ATP Announces First Quarter 2009 Net Income
HOUSTON--(Business Wire)--
ATP Oil & Gas Corporation (NASDAQ:ATPG) today announced first quarter 2009 net
income, results and update.
Highlights include:
* Net income of $1.6 million or $0.05 per basic and diluted share;
* Production of 10.0 Bcfe (55% oil);
* Completed and achieved initial production from two wells, one at the Gomez Hub
in the Gulf of Mexico and one at Wenlock in the North Sea;
* Formation of ATP Infrastructure Partners, L.P. with GE Energy Financial
Services to own the ATP Innovator;
* Repaid $31.2 million of debt in March 2009 and an additional $5.2 million of
debt in May 2009 from the proceeds received relating to ATP Infrastructure.
Results of Operations
ATP recorded net income of $1.6 million or $0.05 per basic and diluted share for
the first quarter of 2009, compared to net income of $46.8 million or $1.31 per
basic and $1.29 per diluted share for the first quarter of 2008. Oil and gas
production for the first quarter of 2009 was 1.7 MMBoe (10.0 Bcfe) compared to
3.6 MMBoe (21.6 Bcfe) for the first quarter of 2008. Oil production was 0.9
MMBbls (55% of total production) and natural gas production was 4.5 Bcf for the
first quarter of 2009, compared to 1.6 MMBbls (45% of total production) and 11.8
Bcfe for the first quarter of 2008. In December of 2009, ATP sold 80% of Wenlock
and Tors in the U.K. North Sea, which impacted production for the first quarter
of 2009. Production was further impacted by curtailment of production at Gomez
due to third party pipeline repairs in the Gulf of Mexico. Revenues from oil and
gas production were $68.3 million for the first quarter of 2009, compared to
$226.0 million for the first quarter of 2008 primarily due to the drop in oil
and natural gas prices and the production details noted above. New wells at
Gomez and Wenlock and properties placed back on production following hurricane
related repairs in the Gulf of Mexico resulted in a 90% increase in production
for the first quarter of 2009 compared to the fourth quarter of 2008.
Capital Resources and Liquidity
On March 6, 2009, ATP and GE Energy Financial Services ("GE") jointly announced
the formation of ATP Infrastructure Partners, L.P. ("ATP-IP"). ATP contributed
the ATP Innovator to ATP-IP for a 49% limited partner interest and a 2% general
partner interest. GE contributed $150.0 million to ATP-IP for a 49% limited
partner interest. The ATP Innovator is the floating production facility located
on Mississippi Canyon Block 711, currently serving the Gomez Hub.The transaction
was effective June 1, 2008 and allows ATP exclusive use of the ATP Innovator
during the term of the Platform Use Agreement. ATP remains the operator and
continues to hold a 100% working interest in the Gomez field and its oil and gas
reserves. Under the partnership agreements, ATP will pay to ATP-IP a minimum fee
or a per unit charge for all hydrocarbons processed by the ATP Innovator, and
all partners will be entitled to future quarterly cash distributions in
accordance with the provisions of the agreement. As a result of this
transaction, ATP reduced its long term debt by $31.2 million in March of 2009
and will reduce debt by another $5.2 million in May of 2009.
Working capital, as defined in ATP`s Senior Secured Credit Facility was $43.4
million as of March 31, 2009. ATP had unrestricted cash of $103.4 million and
restricted cash of $13.5 million at March 31, 2009, as a result of the
successful well at Gomez in the first quarter of 2009, the $13.5 million of
restricted cash was released in April of 2009. During the first quarter of 2009,
ATP incurred $33.5 million of interest expense. ATP capitalized $20.9 million of
this interest, which was directly associated with the construction of the ATP
Titan and the Octabuoy. For the quarter ended March 31, 2009, ATP was in
compliance with all the terms of its credit agreement. Further, based on the
Company`s projections, ATP believes that it will remain in compliance with all
of its financial covenants throughout 2009.
During the first quarter 2009 ATP incurred $167.0 million of capital
expenditures on oil and gas properties. These expenditures were incurred
predominately at ATP`s three major 2009 developments, the Gomez Hub and the
Telemark Hub in the Gulf of Mexico and Wenlock in the North Sea. In March 2009,
ATP placed on production the Gomez #8 well and the Wenlock #2 well. ATP is
currently drilling the #3 well at Wenlock and expects the well to be completed
and on production during the second quarter of 2009. ATP is tightening its
estimated capital expenditure for 2009 to $300 million to $400 million from the
previously announced estimate of $300 million to $500 million. The focus of
ATP`s remaining program for 2009 will center on finalizing the drilling and
completion of the Wenlock #3 well and achieving first production at ATP`s
Telemark Hub. ATP anticipates funding its capital program in 2009 from cash on
hand and cash generated from operations. In addition, ATP is actively pursuing
the sale of certain infrastructure assets and selected oil and gas properties to
further reduce debt and improve liquidity.
Three Months Ended
March 31,
2009 2008
Production
Natural gas (MMcf) 4,474 11,844
Gulf of Mexico 3,887 6,465
North Sea 587 5,379
Oil and condensate (MBbls) 915 1,622
Gulf of Mexico 914 1,610
North Sea 1 12
Natural gas, oil and condensate
Per Mcfe 9,963 21,574
Per Boe 1,661 3,596
Average Prices (1)
Natural gas (per Mcf) $ 4.74 $ 8.96
Gulf of Mexico 4.60 9.28
North Sea 5.74 8.57
Oil and condensate (per Bbl) 38.97 73.96
Natural gas, oil and condensate
Per Mcfe $ 5.71 $ 10.48
Per Boe 34.26 62.88
Deferred Revenue Recognized ($000's)
Natural gas $ 1,956 $ -
Oil and condensate 9,404 -
Total 11,360 -
Gain (Loss) on Oil and Gas Derivatives ($000's)
Natural gas contracts
Realized or settled during the period $ 16,361 $ -
Unrealized (116 ) -
Oil and condensate contracts
Realized or settled during the period - -
Unrealized - -
Total 16,245 -
(1) Includes the effect of cash flow hedges in 2008. Effective January 1, 2009,
four U.K. contracts are accounted for as hedges and aggregate net settlements
during the quarter of $(0.3) million are reflected in the average oil and gas
prices noted above.
First Quarter 2009 Conference Call
ATP Oil & Gas Corporation (NASDAQ:ATPG) will host a conference call on Thursday,
May 7, at 10 am central time to discuss the company`s first quarter results,
followed by a Q&A session.
Date:Thursday, May 7, 2009
Time:11:00 am ET; 10:00 am CT; 9:00 am MT and 8:00 am PT
ATP invites interested persons to listen to the live webcast on the company`s
website at www.atpog.com. Phone participants should dial (888) 204-4317. A
digital replay of the conference call will be available at (888) 203-1112, ID#
4610958, for a period of 24 hours beginning at 1:00 pm CT, and the webcast will
be archived for 30 business days at www.atpog.com.
About ATP Oil & Gas Corporation
ATP Oil & Gas is an international offshore oil and gas development and
production company with operations in the Gulf of Mexico and the North Sea. The
company trades publicly as ATPG on the NASDAQ Global Select Market. For more
information about ATP Oil & Gas Corporation, visit www.atpog.com.
Forward-looking Statements
Certain statements included in this news release are "forward-looking
statements" under the Private Securities Litigation Reform Act of 1995. ATP
cautions that assumptions, expectations, projections, intentions, or beliefs
about future events may, and often do, vary from actual results and the
differences can be material. Some of the key factors which could cause actual
results to vary from those ATP expects include changes in natural gas and oil
prices, the timing of planned capital expenditures, availability of
acquisitions, uncertainties in estimating proved reserves and forecasting
production results, operational factors affecting the commencement or
maintenance of producing wells, the condition of the capital markets generally,
as well as ATP`s ability to access them, and uncertainties regarding
environmental regulations or litigation and other legal or regulatory
developments affecting our business. More information about the risks and
uncertainties relating to ATP`s forward-looking statements are found in the
Company`s SEC filings.
CONSOLIDATED BALANCE SHEETS
(In Thousands)
March 31, December 31,
2009 2008
Assets
Current assets:
Cash and cash equivalents $ 103,380 $ 214,993
Restricted cash 13,500 -
Accounts receivable (net of allowance of $352 and $352, respectively) 74,485 93,915
Deferred tax asset 36,167 39,150
Derivative asset 20,194 15,366
Other current assets 18,077 11,954
Total current assets 265,803 375,378
Oil and gas properties:
Oil and gas properties (using the successful efforts method of accounting):
Proved properties 2,956,315 2,802,315
Unproved properties 15,593 14,705
2,971,908 2,817,020
Less: Accumulated depletion, impairment and amortization (977,545 ) (944,817 )
Oil and gas properties, net 1,994,363 1,872,203
Furniture and fixtures, net 479 470
Deferred financing costs, net 12,556 13,493
Other assets, net 14,235 14,066
Total assets $ 2,287,436 $ 2,275,610
Liabilities and Shareholders' Equity
Current liabilities:
Accounts payable and accruals $ 192,735 $ 277,914
Current maturities of long-term debt 10,500 10,500
Asset retirement obligation 36,305 32,854
Derivative liability 460 8,114
Deferred tax liability 20 -
Other current liabilities 9,837 9,537
Total current liabilities 249,857 338,919
Long-term debt 1,324,927 1,356,130
Asset retirement obligation 97,548 99,254
Deferred tax liability 100,202 101,953
Derivative liability 2,703 1,194
Deferred revenue 47,870 59,229
Other liabilities 2,582 2,582
Total liabilities 1,825,689 1,959,261
Shareholders' equity:
Preferred stock: $0.001 par value - -
Common stock: $0.001 par value 36 36
Additional paid-in capital 402,531 400,334
Retained earnings 31,280 29,644
Accumulated other comprehensive loss (110,100 ) (112,754 )
Treasury stock, at cost (911 ) (911 )
Total shareholders' equity 322,836 316,349
Noncontrolling interest 138,911 -
Total equity 461,747 316,349
Total liabilities and shareholders' equity $ 2,287,436 $ 2,275,610
CONSOLIDATED INCOME STATEMENTS
(In Thousands, Except Per Share Amounts)
Three Months Ended
March 31,
2009 2008
Oil and gas revenues $ 68,256 $ 226,037
Other revenues 13,664 897
Total revenues 81,920 226,934
Costs, operating expenses and other:
Lease operating 20,214 24,618
Exploration 174 141
General and administrative 11,103 9,236
Depreciation, depletion and amortization 39,398 89,399
Impairment of oil and gas properties 8,049 -
Accretion of asset retirement obligation 2,904 4,300
Loss on abandonment 997 377
Loss on disposition of properties 148 -
Other, net - 13
Total costs, operating expenses and other 82,987 128,084
Income (loss) from operations (1,067 ) 98,850
Other income (expense):
Interest income 213 1,228
Interest expense, net (12,623 ) (28,127 )
Gain on derivatives 16,245 40
Total other income (expense) 3,835 (26,859 )
Income before income taxes 2,768 71,991
Income tax (expense) benefit:
Current (378 ) (12,436 )
Deferred 1,252 (12,710 )
Total income tax benefit (expense) 874 (25,146 )
Net income 3,642 46,845
Less amount attributable to noncontrolling interest (2,006 ) -
Net income attributable to common shareholders $ 1,636 $ 46,845
Net income per share attributable to common shareholders:
Basic $ 0.05 $ 1.31
Diluted $ 0.05 $ 1.29
Weighted average shares outstanding:
Basic 35,618 35,824
Diluted 35,706 36,247
CONSOLIDATED CASH FLOW DATA
(In Thousands)
Three Months Ended
March 31,
2009 2008
Cash flows from operating activities:
Net income $ 3,642 $ 46,845
Adjustments to operating activities 44,995 115,179
Changes in assets and liabilities (25,752 ) (344 )
Net cash provided by operating activities 22,885 161,680
Cash flows from investing activities:
Additions to oil and gas properties (234,452 ) (250,052 )
Additions to furniture and fixtures (88 ) (47 )
Increase in restricted cash (13,500 ) -
Net cash used in investing activities (248,040 ) (250,099 )
Cash flows from financing activities:
Proceeds from sale of noncontrolling interest 148,751 -
Principal payments of long-term debt (33,812 ) (3,042 )
Net profits interest payments - (3,583 )
Exercise of stock options - 28
Net cash (used in) provided by financing activities 114,939 (6,597 )
Effect of exchange rate changes on cash (1,397 ) 139
Net decrease in cash and cash equivalents (111,613 ) (94,877 )
Cash and cash equivalents, beginning of period 214,993 199,449
Cash and cash equivalents, end of period $ 103,380 $ 104,572
2009 2010 2011
2Q 3Q 4Q FY 1Q 2Q 3Q 4Q FY 1Q FY
Gulf of Mexico
Fixed Forwards & Swaps
Natural Gas
Volumes (MMMBtu) 2,725 2,750 2,750 8,225 900 900
Price ($/MMBtu) $ 6.71 $ 6.71 $ 7.07 $ 6.83 $ 5.02 $ 5.02
Collars
Natural Gas
Volumes (MMMBtu) 455 460 460 1,375 450 1,365 1,380 1,380 4,575 1,350 1,350
Floor Price ($/MMBtu) $ 4.00 $ 4.00 $ 4.00 $ 4.00 $ 4.00 $ 4.75 $ 4.75 $ 4.75 $ 4.68 $ 4.75 $ 4.75
Ceiling Price ($/MMBtu) $ 7.00 $ 7.00 $ 7.00 $ 7.00 $ 7.00 $ 7.95 $ 7.95 $ 7.95 $ 7.86 $ 7.95 $ 7.95
Puts
Crude Oil
Volumes (MBbls) 455 460 460 1,375 90 91 92 92 365
Floor Price ($/Bbl) $ 29.75 $ 29.75 $ 29.75 $ 29.75 $ 24.70 $ 24.70 $ 24.70 $ 24.70 $ 24.70
North Sea
Fixed Forwards & Swaps
Natural Gas
Volumes (MMMBtu) 455 460 759 1,674
Price ($/MMBtu)(1) $ 5.55 $ 5.55 $ 5.91 $ 5.71
Collars
Natural Gas
Volumes (MMMBtu) 450 455 460 460 1,825 270 270
Floor Price ($/MMBtu)(1) $ 5.70 $ 5.70 $ 5.70 $ 5.70 $ 5.70 $ 5.70 $ 5.70
Ceiling Price ($/MMBtu)(1) $ 8.55 $ 8.55 $ 8.55 $ 8.55 $ 8.55 $ 8.55 $ 8.55
The above are ATP's outstanding financial and physical commodity contracts.
Additional hedges, derivatives and fixed price contracts, if any, will be announced during the year.
(1) Assumes exchange rate of 1.50 USD to 1.00 GBP
ATP Oil & Gas Corporation, Houston
Chairman and CEO
T. Paul Bulmahn, 713-622-3311
or
Chief Financial Officer
Albert L. Reese Jr., 713-622-3311
www.atpog.com
Copyright Business Wire 2009
