EX-99.1 2 d17078exv99w1.htm PRESS RELEASE exv99w1
 

         
(REMINGTON LOOG)   PRESS RELEASE
  FOR IMMEDIATE RELEASE
 
  Contact: Steven J. Craig
Sr. Vice President
(214) 210-2675

REMINGTON OIL AND GAS ANNOUNCES FINANCIAL RESULTS FOR
THE THREE AND SIX MONTHS ENDED JUNE 30, 2004

Dallas, TX, July 28, 2004 – Remington Oil and Gas Corporation (NYSE: REM) announced financial results for the three and six months ended June 30, 2004.

                                 
    Three Months Ended   Six Months Ended
    June 30,
   June 30,
    2004
   2003
   2004
   2003
Total revenues
   $ 58,384     $ 46,003     $ 104,545     $ 88,340  
Net income
   $ 14,988     $ 12,264     $ 25,987     $ 23,951  
Basic net income per share
   $ 0.55     $ 0.46     $ 0.96     $ 0.91  
Diluted income per share
   $ 0.53     $ 0.44     $ 0.92     $ 0.86  
Cash flow provided by operations
   $ 48,133     $ 38,212     $ 77,595     $ 63,216  
Production Bcfe
     9.4       8.5       17.5       15.6  

Oil and gas production for the three months ended June 30, 2004, increased by 11% to 9.4 Bcfe compared to 8.5 Bcfe for the same three months of 2003. For the six months oil and gas production increased by 12% to 17.5 Bcfe in 2004 compared to 15.6 Bcfe in 2003.

Net income for the three months ended June 30, 2004, increased by $2.7 million to $15.0 million, or $0.53 diluted income per share, and net income for the six months ended June 30, 2004, increased by $2.0 million to $26.0 million, or $0.92 diluted income per share. Net income in the second quarter was decreased by a $4.8 million pre-tax property impairment charge, $4.5 million of which was associated with the unsuccessful completion of the Fleishaker #2 well at the Tatum Dome prospect in Mississippi. Cash flow from operations increased by $9.9 million, or 26%, and by $14.4 million, or 23%, for the three and six months ended June 30, 2004, compared to the same periods in 2003 respectively. The increases in net income and cash flow from operations reflect primarily the higher revenues from increased production.

Results versus Guidance

The Company provided production guidance of 17.5 Bcfe to 18.5 Bcfe for the first six months of the year. Actual production was 8.1 Bcfe in the first quarter and 9.4 Bcfe in the second quarter for a combined total of 17.5 Bcfe for the first six months of 2004. This was 12% above the first six months of 2003. Total annual production for 2004 is expected to be approximately 40 Bcfe, or 15% above the 34.8 Bcfe produced in 2003.

DD&A was forecast to be between $1.80 and $1.95 per Mcfe produced for the year. Second quarter DD&A was $17.6 million or $1.87 per Mcfe produced. For the first six months of 2004 DD&A was $32.8 million or $1.87 per Mcfe produced. DD&A in the second quarter and for the first six months of 2003 was $1.50 and $1.51, respectively, per Mcfe produced. This increase of $0.36 per Mcfe produced, or 24%, represents the impact of increased finding and development costs over the past few years.

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Lease operating expenses (LOE) were $6.0 million or $0.64 per Mcfe produced for the second quarter of 2004. For the first six months LOE was $12.1 million or $0.69 per Mcfe produced. Annual guidance is for LOE to be between $0.60 and $0.70 per Mcfe produced.

G&A expense was $1.6 million or $0.17 per Mcfe produced for the second quarter. For the first six months, G&A was $3.5 million or $0.20 per Mcfe produced. Guidance was for annual G&A expense to be between $0.21 and $0.28 per Mcfe produced. Included in the G&A is $371,000 in the first quarter and $732,000 for the first six months for stock-based compensation. This is $0.04 per Mcfe produced in both periods. Interest and financing costs were $250,000 for the quarter and $478,000 for the first six months or $0.03 per Mcfe produced. Guidance was for interest costs to be between $0.03 and $0.05 per Mcfe produced for the year.

Dry hole costs for the second quarter were $1.1 million and $6.8 million for the first six months. Annualized guidance for dry hole expense is between $20 million and $24 million. Geological and geophysical costs, which are included in exploration costs on the income statement, were $3.7 million in the second quarter reflecting the initial payment on the purchase of 1,400 blocks of deeper water 3-D data and costs associated with prior seismic agreements. It is anticipated that $2.5 to $3.0 million of geophysical costs will be incurred in each of the remaining quarters of 2004 associated with the same programs.

James A. Watt, Chairman and Chief Executive Officer said, “This was an excellent quarter for Remington. Our balance sheet is in excellent shape, and we have dramatically expanded our seismic data base to generate new prospects for future drilling.”

Remington Oil and Gas Corporation is an independent oil and gas exploration and production company headquartered in Dallas, Texas, with operations concentrating in the onshore and offshore regions of the Gulf Coast.

Statements concerning future revenues and expenses, production volumes, results of exploration, exploitation, development, acquisition and operations expenditures, and prospective reserve levels of prospects or wells are forward-looking statements. Prospect size and reserve levels are often referred to as “potential” or “un-risked” reserves and are based on the Company’s internal estimates from the volumetric calculations or analogous production. Other forward-looking statements are based on assumptions concerning commodity prices, drilling results, recovery factors for wells, production rates, and operating, administrative and interest costs that management believes are reasonable based on currently available information; however, management’s assumptions and the Company’s future performance are subject to a wide range of business, mechanical, political, environmental, and geologic risks. There is no assurance that these goals, projections, costs, expenses, reserve levels, and production volumes can or will be met. Further information is available in the Company’s filings with the Securities and Exchange Commission, which are herein incorporated by this reference. Information in this document should be reviewed in combination with the Company’s filings with the Securities and Exchange Commission and information available on the Company’s website at www.remoil.net.

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Remington Oil and Gas Corporation
Condensed Consolidated Balance Sheets
(In thousands, except share data)

                 
    June 30,   December 31,
    2004
   2003
    (Unaudited)        
Assets
                
Current assets
                
Cash and cash equivalents
   $ 38,051     $ 31,408  
Accounts receivable
     53,643       43,004  
Prepaid expenses and other current assets
     2,579       2,846  
 
    
 		      
 		  
Total current assets
     94,273       77,258  
 
    
 		      
 		  
Properties
                
Oil and gas properties (successful-efforts method)
     664,662       609,599  
Other properties
     2,999       3,450  
Accumulated depreciation, depletion and amortization
     (364,827 )     (333,011 )
 
    
 		      
 		  
Total properties
     302,834       280,038  
 
    
 		      
 		  
Other assets
     1,681       2,089  
 
    
 		      
 		  
Total assets
   $ 398,788     $ 359,385  
 
    
 		      
 		  
Liabilities and stockholders’ equity
                
Current liabilities
                
Accounts payable and accrued expenses
   $ 60,829     $ 58,266  
Short-term notes payable
     45       45  
 
    
 		      
 		  
Total current liabilities
     60,874       58,311  
 
    
 		      
 		  
Long-term liabilities
                
Notes payable
     10,000       18,000  
Asset retirement obligation
     13,656       12,446  
Deferred income taxes
     40,689       28,751  
 
    
 		      
 		  
Total long-term liabilities
     64,345       59,197  
 
    
 		      
 		  
Total liabilities
     125,219       117,508  
 
    
 		      
 		  
Commitments and contingencies
                
Stockholders’ equity
                
Preferred stock, $0.01 par value, 25,000,000 shares authorized Shares issued – none
                
Common stock, $.01 par value, 100,000,000 shares authorized, 27,550,250 shares issued and 27,515,891 shares outstanding in 2004, 26,946,768 shares issued and 26,912,409 shares outstanding in 2003
     275       269  
Additional paid-in capital
     127,552       120,925  
Restricted common stock
     1,573       3,156  
Unearned compensation
     (1,013 )     (1,668 )
Retained earnings
     145,182       119,195  
 
    
 		      
 		  
Total stockholders’ equity
     273,569       241,877  
 
    
 		      
 		  
Total liabilities and stockholders’ equity
   $ 398,788     $ 359,385  
 
    
 		      
 		  

 

 

Remington Oil and Gas Corporation
Condensed Consolidated Statements of Income
(Unaudited)
(In thousands, except per-share amounts and prices)

                                 
    Three Months Ended   Six Months Ended
    June 30,
   June 30,
    2004
   2003
   2004
   2003
Revenues
                                
Gas sales
   $ 42,713     $ 33,196     $ 74,826     $ 61,847  
Oil sales
     15,552       12,584       29,494       26,237  
Gain on sale of assets and other income
     119       223       225       256  
 
    
 		      
 		      
 		      
 		  
Total revenues
     58,384       46,003       104,545       88,340  
 
    
 		      
 		      
 		      
 		  
Costs and expenses
                                
Lease operating
     6,028       5,277       12,076       9,669  
Exploration
     4,878       6,115       10,406       13,017  
Depreciation, depletion and amortization
     17,617       12,792       32,763       23,549  
Impairment
     4,750       251       4,986       447  
General and administrative
     1,625       2,214       3,547       3,924  
Interest and financing
     250       485       478       885  
 
    
 		      
 		      
 		      
 		  
Total costs and expenses
     35,148       27,134       64,256       51,491  
 
    
 		      
 		      
 		      
 		  
Income before taxes
     23,236       18,869       40,289       36,849  
 
    
 		      
 		      
 		      
 		  
Income tax expense
     8,248       6,605       14,302       12,898  
 
    
 		      
 		      
 		      
 		  
Net income
   $ 14,988     $ 12,264     $ 25,987     $ 23,951  
 
    
 		      
 		      
 		      
 		  
Basic income per share
   $ 0.55     $ 0.46     $ 0.96     $ 0.91  
 
    
 		      
 		      
 		      
 		  
Diluted income per share
   $ 0.53     $ 0.44     $ 0.92     $ 0.86  
 
    
 		      
 		      
 		      
 		  
Average shares outstanding
                                
Basic
     27,287       26,536       27,131       26,436  
Diluted
     28,218       27,844       28,190       27,910  
Production
                                
Gas (Mcf)
     6,869       5,855       12,461       10,360  
Oil (Bbls)
     428       447       841       872  
Mcfe (1 barrel of oil is equivalent to 6 Mcf of gas)
     9,437       8,537       17,507       15,592  
Average prices
                                
Gas
   $ 6.22     $ 5.67     $ 6.00     $ 5.97  
Oil
   $ 36.34     $ 28.15     $ 35.07     $ 30.09  
Mcfe
   $ 6.17     $ 5.36     $ 5.96     $ 5.65  

 

 

Remington Oil and Gas Corporation
Condensed Consolidated Statements of Cash Flows
(Unaudited)
(In thousands)

                 
    Six Months Ended
    June 30,
    2004
   2003
Cash flow provided by operations
                
Net income
   $ 25,987     $ 23,951  
Adjustments to reconcile net income
                
Depreciation, depletion and amortization
     32,763       23,549  
Deferred income taxes
     14,152       12,898  
Amortization of deferred charges
     91       116  
Dry hole costs
     6,753       12,312  
Impairment costs
     4,986       447  
Cash paid for asset retirements
     (377 )     (614 )
Stock based compensation
     732       792  
Changes in working capital
                
(Increase) in accounts receivable
     (10,630 )     (6,223 )
Decrease (increase) in prepaid expenses and other current assets
     575       (2,739 )
Increase (decrease) in accounts payable and accrued liabilities
     2,563       (1,273 )
 
    
 		      
 		  
Net cash flow provided by operations
     77,595       63,216  
 
    
 		      
 		  
Cash from investing activities
                
Payments for capital expenditures
     (65,711 )     (63,460 )
 
    
 		      
 		  
Net cash (used in) investing activities
     (65,711 )     (63,460 )
 
    
 		      
 		  
Cash from financing activities
                
Loan origination costs
     —       (293 )
Payments on notes payable and other long-term payables
     (8,000 )     (679 )
Common stock issued
     3,404       1,770  
Treasury stock acquired and retired
     (645 )     (654 )
 
    
 		      
 		  
Net cash (used in) provided by financing activities
     (5,241 )     144  
 
    
 		      
 		  
Net increase (decrease) in cash and cash equivalents
     6,643       (100 )
Cash and cash equivalents at beginning of period
     31,408       14,929  
 
    
 		      
 		  
Cash and cash equivalents at end of period
   $ 38,051     $ 14,829  
 
    
 		      
 		  

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