Cabot O&G 2Q15: Production Up 8%, Net Income Down 109%
Last Friday Cabot Oil & Gas released their second quarter 2015 operational and financial update, along with holding a conference call to update financial analysts. Below is the Friday press release/update with the particulars of Cabot’s performance during 2Q15. There’s a lot to love about Cabot, one of our favorite Marcellus drillers. Production in the Marcellus year over year for the second quarter was up 7% from 2014 (total natgas production up 8% for all plays). The company continues to get leaner and meaner when it comes to controlling costs. For the first half of the year in 2015, Cabot has managed to trim the time it takes them to drill a well by four days from the time it took them just last year–meaning a 15% cost savings overall. Cabot, whose operations and drilling program is a fraction of the size of Chesapeake Energy, is worth twice as much as Chesapeake. Cabot’s market capitalization (the amount of stock issued times the price per share) is $10.96 billion as of this morning. Chesapeake’s market cap? $5.51 billion. That must really frost corporate raider Carl Icahn. 🙂 Anywho, Cabot is not immune to the brutally low prices for natural gas they receive in the northeast. In Cabot’s small neck of the woods, prices for natural gas are the lowest in the country. And that means Cabot has, finally, gone into negative earnings territory…
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Here’s one flying under the radar that we didn’t know about–until now. In the spring of 2013 Magnum Hunter Resources (MHR), a driller now focused totally on the Marcellus and Utica Shale region, dismissed it’s accounting firm. Apparently some investors didn’t like that action and accused MHR’s senior management and board of directors of “breaches of fiduciary duties and other matters.” The investors filed lawsuits in seven different courts alleging misconduct. As of June 22, the last of those lawsuits was dismissed. In fact, all of the lawsuits filed have been dismissed and MHR paid out zero dollars to settle. Yes, it cost the company big money to defend themselves, but they held firm and didn’t cave and in the end they were exonerated from any wrongdoing…
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