NEWS
RELEASE
FOR IMMEDIATE RELEASE
CONTACT: Anna E. Torma
(512) 433-5312
FORESTAR GROUP INC. REPORTS
SECOND QUARTER 2014 RESULTS
AUSTIN, TEXAS, August 6, 2014—Forestar Group Inc. (NYSE: FOR) today reported second quarter 2014 net income of approximately $14.8 million, or $0.34 per diluted share outstanding, compared with second quarter 2013 net income of approximately $0.5 million, or $0.02 per diluted share outstanding.
“During second quarter, residential lot sales remained strong and we are developing lots commensurate with inventories and home buyer demand. Multifamily market conditions remain favorable in our target markets, and we continue to acquire sites in 'A' locations to grow our business. In addition, oil and gas working interest production grew significantly, driven principally by new wells in the Bakken/Three Forks generating strong initial production. We are on track to deliver our Growing FORward strategic initiatives, which are focused on increasing total segment earnings, return on assets and opportunistically selling non-core assets. Our balance sheet strength, improving cash flows and significant liquidity are expected to adequately fund these initiatives,” said Jim DeCosmo, president and chief executive officer of Forestar Group.
Second Quarter 2014 Significant Highlights
| |
| • | Sold 537 developed residential lots, up nearly 50% compared with second quarter 2013 |
| |
| • | Converted over 10,000 acres of timber leases into ownership of 5,400 acres of undeveloped land from Ironstob venture, resulting in a $10.5 million gain |
| |
| • | Increased working interest oil production over 65% compared with second quarter 2013, with 31 new gross wells generating initial production |
| |
| • | Sold interest in 97 gross (6 net) non-core producing oil and gas wells in Oklahoma for a gain of $4.5 million and sold leasehold interests in 223 net mineral acres in North Dakota for a gain of $1.2 million |
Forestar manages its operations through three business segments: real estate, oil and gas and other natural resources.
REAL ESTATE
Second Quarter 2014 Significant Highlights (Includes Ventures)
| |
| • | Sold 537 developed residential lots at almost $64,100 per lot; highest quarterly average lot price since 2009 |
| |
| • | Sold 79 acres of residential tracts for $63,700 per acre |
| |
| • | Sold over 3,200 acres of undeveloped land for nearly $7.9 million |
| |
| • | Converted over 10,000 acres of timber leases into ownership of 5,400 acres of undeveloped land from Ironstob venture |
Segment Financial Results:
|
| | | | | | |
| ($ in millions) | | 2Q 2014 | | 2Q 2013 | | 1Q 2014 |
| Segment Revenues | | $55.2 | | $41.2 | | $65.5 |
| Segment Earnings | | $27.3 | | $8.1 | | $23.6 |
In second quarter 2014, residential lot sales were up almost 50% compared with second quarter 2013, with average lot prices and gross profit up 11% over that same period. Second quarter 2014 real estate segment earnings were higher compared with second quarter 2013 principally due to a $10.5 million gain associated with the exchange of over 10,000 acres of timber leases for 5,400 acres of undeveloped land from the Ironstob venture, and higher residential lot and undeveloped land sales. Real estate segment earnings increased in second quarter 2014 compared with first quarter 2014 primarily due to the $10.5 million gain associated with the exchange of timber leases for undeveloped land from Ironstob venture. First quarter 2014 real estate segment results include earnings of $13.2 million associated with the sale of approximately 8,400 acres of undeveloped land.
OIL AND GAS
Second Quarter 2014 Significant Highlights (Includes Ventures)
| |
| • | Increased total oil production by over 43% compared with second quarter 2013, principally due to working interest investments primarily targeting the Bakken/Three Forks and the Lansing-Kansas City formations |
| |
| • | Sold interest in 97 gross (6 net) non-core producing oil and gas wells in Oklahoma for a gain of $4.5 million and sold leasehold interests in 223 net mineral acres in North Dakota for a gain of $1.2 million |
| |
| • | Added 31 gross oil and gas wells, 5 Bakken/Three Forks gross wells waiting on completion at quarter-end |
| |
| • | Leased nearly 1,400 net fee mineral acres to third parties, principally in Louisiana and Texas |
Segment Financial Results:
|
| | | | | | |
| ($ in millions) | | 2Q 2014 | | 2Q 2013 | | 1Q 2014 |
| Segment Revenues | | $24.4 | | $15.8 | | $17.6 |
| Segment Earnings | | $9.5 | | $4.2 | | $0.8 |
Oil and gas segment earnings increased in second quarter 2014 compared with second quarter 2013 and first quarter 2014 principally due to $5.7 million in earnings associated with the sale of various oil and gas properties in Oklahoma and North Dakota and higher working interest production volumes, partially offset by higher exploration, production, depletion and operating expenses, and lower production volumes and delay rental revenues from owned mineral interests. Second quarter 2014 oil and gas segment earnings includes $2.1 million of dry hole expense associated with a working interest in an exploratory well in East Texas.
OTHER NATURAL RESOURCES
Second Quarter 2014 Significant Highlights (Includes Ventures)
| |
| • | Signed amended groundwater reservation agreement, generating $0.7 million in earnings |
| |
| • | Sold nearly 107,800 tons of fiber for $16.86 per ton |
Segment Financial Results:
|
| | | | | | |
| ($ in millions) | | 2Q 2014 | | 2Q 2013 | | 1Q 2014 |
| Segment Revenues | | $3.5 | | $3.0 | | $1.6 |
| Segment Earnings | | $2.1 | | $1.0 | | ($0.5) |
Second quarter 2014 other natural resources segment results increased compared with second quarter 2013 and first quarter 2014 principally due to $0.7 million in earnings from a groundwater reservation agreement and a $0.7 million gain on termination of a timber lease in connection with the Ironstob venture.
OUTLOOK
Capitalizing on Low Lot Inventory and Solid Demand
"Our real estate markets remain favorable and we are well positioned to continue to capitalize on the housing recovery by growing residential lot sales and commercial and residential tract sales. We anticipate residential lot sales in 2014 to be in the range of 2,200 - 2,300 lots, up over 20% compared with 2013. Our multifamily team continues to build a solid pipeline of development sites, with our Eleven project in Austin now substantially complete, over 85% leased and on target for sale in 2014. In second quarter 2014, we acquired an additional multifamily site in Austin, Texas and began construction on a community near Denver. We will continue to evaluate and acquire additional residential and multifamily sites to further develop our real estate pipeline.
Working Interest Production Expected to Increase 30% in Second Half of 2014
“During second quarter, we continued to invest in exploration and drilling activity, growing production, reserves and value. Drilling and completion activity increased in second quarter, with 17 gross Bakken/Three Forks wells (7% average working interest) generating initial production and 5 gross Bakken/Three Forks wells waiting on completion at quarter end. Operators in the Bakken/Three Forks formations continue to shift to pad drilling and are generating improved well results with increased production and lower drilling costs. In addition, exploration and drilling activity in Kansas and Nebraska continued to see favorable success rates and our addition of approximately 77,000 leasehold mineral acres in the Lansing-Kansas City formation during second quarter should further develop a solid pipeline of drilling prospects. As a result, working interest production is expected to increase 30% in the second half of 2014 compared with the first six months of 2014. In addition, we anticipate 2014 total oil and gas production will exceed 1.2 million BOE (barrel of oil equivalent), a 15% increase compared with 2013 levels.
Balance Sheet, Cash Flow and Liquidity Expected to Adequately Fund Growing FORward Initiatives
“We continue to see significant opportunities for growth through disciplined investments in our real estate and oil and gas businesses. Our strong balance sheet, improving cash flows and significant liquidity are expected to adequately fund our Growing FORward strategic initiatives,” concluded Mr. DeCosmo.
The Company will host a conference call on August 6, 2014 at 10:00 am ET to discuss results of second quarter 2014. The meeting may be accessed through webcast or by conference call. The webcast may be accessed through Forestar’s Internet site at www.forestargroup.com. To access the conference call, listeners calling from North America should dial 1-866-543-6403 at least 15 minutes prior to the start of the meeting. Those wishing to access the call from outside North America should dial 1-617-213-8896. The password is Forestar. Replays of the call will be available for two weeks following the completion of the live call and can be accessed at 1-888-286-8010 in North America and at 1-617-801-6888 outside North America. The password for the replay is 13170686.
About Forestar Group
Forestar Group Inc. operates in three business segments: real estate, oil and gas and other natural resources. At the end of second quarter 2014, the real estate segment owns directly or through ventures almost 121,000 acres of real estate located in ten states and 13 markets in the U.S. The real estate segment has 11 real estate projects representing approximately 24,400 acres currently in the entitlement process, and 73 entitled, developed and under development projects in eight states and 13 markets encompassing over 11,500 acres, comprised of almost 18,100 planned residential lots and approximately 2,000 commercial acres. The oil and gas segment includes approximately 935,000 net acres of oil and gas mineral interests, with approximately 590,000 acres of fee ownership located principally in Texas, Louisiana, Alabama, and Georgia and approximately 345,000 net acres of leasehold interests principally located in Nebraska, Kansas, Oklahoma, North Dakota and Texas. These leasehold interests include about 8,000 net mineral acres in the core of the prolific Bakken and Three Forks formations. The other natural resources segment includes sale of wood fiber and management of our recreational leases, and approximately 1.5 million acres of groundwater resources, including a 45% nonparticipating royalty interest in groundwater produced or withdrawn for commercial purposes from approximately 1.4 million acres in Texas, Louisiana, Georgia and Alabama and about 20,000 acres of groundwater leases in central Texas. Forestar’s address on the World Wide Web is www.forestargroup.com.
Forward Looking Statements
This release contains “forward-looking statements” within the meaning of the federal securities laws. Forward-looking statements are typically identified by words or phrases such as “will,” “anticipate,” “estimate,” “expect,” “project,” “intend,” “plan,” “believe,” “target,” “forecast,” and other words and terms of similar meaning. These statements reflect management’s current views with respect to future events and are subject to risk and uncertainties. We note that a variety of factors and uncertainties could cause our actual results to differ significantly from the results discussed in the forward-looking statements, including but are not limited to: general economic, market, or business conditions; changes in commodity prices; opportunities (or lack thereof) that may be presented to us and that we may pursue; fluctuations in costs and expenses including development costs; demand for new housing, including impacts from mortgage credit rates or availability; lengthy and uncertain entitlement processes; cyclically of our businesses; accuracy of accounting assumptions; competitive actions by other companies; changes in laws or regulations; and other factors, many of which are beyond our control. Except as required by law, we expressly disclaim any obligation to publicly revise any forward-looking statements contained in this news release to reflect the occurrence of events after the date of this news release.
FORESTAR GROUP INC.
(UNAUDITED)
Business Segments
|
| | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2014 | | 2013 | | 2014 | | 2013 |
| | (In thousands) |
| Revenues: | | | | | | | |
Real estate (a) | $ | 55,173 |
| | $ | 41,219 |
| | $ | 120,653 |
| | $ | 119,908 |
|
| Oil and gas | 24,377 |
| | 15,831 |
| | 41,931 |
| | 31,335 |
|
| Other natural resources | 3,463 |
| | 3,029 |
| | 5,034 |
| | 6,307 |
|
| Total revenues | $ | 83,013 |
| | $ | 60,079 |
| | $ | 167,618 |
| | $ | 157,550 |
|
| Segment earnings: | | | | | | | |
| Real estate | $ | 27,297 |
| | $ | 8,104 |
| | $ | 50,872 |
| | $ | 27,550 |
|
| Oil and gas | 9,522 |
| | 4,243 |
| | 10,329 |
| | 9,370 |
|
| Other natural resources | 2,079 |
| | 991 |
| | 1,551 |
| | 2,243 |
|
| Total segment earnings | 38,898 |
| | 13,338 |
| | 62,752 |
| | 39,163 |
|
| Items not allocated to segments: | | | | | | | |
| General and administrative expense | (5,566 | ) | | (5,329 | ) | | (10,734 | ) | | (10,287 | ) |
Share-based compensation expense (b) | (3,219 | ) | | (1,460 | ) | | (3,532 | ) | | (11,875 | ) |
| Interest expense | (7,370 | ) | | (5,122 | ) | | (12,873 | ) | | (9,661 | ) |
| Other corporate non-operating income | 130 |
| | 25 |
| | 252 |
| | 56 |
|
| Income before taxes | 22,873 |
| | 1,452 |
| | 35,865 |
| | 7,396 |
|
| Income tax expense | (8,051 | ) | | (911 | ) | | (12,709 | ) | | (2,904 | ) |
| Net income attributable to Forestar Group Inc. | $ | 14,822 |
| | $ | 541 |
| | $ | 23,156 |
| | $ | 4,492 |
|
| | | | | | | | |
| Net income per common share: | | | | | | | |
| Diluted | $ | 0.34 |
| | $ | 0.02 |
| | $ | 0.53 |
| | $ | 0.13 |
|
| | | | | | | | |
| Weighted average common shares outstanding (in millions): | | | | | | | |
Diluted (c) | 43.7 |
| | 36.1 |
| | 43.7 |
| | 35.9 |
|
|
| | | | | | | | |
| | | Second Quarter |
| Supplemental Financial Information: | | 2014 | | 2013 |
| | | (In thousands) |
| Cash and cash equivalents | | $ | 184,168 |
| | $ | 69,138 |
|
| | | | | |
| Borrowings under credit facility | | — |
| | 200,000 |
|
| Secured senior notes | | 250,000 |
| | — |
|
| Convertible senior notes, net of discount | | 101,542 |
| | 98,353 |
|
| Tangible equity unit notes, net of discount | | 21,208 |
| | — |
|
Other debt (d) | | 27,578 |
| | 33,294 |
|
| Total debt | | $ | 400,328 |
| | $ | 331,647 |
|
| Net debt | | $ | 216,160 |
| | $ | 262,509 |
|
_____________________
| |
(a) | First six months 2013 real estate revenues include $41 million from the first quarter 2013 sale of Promesa, a wholly-owned multifamily community we developed in Austin. |
| |
(b) | First six months 2014 share-based compensation expense decreased principally as result of a decrease in our stock price since year-end 2013, compared with an increase in our stock price in first six months 2013 since year-end 2012, which impacted the value of vested cash-settled awards. |
| |
(c) | Second quarter and first six months 2014 weighted average diluted shares outstanding includes 7.9 million associated with our tangible equity units issued during fourth quarter 2013. |
| |
(d) | Consists principally of consolidated venture non-recourse debt. Excludes approximately $100.1 million of unconsolidated venture debt and approximately $8.2 million of outstanding letters of credit. |
FORESTAR GROUP INC.
REAL ESTATE SEGMENT
PERFORMANCE METRICS
|
| | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2014 | | 2013 | | 2014 | | 2013 |
| REAL ESTATE | | | | | | | |
| Owned, Consolidated & Equity Method Ventures: | | | | | | | |
| Residential Lots Sold | 537 |
| | 360 |
| | 1,511 |
| | 806 |
|
| Revenue per Lot Sold | $ | 64,056 |
| | $ | 57,588 |
| | $ | 50,228 |
| | $ | 54,432 |
|
| Commercial Acres Sold | 3 |
| | 34 |
| | 3 |
| | 37 |
|
| Revenue per Commercial Acre Sold | $ | 96,774 |
| | $ | 103,102 |
| | $ | 96,774 |
| | $ | 125,706 |
|
| Undeveloped Acres Sold | 3,208 |
| | 1,042 |
| | 12,537 |
| | 1,961 |
|
| Revenue per Acre Sold | $ | 2,460 |
| | $ | 2,579 |
| | $ | 2,202 |
| | $ | 2,753 |
|
| Owned & Consolidated Ventures: | | | | | | | |
| Residential Lots Sold | 481 |
| | 259 |
| | 1,317 |
| | 614 |
|
| Revenue per Lot Sold | $ | 60,651 |
| | $ | 57,154 |
| | $ | 47,644 |
| | $ | 54,440 |
|
| Commercial Acres Sold | 3 |
| | 32 |
| | 3 |
| | 35 |
|
| Revenue per Commercial Acre Sold | $ | 96,774 |
| | $ | 74,166 |
| | $ | 96,774 |
| | $ | 100,311 |
|
| Undeveloped Acres Sold | 2,950 |
| | 1,000 |
| | 12,279 |
| | 1,919 |
|
| Revenue per Acre Sold | $ | 2,473 |
| | $ | 2,576 |
| | $ | 2,200 |
| | $ | 2,755 |
|
| Ventures Accounted For Using the Equity Method: | | | | | | | |
| Residential Lots Sold | 56 |
| | 101 |
| | 194 |
| | 192 |
|
| Revenue per Lot Sold | $ | 93,306 |
| | $ | 58,700 |
| | $ | 67,772 |
| | $ | 54,407 |
|
| Commercial Acres Sold | — |
| | 2 |
| | — |
| | 2 |
|
| Revenue per Commercial Acre Sold | $ | — |
| | $ | 652,886 |
| | $ | — |
| | $ | 652,886 |
|
| Undeveloped Acres Sold | 258 |
| | 42 |
| | 258 |
| | 42 |
|
| Revenue per Acre Sold | $ | 2,306 |
| | $ | 2,650 |
| | $ | 2,306 |
| | $ | 2,650 |
|
SECOND QUARTER 2014
REAL ESTATE PIPELINE
|
| | | | | | | | | | | |
| Real Estate | | Undeveloped | | In Entitlement Process | | Entitled | | Developed & Under Development | | Total Acres (a) |
| Undeveloped Land | | | | | | | | | | |
| Owned | | 79,563 | | | | | | | |
|
|
| Ventures | | 5,073 | | | | | | | | 84,636 |
|
| Residential | | | | | | | | | | |
| Owned | | | | 21,762 | | 7,794 | | 535 | |
|
|
| Ventures | | | | | | 1,105 | | 131 | | 31,327 |
|
| Commercial | | | | | | | | | | |
| Owned | | | | 2,668 | | 1,062 | | 523 | |
|
|
| Ventures | | | | | | 250 | | 123 | | 4,626 |
|
| Total Acres | | 84,636 | | 24,430 | | 10,211 | | 1,312 | | 120,589 |
|
| | | | | | | | | | | |
| Estimated Residential Lots | | | | 16,100 | | 1,998 | | 18,098 |
|
_____________________
| |
(a) | In addition, at second quarter-end 2014, Forestar owns a 58% interest in a venture which controls approximately 2,000 acres of |
undeveloped land in Georgia with minimal investment. Excludes acres associated with fully developed commercial and income producing properties.
FORESTAR GROUP INC.
OIL AND GAS SEGMENT
PERFORMANCE METRICS
|
| | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Leasing Activity from Owned Mineral Interests | | | | | | | |
| Acres Leased | 1,380 |
| | 515 |
| | 3,121 |
| | 825 |
|
| Average Bonus / Acre | $ | 352 |
| | $ | 343 |
| | $ | 347 |
| | $ | 333 |
|
| Delay Rentals Received | $ | 14,000 |
| | $ | 6,000 |
| | $ | 14,000 |
| | $ | 464,000 |
|
| Oil & Gas Production | | | | | | | |
Royalty Interests (a) | | | | | | | |
| Gross Wells | 547 |
| | 543 |
| | 547 |
| | 543 |
|
| Oil Production (Barrels) | 30,400 |
| | 40,600 |
| | 63,100 |
| | 88,900 |
|
| Average Oil Price ($ / Barrel) | $ | 91.75 |
| | $ | 80.75 |
| | $ | 88.44 |
| | $ | 83.56 |
|
| Gas Production (MMcf) | 232.4 |
| | 322.2 |
| | 518.5 |
| | 699.4 |
|
| Average Gas Price ($ / Mcf) | $ | 4.61 |
| | $ | 3.18 |
| | $ | 4.10 |
| | $ | 3.11 |
|
BOE Production (b) | 69,100 |
| | 94,400 |
| | 149,500 |
| | 205,400 |
|
| Average Price ($ / BOE) | $ | 55.83 |
| | $ | 45.66 |
| | $ | 51.55 |
| | $ | 46.73 |
|
| Working Interests | | | | | | | |
| Gross Wells | 410 |
| | 449 |
| | 410 |
| | 449 |
|
| Oil Production (Barrels) | 206,900 |
| | 125,200 |
| | 346,200 |
| | 224,800 |
|
| Average Oil Price ($ / Barrel) | $ | 92.90 |
| | $ | 87.11 |
| | $ | 90.77 |
| | $ | 88.73 |
|
| Gas Production (MMcf) | 227.5 |
| | 183.1 |
| | 427.9 |
| | 399.7 |
|
| Average Gas Price ($ / Mcf) | $ | 4.39 |
| | $ | 3.36 |
| | $ | 4.84 |
| | $ | 3.53 |
|
BOE Production (b) | 244,800 |
| | 155,700 |
| | 417,500 |
| | 291,500 |
|
| Average Price ($ / BOE) | $ | 82.59 |
| | $ | 73.99 |
| | $ | 80.22 |
| | $ | 73.29 |
|
| Total Oil & Gas Interests | | | | | | | |
Gross Wells (c) | 948 |
| | 983 |
| | 948 |
| | 983 |
|
| Oil Production (Barrels) | 225,300 |
| | 152,700 |
| | 382,300 |
| | 286,100 |
|
| Average Oil Price ($ / Barrel) | $ | 95.38 |
| | $ | 90.64 |
| | $ | 93.75 |
| | $ | 92.86 |
|
| NGL Production (Barrels) | 12,000 |
| | 13,100 |
| | 27,000 |
| | 27,600 |
|
| Average NGL Price ($ / Barrel) | $ | 43.24 |
| | $ | 26.49 |
| | $ | 43.17 |
| | $ | 29.37 |
|
| Total Oil Production (Barrels) | 237,300 |
| | 165,800 |
| | 409,300 |
| | 313,700 |
|
| Average Total Oil Price ($ / Barrel) | $ | 92.75 |
| | $ | 85.55 |
| | $ | 90.41 |
| | $ | 87.26 |
|
| Gas Production (MMcf) | 459.9 |
| | 505.3 |
| | 946.4 |
| | 1,099.1 |
|
| Average Gas Price ($ / Mcf) | $ | 4.50 |
| | $ | 3.25 |
| | $ | 4.43 |
| | $ | 3.26 |
|
BOE Production (b) | 313,900 |
| | 250,100 |
| | 567,000 |
| | 496,900 |
|
| Average Price ($ / BOE) | $ | 76.70 |
| | $ | 63.30 |
| | $ | 72.66 |
| | $ | 62.31 |
|
| Average Daily Production | | | | | | | |
| BOE per Day | | | | | | | |
| Royalty Interests | 760 |
| | 1,037 |
| | 828 |
| | 1,136 |
|
| Working Interests | 2,690 |
| | 1,711 |
| | 2,305 |
| | 1,610 |
|
| Total | 3,450 |
| | 2,748 |
| | 3,133 |
| | 2,746 |
|
Working Interests BOE per Day | | | | | | | |
| North Dakota | 1,566 |
| | 814 |
| | 1,188 |
| | 669 |
|
| Kansas/Nebraska | 586 |
| | 351 |
| | 562 |
| | 339 |
|
| Texas, Louisiana and Other | 538 |
| | 546 |
| | 555 |
| | 602 |
|
| Total | 2,690 |
| | 1,711 |
| | 2,305 |
| | 1,610 |
|
_____________________
| |
(a) | Includes our share of venture activity in which we own a 50% interest. Our share of natural gas production is 50.5 MMcf and 103.2 MMcf in second quarter and first six months 2014, and 57.8 MMcf and 128.0 MMcf in second quarter and first six months 2013. |
| |
(b) | BOE – Barrels of oil equivalent (converting natural gas to oil at 6 Mcfe / Bbl). |
| |
(c) | Includes wells operated by third-party lessees/operators. Represent wells in which we own a royalty or working interest in a producing well. Excludes nine working interest wells in second quarter 2014 and 2013 as we also own a royalty interest in these wells. |
FORESTAR GROUP INC.
OIL AND GAS SEGMENT
|
| | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Well Activity | | | | | | | |
Mineral Interests Owned (a) | | | | | | | |
| Net Acres Held By Production | 36,000 |
| | 36,000 |
| | 36,000 |
| | 36,000 |
|
| Gross Wells Drilled | — |
| | — |
| | — |
| | — |
|
| Productive Gross Wells | 547 |
| | 543 |
| | 547 |
| | 543 |
|
Mineral Interests Leased | | | | | | | |
Net Acres Held By Production (b) | 41,000 |
| | 33,000 |
| | 41,000 |
| | 33,000 |
|
| Gross Wells Drilled | 45 |
| | 18 |
| | 66 |
| | 39 |
|
Productive Gross Wells (c) | 401 |
| | 440 |
| | 401 |
| | 440 |
|
| Total Well Activity | | | | | | | |
| Net Acres Held By Production | 77,000 |
| | 69,000 |
| | 77,000 |
| | 69,000 |
|
| Gross Wells Drilled | 45 |
| | 18 |
| | 66 |
| | 39 |
|
| Productive Gross Wells | 948 |
| | 983 |
| | 948 |
| | 983 |
|
_____________________
| |
(a) | Includes wells operated by third-party lessees/operators. Represent wells in which we own a royalty or working interest in a producing well. Excludes nine working interest wells at second quarter-end 2014 and 2013 as we also own a royalty interest in these wells. |
| |
(b) | Excludes 8,000 net acres in which we have an overriding royalty interest. |
| |
(c) | Exclude 1,181 wells in which we have an overriding royalty and nine working interest wells as we also own a royalty interest in these wells. |
FORESTAR GROUP INC.
OIL AND GAS SEGMENT
MINERAL INTERESTS
MINERAL INTERESTS OWNED (a)
Forestar’s oil and gas segment includes approximately 590,000 owned net mineral acres principally located in Texas, Louisiana, Georgia and Alabama.
|
| | | | | | | | | | | |
| State | Unleased | | Leased | | Held By Production | | Total |
| | | | (Net acres) |
| Texas | 208,000 |
| | 17,000 |
| | 27,000 |
| | 252,000 |
|
| Louisiana | 132,000 |
| | 3,000 |
| | 9,000 |
| | 144,000 |
|
| Georgia | 152,000 |
| | — |
| | — |
| | 152,000 |
|
| Alabama | 40,000 |
| | — |
| | — |
| | 40,000 |
|
| California | 1,000 |
| | — |
| | — |
| | 1,000 |
|
| Indiana | 1,000 |
| | — |
| | — |
| | 1,000 |
|
| | 534,000 |
| | 20,000 |
| | 36,000 |
| | 590,000 |
|
_____________________
| |
(a) | Represents net acres and includes ventures. |
MINERAL INTERESTS LEASED
Forestar’s oil and gas segment includes approximately 345,000 net mineral acres of leasehold interests principally located in Nebraska, Kansas, Oklahoma, Texas and North Dakota.
|
| | | | | | | | |
| State | Undeveloped | | Held By Production (a) | | Total |
| Nebraska | 223,000 |
| | 7,000 |
| | 230,000 |
|
| Kansas | 25,000 |
| | 6,000 |
| | 31,000 |
|
| Oklahoma | 23,000 |
| | 17,000 |
| | 40,000 |
|
| Alabama | 8,000 |
| | — |
| | 8,000 |
|
| Texas | 10,000 |
| | 3,000 |
| | 13,000 |
|
| North Dakota | 4,000 |
| | 4,000 |
| | 8,000 |
|
| Other | 11,000 |
| | 4,000 |
| | 15,000 |
|
| | 304,000 |
| | 41,000 |
| | 345,000 |
|
_____________________
| |
(a) | Excludes approximately 8,000 net acres of overriding royalty interests. |
FORESTAR GROUP INC.
OTHER NATURAL RESOURCES SEGMENT
PERFORMANCE METRICS
|
| | | | | | | | | | | | | | | |
| | Second Quarter | | First Six Months |
| | 2014 | | 2013 | | 2014 | | 2013 |
| Fiber Sales | | | | | | | |
| Pulpwood tons sold | 58,200 |
| | 128,100 |
| | 86,400 |
| | 248,700 |
|
| Average pulpwood price per ton | $ | 11.42 |
| | $ | 8.66 |
| | $ | 10.85 |
| | $ | 9.19 |
|
| Sawtimber tons sold | 49,600 |
| | 56,900 |
| | 78,500 |
| | 127,800 |
|
| Average sawtimber price per ton | $ | 23.23 |
| | $ | 23.87 |
| | $ | 22.67 |
| | $ | 23.04 |
|
| | | | | | | | |
| Total tons sold | 107,800 |
| | 185,000 |
| | 164,900 |
| | 376,500 |
|
Average stumpage price per ton (a) | $ | 16.86 |
| | $ | 13.34 |
| | $ | 16.48 |
| | $ | 13.89 |
|
| | | | | | | | |
| Recreational Activity | | | | | | | |
| Average recreational acres leased | 110,000 |
| | 121,800 |
| | 113,200 |
| | 122,200 |
|
| Average price per leased acre | $ | 9.69 |
| | $ | 9.29 |
| | $ | 9.41 |
| | $ | 9.29 |
|
_____________________
| |
(a) | Average stumpage price per ton is based on gross revenues less cut and haul costs. |
FORESTAR GROUP INC.
PROJECTS IN ENTITLEMENT
A summary of our real estate projects in the entitlement process (a) at second quarter-end 2014 follows:
|
| | | | | | |
| Project | County | | Market | | Project Acres (b) |
| California | | | | | |
| Hidden Creek Estates | Los Angeles | | Los Angeles | | 700 |
|
| Terrace at Hidden Hills | Los Angeles | | Los Angeles | | 30 |
|
| | | | | | |
| Georgia | | | | | |
| Ball Ground | Cherokee | | Atlanta | | 500 |
|
| Crossing | Coweta | | Atlanta | | 230 |
|
| Fincher Road | Cherokee | | Atlanta | | 3,890 |
|
| Garland Mountain | Cherokee/Bartow | | Atlanta | | 350 |
|
| Martin’s Bridge | Banks | | Atlanta | | 970 |
|
| Mill Creek | Coweta | | Atlanta | | 770 |
|
| Wolf Creek | Carroll/Douglas | | Atlanta | | 12,230 |
|
| Yellow Creek | Cherokee | | Atlanta | | 1,060 |
|
| | | | | | |
| Texas | | | | | |
| Lake Houston | Harris/Liberty | | Houston | | 3,700 |
|
| Total | | | | | 24,430 |
|
_____________________
| |
(a) | A project is deemed to be in the entitlement process when customary steps necessary for the preparation of an application for governmental land-use approvals, like conducting pre-application meetings or similar discussions with governmental officials, have commenced, or an application has been filed. Projects listed may have significant steps remaining, and there is no assurance that entitlements ultimately will be received. |
| |
(b) | Project acres, which are the total for the project regardless of our ownership interest, are approximate. The actual number of acres entitled may vary. |
FORESTAR GROUP INC.
REAL ESTATE PROJECTS
A summary of activity within our projects in the development process, which includes entitled (a), developed and under development real estate projects, at second quarter-end 2014 follows:
|
| | | | | | | | | | | | | | | | |
| | | | | | Residential Lots (c) | | Commercial Acres (d) |
| Project | County | | Interest Owned (b) | | Lots Sold Since Inception | | Lots Remaining | | Acres Sold Since Inception | | Acres Remaining (e) |
| Projects we own | | | | | | | | | | | |
| California | | | | | | | | | | | |
| San Joaquin River | Contra Costa/Sacramento | | 100 | % | | — |
| | — |
| | — |
| | 288 |
|
| Colorado | | | | | | | | | | | |
| Buffalo Highlands | Weld | | 100 | % | | — |
| | 164 |
| | — |
| | — |
|
| Johnstown Farms | Weld | | 100 | % | | 269 |
| | 343 |
| | 2 |
| | 7 |
|
| Pinery West | Douglas | | 100 | % | | 45 |
| | 41 |
| | 20 |
| | 94 |
|
| Stonebraker | Weld | | 100 | % | | — |
| | 603 |
| | — |
| | — |
|
| Tennessee | | | | | | | | | | | |
| Morgan Farms | Williamson | | 100 | % | | 40 |
| | 133 |
| | — |
| | — |
|
| Weatherford Estates | Williamson | | 100 | % | | — |
| | 17 |
| | — |
| | — |
|
| Texas | | | | | | | | | | | |
| Arrowhead Ranch | Hays | | 100 | % | | — |
| | 387 |
| | — |
| | 6 |
|
| Bar C Ranch | Tarrant | | 100 | % | | 292 |
| | 813 |
| | — |
| | — |
|
| Barrington Kingwood | Harris | | 100 | % | | 120 |
| | 60 |
| | — |
| | — |
|
| Cibolo Canyons | Bexar | | 100 | % | | 831 |
| | 819 |
| | 130 |
| | 20 |
|
| Harbor Lakes | Hood | | 100 | % | | 215 |
| | 234 |
| | 2 |
| | 19 |
|
| Hunter’s Crossing | Bastrop | | 100 | % | | 471 |
| | 39 |
| | 41 |
| | 62 |
|
| La Conterra | Williamson | | 100 | % | | 197 |
| | 133 |
| | — |
| | 58 |
|
| Lakes of Prosper | Collin | | 100 | % | | 65 |
| | 220 |
| | — |
| | — |
|
| Lantana | Denton | | 100 | % | | 1,013 |
| | 749 |
| | 9 |
| | 3 |
|
| Maxwell Creek | Collin | | 100 | % | | 897 |
| | 102 |
| | 10 |
| | — |
|
| Oak Creek Estates | Comal | | 100 | % | | 188 |
| | 459 |
| | 13 |
| | — |
|
| Parkside | Collin | | 100 | % | | — |
| | 200 |
| | — |
| | — |
|
| Stoney Creek | Dallas | | 100 | % | | 221 |
| | 533 |
| | — |
| | — |
|
| Summer Creek Ranch | Tarrant | | 100 | % | | 942 |
| | 332 |
| | 35 |
| | 44 |
|
| Summer Lakes | Fort Bend | | 100 | % | | 610 |
| | 520 |
| | 56 |
| | — |
|
| Summer Park | Fort Bend | | 100 | % | | 69 |
| | 129 |
| | 28 |
| | 62 |
|
| The Colony | Bastrop | | 100 | % | | 448 |
| | 701 |
| | 22 |
| | 31 |
|
| The Preserve at Pecan Creek | Denton | | 100 | % | | 506 |
| | 288 |
| | — |
| | 7 |
|
| Village Park | Collin | | 100 | % | | 749 |
| | 7 |
| | 3 |
| | 2 |
|
| Westside at Buttercup Creek | Williamson | | 100 | % | | 1,491 |
| | 6 |
| | 66 |
| | — |
|
| Other projects (9) | Various | | 100 | % | | 1,727 |
| | 277 |
| | 133 |
| | 7 |
|
| Georgia | | | | | | | | | | | |
| Seven Hills | Paulding | | 100 | % | | 750 |
| | 340 |
| | 26 |
| | 113 |
|
| The Villages at Burt Creek | Dawson | | 100 | % | | — |
| | 1,715 |
| | — |
| | 57 |
|
| Other projects (18) | Various | | 100 | % | | 242 |
| | 2,851 |
| | — |
| | 705 |
|
| Other | | | | | | | | | | | |
| Other projects (3) | Various | | 100 | % | | 522 |
| | 431 |
| | — |
| | — |
|
| | | | | | 12,920 |
| | 13,646 |
| | 596 |
| | 1,585 |
|
|
| | | | | | | | | | | | | | | | |
| | | | | | Residential Lots (c) | | Commercial Acres (d) |
| Project | County | | Interest
Owned (b) | | Lots Sold Since Inception | | Lots Remaining | | Acres Sold Since Inception | | Acres Remaining (e) |
| Projects in entities we consolidate | | | | | | | | | | | |
| Texas | | | | | | | | | | | |
| City Park | Harris | | 75 | % | | 1,311 |
| | 458 |
| | 50 |
| | 115 |
|
| Timber Creek | Collin | | 88 | % | | — |
| | 614 |
| | — |
| | — |
|
| Willow Creek Farms II | Waller/Fort Bend | | 90 | % | | 90 |
| | 160 |
| | — |
| | — |
|
| Other projects (2) | Various | | Various |
| | 9 |
| | 199 |
| | — |
| | 18 |
|
| Georgia | | | | | | | | | | | |
| The Georgian | Paulding | | 75 | % | | 535 |
| | — |
| | — |
| | — |
|
| | | | | | 1,945 |
| | 1,431 |
| | 50 |
| | 133 |
|
| Total owned and consolidated | | | | | 14,865 |
| | 15,077 |
| | 646 |
| | 1,718 |
|
| Projects in ventures that we account for using the equity method | | | | | | | | | | |
| Texas | | | | | | | | | | | |
| Entrada | Travis | | 50 | % | | — |
| | 821 |
| | — |
| | — |
|
| Fannin Farms West | Tarrant | | 50 | % | | 324 |
| | 24 |
| | — |
| | 12 |
|
| Harper’s Preserve | Montgomery | | 50 | % | | 314 |
| | 1,379 |
| | 8 |
| | 51 |
|
| Lantana - Rayzor Ranch | Denton | | 25 | % | | 1,163 |
| | — |
| | 16 |
| �� | 42 |
|
| Long Meadow Farms | Fort Bend | | 38 | % | | 1,307 |
| | 495 |
| | 183 |
| | 120 |
|
| Southern Trails | Brazoria | | 80 | % | | 739 |
| | 252 |
| | — |
| | — |
|
| Stonewall Estates | Bexar | | 50 | % | | 340 |
| | 50 |
| | — |
| | — |
|
| Other projects (2) | Various | | Various |
| | — |
| | — |
| | — |
| | 15 |
|
| Total in ventures | | | | | 4,187 |
| | 3,021 |
| | 207 |
| | 240 |
|
| Combined total | | | | | 19,052 |
| | 18,098 |
| | 853 |
| | 1,958 |
|
_____________________
| |
(a) | A project is deemed entitled when all major discretionary governmental land-use approvals have been received. Some projects may require additional permits and/or non-governmental authorizations for development. |
| |
(b) | Interest owned reflects our net equity interest in the project, whether owned directly or indirectly. There are some projects that have multiple ownership structures within them. Accordingly, portions of these projects may appear as owned, consolidated or accounted for using the equity method. |
| |
(c) | Lots are for the total project, regardless of our ownership interest. Lots remaining represent vacant developed lots, lots under development and future planned lots and are subject to change based on business plan revisions. |
| |
(d) | Commercial acres are for the total project, regardless of our ownership interest, and are net developable acres, which may be fewer than the gross acres available in the project. |
| |
(e) | Excludes acres associated with commercial and income producing properties. |
A summary of our significant commercial and income producing properties at second quarter-end 2014 follows:
|
| | | | | | | | | | | | |
| Project | | Market | | Interest Owned (a) | | Type | | Acres | | Description |
| Radisson Hotel | | Austin | | 100 | % | | Hotel | | 2 |
| | 413 guest rooms and suites |
Eleven (b) | | Austin | | 25 | % | | Multifamily | | 3 |
| | 257-unit luxury apartment |
360° (c) | | Denver | | 20 | % | | Multifamily | | 4 |
| | 304-unit luxury apartment |
Midtown Cedar Hill (c) | | Dallas | | 100 | % | | Multifamily | | 13 |
| | 354-unit luxury apartment |
Acklen (c) | | Nashville | | 30 | % | | Multifamily | | 4 |
| | 320-unit luxury apartment |
_____________________
| |
(a) | Interest owned reflects our total interest in the project, whether owned directly or indirectly. |
| |
(b) | Construction substantially complete. |
| |
(c) | Construction in progress. |
