Goodrich Petroleum Sees Revenue Increase of 44% During Third Quarter

Goodrich Petroleum Corporation

Goodrich Petroleum Corporation (NYSE: GDP) reports financial and operating results for the third quarter and nine months ended September 30, 2005.

REVENUES

Total revenues for the three months ended September 30, 2005 increased by 44% to $17,258,000 versus $12,014,000 for the three months ended September 30, 2004. Average net oil and gas prices received in the third quarter of 2005 by the Company, including realized gains and losses on the effective portion of its commodity hedging program, increased by approximately 37% to $8.65 per Mcf of gas and $36.31 per barrel of oil, compared to the third quarter of 2004.

Total revenues for the nine months ended September 30, 2005 increased by 35% to $43,132,000 versus $31,969,000 for the nine months ended September 30, 2004. Average net oil and gas prices received for the nine months ended September 30, 2005 were $7.51 per Mcf of gas and $37.49 per barrel of oil.

CASH FLOW

Discretionary cash flow, defined as net cash provided by operating activities before changes in working capital, increased to $8,461,000 in the three months ended September 30, 2005, compared to $7,890,000 in the three months ended September 30, 2004. Net cash provided by operating activities was $13,372,000 in the three months ended September 30, 2005, compared to $10,457,000 in the three months ended September 30, 2004 (see accompanying table for a reconciliation of discretionary cash flow, a non-GAAP measure, to net cash provided by operating activities).

Net cash provided by operating activities was $42,894,000 in the nine months ended September 30, 2005, compared to $24,108,000 in the nine months ended September 30, 2004. Discretionary cash flow increased to $23,714,000 in the nine months ended September 30, 2005, compared to $19,007,000 in the nine months ended September 30, 2004 (see accompanying table for a reconciliation of discretionary cash flow, a non-GAAP measure, to net cash provided by operating activities).

OPERATING INCOME

Operating income, defined as revenues minus operating expenses, was $3,007,000 for the three months ended September 30, 2005, compared to $2,604,000 in the three months ended September 30, 2004.

Operating income was $3,602,000 in the nine months ended September 30, 2005 compared to $8,168,000 in the nine months ended September 30, 2004.

NET EARNINGS

After giving effect to a non-cash loss on derivatives not qualifying for hedge accounting of $32,625,000, the Company reported a net loss for the three months ended September 30, 2005 of $19,474,000 ($0.79 per basic share) compared to net income of $4,337,000, or $0.21 per basic share in the prior year period. Net loss applicable to common stock was $19,632,000 ($0.79 per basic share) in the three months ended September 30, 2005, compared to net income of $4,179,000, or $0.21 per basic share, in the three months ended September 30, 2004.

PRODUCTION

Net production volumes in the three months ended September 30, 2005 increased by approximately 9% over the second quarter and approximately 4% over the previous year to 1,573,000 Mcf of gas and 98,000 barrels of oil, or 2.16 billion cubic feet equivalent ("Bcfe"), or the equivalent of approximately 23,500 Mcfe per day, versus 1,345,000 Mcf of gas and 121,000 barrels of oil, or 2.07 Bcfe, or the equivalent of approximately 22,500 Mcfe per day, in the three months ended September 30, 2004. A majority of the Company's South Louisiana production was shut-in for Hurricanes Katrina and Rita for a portion of the third quarter. The Company estimates approximately 550,000 Mcfe of net quarterly production, or an average of 6,000 net Mcfe of gas per day for the quarter, was shut-in on August 24, 2005 and remained shut- in during the quarter as a result of the hurricanes. As previously reported on October 26th, the Company has restored approximately 66% of pre-storm volumes in South Louisiana, but still estimates that approximately 5,000 net Mcfe per day of pre-storm production remains shut-in waiting on downstream pipeline and facility repairs.

Approximately 47% of the production volumes for the three months ended September 30, 2005 came from Cotton Valley wells, versus approximately 4% of the production volumes for the three months ended September 30, 2004. During the three months ended September 30, 2005, the Cotton Valley production volumes averaged approximately 16,000 gross Mcfe per day from 22 net wells producing for the entire quarter.

Net production volumes in the nine months ended September 30, 2005 increased by approximately 9% to 4,094,000 Mcf of gas and 324,000 barrels of oil, or 6.04 Bcfe, versus 3,363,000 Mcf of gas and 366,000 barrels of oil, or 5.56 Bcfe, in the nine months ended September 30, 2004.

CAPITAL EXPENDITURES

Capital expenditures totaled $48,116,000 in the three months ended September 30, 2005, compared to $12,422,000 in the three months ended September 30, 2004. Approximately 75% of the capital expenditures in the third quarter of 2005 were associated with wells drilled in the Cotton Valley Trend.

In September 2005, the Company announced that its Board of Directors had authorized an increase in its 2005 capital expenditure budget to approximately $135 million. Approximately 85% of the 2005 capital expenditure budget is expected to be focused on the Cotton Valley Trend. With the completion of a public equity offering in May 2005, the Company expects to finance its remaining 2005 capital expenditures through a combination of cash flow from operations and borrowings under an anticipated expansion of its senior credit facility. In October 2005, the Company received a non-binding commitment from BNP Paribas and two co-lenders to expand the senior credit facility to a total of $105 million, consisting of a $75 million senior revolver and a new $30 million subordinated term loan, and to extend the term and maturity of the credit facility for an additional two years to February 25, 2010. Documentation of the expanded facility is currently underway and the Company expects closing of the new credit agreement and funding of the $30 million subordinated term loan to take place in mid November.

OPERATIONAL UPDATE

Cotton Valley

During the third quarter, the Company expanded its activities in the Cotton Valley Trend by adding three additional drilling rigs. The Company conducted drilling operations on 25 Cotton Valley wells during the third quarter of 2005. Through the end of the third quarter, the Company had drilled and logged a total of 50 wells, with a 100% success rate. Of the 50 wells drilled to total depth, 42 were producing and 8 were in the completion phase as of September 30th. In addition, the Company was conducting drilling operations on 8 wells.

The Company added 14 wells to production during the quarter. Gross Cotton Valley volumes grew by 43% in the third quarter over the second quarter of 2005, to approximately 1.46 Bcfe, or approximately 16,000 Mcfe per day. The average of 16,000 Mcfe per day was from 22 net wells producing for the entire quarter, for an average of 720 gross Mcfe per day, per well, or approximately 500 Mcfe per day, per well, net to the Company.

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