TXCO Revenues Increase 30% After Record Year in 2007

TXCO Resources reported that for the year, total revenues rose to a record $93.9 million, a 30 percent increase from $72.4 million in 2006. Oil and gas sales increased 45 percent from the prior year to $81.8 million. Assets rose to $354.6 million, nearly 150 percent above year-end 2006, including the second-quarter 2007 acquisition of Output Exploration LLC.

The Company reported net income attributable to common stock of $0.9 million, equal to $0.03 per share, compared with $7.2 million, $0.22 per share, in 2006. Operating income, $10.4 million, was essentially flat with the prior year.

Net cash provided by operating activities was $69.4 million, partially reflecting accrued acquisition costs, a 181 percent increase from $24.7 million in 2006. Ebitda -- earnings before income taxes, interest expense, depreciation, depletion, amortization, impairment and abandonment expense -- was a record $52.9 million, or $1.52 per share, a 42 percent increase from $37.3 million, or $1.12 per share, in 2006. Ebitdax -- Ebitda plus exploration expense - also set a record of $54.2 million, or $1.56 per share, compared with $40.3 million, $1.21 per share in the prior year. All per-share amounts are on a diluted basis. See the accompanying table for a reconciliation of non-GAAP financial measures.

For the fourth quarter of 2007, TXCO had net income attributable to common stock of $1.8 million, or $0.05 per share, compared with a net loss of $4.4 million, $0.13 per share, in fourth-quarter 2006. TXCO's revenues for the three months ended December 31, 2007, were more than double the same period in the prior-year period, $32.1 million compared with $15.3 million.

Oil and gas sales also were more than double the 2006 quarter, $28.9 million versus $12.1 million. Oil and gas volumes increased to 2.4 bcfe, compared with 1.5 bcfe in fourth-quarter 2006.

"We began 2008 as a different company following the landmark changes that followed our acquisition of Output Exploration during 2007," said Chairman and CEO James E. Sigmon. "We continue to build on the valuable assets we gained in the Output transaction. I see more potential than ever before to create greater shareholder value through such exciting projects as the San Miguel oil sands, Pearsall gas resource play, Glen Rose Porosity oil play and Fort Trinidad Glen Rose shoals. I remain confident that we will see stronger continuing growth in production, reserves, profitability and shareholder value in 2008 and going forward."