Denbury Resources Inc.
) fourth-quarter 2012 adjusted earnings of 36 cents per share
(excluding one-time items) beat the Zacks Consensus Estimate of
29 cents. However, the quarterly results were 20% below the
year-earlier adjusted earnings of 45 cents. The decline was
mainly due to lower oil and gas price realizations.
For full year 2012, adjusted profit was $1.45 per share versus
$1.44 in the prior year. The reported figure comfortably
surpassed our expectation of $1.38.
Fourth quarter total revenue of $609.2 million decreased 1.3%
year over year but surpassed the Zacks Consensus Estimate of
$573.0 million. Full year 2012 total revenue increased 6.4% year
over year to $2,456.5 million, beating the Zacks Consensus
Estimate of $2,420 million.
During 2012, production averaged 71,689 barrels of oil equivalent
per day (Boe/d) versus 65,660 Boe/d in prior year period.
During the fourth quarter, production averaged 70,116 Boe/d,
reflecting an increase of 4.3% year over year. The increase was
mainly related to the gains in tertiary.
Oil production averaged 65,368 barrels per day (up nearly 4% from
the year-ago level), representing 93% of the total volume.
Natural gas production averaged 28,486 thousand cubic feet (up
9.6%), on a daily basis.
The company's production from tertiary operations averaged 37,550
barrels per day, which represents a 20.6% increase year over
year. Contributions from new floods at Oyster Bayou and Hastings
fields and existing floods at Tinsley and Delhi fields led to the
Oil price realization (including the impact of hedges) averaged
$97.54 per barrel in the quarter, showing a decline of 5.2% year
over year, while gas prices contracted 25.2% to $5.72 per Mcf. On
an oil equivalent basis, the overall price realization was $93.26
per barrel, down almost 6% from the year-earlier level of $99.18
Cash flow from operations was $316.0 million (including the
increase in current income taxes related to the Bakken
transaction) in the reported quarter versus $387.0 million in the
year-ago quarter. Oil & natural gas capital investments were
$381.7 million (before acquisitions and capitalized interest),
down from the year-earlier level of $437.8 million.
Cash balance as of Dec 31, 2012 was $98.5 million and long-term
debt was $3,145.39 million, representing a debt-to-capitalization
ratio of 38.1%.
Denbury expects its 2013 production in the range of 68,700-71,700
Boe/d. The company's tertiary production target is 36,500-39,500
Boe/d. Capital expenditure budget is reiterated at $1 billion, of
which about 85% has been apportioned for tertiary projects, while
the remainder is for conventional projects, with special emphasis
on Cedar Creek Anticline.
Denbury carries a Zacks #3 Rank (short-term Hold rating).
However, there are other stocks in the oil and gas sector -
Access Midstream Partners, L.P.
Susser Petroleum Partners L.P.
Calumet Specialty Products Partners L.P.
) - which hold a Zacks Rank #1 (Strong Buy) and are expected to
ACCESS MIDSTRM (ACMP): Free Stock Analysis
CALUMET SPECLTY (CLMT): Free Stock Analysis
DENBURY RES INC (DNR): Free Stock Analysis
SUSSER PETRLEUM (SUSP): Free Stock Analysis
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