9,346 | ) | |||||
Income (loss) attributable to Penn Virginia Corporation
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$ | (26,340 | ) | $ | 13,594 | |||
Earnings (loss) per share attributable to Penn Virginia Corporation - Basic:
|
||||||||
Continuing operations
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$ | (0.58 | ) | $ | 0.24 | |||
Discontinued operations
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- | 0.06 | ||||||
Net income (loss)
|
$ | (0.58 | ) | $ | 0.30 | |||
Earnings (loss) per share attributable to Penn Virginia Corporation - Diluted:
|
||||||||
Continuing operations
|
$ | (0.58 | ) | $ | 0.24 | |||
Discontinued operations
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- | 0.06 | ||||||
Net income (loss)
|
$ | (0.58 | ) | $ | 0.30 | |||
Weighted average shares outstanding, basic
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45,687 | 45,465 | ||||||
Weighted average shares outstanding, diluted
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45,687 | 45,761 |
As of
|
||||||||
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Assets
|
||||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$ | 48,340 | $ | 120,911 | ||||
Accounts receivable, net of allowance for doubtful accounts
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66,699 | 72,378 | ||||||
Derivative assets
|
14,290 | 16,818 | ||||||
Other current assets
|
4,255 | 4,233 | ||||||
Total current assets
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133,584 | 214,340 | ||||||
Property and equipment, net (successful efforts method)
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1,746,103 | 1,705,584 | ||||||
Derivative assets
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1,600 | 3,889 | ||||||
Other assets
|
23,238 | 20,787 | ||||||
Total assets
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$ | 1,904,525 | $ | 1,944,600 | ||||
Liabilities and Shareholders’ Equity
|
||||||||
Current liabilities
|
||||||||
Accounts payable and accrued liabilities
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$ | 97,983 | $ | 99,661 | ||||
Derivative liabilities
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988 | 388 | ||||||
Deferred income taxes
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3,113 | 4,318 | ||||||
Income taxes payable
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2,844 | 2,627 | ||||||
Total current liabilities
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104,928 | 106,994 | ||||||
Other liabilities
|
18,856 | 19,958 | ||||||
Deferred income taxes
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317,498 | 330,836 | ||||||
Long-term debt
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508,741 | 506,536 | ||||||
Commitments and contingencies (Note 10)
|
||||||||
Shareholders’ equity:
|
||||||||
Preferred stock of $100 par value – 100,000 shares authorized; none issued
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- | - | ||||||
Common stock of $0.01 par value – 128,000,000 shares authorized; shares issued of 45,670,981 and 45,556,854 as of March 31, 2011and December 31, 2010, respectively
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268 | 267 | ||||||
Paid-in capital
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683,990 | 680,981 | ||||||
Retained earnings
|
271,557 | 300,473 | ||||||
Deferred compensation obligation
|
2,886 | 2,743 | ||||||
Accumulated other comprehensive loss
|
(904 | ) | (938 | ) | ||||
Treasury stock – 128,057 and 125,357 shares of common stock, at cost, as of
|
||||||||
March 31, 2011 and December 31, 2010, respectively
|
(3,295 | ) | (3,250 | ) | ||||
Total shareholders’ equity
|
954,502 | 980,276 | ||||||
Total liabilities and shareholders’ equity
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$ | 1,904,525 | $ | 1,944,600 |
|
Three Months Ended March 31,
|
|||||||
|
2011
|
2010
|
||||||
Cash flows from operating activities
|
||||||||
Net income (loss)
|
$ | (26,340 | ) | $ | 22,940 | |||
Adjustments to reconcile net income (loss) to net cash provided by operating activities from continuing operations:
|
||||||||
Income from discontinued operations before income taxes
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- | (13,955 | ) | |||||
Depreciation, depletion and amortization
|
34,843 | 30,029 | ||||||
Derivative contracts:
|
||||||||
Net gains
|
(1,328 | ) | (29,877 | ) | ||||
Cash settlements
|
6,744 | 8,434 | ||||||
Deferred income tax benefit
|
(14,201 | ) | (9,000 | ) | ||||
Loss (gain) on the sale of property and equipment, net
|
(480 | ) | 254 | |||||
Dry hole and unproved leasehold expense
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26,999 | 5,083 | ||||||
Non-cash interest expense
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3,272 | 3,255 | ||||||
Share-based compensation
|
1,796 | 3,021 | ||||||
Other, net
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236 | (505 | ) | |||||
Changes in operating assets and liabilities, net
|
(2,105 | ) | 11,066 | |||||
Net cash provided by operating activities from continuing operations
|
29,436 | 30,745 | ||||||
Cash flows from investing activities
|
||||||||
Capital expenditures - property and equipment
|
(100,729 | ) | (64,492 | ) | ||||
Proceeds from the sale of property and equipment, net
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360 | 23,273 | ||||||
Other, net
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100 | - | ||||||
Net cash used in investing activities for continuing operations
|
(100,269 | ) | (41,219 | ) | ||||
Cash flows from financing activities
|
||||||||
Dividends paid
|
(2,576 | ) | (2,556 | ) | ||||
Distributions received from discontinued operations
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- | 7,652 | ||||||
Proceeds from the sale of PVG units, net
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- | 177,000 | ||||||
Other, net
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838 | 612 | ||||||
Net cash (used in) provided by financing activities from continuing operations
|
(1,738 | ) | 182,708 | |||||
Cash flows from discontinued operations
|
||||||||
Net cash provided by operating activities
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- | 48,522 | ||||||
Net cash used in investing activities
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- | (16,369 | ) | |||||
Net cash used in financing activities
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- | (32,153 | ) | |||||
Net cash provided by discontinued operations
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- | - | ||||||
Net increase (decrease) in cash and cash equivalents
|
(72,571 | ) | 172,234 | |||||
Cash and cash equivalents - beginning of period
|
120,911 | 79,017 | ||||||
Cash and cash equivalents - end of period
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$ | 48,340 | $ | 251,251 | ||||
Supplemental disclosures:
|
||||||||
Cash paid for:
|
||||||||
Interest (net of amounts capitalized)
|
$ | 387 | $ | 785 | ||||
Income taxes (net of refunds received)
|
$ | (120 | ) | $ | (110 | ) |
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Revenue customers
|
$ | 46,187 | $ | 44,783 | ||||
Joint interest partners
|
16,205 | 23,526 | ||||||
Other
|
4,670 | 4,442 | ||||||
67,062 | 72,751 | |||||||
Less: Allowance for doubtful accounts
|
(363 | ) | (373 | ) | ||||
$ | 66,699 | $ | 72,378 |
Average
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Fair Value
|
||||||||||||||||
Volume Per
|
Weighted Average Price
|
Asset
|
|||||||||||||||
Instrument
|
Day
|
Floor/Swap
|
Ceiling
|
(Liability)
|
|||||||||||||
Natural Gas:
|
(in MMBtu)
|
||||||||||||||||
Second quarter 2011
|
Costless collars
|
30,000 | $ | 4.83 | $ | 6.00 | $ | 1,593 | |||||||||
Third quarter 2011
|
Costless collars
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30,000 | $ | 4.83 | $ | 6.00 | 1,395 | ||||||||||
Fourth quarter 2011
|
Costless collars
|
20,000 | $ | 6.00 | $ | 8.50 | 2,452 | ||||||||||
First quarter 2012
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Costless collars
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20,000 | $ | 6.00 | $ | 8.50 | 2,059 | ||||||||||
Second quarter 2011
|
Swaps
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40,000 | $ | 5.06 | 2,547 | ||||||||||||
Third quarter 2011
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Swaps
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40,000 | $ | 5.06 | 1,858 | ||||||||||||
Fourth quarter 2011
|
Swaps
|
10,000 | $ | 5.01 | 197 | ||||||||||||
First quarter 2012
|
Swaps
|
10,000 | $ | 5.10 | 14 | ||||||||||||
Second quarter 2012
|
Swaps
|
20,000 | $ | 5.31 | 724 | ||||||||||||
Third quarter 2012
|
Swaps
|
20,000 | $ | 5.31 | 563 | ||||||||||||
Fourth quarter 2012
|
Swaps
|
10,000 | $ | 5.10 | (120 | ) | |||||||||||
Crude Oil:
|
(barrels)
|
||||||||||||||||
Second quarter 2011
|
Costless collars
|
425 | $ | 80.00 | $ | 101.50 | (295 | ) | |||||||||
Third quarter 2011
|
Costless collars
|
360 | $ | 80.00 | $ | 103.30 | (326 | ) | |||||||||
Fourth quarter 2011
|
Costless collars
|
360 | $ | 80.00 | $ | 103.30 | (367 | ) |
Notional
|
Swap Interest Rates 1
|
March 31,
|
December 31,
|
||||||||||||||
Term
|
Amount
|
Pay
|
Receive
|
2011
|
2010
|
||||||||||||
Through June 2013
|
$ | 100,000 |
LIBOR + 8.175%
|
10.375 | % | $ | 2,609 | $ | 2,590 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Impact by contract type:
|
||||||||
Commodity contracts
|
$ | 1,308 | $ | 28,212 | ||||
Interest rate contracts
|
20 | 1,665 | ||||||
$ | 1,328 | $ | 29,877 | |||||
Realized and unrealized impact:
|
||||||||
Cash received (paid) for:
|
||||||||
Commodity contract settlements
|
$ | 6,744 | $ | 9,036 | ||||
Interest rate contract settlements
|
- | (602 | ) | |||||
6,744 | 8,434 | |||||||
Unrealized gains (losses) attributable to:
|
||||||||
Commodity contracts
|
(5,436 | ) | 19,176 | |||||
Interest rate contracts
|
20 | 2,267 | ||||||
(5,416 | ) | 21,443 | ||||||
$ | 1,328 | $ | 29,877 |
Fair Values as of
|
||||||||||||||||||
March 31, 2011
|
December 31, 2010
|
|||||||||||||||||
Derivative
|
Derivative
|
Derivative
|
Derivative
|
Derivative
|
||||||||||||||
Instrument
|
Balance Sheet Location
|
Assets
|
Liabilities
|
Assets
|
Liabilities
|
|||||||||||||
Interest rate contracts
|
Derivative assets/liabilities - current
|
$ | 2,176 | $ | - | $ | 1,743 | $ | - | |||||||||
Commodity contracts
|
Derivative assets/liabilities - current
|
12,114 | 988 | 15,075 | 388 | |||||||||||||
14,290 | 988 | 16,818 | 388 | |||||||||||||||
Interest rate contracts
|
Derivative assets/liabilities - noncurrent
|
433 | - | 847 | - | |||||||||||||
Commodity contracts
|
Derivative assets/liabilities - noncurrent
|
1,167 | - | 3,042 | - | |||||||||||||
1,600 | - | 3,889 | - | |||||||||||||||
$ | 15,890 | $ | 988 | $ | 20,707 | $ | 388 |
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Oil and gas properties:
|
||||||||
Proved
|
$ | 2,183,014 | $ | 2,139,894 | ||||
Unproved, net of amortization
|
200,457 | 171,303 | ||||||
Total oil and gas properties
|
2,383,471 | 2,311,197 | ||||||
Other property and equipment
|
15,925 | 15,589 | ||||||
Total property and equipment
|
2,399,396 | 2,326,786 | ||||||
Accumulated depreciation, depletion and amortization
|
(653,293 | ) | (621,202 | ) | ||||
$ | 1,746,103 | $ | 1,705,584 |
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Revolving credit facility
|
$ | - | $ | - | ||||
Senior notes due 2016, net of discount (principal amount of $300,000)
|
292,744 | 292,487 | ||||||
Convertible notes due 2012, net of discount (principal amount of $230,000)
|
215,997 | 214,049 | ||||||
$ | 508,741 | $ | 506,536 |
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Principal
|
$ | 230,000 | $ | 230,000 | ||||
Unamortized discount
|
(14,003 | ) | (15,951 | ) | ||||
Net carrying amount of liability component
|
$ | 215,997 | $ | 214,049 | ||||
Carrying amount of equity component
|
$ | 36,850 | $ | 36,850 |
March 31,
|
December 31,
|
|||||||
2011
|
2010
|
|||||||
Other current assets:
|
||||||||
Tubular inventory and well materials
|
$ | 3,335 | $ | 3,600 | ||||
Prepaid expenses
|
920 | 633 | ||||||
$ | 4,255 | $ | 4,233 | |||||
Other assets:
|
||||||||
Debt issuance costs
|
$ | 13,247 | $ | 14,300 | ||||
Long-term investments - SERP
|
5,545 | 6,440 | ||||||
Restricted cash
|
4,400 | - | ||||||
Other
|
46 | 47 | ||||||
$ | 23,238 | $ | 20,787 | |||||
Accounts payable and accrued liabilities:
|
||||||||
Trade accounts payable
|
$ | 30,416 | $ | 33,831 | ||||
Drilling costs
|
31,884 | 31,770 | ||||||
Royalties
|
9,612 | 9,308 | ||||||
Production and franchise taxes
|
5,163 | 6,012 | ||||||
Compensation
|
3,040 | 9,631 | ||||||
Interest
|
13,338 | 2,977 | ||||||
Other
|
4,530 | 6,132 | ||||||
$ | 97,983 | $ | 99,661 | |||||
Other liabilities:
|
||||||||
Asset retirement obligation
|
$ | 7,266 | $ | 7,364 | ||||
Pension
|
1,733 | 1,766 | ||||||
Postretirement health care
|
2,994 | 2,976 | ||||||
Deferred compensation
|
5,963 | 6,952 | ||||||
Other
|
900 | 900 | ||||||
$ | 18,856 | $ | 19,958 |
March 31, 2011
|
December 31, 2010
|
|||||||||||||||
Fair
|
Carrying
|
Fair
|
Carrying
|
|||||||||||||
Value
|
Value
|
Value
|
Value
|
|||||||||||||
10.375% Senior Unsecured Notes due 2016
|
$ | 340,500 | $ | 292,744 | $ | 335,712 | $ | 292,487 | ||||||||
4.5% Convertible Notes due 2012
|
237,475 | 215,997 | 225,975 | 214,049 | ||||||||||||
$ | 577,975 | $ | 508,741 | $ | 561,687 | $ | 506,536 |
March 31, 2011
|
||||||||||||||||
Fair Value
|
Fair Value Measurement Classification
|
|||||||||||||||
Description
|
Measurement
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Assets:
|
||||||||||||||||
Publicly traded equity securities
|
$ | 5,545 | $ | 5,545 | $ | - | $ | - | ||||||||
Interest rate swap assets - current
|
2,176 | - | 2,176 | - | ||||||||||||
Interest rate swap assets - noncurrent
|
433 | - | 433 | - | ||||||||||||
Commodity derivative assets - current
|
12,114 | - | 12,114 | - | ||||||||||||
Commodity derivative assets - noncurrent
|
1,167 | - | 1,167 | - | ||||||||||||
Liabilities:
|
||||||||||||||||
Deferred compensation - noncurrent liability
|
(5,963 | ) | (5,963 | ) | - | - | ||||||||||
Commodity derivative liabilities - current
|
(988 | ) | - | (988 | ) | - | ||||||||||
Totals
|
$ | 14,484 | $ | (418 | ) | $ | 14,902 | $ | - |
December 31, 2010
|
||||||||||||||||
Fair Value
|
Fair Value Measurement Classification
|
|||||||||||||||
Description
|
Measurement
|
Level 1
|
Level 2
|
Level 3
|
||||||||||||
Assets:
|
||||||||||||||||
Publicly traded equity securities
|
$ | 6,440 | $ | 6,440 | $ | - | $ | - | ||||||||
Interest rate swap assets - current
|
1,743 | - | 1,743 | - | ||||||||||||
Interest rate swap assets - noncurrent
|
847 | - | 847 | - | ||||||||||||
Commodity derivative assets - current
|
15,075 | - | 15,075 | - | ||||||||||||
Commodity derivative assets - noncurrent
|
3,042 | - | 3,042 | - | ||||||||||||
Liabilities:
|
||||||||||||||||
Deferred compensation - noncurrent liability
|
(6,948 | ) | (6,948 | ) | - | - | ||||||||||
Commodity derivative liabilities - current
|
(388 | ) | - | (388 | ) | - | ||||||||||
Interest rate swap liabilities - noncurrent
|
- | - | - | - | ||||||||||||
Commodity derivative liabilities - current
|
- | - | - | - | ||||||||||||
Commodity derivative liabilities - noncurrent
|
- | - | - | - | ||||||||||||
Totals
|
$ | 19,811 | $ | (508 | ) | $ | 20,319 | $ | - |
|
•
|
Publicly traded equity securities: Our publicly traded equity securities consist of various publicly traded equities that are held as assets for funding certain deferred compensation obligations. The fair values are based on quoted market prices, which are level 1 inputs.
|
|
•
|
Commodity derivatives: We determine the fair values of our oil and gas derivative agreements based on discounted cash flows derived from third-party quoted forward prices for NYMEX Henry Hub natural gas and West Texas Intermediate crude oil closing prices as of the end of the reporting periods. We generally use the income approach, using valuation techniques that convert future cash flows to a single discounted value. Each of these is a level 2 input.
|
|
•
|
Interest rate swaps: We use an income approach using valuation techniques that connect future cash flows to a single discounted value. We estimate the fair value of the swaps based on published interest rate yield curves as of the date of the estimate. Each of these is a level 2 input.
|
|
•
|
Deferred compensation: Certain of our deferred compensation obligations are ultimately to be settled in cash based on the underlying fair value of certain publicly traded equity securities. The fair values of these obligations are based on quoted market prices, which are level 1 inputs.
|
Penn Virginia
|
Noncontrolling
|
|||||||||||||||
Corporation
|
Interests in
|
Total
|
||||||||||||||
Shareholders'
|
Discontinued
|
Shareholders'
|
Comprehensive
|
|||||||||||||
Equity
|
Operations
|
Equity
|
Income (Loss)
|
|||||||||||||
Balance as of December 31, 2010
|
$ | 980,276 | $ | - | $ | 980,276 | ||||||||||
Dividends paid ($0.05625 per share)
|
(2,576 | ) | - | (2,576 | ) | |||||||||||
Other changes to shareholders' equity
|
3,108 | - | 3,108 | |||||||||||||
Comprehensive income:
|
||||||||||||||||
Net loss
|
(26,340 | ) | - | (26,340 | ) | $ | (26,340 | ) | ||||||||
Other, net of tax
|
34 | - | 34 | 34 | ||||||||||||
Balance as of March 31, 2011
|
$ | 954,502 | $ | - | $ | 954,502 | $ | (26,306 | ) | |||||||
Balance as of December 31, 2009
|
$ | 908,088 | $ | 329,911 | $ | 1,237,999 | ||||||||||
Dividends paid ($0.05625 per share)
|
(2,556 | ) | - | (2,556 | ) | |||||||||||
Distributions to noncontrolling interest holders
|
- | (22,501 | ) | (22,501 | ) | |||||||||||
Sale of PVG units, net of tax
|
70,300 | 62,318 | 132,618 | |||||||||||||
Other changes to shareholders' equity
|
(1,609 | ) | 2,511 | 902 | ||||||||||||
Comprehensive income:
|
||||||||||||||||
Net income
|
13,594 | 9,346 | 22,940 | $ | 22,940 | |||||||||||
Hedging reclassification adjustment
|
- | 582 | 582 | 582 | ||||||||||||
Other, net of tax
|
(234 | ) | - | (234 | ) | (234 | ) | |||||||||
Balance as of March 31, 2010
|
$ | 987,583 | $ | 382,167 | $ | 1,369,750 | $ | 23,288 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Stock option plans
|
$ | 1,408 | $ | 2,109 | ||||
Common, deferred and restricted stock and restricted stock unit plans
|
388 | 912 | ||||||
$ | 1,796 | $ | 3,021 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Termination benefits
|
$ | - | $ | 862 | ||||
Employee and office relocation costs
|
18 | 160 | ||||||
Other incremental costs
|
- | 455 | ||||||
$ | 18 | $ | 1,477 |
2011
|
2010
|
|||||||
Balance at beginning of period
|
$ | 64 | $ | 529 | ||||
Termination benefits accrued
|
- | 862 | ||||||
Cash payments
|
(64 | ) | (972 | ) | ||||
Balance at end of period
|
$ | - | $ | 419 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Interest on borrowings and related fees
|
$ | 10,747 | $ | 10,778 | ||||
Accretion on original issue discount
|
2,205 | 2,110 | ||||||
Amortization of debt issuance costs
|
1,067 | 1,145 | ||||||
Capitalized interest
|
(535 | ) | (362 | ) | ||||
$ | 13,484 | $ | 13,671 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Net income (loss) from continuing operations
|
$ | (26,340 | ) | $ | 10,766 | |||
Income from discontinued operations, net of tax 1
|
- | 12,174 | ||||||
Less net income attributable to noncontrolling interests
|
- | (9,346 | ) | |||||
Net income (loss) attributable to common shareholders
|
$ | (26,340 | ) | $ | 13,594 | |||
Less: Portion of subsidiary net income allocated to undistributed
|
||||||||
share-based compensation awards, net of tax
|
- | (28 | ) | |||||
$ | (26,340 | ) | $ | 13,566 | ||||
Weighted-average shares, basic
|
45,687 | 45,465 | ||||||
Effect of dilutive securities 2
|
- | 296 | ||||||
Weighted-average shares, diluted
|
45,687 | 45,761 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Revenues
|
$ | - | $ | 187,633 | ||||
Income from discontinued operations before taxes
|
$ | - | $ | 13,955 | ||||
Income tax expense 1
|
- | (1,781 | ) | |||||
Income from discontinued operations, net of taxes
|
$ | - | $ | 12,174 |
|
•
|
the volatility of commodity prices for natural gas, natural gas liquids and oil;
|
|
•
|
our ability to develop, explore for, acquire and replace oil and gas reserves and sustain production;
|
|
•
|
any impairments, write-downs or write-offs of our reserves or assets;
|
|
•
|
the projected demand for and supply of natural gas, natural gas liquids and oil;
|
|
•
|
reductions in the borrowing base under our revolving credit facility;
|
|
•
|
our ability to contract for drilling rigs, supplies and services at reasonable costs;
|
|
•
|
our ability to obtain adequate pipeline transportation capacity for our oil and gas production at reasonable costs and to sell the production at, or at reasonable discounts to, market prices;
|
|
•
|
the uncertainties inherent in projecting future rates of production for our wells and the extent to which actual production differs from estimated proved oil and gas reserves;
|
|
•
|
drilling and operating risks;
|
|
•
|
our ability to compete effectively against other independent and major oil and natural gas companies;
|
|
•
|
uncertainties related to expected benefits from acquisitions of oil and natural gas properties;
|
|
•
|
environmental liabilities that are not covered by an effective indemnity or insurance;
|
|
•
|
the timing of receipt of necessary regulatory permits;
|
|
•
|
the effect of commodity and financial derivative arrangements;
|
|
•
|
our ability to maintain adequate financial liquidity and to access adequate levels of capital on reasonable terms;
|
|
•
|
the occurrence of unusual weather or operating conditions, including force majeure events;
|
|
•
|
our ability to retain or attract senior management and key technical employees;
|
|
•
|
counterparty risk related to their ability to meet their future obligations;
|
|
•
|
changes in governmental regulations or enforcement practices, especially with respect to environmental, health and safety matters;
|
|
•
|
uncertainties relating to general domestic and international economic and political conditions; and
|
|
•
|
other risks set forth in our Annual Report on Form 10-K for the year ended December 31, 2010.
|
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Total production (MMcfe)
|
12,171 | 10,338 | ||||||
Daily production (MMcfe per day)
|
135.2 | 114.9 | ||||||
Realized prices per Mcfe, as reported
|
$ | 5.56 | $ | 6.45 | ||||
Realized prices per Mcfe, adjusted for derivatives
|
$ | 6.12 | $ | 7.33 | ||||
Product revenues, as reported
|
$ | 67,693 | $ | 66,700 | ||||
Product revenues, as adjusted for derivatives
|
$ | 74,437 | $ | 75,736 | ||||
Operating income (loss)
|
$ | (28,529 | ) | $ | 92 | |||
Interest expense
|
$ | 13,484 | $ | 13,671 | ||||
Cash provided by operating activities
|
$ | 29,436 | $ | 30,745 | ||||
Cash paid for capital expenditures
|
$ | 100,729 | $ | 64,492 | ||||
Cash and cash equivalents at end of period
|
$ | 48,340 | $ | 251,251 | ||||
Debt outstanding, net of discounts, at end of period
|
$ | 508,741 | $ | 500,537 | ||||
Credit available under Revolver at end of period
|
$ | 299,268 | $ | 299,268 | ||||
Net development wells drilled
|
2.4 | 7.7 | ||||||
Net exploratory wells drilled
|
5.3 | 1.0 |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Total Production:
|
||||||||||||||||
Natural gas (MMcf)
|
9,726 | 8,568 | 1,158 | 14 | % | |||||||||||
Crude oil (MBbl)
|
188 | 186 | 2 | 1 | % | |||||||||||
NGL (MBbl)
|
220 | 109 | 111 | 102 | % | |||||||||||
Total production (MMcfe)
|
12,171 | 10,338 | 1,833 | 18 | % | |||||||||||
Realized prices, before derivatives:
|
||||||||||||||||
Natural gas ($/Mcf)
|
$ | 4.23 | $ | 5.60 | $ | (1.36 | ) | (24 | )% | |||||||
Crude oil ($/Bbl)
|
88.37 | 74.44 | 13.93 | 19 | % | |||||||||||
NGL ($/Bbl)
|
45.11 | 44.64 | 0.47 | 1 | % | |||||||||||
Total ($/Mcfe)
|
$ | 5.56 | $ | 6.45 | $ | (0.89 | ) | (14 | )% | |||||||
Revenues
|
||||||||||||||||
Natural gas
|
$ | 41,189 | $ | 47,988 | $ | (6,799 | ) | (14 | )% | |||||||
Crude oil
|
16,583 | 13,846 | 2,737 | 20 | % | |||||||||||
NGL
|
9,921 | 4,866 | 5,055 | 104 | % | |||||||||||
Total product revenues
|
67,693 | 66,700 | 993 | 1 | % | |||||||||||
Gain on sale of property and equipment
|
480 | 211 | 269 | 127 | % | |||||||||||
Other income
|
410 | 967 | (557 | ) | (58 | )% | ||||||||||
Total revenues
|
68,583 | 67,878 | 705 | 1 | % | |||||||||||
Operating Expenses
|
||||||||||||||||
Lease operating
|
10,277 | 8,737 | (1,540 | ) | (18 | )% | ||||||||||
Gathering, processing and transportation
|
4,028 | 3,231 | (797 | ) | (25 | )% | ||||||||||
Production and ad valorem taxes
|
5,064 | 4,270 | (794 | ) | (19 | )% | ||||||||||
General and administrative
|
13,352 | 15,025 | 1,673 | 11 | % | |||||||||||
Exploration
|
29,548 | 6,029 | (23,519 | ) | (390 | )% | ||||||||||
Depreciation, depletion and amortization
|
34,843 | 30,029 | (4,814 | ) | (16 | )% | ||||||||||
Other
|
- | 465 | 465 | 100 | % | |||||||||||
Total operating expenses
|
97,112 | 67,786 | (29,326 | ) | (43 | )% | ||||||||||
Operating income (loss)
|
(28,529 | ) | 92 | (28,621 | ) |
NM
|
||||||||||
Other income (expense)
|
||||||||||||||||
Interest expense
|
(13,484 | ) | (13,671 | ) | 187 | 1 | % | |||||||||
Derivatives
|
1,328 | 29,877 | (28,549 | ) | (96 | )% | ||||||||||
Other
|
144 | 1,246 | (1,102 | ) | (88 | )% | ||||||||||
Income (loss) from continuing operations before income taxes
|
(40,541 | ) | 17,544 | (58,085 | ) |
NM
|
||||||||||
Income tax (expense) benefit
|
14,201 | (6,778 | ) | 20,979 |
NM
|
|||||||||||
Income (loss) from continuing operations
|
(26,340 | ) | 10,766 | (37,106 | ) |
NM
|
||||||||||
Income from discontinued operations, net of tax
|
- | 12,174 | (12,174 | ) | (100 | )% | ||||||||||
Net income (loss)
|
(26,340 | ) | 22,940 | (49,280 | ) | 215 | % | |||||||||
Less net income attributable to noncontrolling interests
|
- | (9,346 | ) | 9,346 | 100 | % | ||||||||||
Income (loss) attributable to Penn Virginia Corporation
|
$ | (26,340 | ) | $ | 13,594 | $ | (39,934 | ) |
NM
|
Three Months Ended March 31,
|
Favorable
|
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||||||||||||
2011
|
2010
|
(Unfavorable)
|
2011
|
2010
|
(Unfavorable)
|
% Change
|
||||||||||||||||||||||
(MMcfe)
|
(MMcfe per day)
|
|||||||||||||||||||||||||||
Texas
|
3,826 | 2,583 | 1,243 | 42.5 | 28.7 | 13.8 | 48 | % | ||||||||||||||||||||
Appalachia
|
2,364 | 2,596 | (232 | ) | 26.3 | 28.8 | (2.6 | ) | (9 | )% | ||||||||||||||||||
Mid-Continent
|
4,121 | 3,212 | 909 | 45.8 | 35.7 | 10.1 | 28 | % | ||||||||||||||||||||
Mississippi
|
1,860 | 1,652 | 208 | 20.7 | 18.4 | 2.3 | 13 | % | ||||||||||||||||||||
Gulf Coast (Divested)
|
- | 295 | (295 | ) | - | 3.3 | (3.3 | ) | (100 | )% | ||||||||||||||||||
Total production
|
12,171 | 10,338 | 1,833 | 135.2 | 114.9 | 20.4 | 18 | % |
Three Months Ended March 31,
|
Favorable
|
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||||||||
2011
|
2010
|
(Unfavorable)
|
2011
|
2010
|
(Unfavorable)
|
|||||||||||||||||||
($ per Mcfe)
|
||||||||||||||||||||||||
Texas
|
$ | 21,066 | $ | 16,017 | $ | 5,049 | $ | 5.51 | $ | 6.20 | $ | (0.70 | ) | |||||||||||
Appalachia
|
9,820 | 14,025 | (4,205 | ) | 4.15 | 5.40 | (1.25 | ) | ||||||||||||||||
Mid-Continent
|
28,607 | 25,319 | 3,288 | 6.94 | 7.88 | (0.94 | ) | |||||||||||||||||
Mississippi
|
8,200 | 9,163 | (963 | ) | 4.41 | 5.55 | (1.14 | ) | ||||||||||||||||
Gulf Coast (Divested)
|
- | 2,176 | (2,176 | ) | - | 7.38 | (7.38 | ) | ||||||||||||||||
Total revenues
|
$ | 67,693 | $ | 66,700 | $ | 993 | $ | 5.56 | $ | 6.45 | $ | (0.89 | ) |
Revenue Variance Due to
|
||||||||||||
Volume
|
Price
|
Total
|
||||||||||
Natural gas
|
$ | 6,485 | $ | (13,284 | ) | $ | (6,799 | ) | ||||
Crude oil
|
123 | 2,614 | 2,737 | |||||||||
NGL
|
4,951 | 104 | 5,055 | |||||||||
$ | 11,559 | $ | (10,566 | ) | $ | 993 |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Natural gas revenues as reported
|
$ | 41,189 | $ | 47,988 | $ | (6,799 | ) | (14 | )% | |||||||
Cash settlements on natural gas derivatives
|
6,969 | 8,889 | (1,920 | ) | (22 | )% | ||||||||||
Natural gas revenues adjusted for derivatives
|
$ | 48,158 | $ | 56,877 | $ | (8,719 | ) | (15 | )% | |||||||
Natural gas prices per Mcf, as reported
|
$ | 4.23 | $ | 5.60 | $ | (1.37 | ) | (24 | )% | |||||||
Cash settlements on natural gas derivatives per Mcf
|
0.72 | 1.04 | (0.32 | ) | (31 | )% | ||||||||||
Natural gas prices per Mcf adjusted for derivatives
|
$ | 4.95 | $ | 6.64 | $ | (1.69 | ) | (25 | )% | |||||||
Crude oil revenues as reported
|
$ | 16,583 | $ | 13,846 | $ | 2,737 | 20 | % | ||||||||
Cash settlements on crude oil derivatives
|
(225 | ) | 147 | (372 | ) | (253 | )% | |||||||||
Crude oil revenues adjusted for derivatives
|
$ | 16,358 | $ | 13,993 | $ | 2,365 | 17 | % | ||||||||
Crude oil prices per Bbl, as reported
|
$ | 88.37 | $ | 74.44 | $ | 13.93 | 19 | % | ||||||||
Cash settlements on crude oil derivatives per Bbl
|
(1.20 | ) | 0.79 | (1.99 | ) | (252 | )% | |||||||||
Crude oil prices per Bbl adjusted for derivatives
|
$ | 87.17 | $ | 75.23 | $ | 11.94 | 16 | % |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Lease operating
|
$ | 0.84 | $ | 0.85 | $ | 0.01 | 1 | % | ||||||||
Gathering, processing and transportation
|
0.33 | 0.31 | (0.02 | ) | (6 | )% | ||||||||||
Production and ad valorem taxes
|
0.42 | 0.41 | (0.01 | ) | (1 | )% | ||||||||||
General and administrative
|
1.10 | 1.45 | 0.35 | 24 | % | |||||||||||
General and administrative excluding share-based compensation and restructuring charges
|
0.96 | 1.02 | 0.06 | 6 | % | |||||||||||
Depreciation, depletion and amortization
|
2.86 | 2.90 | 0.04 | 1 | % |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Recurring general and administrative expenses
|
$ | 11,538 | $ | 10,527 | $ | (1,011 | ) | (10 | )% | |||||||
Share-based compensation
|
1,796 | 3,021 | 1,225 | 41 | % | |||||||||||
Restructuring expenses
|
18 | 1,477 | 1,459 | 99 | % | |||||||||||
$ | 13,352 | $ | 15,025 | $ | 1,673 | 11 | % |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Dry hole costs
|
$ | 16,408 | $ | 27 | $ | (16,381 | ) |
NM
|
||||||||
Geological and geophysical
|
1,835 | 420 | (1,415 | ) |
NM
|
|||||||||||
Unproved leasehold
|
10,591 | 5,056 | (5,535 | ) | (109 | )% | ||||||||||
Other, primarily delay rentals
|
714 | 526 | (188 | ) | (36 | )% | ||||||||||
$ | 29,548 | $ | 6,029 | $ | (23,519 | ) |
NM
|
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Depletion
|
$ | 33,443 | $ | 28,265 | $ | (5,178 | ) | (18 | )% | |||||||
Depreciation - Oil and gas operations
|
618 | 647 | 29 | 4 | % | |||||||||||
Depreciation - Corporate
|
652 | 1,007 | 355 | 35 | % | |||||||||||
Amortization
|
130 | 110 | (20 | ) | (18 | )% | ||||||||||
$ | 34,843 | $ | 30,029 | $ | (4,814 | ) | (16 | )% |
DD&A Variance Due to
|
||||||||||||
Production
|
Rates
|
Total
|
||||||||||
Three months ended March 31, 2011 compared to 2010
|
$ | (5,328 | ) | $ | 514 | $ | (4,814 | ) |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Interest on borrowings and related fees
|
$ | 10,747 | $ | 10,778 | $ | 31 | 0 | % | ||||||||
Accretion of original issue discount
|
2,205 | 2,110 | (95 | ) | (5 | )% | ||||||||||
Amortization of debt issuance costs
|
1,067 | 1,145 | 78 | 7 | % | |||||||||||
Capitalized interest
|
(535 | ) | (362 | ) | 173 | 48 | % | |||||||||
$ | 13,484 | $ | 13,671 | $ | 187 | 1 | % |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Oil and gas derivative unrealized derivative gain (loss)
|
$ | (5,436 | ) | $ | 19,176 | $ | (24,612 | ) | 128 | % | ||||||
Oil and gas derivative realized gain
|
6,744 | 9,036 | (2,292 | ) | (25 | )% | ||||||||||
Interest rate swap unrealized gain
|
20 | 2,267 | (2,247 | ) | (99 | )% | ||||||||||
Interest rate swap realized loss
|
- | (602 | ) | 602 | 100 | % | ||||||||||
$ | 1,328 | $ | 29,877 | $ | (28,549 | ) | (96 | )% |
Three Months Ended March 31,
|
Favorable
|
|||||||||||||||
2011
|
2010
|
(Unfavorable)
|
% Change
|
|||||||||||||
Revenues
|
$ | - | $ | 187,633 | $ | (187,633 | ) | 100 | % | |||||||
Income from discontinued operations before taxes
|
$ | - | $ | 13,955 | $ | (13,955 | ) | (100 | )% | |||||||
Income tax expense 1
|
- | (1,781 | ) | 1,781 | (100 | )% | ||||||||||
$ | - | $ | 12,174 | $ | (12,174 | ) | (100 | )% |
1
|
Determined by applying the effective tax rate attributable to discontinued operations to the income from discontinued operations less noncontrolling interests that are fully attributable to PVG's operations.
|
Three Months Ended March 31,
|
||||||||||||
2011
|
2010
|
Variance
|
||||||||||
Cash flows from operating activities
|
$ | 29,436 | $ | 30,745 | $ | (1,309 | ) | |||||
Cash flows from investing activities
|
||||||||||||
Capital expenditures - property and equipment
|
(100,729 | ) | (64,492 | ) | (36,237 | ) | ||||||
Proceeds from the sale of property and equipment and other, net
|
460 | 23,273 | (22,813 | ) | ||||||||
Net cash used in investing activities
|
(100,269 | ) | (41,219 | ) | (59,050 | ) | ||||||
Cash flows from financing activities
|
||||||||||||
Dividends paid
|
(2,576 | ) | (2,556 | ) | (20 | ) | ||||||
Distributions received from discontinued operations
|
- | 7,652 | (7,652 | ) | ||||||||
Proceeds from sale of PVG units, net
|
- | 177,000 | (177,000 | ) | ||||||||
Other, net
|
838 | 612 | 226 | |||||||||
Net cash provided by financing activities
|
(1,738 | ) | 182,708 | (184,446 | ) | |||||||
Net increase in cash and cash equivalents
|
$ | (72,571 | ) | $ | 172,234 | $ | (244,805 | ) |
Cash flows from operating activitities for the three months ended March 31, 2010
|
$ | 30,745 | ||
Variances due to:
|
||||
Lower settlements from commodity derivatives portfolio
|
(2,292 | ) | ||
Lower interest payments, net of amounts capitalized
|
398 | |||
Lower restructuring costs paid
|
1,395 | |||
Lower operating performance
|
(810 | ) | ||
Cash flows from operating activitities for the three months ended March 31, 2011
|
$ | 29,436 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Oil and gas:
|
||||||||
Development drilling
|
$ | 36,775 | $ | 37,927 | ||||
Exploration drilling
|
26,894 | 3,653 | ||||||
Seismic
|
1,835 | 420 | ||||||
Lease acquisitions, field projects and other
|
38,409 | 35,554 | ||||||
Pipeline and gathering facilities
|
374 | 193 | ||||||
104,287 | 77,747 | |||||||
Other - Corporate
|
336 | 271 | ||||||
Total capital program costs
|
$ | 104,623 | $ | 78,018 |
Three Months Ended March 31,
|
||||||||
2011
|
2010
|
|||||||
Total capital program costs
|
$ | 104,623 | $ | 78,018 | ||||
Less:
|
||||||||
Exploration expenses
|
||||||||
Seismic
|
(1,835 | ) | (420 | ) | ||||
Other, primarily delay rentals
|
(716 | ) | (247 | ) | ||||
Other
|
(608 | ) | - | |||||
Changes in accrued capitalized costs
|
(1,270 | ) | (5,017 | ) | ||||
Property received as consideration in sale transaction 1
|
- | (8,204 | ) | |||||
Add:
|
||||||||
Capitalized interest
|
535 | 362 | ||||||
Other
|
- | - | ||||||
Total cash paid for capital expenditures
|
$ | 100,729 | $ | 64,492 |
March 31,
|
December 31,
|
|||||||
2010
|
2010
|
|||||||
Revolving credit facility
|
$ | - | $ | - | ||||
Senior Notes, net of discount (principal amount of $300,000)
|
292,744 | 292,487 | ||||||
Convertible Notes, net of discount (principal amount of $230,000)
|
215,997 | 214,049 | ||||||
$ | 508,741 | $ | 506,536 |
Notional
|
Swap Interest Rates
|
||||||||
Term
|
Amounts
|
Pay
|
Receive
|
||||||
Through June 2013
|
$ | 100,000 |
3-month LIBOR + 8.175%
|
10.375 | % |
|
·
|
Total debt to EBITDAX, each as defined in the Revolver, for any four consecutive quarters may not exceed 4.0 to 1.0 reducing to 3.5 to 1.0 for periods ending on or after September 30, 2011. EBITDAX, which is a non-GAAP measure, generally means net income plus interest expense, taxes, depreciation, depletion and amortization expenses, exploration expenses, impairments, other non-cash charges or losses and the amount of cash distributions received from PVG and Penn Virginia Resource Partners, L.P.
|
|
·
|
The current ratio, as of the last day of any quarter, may not be less than 1.0 to 1.0. The current ratio is generally defined as current assets to current liabilities. Current assets and current liabilities attributable to derivative instruments are excluded. In addition, current assets include the amount of any unused commitment under the Revolver.
|
Required
|
Actual
|
||||||
Description of Covenant
|
Covenant
|
Results
|
|||||
Total debt to EBITDAX
|
< 4.0 to 1
|
2.8 to 1
|
|||||
Current ratio
|
> 1.0 to 1
|
4.0 to 1
|
Average
|
Fair Value
|
||||||||||||||||
Volume Per
|
Weighted Average Price
|
Asset
|
|||||||||||||||
Instrument
|
Day
|
Floor/Swap
|
Ceiling
|
(Liability)
|
|||||||||||||
Natural Gas:
|
(in MMBtu)
|
||||||||||||||||
Second quarter 2011
|
Costless collars
|
30,000 | $ | 4.83 | $ | 6.00 | $ | 1,593 | |||||||||
Third quarter 2011
|
Costless collars
|
30,000 | $ | 4.83 | $ | 6.00 | 1,395 | ||||||||||
Fourth quarter 2011
|
Costless collars
|
20,000 | $ | 6.00 | $ | 8.50 | 2,452 | ||||||||||
First quarter 2012
|
Costless collars
|
20,000 | $ | 6.00 | $ | 8.50 | 2,059 | ||||||||||
Second quarter 2011
|
Swaps
|
40,000 | $ | 5.06 | 2,547 | ||||||||||||
Third quarter 2011
|
Swaps
|
40,000 | $ | 5.06 | 1,858 | ||||||||||||
Fourth quarter 2011
|
Swaps
|
10,000 | $ | 5.01 | 197 | ||||||||||||
First quarter 2012
|
Swaps
|
10,000 | $ | 5.10 | 14 | ||||||||||||
Second quarter 2012
|
Swaps
|
20,000 | $ | 5.31 | 724 | ||||||||||||
Third quarter 2012
|
Swaps
|
20,000 | $ | 5.31 | 563 | ||||||||||||
Fourth quarter 2012
|
Swaps
|
10,000 | $ | 5.10 | (120 | ) | |||||||||||
Crude Oil:
|
(barrels)
|
||||||||||||||||
Second quarter 2011
|
Costless collars
|
425 | $ | 80.00 | $ | 101.50 | (295 | ) | |||||||||
Third quarter 2011
|
Costless collars
|
360 | $ | 80.00 | $ | 103.30 | (326 | ) | |||||||||
Fourth quarter 2011
|
Costless collars
|
360 | $ | 80.00 | $ | 103.30 | (367 | ) |
Change of $1.00 per MMBtu of Natural Gas
|
||||||||
or $10.00 per Barrel of Crude Oil
|
||||||||
Increase
|
Decrease
|
|||||||
Effect on the fair value of natural gas derivatives
|
$ | (18.3 | ) | $ | 19.4 | |||
Effect on the fair value of crude oil derivatives
|
$ | (0.9 | ) | $ | 0.6 | |||
Effect on 2011 operating income, excluding natural gas derivatives
|
$ | (27.6 | ) | $ | 27.6 | |||
Effect on 2011 operating income, excluding crude oil derivatives
|
$ | (15.0 | ) | $ | 15.0 |
3.1
|
Amended and Restated Bylaws of Penn Virginia Corporation (incorporated by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-K filed on February 18, 2011).
|
4.1
|
Senior Indenture dated June 15, 2009, among Penn Virginia Corporation, as issuer, the subsidiary guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to Registrant’s Current Report on Form 8-K filed on June 16, 2009).
|
4.2
|
Second Supplemental Indenture relating to the 10.375% Senior Notes due 2016, dated April 4, 2011, among Penn Virginia Corporation, as issuer, the subsidiary guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.1 to Registrant’s Current Report on Form 8-K filed on April 5, 2011).
|
4.3
|
Third Supplemental Indenture relating to the 7.25% Senior Notes due 2019, dated April 13, 2011, among Penn Virginia Corporation, as issuer, the subsidiary guarantors named therein and Wells Fargo Bank, National Association, as trustee (incorporated by reference to Exhibit 4.2 to Registrant’s Current Report on Form 8-K filed on April 14, 2011).
|
4.4
|
Form of Note for 7.25% Senior Notes due 2019 (incorporated by reference to Exhibit 4.3 to Registrant’s Current Report on Form 8-K filed on April 14, 2011).
|
10.1
|
Penn Virginia Corporation 2011 Annual Incentive Cash Bonus and Long-Term Equity Compensation Guidelines (incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on March 1, 2011).
|
10.2
|
Dealer Management Agreement dated March 8, 2011, by and between Penn Virginia Corporation and J.P. Morgan Securities LLC (incorporated by reference to Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on March 9, 2011).
|
12.1
|
Statement of Computation of Ratio of Earnings to Fixed Charges Calculation.
|
31.1
|
Certification Pursuant to Exchange Act Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
31.2
|
Certification Pursuant to Exchange Act Rule 13a-14(a) or Rule 15d-14(a), as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
32.1
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS
|
XBRL Instance Document
|
101.SCH
|
XBRL Taxonomy Extension Schema Document
|
101.CAL
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
PENN VIRGINIA CORPORATION
|
||
Date: May 5, 2011
|
By:
|
/s/ Steven A. Hartman
|
Steven A. Hartman
|
||
Senior Vice President and Chief Financial Officer
|
||
Date: May 5, 2011
|
By:
|
/s/ Joan C. Sonnen
|
Joan C. Sonnen
|
||
Vice President and Controller
|
VT7Q=I^L01/IR:>"MNJVPA^SRJ60L_F1LS
M;V`9?EP`?JU17YO?\$-?^"J7QD^.EK#^P?\`\%$X1I'Q^T'PM9Z_H>IW*I'%
MX^\.7,"3V^IVQ4*DDRQN!,J`$[2^`RSI%[I\$O`'C#Q-^VQ\>_A]XE_:$^(M
MYX<\/V/AH^%]$;Q5*D>D->6=Q)
Three Months
|
||||||||||||||||||||||||
Ended
|
||||||||||||||||||||||||
2006
|
2007
|
2008
|
2009
|
2010
|
March 31, 2011
|
|||||||||||||||||||
Earnings
|
||||||||||||||||||||||||
Pre-tax income *
|
$ | 91,397 | $ | 52,655 | $ | 146,238 | $ | (219,068 | ) | $ | (109,562 | ) | $ | (26,875 | ) | |||||||||
Fixed charges
|
11,525 | 28,162 | 33,772 | 53,535 | 60,003 | 15,142 | ||||||||||||||||||
Total Earnings
|
$ | 102,922 | $ | 80,817 | $ | 180,010 | $ | (165,533 | ) | $ | (49,559 | ) | $ | (11,733 | ) | |||||||||
Fixed Charges
|
||||||||||||||||||||||||
Interest expense
|
$ | 8,828 | $ | 23,717 | $ | 27,614 | $ | 47,545 | $ | 55,063 | $ | 14,019 | ||||||||||||
Rental Interest Factor
|
2,697 | 4,445 | 6,158 | 5,990 | 4,940 | 1,123 | ||||||||||||||||||
Total Fixed Charges
|
$ | 11,525 | $ | 28,162 | $ | 33,772 | $ | 53,535 | $ | 60,003 | $ | 15,142 | ||||||||||||
Ratio of Earnings to Fixed Charges
|
8.9 | x | 2.9 | x | 5.3 | x | ** | ** | ** |
*
|
Includes cash distributions from equity affiliates and excludes equity earnings from affiliates. Also excludes capitalized interest.
|
**
|
During 2009, 2010 and the three months ended March 31, 2011, earnings were deficient by $165,533, $49,559 and $11,733, respectively, regarding the coverage of fixed charges.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of the Registrant (this “Report”);
|
2.
|
Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
|
4.
|
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and we have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
|
|
(d)
|
Disclosed in this Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
|
5.
|
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
|
Date: May 5, 2011
|
|
/s/ H. Baird Whitehead
|
|
H. Baird Whitehead
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of the Registrant (this “Report”);
|
2.
|
Based on my knowledge, this Report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this Report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this Report, fairly present in all material respects the financial condition, results of operations and cash flows of the Registrant as of, and for, the periods presented in this Report;
|
4.
|
The Registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the Registrant and we have:
|
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this Report is being prepared;
|
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
|
(c)
|
Evaluated the effectiveness of the Registrant’s disclosure controls and procedures and presented in this Report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this Report based on such evaluation; and
|
|
(d)
|
Disclosed in this Report any change in the Registrant’s internal control over financial reporting that occurred during the Registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the Registrant’s internal control over financial reporting; and
|
5.
|
The Registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Registrant’s auditors and the audit committee of the Registrant’s board of directors:
|
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Registrant’s ability to record, process, summarize and report financial information; and
|
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the Registrant’s internal control over financial reporting.
|
Date: May 5, 2011
|
|
/s/ Steven A. Hartman
|
|
Steven A. Hartman
|
|
Senior Vice President and Chief Financial Officer
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: May 5, 2011
|
|
/s/ H. Baird Whitehead
|
|
H. Baird Whitehead
|
|
President and Chief Executive Officer
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
Date: May 5, 2011
|
|
/s/ Steven A. Hartman
|
|
Steven A. Hartman
|
|
Senior Vice President and Chief Financial Officer
|