EXHIBIT 99.1
For Information
---------------
Mark A. Hellerstein
Robert T. Hanley
303-861-8140
ST. MARY REPORTS YEAR 2002 FINANCIAL RESULTS
DENVER, February 20, 2003 - St. Mary Land & Exploration Company (NYSE: SM)
today reported earnings of $27.6 million or $.99 per basic share for the year
ended December 31, 2002. Year 2001 earnings were $40.5 million or $1.45 per
share. Revenues for 2002 were $193.2 million compared to $207.5 million for
2001. Discretionary Cash Flow, which is computed as net income plus
depreciation, depletion, amortization, impairments, deferred taxes, exploration
expense and unrealized derivative loss decreased 14% from $138.6 million in 2001
to $118.8 million in 2002. For a presentation of net cash flows from operating
activities and a reconciliation of Discretionary Cash Flow thereto, see the
attachment.
Oil and gas production for 2002 was a record 55.1 billion cubic feet of gas
equivalent (BCFE), a 2% increase over 2001. The average realized price per MCFE
decreased $.40 to $3.37 in 2002, an 11% decrease from the average price realized
in 2001. Oil and gas reserves at December 31, 2002 increased 28% from 383 BCFE
at year-end 2001 to 491 BCFE, 88% which are proved developed.
Earnings for the fourth quarter were $7.0 million or 25 cents per basic share
compared to $1.0 million for the fourth quarter of 2001. Revenues for the fourth
quarter of 2002, which includes revenues from the properties acquired from
Burlington Resources on December 3, 2002, were $52.1 million compared to $40.7
million for the same period in 2001. Discretionary Cash Flow for the fourth
quarter increased 13% to $31.2 million. Average daily oil and gas production
during the fourth quarter 2002 totaled 156.8 MMCFE, up 4% from 150.2 MMCFE in
the comparable 2001 period. Average prices realized during the quarter were
$3.39 per Mcf and $26.06 per barrel, which were 27% and 36% higher,
respectively, than the realized prices in the fourth quarter of 2001.
St. Mary's net production from Northeast Mayfield in the Anadarko basin has
increased approximately 20 MMCFD since pipeline curtailments that restricted
production during December 2002 ended on January 25, 2003. The Company currently
has no wells restricted by pipeline capacity.
During the fourth quarter 2002 the Company recognized a pre-income tax loss of
$2.6 million on the sale of its interest in Flour Bluff, a non-operated field in
Nueces County, Texas.
The Company's general and administrative expenses increased in the fourth
quarter and for the year 2002, $2 million and $2.5 million, respectively, due to
an increase in employee incentive bonuses in 2002, an increase in other employee
related costs and the listing fee on the New York Stock Exchange.
On January 31, 2003 St. Mary acquired from Pittencrieff America, Inc. its
interest in the Fort Chadbourne Odom Lime Unit in Coke and Runnels Counties,
Texas. St. Mary has owned an interest in the Unit since 1999 and has operated
the Unit since 2001. After completing the $5.1 million acquisition, St. Mary
owns 99% of the Unit. The acquired properties are currently producing 1.8 MMCFE
per day.
The Company updated its forecast for the first quarter and the full year of 2003
as follows:
1st Quarter Year
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Production 17.5 - 19 BCFE 70 - 75 BCFE
Lease operating expenses,
including production taxes and
transportation $1.22-$1.32/MCFE $1.22-$1.32/MCFE
General and administrative exp. $.23 - $.27/MCFE $.21 - $.25/MCFE
Depreciation, depletion & amort. $1.00-$1.10/MCFE $1.00-$1.10/MCFE
As previously announced, the St. Mary year-end 2002 earnings teleconference call
is scheduled for February 21 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 through March 7 at
800-642-1687, conference number 10142. 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 10142. 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 March 7.
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," "forecast" 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.
###
Financial Highlights Follow
ST. MARY LAND & EXPLORATION COMPANY
FINANCIAL HIGHLIGHTS
Three Months Ended Year Ended
December 31, % December 31, %
----------------------- Change ----------------------- Change
2002 2001 2002 2001
----------------------- -----------------------
(Unaudited in thousands, except per share)
Revenues:
Oil and gas production $53,259 $38,778 $185,670 $203,973
Gas marketing revenue 1,589 420 8,399 420
Gain (loss) on sale of proved
properties (2,543) 388 (2,633) 367
Other (235) 1,104 1,770 2,709
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52,070 40,690 193,206 207,469
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Operating Expenses:
Oil and gas production costs 12,886 14,751 50,839 55,000
Depletion, depreciation &
amortization 15,263 13,470 54,432 51,346
Exploration 4,069 4,660 19,501 19,518
Impairment and abandonment 540 2,132 2,446 4,685
General and administrative 3,755 1,401 14,299 11,762
Derivative loss (gain) 1,406 1,573 (3,188) 1,573
Gas marketing expenses 1,351 420 7,982 420
Minority interest and other 300 591 1,206 1,253
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39,570 38,998 147,517 145,557
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Income from operations 12,500 1,692 45,689 61,912
Interest income 190 58 758 466
Interest expense (1,288) (50) (3,868) (90)
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Income before income tax expense 11,402 1,700 42,579 62,288
Income tax expense - current 67 (4,105) 569 804
Income tax expense - deferred 4,356 4,834 14,450 21,025
----------------------- -----------------------
Net income $6,979 $971 $27,560 $40,459
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Basic weighted avg shares outstanding 27,940 27,738 27,856 27,973
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Basic earnings per common share: $0.25 $0.04 $0.99 $1.45
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Diluted weighted avg shares outstanding 28,608 28,189 28,391 28,555
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Diluted earnings per common share: $0.24 $0.03 $0.97 $1.42
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Average price:
Oil (per Bbl) $26.06 $19.10 36% $25.34 $23.29 9%
Gas (per Mcf) $3.39 $2.67 27% $3.00 $3.73 -20%
Margin analysis per MCFE:
Net realized price $3.69 $2.81 31% $3.37 $3.77 -11%
Oil and gas production costs $0.89 $1.07 -17% $0.92 $1.02 -9%
General and administrative costs $0.26 $0.10 160% $0.26 $0.22 18%
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Operating margin $2.54 $1.64 55% $2.19 $2.54 -14%
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Depletion, depreciation &
amortization $1.06 $0.97 9% $0.99 $0.95 4%
Production (in thousands):
Oil (Bbls) 758 622 22% 2,815 2,434 16%
Gas (Mcf) 9,880 10,087 -2% 38,164 39,491 -3%
MCFE (6:1) 14,430 13,819 4% 55,055 54,093 2%
Dec 31, Dec 31, Reconciliation of Discretionary Cash
BALANCE SHEET 2002 2001 Flow to Cash Provided by Operations:
----------------------- -----------------------------------------
Working Capital $2,050 $34,000
Long-term debt 113,601 64,000 Discretionary Cash Flow $118,762
Stockholders' equity 299,513 286,117
(Gain) loss on sales 1,797
Shares outstanding 27,972 27,770 Non-expl dry hole exploration exp (11,824)
Minority interest & other 40
Dec 31, Dec 31, Changes in working capital 32,934
PROVEN RESERVES (in thousands): 2002 2001
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Domestic: Cash provided by operations $141,709
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Oil (Bbls) 36,119 23,669 53%
Gas (Mcf) 274,172 241,231 14%
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MCFE (6:1) 490,887 383,247 28%
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