* Production growth of 24%
* Proved reserve growth of 17%
* Discretionary cash flow (1) of $195.4 million
* Discretionary cash flow (1) per share of $4.50
* Net income of $23.8 million
* Earnings per share of $0.55
As previously announced, oil and gas production
for 2005 was 39.4 Bcfe compared to 31.7 Bcfe in 2004. Net
of the effect of hedging transactions, the Company's average
realized sales price for oil and gas production in 2005 was
$7.21 per Mcfe compared to an average realized sales price
in 2004 of $5.23 per Mcfe. In the fourth quarter of 2005,
production was 12.3 Bcfe, a 22% increase over the prior quarter
and a 51% increase over the comparable period of 2004. For
the fourth quarter of 2005, realized prices were $8.89 per
Mcfe compared to $5.76 per Mcfe in the fourth quarter of 2004.
Proved reserves at December 31, 2005 were 341.0 Bcfe compared
to 292.3 Bcfe at year end 2004.
For 2005, discretionary cash flow (1), a
non-GAAP measure defined below, was $195.4 million, a 91%
increase over 2004. Discretionary cash flow (1) for the fourth
quarter of 2005 was $81.3 million, a 188% increase compared
to the comparable 2004 period. On a per share basis, discretionary
cash flow (1) was $4.50 and $1.86 for the year ended 2005
and the fourth quarter of 2005, respectively.
Net income for 2005 was $23.8 million compared
to a loss for 2004 of $5.3 million. In the fourth quarter
of 2005, net income was $23.3 million compared to a loss of
$9.1 million in the fourth quarter of 2004. Included in the
net income for 2005 were impairments related to certain properties
in the Wind River Basin that totaled $42.7 million. Diluted
earnings per share were $0.55 for the year ended 2005 and
$0.53 for the fourth quarter of 2005.
Fredrick J. Barrett, Chairman and Chief
Executive Officer, commented: "We are extremely pleased that
we accomplished nearly everything we had planned for 2005.
We significantly increased proved reserves and production
organically due to our success in both development and exploration
drilling, including two high-profile discoveries. We have
grown our undeveloped acreage position to greater than 1.2
million acres and have 26 distinct exploration projects across
the Rockies. We are carrying this momentum into 2006 as our
$350 million net capital budget includes the drilling of nearly
40 exploration wells and continuing drilling in our active
development program, primarily in West Tavaputs, Williston,
and Piceance."
Capital Expenditures
For 2005, net capital expenditures totaled
$333.6 million, which was comprised of $28.2 million for the
acquisition of undeveloped properties and land, $305.8 million
for drilling, development, exploration, and exploitation of
natural gas and oil properties, $10.9 million for geologic
and geophysical costs, and $2.5 million for equipment and
other expenditures, offset by $13.8 million received in proceeds
from industry partners to pursue joint exploration projects.
The following table lists the net capital expenditures, proved
reserves, and wells spud by basin for 2005.
Net Capital
Expenditures Proved Reserves
Basin (in millions) (Bcfe) Wells spud
Piceance $129.5 114.5 80
Uinta 82.2 83.1 19
Wind River 57.8 85.8 22
Powder River 28.7 25.9 182
Williston 14.3 31.6 12
Other 21.1 0.1 8
Total $333.6 341.0 323
Conference call to discuss fourth quarter and 2005 results
The Company's year-end 2005 earnings teleconference
call is scheduled for March 2, 2006 at 2:30 p.m. (MST). The
call participation number is 800-344-0624 in the U. S. and
Canada (1-706-643-1890 outside the U. S. and Canada) and the
passcode is 4465883. A digital recording of the conference
call will be available approximately two hours after the completion
of the call, and continues through March 6, 2006 at 1-800-642-1687
in the U. S. and Canada (1-706-645-9291 outside the U. S.
and Canada) and the passcode is 4465883. In addition, the
call will be broadcast live online (audio only) and can be
accessed by going directly to the Company's website home page
at www.billbarrettcorp.com
by clicking on the link titled "Webcast." An audio recording
of the conference call will be available at that site approximately
one hour after the conference call through March 20, 2006.
Forward-Looking Statements
This press release and certain statements
in the scheduled conference call are forward-looking within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These
forward-looking statements reflect Bill Barrett Corporation's
current views with respect to future events, based on what
it believes are reasonable assumptions. No assurance can be
given, however, that these events will occur. These statements
are subject to risks and uncertainties that could cause actual
results to differ materially including, among other things,
exploration results, market conditions, oil and gas price
volatility, the availability and cost of services and materials,
uncertainties inherent in oil and gas production operations
and estimating reserves, unexpected future capital expenditures,
competition, the success of risk management activities, governmental
regulations and other factors discussed in the Company's Form
10-K for the year ended December 31, 2005 that is expected
to be filed with the Securities and Exchange Commission (www.sec.gov)
on or about March 2, 2006.
About Bill Barrett Corporation
Bill Barrett Corporation, headquartered
in Denver, explores for and develops natural gas and oil in
nine basins and the overthrust belt in the Rocky Mountain
region of the United States. Additional information about
the Company may be found on its web site www.billbarrettcorp.com.
The following is a summary of our operational
and financial highlights. Quarter ended December 31, 2004
and 2005 is unaudited.
Bill Barrett Corporation
Selected Operating Highlights
Quarter Ended Year Ended
December 31, December 31,
2005 2004 2005 2004
Production:
Natural gas (MMcf) 11,474 7,415 36,287 28,864
Oil (MBbls) 137 122 523 474
Combined volumes
(MMcfe) 12,296 8,147 39,425 31,708
Daily combined
volumes (MMcfe/d) 133.7 88.6 108.0 86.6
Average Prices
(net of the effect
of hedges):
Natural gas (per Mcf) $8.94 $5.57 $7.16 $5.10
Oil (per Bbl) 48.46 46.49 46.68 39.49
Combined (per Mcfe) 8.89 5.76 7.21 5.23
Average Costs
(per Mcfe):
Lease operating
expense $0.45 $0.44 $0.50 $0.46
Gathering and
transportation
expense 0.26 0.23 0.30 0.19
Production tax
expense 0.97 0.65 0.85 0.63
Depreciation,
depletion and
amortization 2.32 2.39 2.27 2.15
General and
administrative
(excluding
stock-based
compensation) 0.57 0.66 0.62 0.57
Year End Reserves:
Natural gas (Bcf) N/A N/A 306.0 257.8
Oil (MMBbls) N/A N/A 5.8 5.7
Combined (Bcfe) N/A N/A 341.0 292.3
PV-10 (in millions)* N/A N/A $1,050 $592
*PV-10, a non-GAAP measure, refers to the present value of future net
revenues before income taxes of our proved reserves discounted at 10%.
They were calculated using market prices for natural gas and oil at
December 31, 2005 and 2004, which, for natural gas, were $7.72 and $5.52
per million British thermal units (MMBtu), respectively, and, for oil,
were $61.04 and $43.46 per barrel (Bbl), respectively. PV-10 differs from
Standardized Measure, a GAAP measure, because Standardized Measure
includes the effect of future income taxes.
Bill Barrett Corporation
Consolidated Statements of Operations
Quarter Ended Year Ended
December 31, December 31,
2005 2004 2005 2004
(in thousands, except share and per share amounts)
Revenues:
Oil and gas
production $109,288 $46,970 $284,406 $165,843
Other 1,879 1,495 4,353 4,137
Total revenues 111,167 48,465 288,759 169,980
Operating Expenses:
Lease operating
expense 5,526 3,583 19,585 14,592
Gathering and
transportation
expense 3,233 1,877 11,950 5,968
Production tax
expense 11,911 5,303 33,465 20,087
Exploration expense 4,113 3,379 10,930 12,661
Dry hole costs and
abandonment expense 4,676 15,608 12,654 23,495
Impairment expense 6,356 516 42,699 516
Depreciation,
depletion and
amortization 28,563 19,482 89,499 68,202
General and
administrative 7,020 5,376 24,540 18,061
Non-cash
stock-based
compensation 991 467 3,212 3,031
Total operating
expenses 72,389 55,591 248,534 166,613
Operating (loss)
income 38,778 (7,126) 40,255 3,367
Other Income and
Expense:
Interest income 593 206 1,977 437
Interest expense (1,439) (6,556) (3,175) (9,945)
Total other
income and
expense (846) (6,350) (1,198) (9,508)
Income (Loss) before
Income Taxes 37,932 (13,476) 39,027 (6,141)
Provision (Benefit)
from Income Taxes 14,607 (4,378) 15,222 (875)
Net Income (Loss) 23,325 (9,098) 23,805 (5,266)
Less deemed dividends
on preferred stock N/A (36,343) N/A (36,343)
Less cumulative
dividends on
preferred stock N/A (4,246) N/A (18,633)
Net income (loss)
attributable to
common stock $23,325 $(49,687) $23,805 $(60,242)
Net Income (Loss)
Per Common Share:
Net Income (Loss)
Attributable to
Common Stock,
Basic $0.54 $(4.33) $0.55 $(15.40)
Net Income (Loss)
attributable to
Common Stock,
Diluted $0.53 $(4.33) $0.55 $(15.40)
Weighted Average
Common Shares
Outstanding,
Basic 43,390,935 11,463,945 43,238,312 3,912,285
Weighted Average
Common Shares
Outstanding,
Diluted 43,823,537 11,463,945 43,439,634 3,912,285
***Deemed dividends of $36.3 million were related to the issuance of
preferred stock through May 2004 at prices that were less than fair market
value at the date of sale in addition to other beneficial conversion
features. These dividends were reflected in December 2004 due to the
conversion of all outstanding preferred stock into common stock upon
completion of our IPO.
Bill Barrett Corporation
Consolidated Condensed Balance Sheets
As of December 31,
2005 2004
(in thousands)
Assets:
Cash and cash equivalents $68,282 $99,926
Other current assets 73,036 37,964
Property and equipment, net 745,948 552,165
Other assets 1,679 6,103
Total assets $888,945 $696,158
Liabilities and Stockholders' Equity:
Current liabilities $132,798 $62,106
Long-term debt 86,000 --
Other long-term liabilities 39,364 14,320
Stockholders' equity 630,783 619,732
Total liabilities and stockholders' equity $888,945 $696,158
Bill Barrett Corporation
Consolidated Statements of Cash Flows
Quarter Ended December 31, Year Ended December 31,
2005 2004 2005 2004
(in thousands)
Operating Activities:
Net Income (Loss) $23,325 $(9,098) $23,805 $(5,266)
Adjustments to
reconcile to
net cash provided
by operations:
Depreciation,
depletion and
amortization 28,563 19,482 89,499 68,202
Impairment expense 6,356 516 42,699 516
Deferred income
taxes 14,607 (4,378) 15,222 (875)
Exploratory dry
holes and
abandonments 4,676 15,607 12,654 23,495
Stock compensation
and other
non-cash items 1,123 400 3,226 3,071
Amortization of
deferred
financing costs 293 3,728 1,175 4,409
Gain on sale of
properties (1,707) (1,381) (3,808) (3,729)
Change in assets
and liabilities:
Accounts
receivable (14,699) (9,521) (24,811) (15,802)
Prepayments
and other
current assets (1,238) 156 (1,891) (2,037)
Accounts payable,
accrued and
other liabilities 1,853 3,940 1,700 3,664
Amounts payable
to oil and
gas property
owners 13,191 2,871 14,307 3,450
Production taxes
payable (2,817) (1,619) 10,493 7,784
Net cash
provided by
operating
activities 73,526 20,703 184,270 86,882
Investing Activities:
Additions to
oil and gas
properties,
including
acquisitions (90,830) (51,794) (314,965) (327,430)
Additions of
furniture,
equipment and
other (1,868) (799) (3,720) (2,141)
Proceeds from
sale of properties 4,806 1,592 13,842 8,811
Net cash used
in investing
activities (87,892) (51,001) (304,843) (320,760)
Financing Activities:
Proceeds from debt 80,000 34,000 146,000 288,000
Principal payments
on debt (37,000) (277,000) (60,000) (345,000)
Proceeds from
sale of common
and preferred
stock 1,984 9 2,979 33,782
Proceeds from
initial public
offering -- 373,750 -- 373,750
Offering costs -- (25,221) (84) (26,384)
Deferred financing
costs and other -- (209) 34 (6,378)
Net cash
provided by
financing
activities 44,984 105,329 88,929 317,770
Increase (Decrease)
in Cash and Cash
Equivalents 30,618 75,031 (31,644) 83,892
Beginning Cash and
Cash Equivalents 37,664 24,895 99,926 16,034
Ending Cash and
Cash Equivalents $68,282 $99,926 $68,282 $99,926
Bill Barrett Corporation
Reconciliation of Discretionary Cash Flow (1) from Net Income (Loss)
Quarter Ended December 31, Year Ended December 31,
2005 2004 2005 2004
(in thousands except share and per share amounts)
Net Income (Loss) $23,325 $(9,098) $23,805 $(5,266)
Adjustments to
reconcile to
discretionary
cash flow (1):
Depreciation,
depletion and
amortization 28,563 19,482 89,499 68,202
Dry hole costs,
abandonments,
and impairment
expense 11,032 16,104 55,353 24,011
Exploration expense 4,113 3,379 10,930 12,661
Deferred income
taxes 14,607 (4,378) 15,222 (875)
Stock compensation
and other non-cash
items 1,123 400 3,226 3,071
Amortization of
deferred financing
costs 293 3,728 1,175 4,409
Gain on sale of
properties (1,707) (1,381) (3,808) (3,729)
Discretionary
cash flow (1) $81,349 $28,256 $195,402 $102,484
Weighted Average
Common Shares
Outstanding,
Diluted 43,823,537 11,463,945 43,439,634 3,912,285
Discretionary
cash flow (1)
per share $1.86 N/A $4.50 N/A
(1) Discretionary cash flow is computed as net income (loss) plus
depreciation, depletion, amortization and impairment expenses, deferred
income taxes, exploration expenses, non-cash stock based compensation,
losses (gains) on sale of properties, and certain other non-cash charges.
The non-GAAP measure of discretionary cash flow is presented because
management believes that it provides useful additional information to
investors for analysis of the Company's ability to internally generate
funds for exploration, development and acquisitions. In addition,
discretionary cash flow is widely used by professional research analysts
and others in the valuation, comparison and investment recommendations of
companies in the oil and gas exploration and production industry, and many
investors use the published research of industry research analysts in
making investment decisions. Discretionary cash flow should not be
considered in isolation or as a substitute for net income, income from
operations, net cash provided by operating activities or other income,
profitability, cash flow or liquidity measures prepared in accordance with
accounting principles generally accepted in the United States of America
("GAAP"). Because discretionary cash flow excludes some, but not all,
items that affect net income and net cash provided by operating activities
and may vary among companies, the discretionary cash flow amounts
presented may not be comparable to similarly titled measures of other
companies.
