NATCHEZ, Miss., March 4, 2015 /PRNewswire/ -- Callon
Petroleum Company (NYSE: CPE) ("Callon" or the "Company") today
reported results of operations for the three and twelve month
periods ended December 31, 2014.
The Company highlighted financial and operating results for the
fourth quarter of 2014:
- Net daily production of 7,270 barrels of oil equivalent per day
("BOE/d"), an increase of 29% over the third quarter of 2014,
comprised of 79% oil volume
- Adjusted EBITDA and discretionary cash flow, non-GAAP financial
measures(i), of $32.9 million and $27.6
million, respectively
- "Drill-bit" finding and development costs(ii) of $13.91 per barrel
of oil equivalent ("BOE") for the year ended December 31, 2014 related to a 15.7 million BOE
increase in total proved reserves which resulted in the replacement
of 759% of 2014 production volumes
"While we have tempered our growth expectations in the current
commodity price environment, we remain focused on delivering value
to shareholders through a two-rig horizontal drilling program
across our concentrated asset base in the Midland Basin," commented
Fred Callon, Chairman and Chief
Executive Officer. "We are encouraged by our initial wells
targeting the Lower Spraberry zone, providing further evidence of
our asset quality and adding a fourth horizontal zone to our
production profile. Importantly, we have exceeded our initial
expectations for capital cost reductions, and also preserved the
continuity of high-quality service crews as we continue to work
closely with our service partners. We have already secured a 40%
reduction in drilling rig costs and average cost reductions of over
20% for completion and ancillary services, which collectively
translate into an estimated total completed well cost of
$6 million per 7,500' well for
near-term activity. As a result, the expected cost environment in
2015, combined with our initiatives to enhance reserve recoveries,
provides the opportunity to further improve finding and development
costs as we continue to grow our asset base in the Midland
Basin."
Operating and Financial Results
Total Revenue. For the quarter ended December 31, 2014, Callon reported total revenues
of $38.4 million, excluding the
$7.1 million impact of settled
derivative contracts, comprised of oil revenues of $34.4 million and natural gas revenues of
$4.0 million. Average daily
production for the quarter was 7,270 BOE/d compared to average
daily production of 5,641 BOE/d in the third quarter of 2014. As
discussed in the Company's prior operations update release, weather
conditions at the end of December
2014 adversely impacted sales volumes for the quarter.
Average realized prices were $65.05
per barrel of oil and $4.78 per Mcf
of natural gas in the fourth quarter of 2014, representing a
weighted average of $57.44 per BOE
produced, excluding the impact of settled derivative contracts.
Hedging impacts. For the quarter ended December 31, 2014 Callon recognized gains on the
settlement of its oil and gas derivatives totaling $7.1 million (or $10.57 per BOE), comprised of $7.0 million for oil (or $13.25 per Bbl) and $0.1
million for natural gas (or $0.07 per Mcf). Average realized prices including
the impact of cash settled derivatives during the fourth quarter
were $78.29 per barrel of oil and
$4.78 per Mcf of natural gas, or
$68.01 per BOE. Similarly, Callon
recognized fair value adjustment gains on its oil and gas
derivative positions totaling $21.9
million, comprised of $20.6
million related to oil hedges and $1.3 million related to natural gas hedges.
Lease Operating Expenses, including workover expense
("LOE"). LOE for the three months ended December 31, 2014 was $11.23 per BOE, compared to LOE of $12.08 per BOE in the third quarter of 2014, and
$10.85 per BOE for the year ended
December 31, 2014. Higher production
volumes contributed to the 7% per BOE decrease in the fourth
quarter.
Production Taxes, including ad valorem taxes. Production
taxes were $3.80 per BOE in the
fourth quarter of 2014, representing approximately 6.6% of total
revenue before the impact of derivative settlements.
Depreciation, Depletion and Amortization
("DD&A"). DD&A for the three months ended
December 31, 2014 was $27.05 per BOE compared to $31.05 per BOE in the third quarter of 2014, with
the decrease in per unit DD&A being attributable to our
increase in proved reserves relative to our depreciable asset base.
DD&A for the year ended December 31,
2014 was $27.51 per BOE.
General and Administrative, net of amounts capitalized
("G&A"). G&A for the three months ended
December 31, 2014 was $1.4 million compared to $3.3 million in the third quarter of 2014. The
$1.9 million decrease primarily
relates to a net decrease in the fair value adjustment of
cash-settled restricted stock unit awards period over period.
G&A excluding certain non-recurring items and non-cash
incentive share-based compensation valuation adjustments ("Adjusted
G&A", a non-GAAP measure(i)) was $3.9 million, or $5.89 per BOE, for the current period compared to
$4.7 million, or $8.98 per BOE, for the third quarter of 2014.
Adjusted G&A for the fourth quarter of 2014 excludes the
following items from reported G&A:
- $0.1 million in non-recurring,
cash expense related to a withdrawn proxy contest
- $2.6 million in non-cash gain
related to the fair value adjustment of cash-settled restricted
stock unit awards
For the fourth quarter of 2014, the cash component of Adjusted
G&A included $2.9 million, or
$4.35 per BOE, compared to
$3.8 million or $7.27 per BOE for the third quarter of 2014.
Adjusted G&A on a cash basis excludes the amortization of
share-based incentive awards and corporate depreciation and
amortization.
Interest Expense. Interest expense incurred during
the three months ended December 31,
2014 increased to $4.8 million
compared to $2.2 million in the third
quarter of 2014, primarily due to the issuance of our Second Lien
Loan.
Income (Loss) Available to Common Shareholders. The
Company reported net income available to common shareholders of
$17.0 million in the fourth quarter
of 2014 and Adjusted income, a non-GAAP measure(i), of
$3.1 million, or $0.05 per diluted share, which excludes (net of
tax effects): (a) $16.0 million in
expenses related to the non-cash, mark-to-market valuation of the
Company's derivative positions and phantom stock equity awards, (b)
$0.1 million of non-recurring G&A
expenses and (c) $2.0 million of loss on the early redemption of
debt.
The Company's effective tax rate for the fourth quarter was 36%,
representative of the statutory rate of 35% adjusted for
non-deductible executive compensation expense and state income
taxes. Adjusted income reconciling items are reflected net of tax
at the 35% statutory tax rate.
Discretionary Cash Flow. Discretionary cash flow, a
non-GAAP measure(i), for the fourth quarter of 2014 was
$27.6 million. The fourth quarter of
2014 included $0.5 million for
retained asset retirement obligation expenditures related to
Gulf of Mexico properties that
were divested in the fourth quarter of 2013. Excluding this
expenditure attributable to the sold properties, discretionary cash
flow from continuing operations was $28.1
million or $0.50 per diluted
share.
Liquidity
As of December 31, 2014, the
Company had total liquidity of $216
million, including $215
million of credit facility availability.
Operations Update
The following table summarizes the Company's drilling activity
for the three months ended December 31,
2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Drilled
|
|
Completed
|
|
Awaiting
Completion
|
|
|
Gross
|
|
Net
|
|
Gross
|
|
Net
|
|
Gross
|
|
Net
|
Southern Midland
Basin
|
|
|
|
|
|
|
|
|
|
|
|
|
Horizontal
wells
|
|
5
|
|
4.5
|
|
4
|
|
3.5
|
|
3
|
|
3.0
|
Total
|
|
5
|
|
4.5
|
|
4
|
|
3.5
|
|
3
|
|
3.0
|
Central Midland
Basin
|
|
|
|
|
|
|
|
|
|
|
|
|
Vertical
wells
|
|
1
|
|
0.5
|
|
—
|
|
—
|
|
1
|
|
0.4
|
Horizontal
wells
|
|
—
|
|
0.1
|
|
5
|
|
3.8
|
|
—
|
|
—
|
Total
|
|
1
|
|
0.5
|
|
5
|
|
3.8
|
|
1
|
|
0.4
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total vertical
wells
|
|
1
|
|
0.5
|
|
—
|
|
—
|
|
1
|
|
0.4
|
Total horizontal
wells
|
|
5
|
|
4.6
|
|
9
|
|
7.3
|
|
3
|
|
3.0
|
Total
|
|
6
|
|
5.0
|
|
9
|
|
7.3
|
|
4
|
|
3.4
|
|
Callon's total
capital expenditures for the fourth quarter of 2014 are detailed
below (in thousands):
|
|
|
|
Operational capital
expenditures
|
$
|
49,637
|
Capitalized G&A
and interest
|
|
3,748
|
Total
capital expenditures, excluding acquisitions
|
|
53,385
|
|
|
|
Acquisitions
|
|
213,301
|
Total
capital expenditures
|
$
|
266,686
|
For the year ended December 31,
2014, the Company incurred a total of $217.7 million of operational capital
expenditures, including facilities, on a cash basis. Based on
extensions and discoveries of 15.7 million BOE in 2014, Callon's
"drill-bit" F&D costs (ii) were $13.91 per BOE.
First Quarter 2015 Outlook
|
|
|
|
|
|
|
Fourth
Quarter
|
|
First
Quarter
|
|
|
2014
Actual
|
|
2015
Guidance
|
Total production
(BOE/d)
|
|
7,270
|
|
7,800 -
8,100
|
%
oil
|
|
79%
|
|
80%
|
|
|
|
|
|
Expenses
|
|
|
|
|
LOE, including
workovers ($/BOE)
|
|
$11.23
|
|
$9.50 -
$10.25
|
Adjusted G&A
($/BOE)(a)
|
|
$5.89
|
|
$5.75 -
$6.25
|
Recurring cash component
|
|
76%
|
|
85%
|
Production taxes,
including ad valorem (% of unhedged revenues)
|
|
6.6%
|
|
7.0%
|
|
|
|
|
(a)
|
Excludes certain
non-recurring expenses and non-cash valuation adjustments. See the
reconciliation provided within the Non-GAAP financial measures and
reconciliations section of this press release for a reconciliation
of G&A expense on a GAAP basis to Adjusted G&A
expense.
|
Production. Production volumes are anticipated to
sequentially increase approximately 10% in the first quarter of
2015 over the fourth quarter of 2014. Guidance includes the impact
of adverse weather conditions on operations and marketing that was
experienced in early January and, recently, in late
February.
LOE, including workovers. Lease operating expenses in the
first quarter of 2015 are expected to reflect the impact of lower
workover expenses due to a reduced level of remediation investment
into mature vertical wells in a lower commodity price environment,
combined with service cost reductions that are forecast to be
increasingly realized over the course of the year.
Adjusted G&A. Adjusted G&A (which excludes
certain non-recurring expenses and non-cash incentive share-based
compensation valuation adjustments) is anticipated to be lower on a
per unit basis due to increased production volumes combined with
the partial realization of recently implemented corporate cost
reduction initiatives. These initiatives include staffing level
reductions that are forecast to reduce total cash G&A
(including expensed and capitalized components) by approximately
20% in future quarters. The cash component of Adjusted G&A in
the first quarter of 2015 is expected to be 85% after adjusting for
corporate depreciation and amortization and stock-based
compensation expense.
Production taxes, including ad valorem. The aggregate
amount of production taxes, including ad valorem, is estimated to
be approximately 7.0% of total unhedged revenues in the first
quarter of 2015, similar to recent historical results.
__________________________________
|
i.
|
See "Non-GAAP
Financial Measures and Reconciliations" included within this
release for related disclosures and calculations
|
ii.
|
"Drill-bit" finding
and development ("F&D") costs are defined as the quotient of
operational capital expenditures divided by total extensions and
discoveries, excluding acquisitions
|
|
|
Non-GAAP Financial Measures and Reconciliations
This news release refers to non-GAAP financial measures as
"discretionary cash flow," "Adjusted income," "Adjusted G&A"
and "Adjusted EBITDA." These measures, detailed below, are provided
in addition to, and not as an alternative for, and should be read
in conjunction with, the information contained in our financial
statements prepared in accordance with GAAP (including the notes),
included in our SEC filings and posted on our website.
- Callon believes that the non-GAAP measure of discretionary cash
flow is useful as an indicator of an oil and gas exploration and
production company's ability to internally fund exploration and
development activities and to service or incur additional debt. The
Company also has included this information because changes in
operating assets and liabilities relate to the timing of cash
receipts and disbursements which the company may not control and
may not relate to the period in which the operating activities
occurred.
- We believe that the non-GAAP measure of Adjusted income and
Adjusted income per diluted share are useful to investors because
they provide readers with a meaningful measure of our profitability
before recording certain items whose timing or amount cannot be
reasonably determined. These measures exclude the net of tax
effects of certain non-recurring items and non-cash valuation
adjustments, which are detailed in the reconciliation provided
below. Prior to being tax-effected and excluded, the amounts
reflected in the determination of Adjusted income and Adjusted
income per diluted share below were computed in accordance with
GAAP.
- Callon believes that the non-GAAP measure of Adjusted G&A
is useful to investors because it provides readers with a
meaningful measure of our recurring G&A expense and provides
for greater comparability period-over-period. The table below
details all adjustments to G&A on a GAAP basis to arrive at
Adjusted G&A.
- We calculate Adjusted Earnings before Interest, Income Taxes,
Depreciation, Depletion and Amortization ("Adjusted EBITDA") as
Adjusted income plus interest expense, income tax expense (benefit)
and depreciation, depletion and amortization expense. Adjusted
EBITDA is not a measure of financial performance under GAAP.
Accordingly, it should not be considered as a substitute for net
income (loss), operating income (loss), cash flow provided by
operating activities or other income or cash flow data prepared in
accordance with GAAP. However, we believe that Adjusted EBITDA
provides additional information with respect to our performance or
ability to meet its future debt service, capital expenditures and
working capital requirements. Because Adjusted EBITDA excludes
some, but not all, items that affect net income (loss) and may vary
among companies, the Adjusted EBITDA we present may not be
comparable to similarly titled measures of other companies.
The following table reconciles net cash flow provided by
operating activities to discretionary cash flow for the periods
indicated (in thousands):
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2014
|
|
September 30,
2014
|
|
December 31,
2013
|
Discretionary cash
flow (a)
|
$
|
27,600
|
|
$
|
23,027
|
|
$
|
15,826
|
Net
working capital changes and other changes
|
|
9,090
|
|
|
(927)
|
|
|
3,289
|
Net cash flow
provided by operating activities (a)
|
$
|
36,690
|
|
$
|
22,100
|
|
$
|
19,115
|
|
|
|
|
(a)
|
Includes $525, $1,814
and $20 of asset retirement obligations related to discontinued
Gulf of Mexico operations in the three month periods ended December
31, 2014, September 30, 2014, and December 31, 2013,
respectively.
|
The following tables reconcile income (loss) available to common
stockholders to Adjusted income (in thousands; reconciling items
are reflected net of tax):
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2014
|
|
September 30,
2014
|
|
December 31,
2013
|
Income (loss)
available to common stockholders
|
$
|
16,988
|
|
$
|
10,227
|
|
$
|
1,291
|
Net gain
on derivative contracts, net of settlements
|
|
(14,249)
|
|
|
(6,764)
|
|
|
(47)
|
Cash-settled restricted stock unit awards, net
of settlements
|
|
(1,713)
|
|
|
(974)
|
|
|
1,188
|
Withdrawn proxy contest expenses
|
|
65
|
|
|
65
|
|
|
89
|
Gain
(loss) on early redemption of debt
|
|
1,985
|
|
|
—
|
|
|
(2,402)
|
Impairment related to equipment
|
|
—
|
|
|
—
|
|
|
1,110
|
Adjusted
income
|
$
|
3,076
|
|
$
|
2,554
|
|
$
|
1,227
|
Adjusted income per
fully diluted common share
|
$
|
0.05
|
|
$
|
0.06
|
|
$
|
0.03
|
The following tables reconcile net income (loss) to Adjusted
EBITDA for the periods indicated (in thousands):
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2014
|
|
September 30,
2014
|
|
December 31,
2013
|
Net income
|
$
|
18,962
|
|
$
|
12,201
|
|
$
|
3,264
|
Net gain
on derivative contracts, net of settlements
|
|
(21,921)
|
|
|
(10,406)
|
|
|
(73)
|
Non-cash
stock-based compensation expense
|
|
(1,941)
|
|
|
(1,031)
|
|
|
2,584
|
Loss on
early redemption of debt
|
|
3,054
|
|
|
—
|
|
|
(3,696)
|
Impairment of other property and equipment
|
|
—
|
|
|
—
|
|
|
1,707
|
Withdrawn proxy contest expenses
|
|
100
|
|
|
100
|
|
|
137
|
Acquisition expense
|
|
668
|
|
|
—
|
|
|
—
|
Income
tax expense
|
|
10,504
|
|
|
7,161
|
|
|
2,154
|
Interest
expense
|
|
4,765
|
|
|
2,205
|
|
|
1,625
|
Depreciation, depletion and amortization
|
|
18,521
|
|
|
16,517
|
|
|
10,725
|
Accretion expense
|
|
223
|
|
|
202
|
|
|
229
|
Adjusted
EBITDA
|
$
|
32,935
|
|
$
|
26,949
|
|
$
|
18,656
|
The following tables reconcile total G&A to Adjusted G&A
for the periods indicated (in thousands):
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2014
|
|
September 30,
2014
|
|
December 31,
2013
|
Total
G&A
|
$
|
1,402
|
|
$
|
3,261
|
|
$
|
6,424
|
Withdrawn proxy contest
|
|
(100)
|
|
|
(100)
|
|
|
(137)
|
Fair
value adjustment of cash-settled restricted stock unit
awards
|
|
2,635
|
|
|
1,499
|
|
|
(1,827)
|
Adjusted
G&A
|
$
|
3,937
|
|
$
|
4,660
|
|
$
|
4,460
|
The following table presents summary information for the periods
indicated, and are followed by the Company's financial
statements.
|
|
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
December 31,
2014
|
|
September 30,
2014
|
|
December 31,
2013
|
Net
production:
|
|
|
|
|
|
|
|
|
Oil
(MBbls)
|
|
529
|
|
|
425
|
|
|
250
|
Natural
gas (MMcf)
|
|
839
|
|
|
565
|
|
|
622
|
Total
production (MBOE)
|
|
669
|
|
|
519
|
|
|
354
|
Average
daily production (BOE/d)
|
|
7,270
|
|
|
5,641
|
|
|
3,848
|
% oil
(BOE basis)
|
|
79%
|
|
|
82%
|
|
|
71%
|
Average realized
sales price:
|
|
|
|
|
|
|
|
|
Oil
(Bbl) (excluding impact of cash settled derivatives)
|
$
|
65.05
|
|
$
|
85.52
|
|
$
|
93.38
|
Oil
(Bbl) (including impact of cash settled derivatives)
|
|
78.29
|
|
|
84.35
|
|
|
96.24
|
Natural
gas (Mcf) (excluding impact of cash settled derivatives)
|
$
|
4.78
|
|
$
|
5.86
|
|
$
|
5.03
|
Natural
gas (Mcf) (including impact of cash settled derivatives)
|
|
4.85
|
|
|
5.92
|
|
|
4.99
|
Total
(BOE) (excluding impact of cash settled derivatives)
|
$
|
57.44
|
|
$
|
76.41
|
|
$
|
74.78
|
Total
(BOE) (including impact of cash settled derivatives)
|
|
68.01
|
|
|
75.52
|
|
|
76.72
|
Oil and natural
gas revenues (in thousands):
|
|
|
|
|
|
|
|
|
Oil
revenue
|
$
|
34,409
|
|
$
|
36,346
|
|
$
|
23,345
|
Natural
gas revenue
|
|
4,009
|
|
|
3,311
|
|
|
3,126
|
Total
|
$
|
38,418
|
|
$
|
39,657
|
|
$
|
26,471
|
Additional per BOE
data:
|
|
|
|
|
|
|
|
|
Sales
price
|
$
|
57.44
|
|
$
|
76.41
|
|
$
|
74.78
|
Lease operating
expense
|
|
11.23
|
|
|
12.08
|
|
|
11.33
|
Production
taxes
|
|
3.80
|
|
|
4.33
|
|
|
3.62
|
Operating margin
|
$
|
42.41
|
|
$
|
60.00
|
|
$
|
60.04
|
Other expenses per
BOE:
|
|
|
|
|
|
|
|
|
Depletion,
depreciation and amortization
|
$
|
27.05
|
|
$
|
31.05
|
|
$
|
29.36
|
Adjusted G&A
(a)
|
|
5.89
|
|
|
8.98
|
|
|
12.60
|
|
|
|
|
(a)
|
Excludes certain
non-recurring expenses and non-cash valuation adjustments. See the
reconciliation provided within the Non-GAAP financial measures and
reconciliations section of this press release for a reconciliation
of G&A expense on a GAAP basis to Adjusted G&A
expense.
|
Callon Petroleum
Company
Consolidated
Balance Sheets
(in thousands,
except par and per share values and share data)
|
|
|
|
|
|
|
|
December 31,
2014
|
|
December 31,
2013
|
ASSETS
|
|
|
|
|
|
Current
assets:
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
968
|
|
$
|
3,012
|
Accounts
receivable
|
|
30,198
|
|
|
20,586
|
Deferred tax
asset
|
|
—
|
|
|
3,843
|
Fair value of
derivatives
|
|
27,850
|
|
|
60
|
Other current
assets
|
|
1,441
|
|
|
2,063
|
Total current
assets
|
|
60,457
|
|
|
29,564
|
Oil and natural gas
properties, full cost accounting method:
|
|
|
|
|
|
Evaluated properties
|
|
2,077,985
|
|
|
1,701,577
|
Less
accumulated depreciation, depletion and amortization
|
|
(1,478,355)
|
|
|
(1,420,612)
|
Net oil
and natural gas properties
|
|
599,630
|
|
|
280,965
|
Unevaluated properties
|
|
142,525
|
|
|
43,222
|
Total oil and natural
gas properties
|
|
742,155
|
|
|
324,187
|
Other property and
equipment, net
|
|
7,118
|
|
|
7,255
|
Restricted
investments
|
|
3,810
|
|
|
3,806
|
Deferred tax
asset
|
|
44,688
|
|
|
57,765
|
Deferred financing
costs
|
|
18,200
|
|
|
1,098
|
Other assets,
net
|
|
342
|
|
|
278
|
Total
assets
|
$
|
876,770
|
|
$
|
423,953
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
Accounts payable and
accrued liabilities
|
$
|
76,753
|
|
$
|
53,447
|
Accrued
interest
|
|
5,993
|
|
|
17
|
Cash-settled
restricted stock unit awards
|
|
3,856
|
|
|
4,173
|
Asset retirement
obligations
|
|
4,747
|
|
|
4,120
|
Deferred tax
liability
|
|
6,214
|
|
|
—
|
Fair value of
derivatives
|
|
1,249
|
|
|
1,036
|
Total current
liabilities
|
|
98,812
|
|
|
62,793
|
13% senior
notes:
|
|
|
|
|
|
Principal outstanding
|
|
—
|
|
|
48,481
|
Deferred
credit, net of accumulated amortization of $0 and $26,239,
respectively
|
|
—
|
|
|
5,267
|
Total 13% senior
notes
|
|
—
|
|
|
53,748
|
Senior secured
revolving credit facility
|
|
35,000
|
|
|
22,000
|
Secured second lien
term loan
|
|
300,000
|
|
|
—
|
Asset retirement
obligations
|
|
1,927
|
|
|
2,612
|
Cash-settled
restricted stock unit awards
|
|
7,175
|
|
|
3,409
|
Other long-term
liabilities
|
|
121
|
|
|
297
|
Total
liabilities
|
|
443,035
|
|
|
144,859
|
Stockholders'
equity:
|
|
|
|
|
|
Preferred stock,
series A cumulative, $0.01 par value and $50.00 liquidation
preference, 2,500,000 shares authorized: 1,578,948 and 1,578,948
shares outstanding, respectively
|
|
16
|
|
|
16
|
Common stock, $0.01
par value, 110,000,000 and 60,000,000 shares authorized; 55,225,288
and 40,345,456 shares outstanding, respectively
|
|
552
|
|
|
404
|
Capital in excess of
par value
|
|
526,162
|
|
|
401,540
|
Accumulated
deficit
|
|
(92,995)
|
|
|
(122,866)
|
Total stockholders'
equity
|
|
433,735
|
|
|
279,094
|
Total liabilities and
stockholders' equity
|
$
|
876,770
|
|
$
|
423,953
|
Callon Petroleum
Company
Consolidated
Statements of Operations
(in thousands,
except per share data)
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended
December 31,
|
|
2014
|
|
2013
|
|
2012
|
Operating
revenues:
|
|
|
|
|
|
|
|
|
Oil
sales
|
$
|
139,374
|
|
$
|
88,960
|
|
$
|
96,584
|
Natural
gas sales
|
|
12,488
|
|
|
13,609
|
|
|
14,149
|
Total operating
revenues
|
|
151,862
|
|
|
102,569
|
|
|
110,733
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
Lease
operating expenses
|
|
22,372
|
|
|
19,779
|
|
|
23,330
|
Production taxes
|
|
8,973
|
|
|
4,133
|
|
|
3,224
|
Depreciation, depletion and amortization
|
|
56,724
|
|
|
43,967
|
|
|
49,701
|
General
and administrative
|
|
25,109
|
|
|
20,534
|
|
|
20,358
|
Accretion expense
|
|
826
|
|
|
1,785
|
|
|
2,253
|
Gain on
sale of other property and equipment
|
|
(1,080)
|
|
|
—
|
|
|
—
|
Impairment of other property and equipment
|
|
—
|
|
|
1,707
|
|
|
1,177
|
Acquisition expense
|
|
668
|
|
|
—
|
|
|
—
|
Total operating
expenses
|
|
113,592
|
|
|
91,905
|
|
|
100,043
|
Income
from operations
|
|
38,270
|
|
|
10,664
|
|
|
10,690
|
Other (income)
expenses:
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
9,772
|
|
|
6,094
|
|
|
9,108
|
Gain on
early extinguishment of debt
|
|
(151)
|
|
|
(3,696)
|
|
|
(1,366)
|
(Gain)
loss on derivative contracts
|
|
(31,736)
|
|
|
1,360
|
|
|
(1,717)
|
Other
income
|
|
(515)
|
|
|
(485)
|
|
|
(79)
|
Total other (income)
expense
|
|
(22,630)
|
|
|
3,273
|
|
|
5,946
|
Income
before income taxes
|
|
60,900
|
|
|
7,391
|
|
|
4,744
|
Income tax
expense
|
|
23,134
|
|
|
3,104
|
|
|
2,223
|
Income before equity
in earnings of Medusa Spar LLC
|
|
37,766
|
|
|
4,287
|
|
|
2,521
|
Equity
in earnings of Medusa Spar LLC
|
|
—
|
|
|
17
|
|
|
226
|
Net income
|
|
37,766
|
|
|
4,304
|
|
|
2,747
|
Preferred stock
dividends
|
|
(7,895)
|
|
|
(4,627)
|
|
|
—
|
Income (loss)
available to common stockholders
|
$
|
29,871
|
|
$
|
(323)
|
|
$
|
2,747
|
Income (loss)
per common share:
|
|
|
|
|
|
|
|
|
Basic
|
$
|
0.67
|
|
$
|
(0.01)
|
|
$
|
0.07
|
Diluted
|
$
|
0.65
|
|
$
|
(0.01)
|
|
$
|
0.07
|
|
|
|
|
|
|
|
|
|
Shares
used in computing income (loss) per common share:
|
|
|
|
|
|
|
|
|
Basic
|
|
44,848
|
|
|
40,133
|
|
|
39,522
|
Diluted
|
|
45,961
|
|
|
40,133
|
|
|
40,337
|
Callon Petroleum
Company
Consolidated
Statements of Cash Flows
(in
thousands)
|
|
|
|
|
|
|
|
|
|
|
For the Year Ended
December 31,
|
|
2014
|
|
2013
|
|
2012
|
Cash flows from
operating activities:
|
|
|
|
|
|
|
|
|
Net income
|
$
|
37,766
|
|
$
|
4,304
|
|
$
|
2,747
|
Adjustments to
reconcile net income to cash provided by operating
activities:
|
|
|
|
|
|
|
|
|
Depreciation, depletion and amortization
|
|
58,014
|
|
|
45,393
|
|
|
51,043
|
Accretion expense
|
|
826
|
|
|
1,785
|
|
|
2,253
|
Amortization of non-cash debt related items
|
|
1,272
|
|
|
471
|
|
|
402
|
Amortization of deferred credit
|
|
(487)
|
|
|
(3,164)
|
|
|
(3,086)
|
Equity
in earnings of Medusa Spar LLC
|
|
—
|
|
|
(17)
|
|
|
(226)
|
Deferred
income tax expense
|
|
23,134
|
|
|
2,778
|
|
|
2,223
|
Net loss
(gain) on derivatives, net of settlements
|
|
(27,650)
|
|
|
2,730
|
|
|
(1,683)
|
Impairment of other property and equipment
|
|
—
|
|
|
1,707
|
|
|
1,176
|
Gain on
sale of other property and equipment
|
|
(1,080)
|
|
|
—
|
|
|
—
|
Non-cash
gain on early debt extinguishment
|
|
(151)
|
|
|
(3,696)
|
|
|
(1,366)
|
Non-cash
expense related to equity share-based awards
|
|
1,126
|
|
|
2,092
|
|
|
1,697
|
Change
in the fair value of liability share-based awards
|
|
3,936
|
|
|
2,903
|
|
|
1,620
|
Payments
to settle asset retirement obligations
|
|
(3,808)
|
|
|
(721)
|
|
|
(1,314)
|
Changes
in current assets and liabilities:
|
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
(7,915)
|
|
|
(3,497)
|
|
|
(883)
|
Other current
assets
|
|
622
|
|
|
(560)
|
|
|
100
|
Current
liabilities
|
|
12,805
|
|
|
3,583
|
|
|
1,753
|
Payments
to settle vested liability share-based awards
|
|
(3,469)
|
|
|
(239)
|
|
|
(3,383)
|
Change
in other long-term liabilities
|
|
(106)
|
|
|
(711)
|
|
|
103
|
Change
in other assets, net
|
|
(448)
|
|
|
(666)
|
|
|
(1,886)
|
Net cash provided
by operating activities
|
|
94,387
|
|
|
54,475
|
|
|
51,290
|
Cash flows from
investing activities:
|
|
|
|
|
|
|
|
|
Capital
expenditures
|
|
(232,596)
|
|
|
(159,724)
|
|
|
(133,299)
|
Acquisition
|
|
(222,883)
|
|
|
(10,885)
|
|
|
(2,075)
|
Proceeds from sales
of mineral interest and equipment
|
|
2,978
|
|
|
89,992
|
|
|
39,936
|
Distribution from
Medusa Spar LLC
|
|
—
|
|
|
813
|
|
|
1,735
|
Net cash used in
investing activities
|
|
(452,501)
|
|
|
(79,804)
|
|
|
(93,703)
|
Cash flows from
financing activities:
|
|
|
|
|
|
|
|
|
Borrowings on credit
facility
|
|
132,500
|
|
|
80,000
|
|
|
53,000
|
Borrowings on term
loan
|
|
382,500
|
|
|
—
|
|
|
—
|
Payments on credit
facility
|
|
(119,500)
|
|
|
(68,000)
|
|
|
(43,000)
|
Payments on term
loan
|
|
(84,149)
|
|
|
—
|
|
|
—
|
Payment of deferred
financing costs
|
|
(19,779)
|
|
|
(146)
|
|
|
—
|
Redemption of 13%
senior notes
|
|
(50,057)
|
|
|
(50,060)
|
|
|
(10,225)
|
Issuance of preferred
stock
|
|
—
|
|
|
70,035
|
|
|
—
|
Issuance of common
stock
|
|
122,450
|
|
|
—
|
|
|
—
|
Payment of preferred
stock dividends
|
|
(7,895)
|
|
|
(4,627)
|
|
|
—
|
Taxes paid related to
exercise of employee stock options
|
|
—
|
|
|
—
|
|
|
(18)
|
Net cash provided
by (used in) financing activities
|
|
356,070
|
|
|
27,202
|
|
|
(243)
|
Net change in cash
and cash equivalents
|
|
(2,044)
|
|
|
1,873
|
|
|
(42,656)
|
Balance,
beginning of period
|
|
3,012
|
|
|
1,139
|
|
|
43,795
|
Balance,
end of period
|
$
|
968
|
|
$
|
3,012
|
|
$
|
1,139
|
Earnings Call Information
The Company will host a conference call on Thursday, March 5, 2015 to discuss fourth quarter
2014 financial and operating results.
Please join Callon Petroleum Company via the Internet for a
webcast of the conference call:
Date/Time:
|
Thursday, March 5,
2015, at 9:00 a.m. Central Time (10:00 a.m. Eastern
Time)
|
Webcast:
|
Live webcast will be
available at www.callon.com in the "Investors" section of the
website.
|
Alternatively, you may join by telephone using the following
numbers:
Toll
Free:
|
1-877-870-4263
|
Canada Toll
Free:
|
1-855-669-9657
|
International:
|
1-412-317-0790
|
Request to
join:
|
Callon Petroleum
Company conference call
|
An archive of the conference call webcast will also be available
at www.callon.com in the "Investors" section of the
website.
About Callon Petroleum
Callon Petroleum Company is an independent energy company
focused on the acquisition, development, exploration, and operation
of oil and gas properties in the Permian Basin in West Texas.
This news release is posted on the Company's website at
www.callon.com and will be archived there for subsequent
review. It can be accessed from the "News" link on the top of the
homepage.
Cautionary Statement Regarding Forward Looking
Statements
This news release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section
21E of the Securities Exchange Act of 1934. Forward-looking
statements include all statements regarding wells anticipated to be
drilled and placed on production, and associated returns on
capital, future increases in production, the Company's 2014 and
2015 guidance, capital budget amounts, reserve quantities and the
present value thereof, the implementation of the Company's business
plans and strategy, as well as statements including the words
"believe," "expect," "plans" and words of similar meaning. These
statements reflect the Company's current views with respect to
future events and financial performance. No assurances can be
given, however, that these events will occur or that these
projections will be achieved, and actual results could differ
materially from those projected as a result of certain factors.
Some of the factors which could affect our future results and could
cause results to differ materially from those expressed in our
forward-looking statements include the volatility of oil and gas
prices, ability to drill and complete wells, operational,
regulatory and environment risks, our ability to finance our
activities and other risks more fully discussed in our filings with
the Securities and Exchange Commission, including our Annual
Reports on Form 10-K, available on our website or the SEC's website
at www.sec.gov.
For further information contact:
Joe Gatto
Chief Financial Officer, Senior Vice President and Treasurer
1-800-451-1294
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/callon-petroleum-company-announces-full-year-and-fourth-quarter-2014-financial-and-operating-results-300045675.html
SOURCE Callon Petroleum Company