EXHIBIT 99.1
For Information
Mark A. Hellerstein
Robert T. Hanley
303-861-8140
ST. MARY REPORTS THIRD QUARTER 2002 FINANCIAL RESULTS
DENVER, November 6, 2002- St. Mary Land & Exploration Company (Nasdaq: MARY)
today announced its earnings for third quarter 2002 of $7.7 million or 28 cents
per basic share. Third quarter 2001 earnings were $4.9 million or 17 cents per
basic share. Revenues for the third quarter of 2002 were $48.3 million compared
to $42.7 million for the third quarter of 2001. Third 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 $29.3 million in the third quarter of
2001 to $27.8 million in the third quarter of 2002. Included in third quarter
2002 income is a pre-income tax $2.6 million mark-to-market unrealized
derivative gain on an interest rate swap agreement entered into during the first
quarter 2002.
Daily oil and gas production during the third quarter 2002 averaged 143.3
million cubic feet of gas equivalent (MMCFE), down 1.6% from 145.7 MMCFE in the
comparable 2001 period. Average prices realized during the quarter were $2.97
per MCF and $26.53 per barrel, 7% and 9% higher, respectively, than the realized
prices in the third quarter of 2001.
Earnings for the first nine months of 2002 were $20.6 million or 74 cents per
basic share, compared to $39.5 million or $1.41 per basic share for the first
nine months of 2001. Revenues for the first nine months of 2002 were $141.1
million compared to $166.8 million for the same period in 2001. Discretionary
cash flow for the first nine months decreased from $111.0 million to $82.6
million. The decrease in earnings, revenue and discretionary cash flow in 2002
is primarily due to the 30% decline in natural gas prices from 2001.
An update of the Company's forecasts for the year 2002 is as follows:
4th Quarter Year
----------- ----
Oil and gas production 14.5 - 15.5 BCFE 55 - 56 BCFE
Lease operating expenses,
including production taxes and
transportation $.95-$1.05/MCFE $ .93-$.98/MCFE
General & administrative expense $ .21-$.25/MCFE $ .23-$.27/MCFE
Depreciation, depletion & amort. $.95-$1.05/MCFE $.95-$1.05/MCFE
Exploration expense $ 3.0-$5.0 MM $18.0-$21.0 MM
The current portion of income tax expense for the year is expected to
be 5%-10% of total income taxes.
The production forecast includes the impact of Hurricane Lily, which caused the
temporary shut-in of an estimated 250 MMCFE of Gulf Coast production during
October and November, and the anticipated production from the previously
announced pending acquisition of oil and gas properties from Burlington
Resources Oil & Gas Company LP, which is expected to close on December 3,
2002.
2002 EXPLORATION AND DEVELOPMENT PROGRAM
Through September 30, St. Mary has participated in a total of 105 wells with 60
successful completions and 16 dry holes (79% success rate). On September 30 the
active wells included 18 wells being completed and 11 drilling. For a detailed
summary of significant well completions in the third quarter, please refer to
the Company's release of October 2. As previously announced, the St. Mary third
quarter earnings teleconference call is scheduled for November 7 at 8:00 am
(MST). 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 November 17 at 800-642-1687, conference number 5667059.
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
5667059. 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 November 17.
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-02-15
###
Financial Highlights Follow
ST. MARY LAND & EXPLORATION COMPANY
FINANCIAL HIGHLIGHTS
Three Months Ended Nine Months Ended
September 30, % September 30, %
------------------------ ------------------------
2002 2001 Change 2002 2001 Change
------------------------ ------------------------
Unaudited in thousands, except per share)
Revenues:
Oil and gas production $45,121 $41,859 $132,411 $165,195
Gas marketing revenue 3,366 - 6,810 -
Other (152) 797 1,915 1,584
------------------------ ------------------------
48,335 42,656 141,136 166,779
------------------------ ------------------------
Operating Expenses:
Oil and gas production costs 12,392 14,756 37,953 40,249
Depletion, depreciation & amortization 12,836 13,704 39,169 37,876
Exploration 4,219 4,347 15,432 14,858
Impairment and abandonment 587 1,235 1,906 2,553
General and administrative 4,388 2,804 10,544 10,361
Unrealized derivative loss (gain) (2,619) - (4,594) -
Gas marketing expenses 3,545 - 6,631 -
Minority interest and other 286 283 906 662
------------------------ ------------------------
35,634 37,129 107,947 106,559
------------------------ ------------------------
Income from operations 12,701 5,527 33,189 60,220
Interest income 288 73 568 408
Interest expense (1,110) (5) (2,580) (40)
------------------------ ------------------------
Income before income tax expense 11,879 5,595 31,177 60,588
Income tax expense - current (900) (4,452) 502 4,909
Income tax expense - deferred 5,105 5,186 10,094 16,191
------------------------ ------------------------
Net income $7,674 $4,861 $20,581 $39,488
======================== ========================
Basic weighted average
shares outstanding 27,873 27,790 27,828 28,052
======================== ========================
Basic earnings per common share: $0.28 $0.17 $0.74 $1.41
======================== ========================
Diluted weighted average
shares outstanding 28,448 28,252 28,388 28,620
======================== ========================
Diluted earnings per common share: $0.27 $0.17 $0.72 $1.38
======================== ========================
Average price:
Oil $26.53 $24.35 9% $25.07 $24.73 1%
Gas $2.97 $2.77 7% $2.86 $4.09 -30%
Margin analysis per MCFE:
Net realized price $3.42 $3.12 10% $3.26 $4.10 -21%
Oil and gas production costs $0.94 $1.10 -15% $0.93 $1.00 -7%
General and administrative costs $0.33 $0.21 58% $0.26 $0.26 0%
------------------------ ------------------------
Operating margin $2.15 $1.81 19% $2.07 $2.85 -28%
------------------------ ------------------------
Depletion, depreciation & amortization $0.97 $1.02 -5% $0.96 $0.94 3%
Production (in thousands):
Oil (Bbls) 679 609 12% 2,057 1,812 14%
Gas (MCF) 9,111 9,754 -7% 28,283 29,404 -4%
MCFE (6:1) 13,186 13,405 -2% 40,625 40,274 1%
September 30, Dec 31,
BALANCE SHEET 2002 2001
------------------------
Working Capital $63,208 $34,000
Long-term debt 99,578 64,000
Stockholders' equity 302,374 286,117
Shares outstanding 27,898 27,770
Dec 31,
PROVEN RESERVES (in thousands): 2001
------------
Domestic:
Oil (Bbls) 23,669
Gas (MCF) 241,231
------------
MCFE (6:1) 383,247
============