Financial Results for Quarter and Year Ended December 31, 2004
Comstock reported net income of $15.9 million, 43 cents per diluted share for the three months ended December 31, 2004 as compared to 2003's fourth quarter income of $5.7 million, 16 cents per diluted share. Fourth quarter 2004's oil and gas sales increased 36% to $71.2 million over 2003's fourth quarter sales of $52.5 million. Operating cash flow (before changes in working capital accounts) generated by Comstock in 2004's fourth quarter of $47.5 million was 56% higher than 2003's fourth quarter cash flow of $30.4 million. EBITDAX or earnings before interest, taxes, depreciation, depletion, amortization, exploration expense and other noncash expenses was $54.9 million in 2004's fourth quarter, a 42% increase over 2003's fourth quarter EBITDAX of $38.6 million. The 2004 financial results include Comstock's 59.9% ownership in Bois d'Arc Energy which was formed in July of 2004 and is engaged in the exploration and production of oil and natural gas in the Gulf of Mexico.
In 2004, Comstock's oil and gas sales reached $261.6 million, a record high for the Company, as compared to oil and gas sales of $235.1 million in 2003. Net income for the year ended December 31, 2004 was $46.9 million, $1.29 per diluted share, as compared to net income of $53.3 million, $1.51 per diluted share, excluding the cumulative effect of an accounting principle change for future abandonment costs. The results for the year ended December 31, 2004 include a charge of $19.6 million ($12.5 million after income taxes or 35 cents per diluted share) relating to the early retirement of the Company's 11-1/4% senior notes. Operating cash flow (before changes in working capital accounts) generated by Comstock in 2004 was $176.2 million, a 16% increase from cash flow of $152.0 million in the same period in 2003. For the year ended December 31, 2004, EBITDAX increased 11% or $202.6 million as compared to EBITDAX of $183.0 million for the same period in 2003.
Comstock's production in the fourth quarter of 2004 totaled 10.4 billion cubic feet equivalent of natural gas ("Bcfe"), as compared to production of 11.0 Bcfe in the fourth quarter of 2003. For the year ended 2004, Comstock produced 42.7 Bcfe, as compared to production in 2003 of 44.0 Bcfe. Production was lower than 2003 mainly due to the effects of Hurricane Ivan which caused part of Bois d'Arc Energy's Gulf of Mexico production to be shut in the third and the fourth quarter of 2004 either during the storm or awaiting repairs to third party pipelines that were damaged by the hurricane. The higher sales were attributable to increased oil and natural gas prices. The Company's realized natural gas price averaged $6.66 per Mcf in 2004's fourth quarter as compared to $4.65 per Mcf in 2003's fourth quarter. Realized oil prices in the fourth quarter of 2004 averaged $47.06 per barrel as compared to $30.46 per barrel for 2003. For the year ended 2004, Comstock's realized natural gas price averaged $5.98 per Mcf as compared to 2003's average natural gas price of $5.41 per Mcf. For 2004, Comstock's realized oil price was $39.86 per barrel as compared to $30.70 per barrel in 2003.
2004 Drilling Results
Comstock also announced the results of its 2004 drilling program under which Comstock spent $115.6 million to drill 70 wells (46 development wells and 24 exploratory wells). Comstock spent an additional $62.7 million on acquisitions of producing properties, $6.2 million on acquiring acreage, $16.6 million on recompletions, workovers and abandonment and $8.3 million on offshore production facilities in 2004 for a total of $209.4 million. Fifty-eight of the 70 wells drilled in 2004 were completed as producing wells and twelve were dry holes or non commercial for an overall 83% drilling success rate in 2004. Of the 24 exploratory wells drilled last year, thirteen resulted in discoveries and eleven were dry holes. Overall, Comstock had a 54% drilling success rate in its exploration program in 2004.
Gulf of Mexico Region
To date in 2005, Bois d'Arc has drilled four more successful wells and has had no dry holes. Two are successful development wells at Ship Shoal blocks 92 and 98. The remaining two were exploratory wells including a well at Ship Shoal 111 drilled to test the "Laker" prospect and a successful well at South Pelto block 14.
South Texas Region
Southeast Texas Region
East Texas / North Louisiana and Other Regions
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