Southwestern Energy's First-Quarter Profit Rises 52%

By Dow Jones Business News, 
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By Anna Prior

Southwestern Energy Co.'s ( SWN ) first-quarter profit rose 52% as the oil and gas company's operating revenue was bolstered by higher gas sales.

Like other natural-gas producers, Southwestern has been hurt by beaten-down prices for natural gas. But the company has boosted production, while natural-gas prices have climbed from their previous lows.

"Our first quarter demonstrated the earnings and cash flow power of our combined Fayetteville and Marcellus assets," noted Chief Executive Steve Mueller.

In March, Southwestern agreed to buy roughly 312,000 net acres in northwest Colorado for about $180 million from fellow oil and gas company Quicksilver Resources Inc. (KWK) and Royal Dutch Shell PLC (RDSA, RDSB, RDSA.LN, RDSB.LN) unit SWEPI LP, expanding its energy assets in the Niobrara formation. The deal, expected to close in the second quarter, will give Southwestern acreage targeting crude oil, natural-gas liquids and natural gas.

In the latest period, total production of oil and gas rose 23%. The average realized price, including hedging effects, rose 23% to $4.19 for natural gas while oil prices fell 6.1% to $100.43.

Overall, Southwestern reported a profit of $194.2 million, or 55 cents a share, compared with a year-earlier profit of $127.5 million, or 36 cents a share. Excluding tax items and derivatives, adjusted profit increased to 66 cents a share from 42 cents.

Operating revenue rose 52% to $1.11 billion.

Analysts polled by Thomson Reuters expected per-share earnings of 64 cents on revenue of $970.3 million.

Gas sales rose 52% to $793.4 million, though oil sales slipped to $2.05 million from $5.4 million a year earlier.

Write to Anna Prior at anna.prior@wsj.com

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This article appears in: Energy

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