EXHIBIT 99.2
[GRAPHIC OMITTED]
BRIGHAM EXPLORATION NEWS RELEASE
EXPLORATION COMPANY FOR IMMEDIATE RELEASE
BRIGHAM EXPLORATION ANNOUNCES Q1 2002 FINANCIAL RESULTS AND PROVIDES Q2 2002
GUIDANCE
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Austin, TX -- May 7, 2002 -- Brigham Exploration Company (NASDAQ:BEXP)
today announced its financial results for the first quarter ended March 31,
2002. Highlights of Brigham's financial performance for the first quarter
include:
- - Production volumes increased 10% to average 25.3 MMcfe per day as compared
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to volumes produced in the first quarter of 2001, with an estimated exit
rate for the quarter of approximately 30 MMcfe per day;
- - 6% sequential quarterly growth in revenue due to 5% higher realized natural
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gas and oil prices ($2.83 vs. $2.69 per Mcfe); and
- - 8% sequential increase in EBITDA to $4.3 million in the first quarter 2002
---------------------------------
from $4.0 million in the fourth quarter 2001 due to the combined effects of
improved realized sales prices and lower discretionary unit operating
costs.
FIRST QUARTER 2002 RESULTS
Average net daily production volumes for the first quarter 2002 were 25.3
MMcfe, an increase of 10% from the first quarter 2001 and flat relative to the
fourth quarter 2001. Brigham estimates that it exited the first quarter 2002
producing approximately 30 MMcfe per day.
Natural gas and oil sales declined 7% from $6.9 million in the first
quarter of 2001 to $6.4 million in the first quarter of 2002. A 16% decrease in
Brigham's average equivalent sales price received for natural gas and oil was
partially offset by $1.3 million in revenue related to increased production
volumes.
Lease operating expenses in the first quarter of 2002 were $871,000
compared to $706,000 in the first quarter of 2001. Partially offsetting this
increase, production taxes declined 24% to $353,000 in the first quarter of 2002
compared to $466,000 in the first quarter of 2001. Production tax refunds on
wells that qualify for reduced severance tax rates and a 59% decrease in the
average pre-hedge equivalent sales price were the primary contributors to this
decrease.
General and administrative expenses in the first quarter 2002 were $964,000
and increased 5% to $0.42 per Mcfe on a per unit of equivalent production basis
relative to the first quarter 2001. Depletion expenses were $3.1 million and
Brigham's depletion rate per unit increased 15% over the prior year first
quarter to $1.38 per Mcfe. Of this increase, $289,000 was attributable to
higher production volumes and $371,000 was due to an increase in the depletion
rate per unit of production.
Lower interest rates on outstanding debt borrowings during the first
quarter of 2002 led to a decrease in interest expense from $1.8 million in first
quarter of 2001 to $1.4 million in the first quarter of 2002. Brigham's average
effective interest rate on its total outstanding indebtedness decreased from
10.9% in the first quarter of 2001 to 7.4% in the first quarter of 2002. The
decrease in Brigham's average effective interest is primarily the result of
lower LIBOR rates for the first quarter of 2002.
Earnings before interest, taxes, depreciation, depletion, amortization and
other non-cash charges (EBITDA) decreased from $5.1 million in the first quarter
2001 to $4.3 million in the first quarter 2002. Operating cash flow, before
changes in working capital, declined 8% from $3.7 million to $3.4 million for
the first quarter 2002. However, on a sequential quarterly basis, EBITDA
increased 8% and operating cash flow improved by 11% from fourth quarter 2001
levels. Recurring earnings per diluted share were $(0.07) for the first quarter
of 2002, compared to $0.01 per diluted share for the first quarter 2001.
Net capital expenditures during the first quarter 2002 totaled $6.6
million, which included $5.2 million related to drilling, $344,000 for land and
G&G activities and $1.1 million for capitalized interest and overhead expenses.
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EXHIBIT 99.2
MANAGEMENT COMMENTS
Curtis Harrell, the Company's Executive Vice President and CFO stated,
"We're pleased with our progress during the first quarter, with results in line
with expectations. More importantly, given our recent increase in production
volumes, coupled with substantially improved commodity prices and an improved
hedge position, we're now well positioned to deliver an outstanding second
quarter. Our corporate goal remains to deliver sequential quarterly growth in
production volumes and cash flow for each reporting period this year."
SECOND QUARTER 2002 RESULTS GUIDANCE
The following forecasts and estimates of Brigham's second quarter 2002
results are forward looking statements subject to the risks and uncertainties
identified in the "Forward Looking Statements Disclosure" at the end of this
release.
Brigham currently expects second quarter 2002 production volumes to average
between 28 and 31 MMcfe per day, 58% of which consists of natural gas. For the
second quarter 2002, lease operating expenses are projected to be $0.36 per
Mcfe, production taxes are projected to be 5.5% of pre-hedge oil and gas
revenues, and net general and administrative expenses are projected to be
$950,000 ($0.34 to $0.38 per Mcfe).
Based on these production and cost estimates, assumed average NYMEX prices
of $3.48 per MMBtu for natural gas and $26.17 per barrel for oil, and taking
into account current hedging contracts outstanding, Brigham forecasts revenue of
between $8.1 and $9.1 million and EBITDA of between $5.8 and $6.6 million for
the second quarter 2002.
CONFERENCE CALL INFORMATION
Brigham management will host a conference call to discuss the Company's
first quarter 2002 operational and financial results with investors, analysts
and other interested parties on Wednesday, May 8th, at 9:00 a.m. Central time.
To participate in the call, please dial 800-360-9865 and ask for the Brigham
Exploration conference call. A telephone recording of the conference call will
be available to interested parties approximately two hours after the call is
completed through 12:00 p.m. Central time on Wednesday, May 22nd. To access the
recording, domestic callers dial 800-428-6051 and international callers dial
973-709-2089. The passcode I.D. for the conference playback is 241324. In
addition, a live and archived web cast of the conference call will be available
over the Internet at either www.bexp3d.com or www.streetevents.com.
ABOUT BRIGHAM EXPLORATION
Brigham Exploration Company is an independent exploration and production
company that applies 3-D seismic imaging and other advanced technologies to
systematically explore and develop onshore domestic natural gas and oil
provinces. For more information about Brigham Exploration, please visit our
website at www.bexp3d.com or contact Investor Relations at 512-427-3444.
FORWARD LOOKING STATEMENTS DISCLOSURE
Except for the historical information contained herein, the matters
discussed in this news release are forward looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995 that are based upon
current expectations. Important factors that could cause actual results to
differ materially from those in the forward looking statements include risks
inherent in exploratory drilling activities, the timing and extent of changes in
commodity prices, unforeseen engineering and mechanical or technological
difficulties in drilling wells, availability of drilling rigs, land issues,
federal and state regulatory developments and other risks more fully described
in the company's filings with the Securities and Exchange Commission. All
forward looking statements contained in this release, including any forecasts
and estimates, are based on management's outlook only as of the date of this
release, and we undertake no obligation to update or revise these forward
looking statements, whether as a result of subsequent developments or otherwise.
Contact: John Turner, Manager - Finance & Investor Relations
(512) 427-3300 / investor@bexp3d.com
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EXHIBIT 99.2
BRIGHAM EXPLORATION COMPANY
SUMMARY CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data) (unaudited)
Three Months Ended March 31,
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2001 2002
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Revenues:
Natural gas and oil sales $ 6,905 $ 6,434
Other revenue 138 10
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7,043 6,444
Costs and expenses:
Lease operating 706 871
Production taxes 466 353
General and administrative 817 964
Depletion of natural gas and oil properties 2,477 3,137
Depreciation and amortization 152 103
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4,618 5,428
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Operating income 2,425 1,016
Interest expense, net (1,806) (1,421)
Interest income 62 19
Other income (expense) (a) 221 (248)
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Net income (loss) before income taxes 902 (634)
Income taxes - -
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Net income (loss) 902 (634)
Preferred stock accretion and dividends 478 698
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Net income (loss) to common stockholders $ 424 $ (1,332)
================= ===============
Net income (loss) to common per share:
Basic $ 0.03 $ (0.08)
Diluted $ 0.02 $ (0.08)
Wt. avg. common shares outstanding:
Basic 15,983 16,016
Diluted 17,888 16,016
(a) Includes non-cash income (expenses) related to changes
in the fair market value of certain hedging contracts of: $ 221 $ (251)
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EXHIBIT 99.2
BRIGHAM EXPLORATION COMPANY
PRODUCTION, SALES PRICES AND OTHER FINANCIAL DATA
(unaudited)
Three Months Ended March 31,
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2001 2002
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Avg. net daily production:
Natural gas (MMcf) 17.9 14.9
Oil (Bbls) 841 1,720
Equivalent natural gas (MMcfe) (6:1) 22.9 25.3
Total net production:
Natural gas (MMcf) 1,610 1,344
Oil (MBbls) 76 155
Equivalent natural gas (MMcfe) (6:1) 2,064 2,273
% Natural gas 78% 59%
Sales prices:
Natural gas ($/Mcf) (a) $ 3.03 $ 2.49
Oil ($/Bbl) (a) $ 26.74 $ 19.93
Equivalent natural gas ($/Mcfe) (6:1) $ 3.35 $ 2.83
Other financial data:
EBITDA ($000) (b) $ 5,116 $ 4,278
Operating cash flow before changes in working capital ($000) $ 3,728 $ 3,370
(a) Includes the effects of hedging gains (losses) of:
Natural gas ($/Mcf) $ (4.08) $ 0.25
Oil ($/Bbl) $ (1.00) $ (0.32)
(b) Net income (loss) plus interest expense, DD&A expenses, income taxes and other non-cash items.
SUMMARY CONSOLIDATED BALANCE SHEETS
(in thousands) (unaudited)
December 31, March 31,
2001 2002
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Assets:
Current assets $ 16,968 $ 19,227
Natural gas and oil properties, at cost, net 151,891 155,383
Other property and equipment, at cost, net 1,331 1,337
Other non-current assets 3,218 2,990
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Total assets $ 173,408 $ 178,937
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Liabilities and stockholders' equity:
Current liabilities $ 15,266 $ 19,280
Notes payable 75,000 75,000
Senior subordinated notes 16,721 20,948
Other non-current liabilities 206 485
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Total liabilities 107,193 115,713
Redeemable preferred stock 16,614 17,312
Stockholders' equity 49,601 45,912
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Total liabilities and stockholders' equity $ 173,408 $ 178,937
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EXHIBIT 99.2
BRIGHAM EXPLORATION COMPANY
SUMMARY CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands) (unaudited)
Three Months Ended March 31,
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2001 2002
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Cash flows from operating activities:
Net income (loss) $ 902 $ (634)
Depletion, depreciation and amortization 2,629 3,240
Interest paid through issuance of add'l senior sub. Notes 75 227
Amortization of deferred loan fees and debt issuance cost 343 286
Market value adjustment for derivative instruments (221) 251
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Operating cash flow 3,728 3,370
Changes in working capital and other items (2,476) 661
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Cash flows provided (used) by operating activities 1,252 4,031
Cash flows used by investing activities (8,918) (5,000)
Cash flows provided by financing activities 18,858 3,677
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Net increase (decrease) in cash and cash equivalents $ 11,192 $ 2,708
============== ==============
SUMMARY PER MCFE DATA
(unaudited)
Three Months Ended March 31,
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2001 2002
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Revenues:
Natural gas and oil sales $ 3.35 $ 2.83
Other revenue 0.07 0.00
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3.42 2.83
Costs and expenses:
Lease operating 0.34 0.38
Production taxes 0.23 0.16
General and administrative 0.40 0.42
Depletion of natural gas and oil properties 1.20 1.38
Depreciation and amortization 0.07 0.05
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2.24 2.39
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Operating income $ 1.18 $ 0.44
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EXHIBIT 99.2
BRIGHAM EXPLORATION COMPANY
SUMMARY OF COMMODITY PRICE HEDGES OUTSTANDING AS OF MAY 7, 2002
(unaudited)
Q2 2002 Q3 2002 Q4 2002 Q1 2003 Q2 2003 Q3 2003 Q4 2003
-------- -------- -------- -------- -------- -------- --------
Natural Gas Swap: MMBtu/d 7,500 10,000 8,500 7,500 6,000 5,000 3,500
$/MMBtu $ 2.900 $ 3.165 $ 3.246 $ 3.532 $ 3.281 $ 3.503 $ 3.731
Natural Gas Cap: MMBtu/d 10,000
$/MMBtu $ 2.756
Crude Oil Swap: Bbls/d - - 500 250 250 250 250 250
$/Bbl - - $ 25.06 $ 24.50 $ 23.92 $ 23.50 $ 23.15 $ 22.90
Crude Oil Collar: Cap - Bbls/d 750 500 500 250 250 - - - -
Cap - $/Bbl $ 22.29 $ 22.46 $ 22.46 $ 22.56 $ 22.56 - - - -
Floor - Bbls/d 750 500 500 250 250 - - - -
Floor - $/Bbl $ 18.00 $ 18.00 $ 18.00 $ 18.00 $ 18.00 - - - -
Note: Hedged volumes and prices reflected in this table represent average
contract amounts for the quarterly periods presented; natural gas hedge
prices and crude oil hedge contract prices are based on NYMEX pricing.
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