Delaware | 001-14039 | 64-0844345 |
(State or other jurisdiction of | (Commission File Number) | (I.R.S. Employer |
incorporation or organization) | Identification Number) |
Exhibit Number | Title of Document | |
99.1 | Press release dated November 6, 2013 providing information regarding Callon Petroleum Company's financial and operational results for the third quarter ended September 30, 2013. | |
99.2 | Press release dated November 6, 2013 announcing guidance for the full year 2013 (pro forma for the divestiture of Gulf of Mexico assets). | |
99.3 | Press release dated October 30, 2013 announcing that its conference call reporting third quarter 2013 results would be held on Thursday, November 7, 2013 beginning at 1:00 p.m. Central Time. | |
Callon Petroleum Company | ||
(Registrant) | ||
November 7, 2013 | By: /s/ B. F. Weatherly | |
B.F. Weatherly | ||
Executive Vice President and Chief Financial Officer | ||
Exhibit Number | Title of Document | |
99.1 | Press release dated November 6, 2013 providing information regarding Callon Petroleum Company's financial and operational results for the third quarter ended September 30, 2013. | |
99.2 | Press release dated November 6, 2013 announcing guidance for the full year 2013 (pro forma for the divestiture of Gulf of Mexico assets). | |
99.3 | Press release dated October 30, 2013 announcing that its conference call reporting third quarter 2013 results would be held on Thursday, November 7, 2013 beginning at 1:00 p.m. Central Time. | |
• | Average total quarterly production of 4,370 Boepd, a sequential increase of 21% |
• | Average Permian quarterly production of 2,456 Boepd, a sequential increase of 31% |
• | Discretionary cash flow, a non-GAAP financial measure, of $19.2 million, a sequential increase of 86% |
• | Net loss of $0.02 per diluted share, or net income of $0.03 per diluted share excluding the impact of unrealized mark-to-market derivative positions on a non-GAAP basis |
• | Continued delineation of Borden County with a vertical test of the Mississippian chat with a peak 24-rate of 326 boepd |
Drilled | Completed (a) | |||||||||||
Gross | Net | Gross | Net | |||||||||
Southern portion: | ||||||||||||
Vertical wells | 1 | 1.00 | — | — | ||||||||
Horizontal wells | 13 | 11.75 | 9 | 8.23 | ||||||||
Total southern portion | 14 | 12.75 | 9 | 8.23 | ||||||||
Central portion: | ||||||||||||
Vertical wells | 4 | 2.58 | 6 | 3.97 | ||||||||
Horizontal wells | — | — | — | — | ||||||||
Total central portion | 4 | 2.58 | 6 | 3.97 | ||||||||
Northern portion: | ||||||||||||
Vertical wells | 1 | 1 | 1 | 0.75 | ||||||||
Horizontal wells | — | — | 1 | 0.75 | ||||||||
Total northern portion | 1 | 1 | 2 | 1.50 | ||||||||
Total vertical wells | 6 | 4.58 | 7 | 4.72 | ||||||||
Total horizontal wells | 13 | 11.75 | 10 | 8.98 | ||||||||
Total | 19 | 16.33 | 17 | 13.70 |
(a) | Completions include wells drilled prior to 2013. |
Southern Midland Basin | $ | 71 | ||
Central Midland Basin | 12 | |||
Northern Midland Basin | 5 | |||
Total capital expenditures | $ | 88 | ||
Capitalized general and administrative costs | 10 | |||
Capitalized interest and other | 3 | |||
Total capitalized expenses | $ | 13 | ||
Total operational expenditures | 101 | |||
Acquisition - Southern Midland Basin | 11 | |||
Total capital expenditures, including acquisition | $ | 112 |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||||||||||
2013 | 2012 | Change | 2013 | 2012 | Change | ||||||||||||||||||
Discretionary cash flow | $ | 19,150 | $ | 12,959 | $ | 6,191 | $ | 40,739 | $ | 38,595 | $ | 2,144 | |||||||||||
Net working capital changes and other changes | (4,173 | ) | 985 | (5,158 | ) | (5,525 | ) | 2,790 | (8,315 | ) | |||||||||||||
Net cash flow provided by (used in) operating activities | $ | 14,977 | $ | 13,944 | $ | 1,033 | $ | 35,214 | $ | 41,385 | $ | (6,171 | ) |
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Net (loss) income available to common shares | $ | (892 | ) | $ | (1,105 | ) | $ | (1,614 | ) | $ | 3,182 | ||||
Reconciling items, net of tax: | |||||||||||||||
Unrealized derivative loss (gains) | 1,984 | 1,039 | 1,823 | (1,285 | ) | ||||||||||
Gain on early redemption of debt | — | — | — | (888 | ) | ||||||||||
Adjusted net income | $ | 1,092 | $ | (66 | ) | $ | 209 | $ | 1,009 | ||||||
Adjusted net income fully diluted earnings per share | $ | 0.03 | $ | 0.00 | $ | 0.01 | $ | 0.03 |
Three Months Ended September 30, | |||||||||||||||
2013 | 2012 | Change | % Change | ||||||||||||
Net production: | |||||||||||||||
Crude oil (MBbls) | 257 | 251 | 6 | 2 | % | ||||||||||
Natural gas (MMcf) | 864 | 890 | (26 | ) | (3 | )% | |||||||||
Total production (MBoe) | 402 | 399 | 3 | 1 | % | ||||||||||
Average daily production (MBoe) | 4.4 | 4.3 | 0.1 | 2 | % | ||||||||||
Average realized sales price (a): | |||||||||||||||
Crude oil (Bbl) | $ | 105.11 | $ | 95.86 | $ | 9.25 | 10 | % | |||||||
Natural gas (Mcf) | $ | 4.38 | $ | 3.76 | $ | 0.62 | 16 | % | |||||||
Average realized sales price on an equivalent basis (Boe) | $ | 76.61 | $ | 68.67 | $ | 7.94 | 12 | % | |||||||
Crude oil and natural gas revenues (in thousands): | |||||||||||||||
Crude oil revenue | $ | 27,014 | $ | 24,061 | $ | 2,953 | 12 | % | |||||||
Natural gas revenue | 3,783 | 3,341 | 442 | 13 | % | ||||||||||
Total | $ | 30,797 | $ | 27,402 | $ | 3,395 | 12 | % | |||||||
Additional per Boe data: | |||||||||||||||
Average realized sales price | $ | 76.61 | $ | 68.67 | $ | 7.94 | 12 | % | |||||||
Lease operating expense | 13.11 | 13.05 | 0.06 | < 1% | |||||||||||
Production taxes | 2.47 | 1.64 | 0.83 | 51 | % | ||||||||||
Operating margin | $ | 61.03 | $ | 53.98 | $ | 7.05 | 13 | % | |||||||
Other expenses per Boe: | |||||||||||||||
Depletion, depreciation and amortization | $ | 29.62 | $ | 29.99 | $ | (0.37 | ) | (1 | )% | ||||||
General and administrative | 14.49 | 16.14 | (1.65 | ) | (10 | )% | |||||||||
(a) Below is a reconciliation of the average NYMEX price to the average realized sales price: | |||||||||||||||
Average NYMEX price per barrel ("Bbl") of crude oil | $ | 105.82 | $ | 92.22 | $ | 13.60 | 15 | % | |||||||
Basis differential and quality adjustments | (0.24 | ) | 3.28 | (3.52 | ) | (107 | )% | ||||||||
Transportation | (0.47 | ) | (0.68 | ) | 0.21 | (31 | )% | ||||||||
Hedging | — | 1.04 | (1.04 | ) | (100 | )% | |||||||||
Average realized price per Bbl of crude oil | $ | 105.11 | $ | 95.86 | $ | 9.25 | 10 | % | |||||||
Average NYMEX price per million British thermal units (“MMBtu”) | $ | 3.56 | $ | 2.90 | $ | 0.66 | 23 | % | |||||||
Basis differential, quality and Btu adjustments | 0.82 | 0.86 | (0.04 | ) | (5 | )% | |||||||||
Average realized price per Mcf of natural gas | $ | 4.38 | $ | 3.76 | $ | 0.62 | 16 | % |
Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | Change | % Change | ||||||||||||
Net production: | |||||||||||||||
Crude oil (MBbls) | 661 | 716 | (55 | ) | (8 | )% | |||||||||
Natural gas (MMcf) | 2,389 | 2,695 | (306 | ) | (11 | )% | |||||||||
Total production (MBoe) | 1,060 | 1,165 | (105 | ) | (9 | )% | |||||||||
Average daily production (MBoe) | 3.9 | 4.3 | (0.4 | ) | (9 | )% | |||||||||
Average realized sales price (a): | |||||||||||||||
Crude oil (Bbl) | $ | 99.27 | $ | 100.39 | $ | (1.12 | ) | (1 | )% | ||||||
Natural gas (Mcf) | $ | 4.39 | $ | 3.77 | $ | 0.62 | 16 | % | |||||||
Average realized sales price on an equivalent basis (Boe) | $ | 71.79 | $ | 70.44 | $ | 1.35 | 2 | % | |||||||
Crude oil and natural gas revenues (in thousands): | |||||||||||||||
Crude oil revenue | $ | 65,615 | $ | 71,883 | $ | (6,268 | ) | (9 | )% | ||||||
Natural gas revenue | 10,483 | 10,174 | 309 | 3 | % | ||||||||||
Total | $ | 76,098 | $ | 82,057 | $ | (5,959 | ) | (7 | )% | ||||||
Additional per Boe data: | |||||||||||||||
Average realized sales price | $ | 71.79 | $ | 70.44 | $ | 1.35 | 2 | % | |||||||
Lease operating expense | 15.48 | 16.04 | (0.56 | ) | (3 | )% | |||||||||
Production taxes | 2.09 | 1.53 | 0.56 | 37 | % | ||||||||||
Operating margin | $ | 54.22 | $ | 52.87 | $ | 1.35 | 3 | % | |||||||
Other expenses per Boe: | |||||||||||||||
Depletion, depreciation and amortization | $ | 31.70 | $ | 30.90 | $ | 0.80 | 3 | % | |||||||
General and administrative | 13.31 | 13.60 | (0.29 | ) | (2 | )% | |||||||||
(a) Below is a reconciliation of the average NYMEX price to the average realized sales price: | |||||||||||||||
Average NYMEX price per barrel ("Bbl") of crude oil | $ | 98.14 | $ | 96.21 | $ | 1.93 | 2 | % | |||||||
Basis differential and quality adjustments | 1.66 | 3.84 | (2.18 | ) | (57 | )% | |||||||||
Transportation | (0.53 | ) | (0.74 | ) | 0.21 | (28 | )% | ||||||||
Hedging | — | 1.08 | (1.08 | ) | (100 | )% | |||||||||
Average realized price per Bbl of crude oil | $ | 99.27 | $ | 100.39 | (1.12 | ) | (1 | )% | |||||||
Average NYMEX price per million British thermal units (“MMBtu”) | $ | 3.68 | $ | 2.43 | $ | 1.25 | 51 | % | |||||||
Basis differential, quality and Btu adjustments | 0.71 | 1.34 | (0.63 | ) | (47 | )% | |||||||||
Average realized price per Mcf of natural gas | $ | 4.39 | $ | 3.77 | $ | 0.62 | 16 | % |
CALLON PETROLEUM COMPANY CONSOLIDATED BALANCE SHEETS (In thousands, except per share data) | |||||||
September 30, 2013 | December 31, 2012 | ||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 869 | $ | 1,139 | |||
Accounts receivable | 20,072 | 15,608 | |||||
Fair market value of derivatives | — | 1,674 | |||||
Deferred tax asset | 3,323 | — | |||||
Other current assets | 1,738 | 1,502 | |||||
Total current assets | 26,002 | 19,923 | |||||
Oil and natural gas properties, full-cost accounting method: | |||||||
Evaluated properties | 1,634,151 | 1,497,010 | |||||
Less accumulated depreciation, depletion and amortization | (1,329,866 | ) | (1,296,265 | ) | |||
Net oil and natural gas properties | 304,285 | 200,745 | |||||
Unevaluated properties excluded from amortization | 50,540 | 68,776 | |||||
Total oil and natural gas properties | 354,825 | 269,521 | |||||
Other property and equipment, net | 10,635 | 10,058 | |||||
Restricted investments | 3,800 | 3,798 | |||||
Investment in Medusa Spar LLC | 7,776 | 8,568 | |||||
Deferred tax asset | 60,198 | 64,383 | |||||
Other assets, net | 4,205 | 1,922 | |||||
Total assets | $ | 467,441 | $ | 378,173 | |||
LIABILITIES AND STOCKHOLDERS' EQUITY | |||||||
Current liabilities: | |||||||
Accounts payable and accrued liabilities | $ | 49,384 | $ | 36,016 | |||
Asset retirement obligations | 6,002 | 2,336 | |||||
Fair market value of derivatives | 1,139 | 125 | |||||
Total current liabilities | 56,525 | 38,477 | |||||
13% Senior Notes: | |||||||
Principal outstanding | 96,961 | 96,961 | |||||
Deferred credit, net of accumulated amortization of $20,248 and $17,800, respectively | 11,259 | 13,707 | |||||
Total 13% Senior Notes | 108,220 | 110,668 | |||||
Senior secured revolving credit facility | 17,000 | 10,000 | |||||
Asset retirement obligations | 5,505 | 10,965 | |||||
Other long-term liabilities | 3,579 | 2,092 | |||||
Total liabilities | 190,829 | 172,202 | |||||
Stockholders' equity: | |||||||
Preferred stock, series A cumulative, $0.01 par value and $50.00 liquidation preference, 2,500 shares authorized: 1,579 and 0 shares outstanding, respectively | 16 | — | |||||
Common stock, $0.01 par value, 60,000 shares authorized; 40,328 and 39,801 shares outstanding, respectively | 405 | 398 | |||||
Capital in excess of par value | 400,348 | 328,116 | |||||
Retained deficit | (124,157 | ) | (122,543 | ) | |||
Total stockholders' equity | 276,612 | 205,971 | |||||
Total liabilities and stockholders' equity | $ | 467,441 | $ | 378,173 |
CALLON PETROLEUM COMPANY CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share data) | ||||||||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
Operating revenues: | ||||||||||||||||
Crude oil sales | $ | 27,014 | $ | 24,061 | $ | 65,615 | $ | 71,883 | ||||||||
Natural gas sales | 3,783 | 3,341 | 10,483 | 10,174 | ||||||||||||
Total operating revenues | 30,797 | 27,402 | 76,098 | 82,057 | ||||||||||||
Operating expenses: | ||||||||||||||||
Lease operating expenses | 5,270 | 5,203 | 16,412 | 18,687 | ||||||||||||
Production taxes | 991 | 656 | 2,217 | 1,778 | ||||||||||||
Depreciation, depletion and amortization | 11,907 | 11,965 | 33,603 | 35,998 | ||||||||||||
General and administrative | 5,826 | 6,441 | 14,110 | 15,846 | ||||||||||||
Accretion expense | 458 | 574 | 1,556 | 1,709 | ||||||||||||
Total operating expenses | 24,452 | 24,839 | 67,898 | 74,018 | ||||||||||||
Income from operations | 6,345 | 2,563 | 8,200 | 8,039 | ||||||||||||
Other (income) expenses: | ||||||||||||||||
Interest expense | 1,417 | 2,135 | 4,469 | 7,096 | ||||||||||||
Gain on early extinguishment of debt | — | — | — | (1,366 | ) | |||||||||||
Loss (gain) on derivative contracts | 3,686 | 1,598 | 2,123 | (1,977 | ) | |||||||||||
Other (income) expense, net | (279 | ) | 237 | (368 | ) | (224 | ) | |||||||||
Total other (income) expenses, net | 4,824 | 3,970 | 6,224 | 3,529 | ||||||||||||
Income (loss) before income taxes | 1,521 | (1,407 | ) | 1,976 | 4,510 | |||||||||||
Income tax expense (benefit) | 456 | (246 | ) | 950 | 1,508 | |||||||||||
Income (loss) before equity in earnings of Medusa Spar LLC | 1,065 | (1,161 | ) | 1,026 | 3,002 | |||||||||||
Equity in earnings of Medusa Spar LLC | 17 | 56 | 14 | 180 | ||||||||||||
Net income (loss) | 1,082 | (1,105 | ) | 1,040 | 3,182 | |||||||||||
Preferred stock dividends | (1,974 | ) | — | (2,654 | ) | — | ||||||||||
Net income (loss) available to common shareholders | $ | (892 | ) | $ | (1,105 | ) | $ | (1,614 | ) | $ | 3,182 | |||||
Net income (loss) per common share: | ||||||||||||||||
Basic | $ | (0.02 | ) | $ | (0.03 | ) | $ | (0.04 | ) | $ | 0.08 | |||||
Diluted | $ | (0.02 | ) | $ | (0.03 | ) | $ | (0.04 | ) | $ | 0.08 | |||||
Shares used in computing net income (loss) per common share: | ||||||||||||||||
Basic | 40,321 | 39,575 | 40,064 | 39,441 | ||||||||||||
Diluted | 40,321 | 39,575 | 40,064 | 40,243 |
CALLON PETROLEUM COMPANY CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) | ||||||||
Nine Months Ended September 30, | ||||||||
2013 | 2012 | |||||||
Cash flows from operating activities: | ||||||||
Net income | $ | 1,040 | $ | 3,182 | ||||
Adjustments to reconcile net income to cash provided by operating activities: | ||||||||
Depreciation, depletion and amortization | 34,668 | 37,005 | ||||||
Accretion expense | 1,556 | 1,709 | ||||||
Amortization of non-cash debt related items | 348 | 293 | ||||||
Amortization of deferred credit | (2,448 | ) | (2,304 | ) | ||||
Non-cash gain on early extinguishment of debt | — | (1,366 | ) | |||||
Equity in earnings of Medusa Spar LLC | (14 | ) | (180 | ) | ||||
Deferred income tax expense | 950 | 1,508 | ||||||
Unrealized loss (gain) on derivative contracts | 2,929 | (2,017 | ) | |||||
Non-cash expense related to equity share-based awards | 1,335 | 752 | ||||||
Change in the fair value of liability share-based awards | 1,076 | 2,611 | ||||||
Payments to settle asset retirement obligations | (701 | ) | (1,136 | ) | ||||
Changes in current assets and liabilities: | ||||||||
Accounts receivable | (3,455 | ) | (1,260 | ) | ||||
Other current assets | (236 | ) | 244 | |||||
Current liabilities | 1,969 | 4,965 | ||||||
Payments to settle vested liability share-based awards | (239 | ) | (1,462 | ) | ||||
Change in natural gas balancing receivable | (206 | ) | (96 | ) | ||||
Change in natural gas balancing payable | (52 | ) | (152 | ) | ||||
Change in other long-term liabilities | (206 | ) | — | |||||
Change in other assets, net | (3,100 | ) | (911 | ) | ||||
Cash provided by operating activities | $ | 35,214 | $ | 41,385 | ||||
Cash flows from investing activities: | ||||||||
Capital expenditures | (101,067 | ) | (115,401 | ) | ||||
Acquisition | (11,000 | ) | — | |||||
Proceeds from sale of mineral interest and equipment | 1,389 | 526 | ||||||
Distribution from Medusa Spar LLC | 813 | 1,423 | ||||||
Cash used in investing activities | $ | (109,865 | ) | $ | (113,452 | ) | ||
Cash flows from financing activities: | ||||||||
Borrowings on senior secured revolving credit facility | 48,000 | 43,000 | ||||||
Payments on senior secured revolving credit facility | (41,000 | ) | (3,000 | ) | ||||
Redemption of 13% senior notes | — | (10,225 | ) | |||||
Issuance of preferred stock | 70,035 | — | ||||||
Payment of preferred stock dividends | (2,654 | ) | — | |||||
Taxes paid related to exercise of employee stock options | — | (18 | ) | |||||
Cash provided by financing activities | $ | 74,381 | $ | 29,757 | ||||
Net change in cash and cash equivalents | (270 | ) | (42,310 | ) | ||||
Beginning of period cash and cash equivalents | 1,139 | 43,795 | ||||||
End of period cash and cash equivalents | $ | 869 | $ | 1,485 |
($ amounts in millions, except per production unit amounts) | ||
Guidance for | ||
Full Year 2013 | ||
Total production (Boe/d) | 3,800 - 4,100 | |
Permian (Boe/d) | 2,200 - 2,400 | |
% Oil | 65% | |
Lease operating expenses | $20 - $22 | |
Severance tax | $3 - $4 | |
General and administrative expenses: | ||
Cash | $14 - $16 | |
Non-cash | $4 - $6 | |
DD&A - per Boe | $30.00 - $32.00 | |
Accretion expense | $1 - $2 | |
Crude Oil | 4Q - 2013 | ||||||||||||||||
Swap | Volume (Mbo) | 120 | |||||||||||||||
Price | $ | 101.30 | |||||||||||||||
Swap | Volume (Mbo) | 55 | |||||||||||||||
Price | $ | 102.08 | |||||||||||||||
1Q - 2014 | 2Q - 2014 | 3Q - 2014 | 4Q - 2014 | ||||||||||||||
Swap | Volume (Mbo) | 90 | 91 | 92 | 92 | ||||||||||||
Price | $ | 93.35 | $ | 93.35 | $ | 93.35 | $ | 93.35 | |||||||||
Put | Volume (Mbo) | 90 | 91 | 92 | 92 | ||||||||||||
Price | $ | 70.00 | $ | 70.00 | $ | 70.00 | $ | 70.00 | |||||||||
Swap | Volume (Mbo) | 27 | 27 | 28 | 28 | ||||||||||||
Price | $ | 94.58 | $ | 94.58 | $ | 94.58 | $ | 94.58 | |||||||||
Natural Gas | 4Q - 2013 | ||||||||||||||||
Swap | Volume (Bbtu) | 276 | |||||||||||||||
Price | $ | 3.52 | |||||||||||||||
Put Option | Volume (Bbtu) | 276 | |||||||||||||||
Price | $ | 3.00 | |||||||||||||||
1Q - 2014 | 2Q - 2014 | 3Q - 2014 | 4Q - 2014 | ||||||||||||||
Call Option | Volume (Bbtu) | 113 | 114 | 115 | 115 | ||||||||||||
Price | $ | 4.75 | $ | 4.75 | $ | 4.75 | $ | 4.75 |
• | general economic and industry conditions; |
• | volatility of oil and natural gas prices; |
• | uncertainty of estimates of oil and natural gas reserves; |
• | impact of competition; |
• | availability and cost of seismic, drilling and other equipment; |
• | operating hazards inherent in the exploration for and production of oil and natural gas; |
• | difficulties encountered during the exploration for and production of oil and natural gas; |
• | difficulties encountered in delivering oil and natural gas to commercial markets; |
• | changes in customer demand and producers’ supply; |
• | uncertainty of our ability to attract capital; |
• | compliance with, or the effect of changes in, the extensive governmental regulations regarding the oil and natural gas business; |
• | actions of operators of our oil and gas properties; |
• | weather conditions; and |
• | the risk factors discussed in our filings with the Securities and Exchange Commission, including but not limited to those in our Annual Report for the year ended December 31, 2012 on Form 10-K. |
Date/Time: | Thursday, November 7, 2013, at 1:00 p.m. Central Time (2:00 p.m. Eastern Time) |
Webcast: | Live webcast will be available at www.callon.com in the "Investors" section of the website |
Call-in Number: | 1-877-546-5018 (Toll-free) |
Participant Passcode: | 76863822 |
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