Exhibit 99.1
For Information
Mark A. Hellerstein
Robert T. Hanley
303-861-8140
ST. MARY REPORTS EARNINGS FOR SECOND QUARTER 2002
DENVER, August 7, 2002- St. Mary Land amp; Exploration Company (Nasdaq:
MARY) today announced its earnings for second quarter 2002 of $10.6 million or
38 cents per basic share. Second quarter 2001 earnings were $14.2 million or 51
cents per basic share. Revenues for the second quarter of 2002 were $50.0
million compared to $55.8 million for the second quarter of 2001. Second quarter
discretionary cash flow, which is computed as net income plus depreciation,
depletion, amortization, impairments, deferred taxes and exploration expense,
less the unrealized derivative gain, decreased from $34.3 million in the second
quarter of 2001 to $33.2 million in the second quarter of 2002.
Earnings for the first six months of 2002 were $12.9 million or 46 cents per
basic share, compared to $34.6 million or $1.23 per basic share for the first
six months of 2001. Revenues for the first six months of 2002 were $92.8 million
compared to $124.1 million for the same period in 2001. Discretionary cash flow
for the first six months decreased from $81.6 million to $57.9 million.
Daily oil and gas production during the second quarter 2002 averaged 150.1
million cubic feet of gas equivalent (MMCFE), up slightly from 149.6 MMCFE in
the comparable 2001 period. Average prices realized during the quarter were
$3.03 per MCF and $25.39 per barrel compared to $4.08 per MCF and $24.30 per
barrel realized in the second quarter of 2001.
Mark Hellerstein, President and CEO commented, "The decline in revenue for the
second quarter 2002 compared to the second quarter 2001 was primarily due to the
26% decline in realized natural gas prices, which was partially offset by $2.9
million of gas marketing revenue. After the acquisition of a gas gathering
system included in the Merchant acquisition made earlier this year, we began
recognizing gas marketing revenue and operating expense separately. Included in
second quarter 2002 income is a pre-income tax $2.3 million mark-to-market
unrealized derivative gain on an interest rate swap agreement entered into
during the first quarter 2002."
An update of the Company's forecasts for the year 2002 is as follows:
Year
Oil and Gas Production 56 - 59 BCFE
Lease operating expenses,
including production taxes and
transportation $.90 - $1.00/MCFE
General amp; administrative expense $.20 - $.24/MCFE
Depreciation, depletion amp; amort. $.95 - $1.05/MCFE
Exploration expense $18.0 - $22.0 MM
The current portion of income tax expense for the year is expected to be
10%-20% of total income taxes.
An operational update for the second quarter 2002 was provided in the Company's
July 8, 2002 press release.
As previously announced, the St. Mary second quarter earnings teleconference
call is scheduled for August 8 at 8:00 am (MDT). The call participation number
is 888-424-5231. A digital recording of the conference call will be available
two hours after the completion of the call, 24 hours per day until August 19 at
800-642-1687, conference number 4818567. International participants can dial
706-634-6088 to take part in the conference call, and can access a replay of the
call at 706-645-9291, conference number 4818567. In addition the call will be
broadcast live online at www.stmaryland.com. An audio recording of the
conference call will be available at that site through August 19.
This release contains forward looking statements within the meaning of
securities laws, including forecasts and projections for future periods. The
words "will," "believe," "anticipate," "intend," "estimate," and "expect" and
similar expressions are intended to identify forward looking statements. These
statements involve known and unknown risks, which may cause St. Mary's actual
results to differ materially from results expressed or implied by the forward
looking statements. These risks include such factors as the volatility and level
of oil and natural gas prices, production rates and reserve replacement, reserve
estimates, drilling and operating service availability and uncertainties in cash
flow, the financial strength of hedge contract counterparties, the availability
of attractive exploration and development and property acquisition opportunities
and any necessary financing, expected acquisition benefits, competition,
litigation, environmental matters, the potential impact of government
regulations, and other such matters discussed in the "Risk Factors" section of
St. Mary's 2001 Annual Report on Form 10-K filed with the SEC. Although St. Mary
may from time to time voluntarily update its prior forward looking statements,
it disclaims any commitment to do so except as required by securities laws.
PR-02-12
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Financial Highlights Follow
ST. MARY LAND amp; EXPLORATION COMPANY
FINANCIAL HIGHLIGHTS
Three Months Ended Six Months Ended
June 30, % June 30, %
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2002 2001 Change 2002 2001 Change
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(Unaudited in thousands, except per share)
Revenues:
Oil and gas production $46,197 $55,421 $87,290 $123,336
Gas marketing revenue 2,939 - 3,444 -
Other 892 355 2,067 787
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50,028 55,776 92,801 124,123
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Operating Expenses:
Oil and gas production costs 11,531 13,436 25,561 25,493
Depletion, depreciation amp; amortization 13,279 12,884 26,333 24,172
Exploration 4,297 2,149 11,213 10,511
Impairment and abandonment 622 681 1,319 1,318
General and administrative 3,015 3,536 6,156 7,557
Unrealized derivative loss (gain) (2,327) - (1,975) -
Gas marketing expenses 2,662 - 3,086 -
Minority interest and other 243 118 620 379
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33,322 32,804 72,313 69,430
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Income from operations 16,706 22,972 20,488 54,693
Interest income 170 147 280 335
Interest expense (1,018) - (1,470) (35)
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Income before income tax expense 15,858 23,119 19,298 54,993
Income tax expense - current 1,205 4,547 1,402 9,361
Income tax expense - deferred 4,064 4,338 4,989 11,005
------------------------ ------------------------
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Net income $10,589 $14,234 $12,907 $34,627
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Basic weighted average
shares outstanding 27,825 28,135 27,805 28,185
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Basic earnings per common share: $0.38 $0.51 $0.46 $1.23
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Diluted weighted average
shares outstanding 28,428 28,717 28,347 28,826
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Diluted earnings per common share: $0.37 $0.50 $0.46 $1.20
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Average price:
Oil $25.39 $24.30 4% $24.35 $24.92 -2%
Gas $3.03 $4.08 -26% $2.80 $4.75 -41%
Margin analysis per MCFE:
Net realized price $3.38 $4.07 -17% $3.18 $4.59 -31%
Oil and gas production costs $0.84 $0.99 -14% $0.93 $0.95 -2%
General and administrative costs $0.22 $0.26 -15% $0.22 $0.28 -20%
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Operating margin $2.32 $2.82 -18% $2.03 $3.36 -40%
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Depletion, depreciation amp; amortization $0.97 $0.95 3% $0.96 $0.90 7%
Production (in thousands):
Oil (Bbls) 673 595 13% 1,378 1,203 15%
Gas (MCF) 9,618 10,041 -4% 19,173 19,650 -2%
MCFE (6:1) 13,655 13,611 0% 27,440 26,868 2%
Jun 30, Dec 31,
BALANCE SHEET 2002 2001
------------------------
Working Capital $59,980 $34,000
Long-term debt 99,554 64,000
Stockholders' equity 295,625 286,117
Shares outstanding 27,857 27,770
Dec 31,
PROVEN RESERVES (in thousands): 2001
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Domestic:
Oil (Bbls) 23,669
Gas (MCF) 241,231
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MCFE (6:1) 383,247
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