Exhibit 99.1
For Information
---------------
Mark A. Hellerstein
Robert T. Hanley
303-861-8140
ST. MARY REPORTS RECORD RESULTS FOR FIRST QUARTER 2005 AND
UPDATES GUIDANCE
DENVER, May 3, 2005 - St. Mary Land & Exploration Company (NYSE: SM) today
reported record earnings for the first quarter 2005 of $35.1 million or $0.54
per diluted share, which reflects the two-for-one stock split effected in the
form of a stock dividend distributed on March 31, 2005. First quarter 2004
earnings were $21.4 million or $0.33 per diluted share. Revenues for the first
quarter of 2005 were a record $143.8 million compared to $96.5 million for the
first quarter of 2004. First quarter Discretionary Cash Flow(1) increased to a
record $90.8 million in the first quarter of 2005 from $56.2 million in the
first quarter of 2004.
Daily oil and gas production during the first quarter 2005 averaged a record
229.4 million cubic feet of gas equivalent (MMCFE), up from 202.8 MMCFE in the
comparable 2004 period. Average prices realized during the quarter were $6.22
per Mcf and $45.37 per barrel, 20% and 61% higher, respectively, than the
realized prices in the first quarter of 2004.
Mark Hellerstein, Chairman, President and CEO, commented, "This was another
excellent quarter at St. Mary. We closed the Agate acquisition in January and
had good drilling results. The addition of the previously announced Cromwell
play to our other multi-year drilling programs gives us a solid base for future
growth. We anticipate our drilling program will provide an increasing rate of
production throughout the year."
The Company's forecasts for the second quarter and the full year 2005 are shown
below.
2nd Quarter Year
------------- --------
Oil and gas production 20.5 - 21.5 BCFE 83.0 - 87.0 BCFE
Lease operating expenses,
including production taxes
and transportation $1.45 - $1.55/MCFE $1.52 - $1.57/MCFE
General and administrative exp. $0.32 - $0.37/MCFE $0.31 - $0.36/MCFE
Depreciation, depletion & amort. $1.47 - $1.52/MCFE $1.50 - $1.55/MCFE
Operational updates for the first quarter 2005 were provided in the Company's
April 11, 2005 press release.
As previously announced, the St. Mary first quarter earnings teleconference call
is scheduled for May 4 at 8:00 am (MDT). The call participation number is
888-424-5231. A replay of the conference call will be available two hours after
the completion of the call, 24 hours per day through May 13 at 800-642-1687,
conference number 5396566. International participants can dial 706-634-6088 to
take part in the conference call, and can access a replay of the call at
706-645-9291, conference number 5396566. In addition the call will be broadcast
live at St. Mary's website at www.stmaryland.com and this press release and
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financial highlights attachment will be available before the call at
www.stmaryland.com under "News--Press Releases." An audio recording of the
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conference call will be available at that site through May 31.
This release contains forward looking statements within the meaning of
securities laws, including forecasts and projections. The words "will,"
"believe," "anticipate," "intend," "estimate," "forecast" and "expect" and
similar expressions are intended to identify forward looking statements. These
statements involve known and unknown risks, which may cause St. Mary's actual
results to differ materially from results expressed or implied by the forward
looking statements. These risks include such factors as the uncertain nature of
the expected benefits from the acquisition of oil and gas properties, the
volatility and level of oil and natural gas prices, unexpected drilling
conditions and results, the risks of various exploration strategies, production
rates and reserve replacement, the imprecise nature of oil and gas reserve
estimates, drilling and operating service availability, uncertainties in cash
flow, the financial strength of hedge contract counterparties, the availability
of economically attractive exploration and development and property acquisition
opportunities and any necessary financing, competition, litigation,
environmental matters, the potential impact of government regulations, and other
such matters discussed in the "Risk Factors" section of St. Mary's 2004 Annual
Report on Form 10-K filed with the SEC. Although St. Mary may from time to time
voluntarily update its prior forward looking statements, it disclaims any
commitment to do so except as required by securities laws.
(1) Discretionary cash flow is computed as net income plus
depreciation, depletion, amortization, impairments, deferred
taxes, exploration expense, stock based compensation expense
and non-cash changes in the Net Profits Plan liability, less
the cumulative effect of unrealized derivative loss. See the
attached financial highlights for a reconciliation of
discretionary cash flow to net cash provided by operating
activities, a presentation of other cash flow information, and
a statement indicating why management believes the
presentation of the non-GAAP measure of discretionary cash
flow provides useful information to investors.
PR-05-09
###
ST. MARY LAND & EXPLORATION COMPANY FINANCIAL HIGHLIGHTS
March 31, 2005
(Unaudited)
PRODUCTION DATA Three Months Ended
- --------------- March 31, Percent
-----------------------------
2005 2004 Change
-----------------------------
Average realized price, net of hedging:
Gas (per Mcf) $ 6.22 $ 5.20 20%
Oil (per Bbl) $ 45.37 $ 28.20 61%
Production:
Gas (MMcf) 12,047 11,613 4%
Oil (MBbls) 1,433 1,141 26%
MMCFE (6:1) 20,647 18,456 12%
Daily production:
Gas (Mcf per day) 133,852 127,614 5%
Oil (Bbls per day) 15,927 12,533 27%
MCFE per day (6:1) 229,416 202,812 13%
Margin analysis per MCFE:
Average net realized price, net of hedging $ 6.78 $ 5.02 35%
Oil and gas production costs 1.56 1.28 22%
General and administrative costs 0.29 0.30 -3%
-----------------------------
Operating margin $ 4.93 $ 3.44 43%
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Depletion, depreciation & amortization $ 1.46 $ 1.12 30%
INCOME STATEMENT
- ----------------
(In thousands, except per share amounts) Three Months Ended
March 31,
-----------------------------
2005 2004
-----------------------------
Operating Revenues:
Oil and gas production revenue $ 138,370 $ 101,206
Oil and gas hedge gain (loss) 1,560 (8,599)
Marketed gas revenue 3,396 3,573
Gain on sale of proved properties - 195
Other revenue 492 107
-----------------------------
143,818 96,482
-----------------------------
Operating expenses:
Oil and gas production expense 32,159 23,543
Depletion, depreciation, amortization
and abandonment liability accretion 30,074 20,626
Exploration 7,083 4,631
Abandonment and impairment of
unproved properties 1,870 922
General and administrative 5,986 5,577
Change in Net Profits Plan liability 4,221 2,160
Marketed gas operating expense 3,125 3,411
Derivative loss (gain) 1,129 (852)
Other expense 514 585
-----------------------------
86,161 60,603
-----------------------------
Income from operations 57,657 35,879
Interest income 82 144
Interest expense (1,944) (1,488)
-----------------------------
Income before income taxes 55,795 34,535
Income tax expense - current 10,423 5,901
Income tax expense - deferred 10,269 7,185
-----------------------------
Net income $ 35,103 $ 21,449
=============================
Basic weighted-avg shares outstanding 57,231 59,549
=========== ===========
Diluted weighted-avg shares outstanding 67,047 68,383
=========== ===========
Basic net income per common share $ 0.61 $ 0.36
=========== ===========
Diluted net income per common share $ 0.54 $ 0.33
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BALANCE SHEET
- -------------
(In thousands) Mar 31, Dec 31,
2005 2004
-----------------------------
Working capital (deficit) $ (959) $ 12,035
Long-term debt $ 146,814 $ 136,791
Stockholders' equity $ 500,290 $ 484,455
Shares outstanding - permanent equity 57,233 56,958
PROVEN RESERVES
- --------------- Dec 31, Dec 31,
2004 2003
----------- -----------
Oil (MBbls) 56,574 47,787
Gas (MMcf) 319,196 307,024
----------- -----------
MMCFE (6:1) 658,638 593,744
=========== ===========
CASH FLOW
- ---------
(In thousands)
Reconciliation of Discretionary Cash Flow
to Net Cash Provided by Operating Activities:
Three Months Ended
March 31,
-----------------------------
2005 2004
-----------------------------
Discretionary Cash Flow (1) $ 90,784 $ 56,192
Gain on property sales - (195)
Exploration exp, excluding
exploratory dry hole exp (6,883) (5,660)
Minority interest & other 1,046 1,161
Changes in working capital and deferred taxes 7,184 (11,580)
----------- -----------
Net Cash Provided by Operating Activities $ 92,131 $ 39,918
=========== ===========
Net Cash Used in Investing Activities $ (94,278) $ (41,472)
=========== ===========
Net Cash Provided by Financing Activities $ 13,249 $ 4,533
=========== ===========
(1)Discretionary cash flow is computed as net income plus depreciation,
depletion, amortization, impairments, deferred taxes, exploration expense,
stock-based compensation expense, and non-cash changes in the Net Profits
Plan liability less the cumulative effect of unrealized derivative loss. The
non-GAAP measure of discretionary cash flow is presented since management
believes that it provides useful additional information to investors for
analysis of St. Mary's ability to internally generate funds for exploration,
development and acquisitions. In addition, discretionary cash flow is widely
used by professional research analysts and others in the valuation,
comparison and investment recommendations of companies in the oil and gas
exploration and production industry, and many investors use the published
research of industry research analysts in making investment decisions.
Discretionary cash flow should not be considered in isolation or as a
substitute for net income, income from operations, net cash provided by
operating activities or other income, profitability, cash flow or liquidity
measures prepared under GAAP. Since discretionary cash flow excludes some,
but not all, items that affect net income and net cash provided by operating
activities and may vary among companies, the discretionary cash flow amounts
presented may not be comparable to similarly titled measures of other
companies.
