Exhibit 99.1
ATP Announces First Quarter 2009 Net Income
HOUSTON--(BUSINESS WIRE)--May 6, 2009--ATP Oil & Gas Corporation (NASDAQ:ATPG) today announced first quarter 2009 net income, results and update.
Highlights include:
- Net income of $1.6 million or $0.05 per basic and diluted share;
- Production of 10.0 Bcfe (55% oil);
- Completed and achieved initial production from two wells, one at the Gomez Hub in the Gulf of Mexico and one at Wenlock in the North Sea;
- Formation of ATP Infrastructure Partners, L.P. with GE Energy Financial Services to own the ATP Innovator;
- Repaid $31.2 million of debt in March 2009 and an additional $5.2 million of debt in May 2009 from the proceeds received relating to ATP Infrastructure.
Results of Operations
ATP recorded net income of $1.6 million or $0.05 per basic and diluted share for the first quarter of 2009, compared to net income of $46.8 million or $1.31 per basic and $1.29 per diluted share for the first quarter of 2008. Oil and gas production for the first quarter of 2009 was 1.7 MMBoe (10.0 Bcfe) compared to 3.6 MMBoe (21.6 Bcfe) for the first quarter of 2008. Oil production was 0.9 MMBbls (55% of total production) and natural gas production was 4.5 Bcf for the first quarter of 2009, compared to 1.6 MMBbls (45% of total production) and 11.8 Bcfe for the first quarter of 2008. In December of 2008, ATP sold 80% of Wenlock and Tors in the U.K. North Sea, which impacted production for the first quarter of 2009. Production was further impacted by curtailment of production at Gomez due to third party pipeline repairs in the Gulf of Mexico. Revenues from oil and gas production were $68.3 million for the first quarter of 2009, compared to $226.0 million for the first quarter of 2008 primarily due to the drop in oil and natural gas prices and the production details noted above. New wells at Gomez and Wenlock and properties placed back on production following hurricane related repairs in the Gulf of Mexico resulted in a 90% increase in production for the first quarter of 2009 compared to the fourth quarter of 2008.
Capital Resources and Liquidity
On March 6, 2009, ATP and GE Energy Financial Services (“GE”) jointly announced the formation of ATP Infrastructure Partners, L.P. (“ATP-IP”). ATP contributed the ATP Innovator to ATP-IP for a 49% limited partner interest and a 2% general partner interest. GE contributed $150.0 million to ATP-IP for a 49% limited partner interest. The ATP Innovator is the floating production facility located on Mississippi Canyon Block 711, currently serving the Gomez Hub. The transaction was effective June 1, 2008 and allows ATP exclusive use of the ATP Innovator during the term of the Platform Use Agreement. ATP remains the operator and continues to hold a 100% working interest in the Gomez field and its oil and gas reserves. Under the partnership agreements, ATP will pay to ATP-IP a minimum fee or a per unit charge for all hydrocarbons processed by the ATP Innovator, and all partners will be entitled to future quarterly cash distributions in accordance with the provisions of the agreement. As a result of this transaction, ATP reduced its long term debt by $31.2 million in March of 2009 and will reduce debt by another $5.2 million in May of 2009.
Working capital, as defined in ATP’s Senior Secured Credit Facility was $43.4 million as of March 31, 2009. ATP had unrestricted cash of $103.4 million and restricted cash of $13.5 million at March 31, 2009, as a result of the successful well at Gomez in the first quarter of 2009, the $13.5 million of restricted cash was released in April of 2009. During the first quarter of 2009, ATP incurred $33.5 million of interest expense. ATP capitalized $20.9 million of this interest, which was directly associated with the construction of the ATP Titan and the Octabuoy. For the quarter ended March 31, 2009, ATP was in compliance with all the terms of its credit agreement. Further, based on the Company’s projections, ATP believes that it will remain in compliance with all of its financial covenants throughout 2009.
During the first quarter 2009 ATP incurred $167.0 million of capital expenditures on oil and gas properties. These expenditures were incurred predominately at ATP’s three major 2009 developments, the Gomez Hub and the Telemark Hub in the Gulf of Mexico and Wenlock in the North Sea. In March 2009, ATP placed on production the Gomez #8 well and the Wenlock #2 well. ATP is currently drilling the #3 well at Wenlock and expects the well to be completed and on production during the second quarter of 2009. ATP is tightening its estimated capital expenditure for 2009 to $300 million to $400 million from the previously announced estimate of $300 million to $500 million. The focus of ATP’s remaining program for 2009 will center on finalizing the drilling and completion of the Wenlock #3 well and achieving first production at ATP’s Telemark Hub. ATP anticipates funding its capital program in 2009 from cash on hand and cash generated from operations. In addition, ATP is actively pursuing the sale of certain infrastructure assets and selected oil and gas properties to further reduce debt and improve liquidity.
| | Three Months Ended |
| | March 31, |
| | 2009 | | 2008 |
| | | | |
| Production | | | | |
| Natural gas (MMcf) | | | 4,474 | | | | 11,844 |
| Gulf of Mexico | | | 3,887 | | | | 6,465 |
| North Sea | | | 587 | | | | 5,379 |
| | | | | | | |
| Oil and condensate (MBbls) | | | 915 | | | | 1,622 |
| Gulf of Mexico | | | 914 | | | | 1,610 |
| North Sea | | | 1 | | | | 12 |
| | | | |
| Natural gas, oil and condensate | | | | |
| Per Mcfe | | | 9,963 | | | | 21,574 |
| Per Boe | | | 1,661 | | | | 3,596 |
| | | | |
| Average Prices (1) | | | | |
| Natural gas (per Mcf) | | $ | 4.74 | | | $ | 8.96 |
| Gulf of Mexico | | | 4.60 | | | | 9.28 |
| North Sea | | | 5.74 | | | | 8.57 |
| Oil and condensate (per Bbl) | | | 38.97 | | | | 73.96 |
| | | | |
| Natural gas, oil and condensate | | | | |
| Per Mcfe | | $ | 5.71 | | | $ | 10.48 |
| Per Boe | | | 34.26 | | | | 62.88 |
| | | | |
| Deferred Revenue Recognized ($000's) | | | | |
| Natural gas | | $ | 1,956 | | | $ | - |
| Oil and condensate | | | 9,404 | | | | - |
| Total | | | 11,360 | | | | - |
| | | | |
| Gain (Loss) on Oil and Gas Derivatives ($000's) | | | | |
| Natural gas contracts | | | | |
| Realized or settled during the period | | $ | 16,361 | | | $ | - |
| Unrealized | | | (116 | ) | | | - |
| Oil and condensate contracts | | | | |
| Realized or settled during the period | | | - | | | | - |
| Unrealized | | | - | | | | - |
| Total | | | 16,245 | | | | - |
| | | | | | | |
(1) Includes the effect of cash flow hedges in 2008. Effective January 1, 2009, four U.K. contracts are accounted for as hedges and aggregate net settlements during the quarter of $(0.3) million are reflected in the average oil and gas prices noted above.
First Quarter 2009 Conference Call
ATP Oil & Gas Corporation (NASDAQ:ATPG) will host a conference call on Thursday, May 7, at 10 am central time to discuss the company’s first quarter results, followed by a Q&A session.
Date: Thursday, May 7, 2009
Time: 11:00 am ET; 10:00 am CT; 9:00 am MT and 8:00 am PT
ATP invites interested persons to listen to the live webcast on the company’s website at www.atpog.com. Phone participants should dial (888) 204-4317. A digital replay of the conference call will be available at (888) 203-1112, ID# 4610958, for a period of 24 hours beginning at 1:00 pm CT, and the webcast will be archived for 30 business days at www.atpog.com.
About ATP Oil & Gas Corporation
ATP Oil & Gas is an international offshore oil and gas development and production company with operations in the Gulf of Mexico and the North Sea. The company trades publicly as ATPG on the NASDAQ Global Select Market. For more information about ATP Oil & Gas Corporation, visit www.atpog.com.
Forward-looking Statements
Certain statements included in this news release are “forward-looking statements” under the Private Securities Litigation Reform Act of 1995. ATP cautions that assumptions, expectations, projections, intentions, or beliefs about future events may, and often do, vary from actual results and the differences can be material. Some of the key factors which could cause actual results to vary from those ATP expects include changes in natural gas and oil prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as ATP’s ability to access them, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting our business. More information about the risks and uncertainties relating to ATP’s forward-looking statements are found in the Company’s SEC filings.
| CONSOLIDATED BALANCE SHEETS |
| (In Thousands) |
| | | | |
| | March 31, | | December 31, |
| | 2009 | | 2008 |
| Assets | | | | |
| | | | |
| Current assets: | | | | |
| Cash and cash equivalents | | $ | 103,380 | | | $ | 214,993 | |
| Restricted cash | | | 13,500 | | | | - | |
| Accounts receivable (net of allowance of $352 and $352, respectively) | | | 74,485 | | | | 93,915 | |
| Deferred tax asset | | | 36,167 | | | | 39,150 | |
| Derivative asset | | | 20,194 | | | | 15,366 | |
| Other current assets | | | 18,077 | | | | 11,954 | |
| Total current assets | | | 265,803 | | | | 375,378 | |
| | | | |
| Oil and gas properties: | | | | |
| Oil and gas properties (using the successful efforts method of accounting): | | | | |
| Proved properties | | | 2,956,315 | | | | 2,802,315 | |
| Unproved properties | | | 15,593 | | | | 14,705 | |
| | | 2,971,908 | | | | 2,817,020 | |
| Less: Accumulated depletion, impairment and amortization | | | (977,545 | ) | | | (944,817 | ) |
| Oil and gas properties, net | | | 1,994,363 | | | | 1,872,203 | |
| | | | |
| Furniture and fixtures, net | | | 479 | | | | 470 | |
| Deferred financing costs, net | | | 12,556 | | | | 13,493 | |
| Other assets, net | | | 14,235 | | | | 14,066 | |
| Total assets | | $ | 2,287,436 | | | $ | 2,275,610 | |
| | | | |
| Liabilities and Shareholders' Equity | | | | |
| | | | |
| Current liabilities: | | | | |
| Accounts payable and accruals | | $ | 192,735 | | | $ | 277,914 | |
| Current maturities of long-term debt | | | 10,500 | | | | 10,500 | |
| Asset retirement obligation | | | 36,305 | | | | 32,854 | |
| Derivative liability | | | 460 | | | | 8,114 | |
| Deferred tax liability | | | 20 | | | | - | |
| Other current liabilities | | | 9,837 | | | | 9,537 | |
| Total current liabilities | | | 249,857 | | | | 338,919 | |
| | | | |
| Long-term debt | | | 1,324,927 | | | | 1,356,130 | |
| Asset retirement obligation | | | 97,548 | | | | 99,254 | |
| Deferred tax liability | | | 100,202 | | | | 101,953 | |
| Derivative liability | | | 2,703 | | | | 1,194 | |
| Deferred revenue | | | 47,870 | | | | 59,229 | |
| Other liabilities | | | 2,582 | | | | 2,582 | |
| Total liabilities | | | 1,825,689 | | | | 1,959,261 | |
| | | | |
| Shareholders' equity: | | | | |
| Preferred stock: $0.001 par value | | | - | | | | - | |
| Common stock: $0.001 par value | | | 36 | | | | 36 | |
| Additional paid-in capital | | | 402,531 | | | | 400,334 | |
| Retained earnings | | | 31,280 | | | | 29,644 | |
| Accumulated other comprehensive loss | | | (110,100 | ) | | | (112,754 | ) |
| Treasury stock, at cost | | | (911 | ) | | | (911 | ) |
| Total shareholders' equity | | | 322,836 | | | | 316,349 | |
| Noncontrolling interest | | | 138,911 | | | | - | |
| Total equity | | | 461,747 | | | | 316,349 | |
| Total liabilities and shareholders' equity | | $ | 2,287,436 | | | $ | 2,275,610 | |
| | | | | | | | |
| CONSOLIDATED INCOME STATEMENTS |
| (In Thousands, Except Per Share Amounts) |
| | | | |
| | Three Months Ended |
| | March 31, |
| | 2009 | | 2008 |
| | | | |
| Oil and gas revenues | | $ | 68,256 | | | $ | 226,037 | |
| Other revenues | | | 13,664 | | | | 897 | |
| Total revenues | | | 81,920 | | | | 226,934 | |
| | | | |
| Costs, operating expenses and other: | | | | |
| Lease operating | | | 20,214 | | | | 24,618 | |
| Exploration | | | 174 | | | | 141 | |
| General and administrative | | | 11,103 | | | | 9,236 | |
| Depreciation, depletion and amortization | | | 39,398 | | | | 89,399 | |
| Impairment of oil and gas properties | | | 8,049 | | | | - | |
| Accretion of asset retirement obligation | | | 2,904 | | | | 4,300 | |
| Loss on abandonment | | | 997 | | | | 377 | |
| Loss on disposition of properties | | | 148 | | | | - | |
| Other, net | | | - | | | | 13 | |
| Total costs, operating expenses and other | | | 82,987 | | | | 128,084 | |
| Income (loss) from operations | | | (1,067 | ) | | | 98,850 | |
| | | | |
| Other income (expense): | | | | |
| Interest income | | | 213 | | | | 1,228 | |
| Interest expense, net | | | (12,623 | ) | | | (28,127 | ) |
| Gain on derivatives | | | 16,245 | | | | 40 | |
| Total other income (expense) | | | 3,835 | | | | (26,859 | ) |
| | | | |
| Income before income taxes | | | 2,768 | | | | 71,991 | |
| Income tax (expense) benefit: | | | | |
| Current | | | (378 | ) | | | (12,436 | ) |
| Deferred | | | 1,252 | | | | (12,710 | ) |
| Total income tax benefit (expense) | | | 874 | | | | (25,146 | ) |
| | | | | | | | |
| Net income | | | 3,642 | | | | 46,845 | |
| Less amount attributable to noncontrolling interest | | | (2,006 | ) | | | - | |
| | | | |
| Net income attributable to common shareholders | | $ | 1,636 | | | $ | 46,845 | |
| | | | |
| Net income per share attributable to common shareholders: | | | | |
| Basic | | $ | 0.05 | | | $ | 1.31 | |
| Diluted | | $ | 0.05 | | | $ | 1.29 | |
| | | | |
| Weighted average shares outstanding: | | | | |
| Basic | | | 35,618 | | | | 35,824 | |
| Diluted | | | 35,706 | | | | 36,247 | |
| | | | | | | | |
| CONSOLIDATED CASH FLOW DATA |
| (In Thousands) |
| | | | |
| | Three Months Ended |
| | March 31, |
| | 2009 | | 2008 |
| | | | |
| Cash flows from operating activities: | | | | |
| Net income | | $ | 3,642 | | | $ | 46,845 | |
| Adjustments to operating activities | | | 44,995 | | | | 115,179 | |
| Changes in assets and liabilities | | | (25,752 | ) | | | (344 | ) |
| Net cash provided by operating activities | | | 22,885 | | | | 161,680 | |
| | | | |
| Cash flows from investing activities: | | | | |
| Additions to oil and gas properties | | | (234,452 | ) | | | (250,052 | ) |
| Additions to furniture and fixtures | | | (88 | ) | | | (47 | ) |
| Increase in restricted cash | | | (13,500 | ) | | | - | |
| Net cash used in investing activities | | | (248,040 | ) | | | (250,099 | ) |
| | | | |
| Cash flows from financing activities: | | | | |
| Proceeds from sale of noncontrolling interest | | | 148,751 | | | | - | |
| Principal payments of long-term debt | | | (33,812 | ) | | | (3,042 | ) |
| Net profits interest payments | | | - | | | | (3,583 | ) |
| Exercise of stock options | | | - | | | | 28 | |
| Net cash (used in) provided by financing activities | | | 114,939 | | | | (6,597 | ) |
| | | | |
| Effect of exchange rate changes on cash | | | (1,397 | ) | | | 139 | |
| | | | |
| Net decrease in cash and cash equivalents | | | (111,613 | ) | | | (94,877 | ) |
| Cash and cash equivalents, beginning of period | | | 214,993 | | | | 199,449 | |
| | | | |
| Cash and cash equivalents, end of period | | $ | 103,380 | | | $ | 104,572 | |
| | | | | | | | |
| | 2009 | | | 2010 | | | 2011 |
| | 2Q | | 3Q | | 4Q | | FY | | | 1Q | | 2Q | | 3Q | | 4Q | | FY | | | 1Q | | FY |
| Gulf of Mexico | | | | | | | | | | | | | | | | | | | | | | | | |
| Fixed Forwards & Swaps | | | | | | | | | | | | | | | | | | | | | | | | |
| Natural Gas | | | | | | | | | | | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | | 2,725 | | | 2,750 | | | 2,750 | | | 8,225 | | | | 900 | | | | | | | | | 900 | | | | | |
| Price ($/MMBtu) | | $ | 6.71 | | $ | 6.71 | | $ | 7.07 | | $ | 6.83 | | | $ | 5.02 | | | | | | | | $ | 5.02 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Collars | | | | | | | | | | | | | | | | | | | | | | | | |
| Natural Gas | | | | | | | | | | | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | | 455 | | | 460 | | | 460 | | | 1,375 | | | | 450 | | | 1,365 | | | 1,380 | | | 1,380 | | | 4,575 | | | | 1,350 | | | 1,350 |
| Floor Price ($/MMBtu) | | $ | 4.00 | | $ | 4.00 | | $ | 4.00 | | $ | 4.00 | | | $ | 4.00 | | $ | 4.75 | | $ | 4.75 | | $ | 4.75 | | $ | 4.68 | | | $ | 4.75 | | $ | 4.75 |
| Ceiling Price ($/MMBtu) | | $ | 7.00 | | $ | 7.00 | | $ | 7.00 | | $ | 7.00 | | | $ | 7.00 | | $ | 7.95 | | $ | 7.95 | | $ | 7.95 | | $ | 7.86 | | | $ | 7.95 | | $ | 7.95 |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Puts | | | | | | | | | | | | | | | | | | | | | | | | |
| Crude Oil | | | | | | | | | | | | | | | | | | | | | | | | |
| Volumes (MBbls) | | | 455 | | | 460 | | | 460 | | | 1,375 | | | | 90 | | | 91 | | | 92 | | | 92 | | | 365 | | | | | |
| Floor Price ($/Bbl) | | $ | 29.75 | | $ | 29.75 | | $ | 29.75 | | $ | 29.75 | | | $ | 24.70 | | $ | 24.70 | | $ | 24.70 | | $ | 24.70 | | $ | 24.70 | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| North Sea | | | | | | | | | | | | | | | | | | | | | | | | |
| Fixed Forwards & Swaps | | | | | | | | | | | | | | | | | | | | | | | | |
| Natural Gas | | | | | | | | | | | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | | 455 | | | 460 | | | 759 | | | 1,674 | | | | | | | | | | | | | | | | |
| Price ($/MMBtu)(1) | | $ | 5.55 | | $ | 5.55 | | $ | 5.91 | | $ | 5.71 | | | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | | | | | | | | |
| Collars | | | | | | | | | | | | | | | | | | | | | | | | |
| Natural Gas | | | | | | | | | | | | | | | | | | | | | | | | |
| Volumes (MMMBtu) | | | | | | | | | | | | 450 | | | 455 | | | 460 | | | 460 | | | 1,825 | | | | 270 | | | 270 |
| Floor Price ($/MMBtu)(1) | | | | | | | | | | | $ | 5.70 | | $ | 5.70 | | $ | 5.70 | | $ | 5.70 | | $ | 5.70 | | | $ | 5.70 | | $ | 5.70 |
| Ceiling Price ($/MMBtu)(1) | | | | | | | | | | | $ | 8.55 | | $ | 8.55 | | $ | 8.55 | | $ | 8.55 | | $ | 8.55 | | | $ | 8.55 | | $ | 8.55 |
| | | | | | | | | | | | | | | | | | | | | | | | | |
| The above are ATP's outstanding financial and physical commodity contracts. |
| Additional hedges, derivatives and fixed price contracts, if any, will be announced during the year. |
| (1) Assumes exchange rate of 1.50 USD to 1.00 GBP |
CONTACT:
ATP Oil & Gas Corporation, Houston
Chairman and CEO
T. Paul Bulmahn, 713-622-3311
or
Chief Financial Officer
Albert L. Reese Jr., 713-622-3311
www.atpog.com
