PRESS RELEASE Contact: Carrizo Oil & Gas, Inc.
B. Allen Connell, Director of Investor Relations
Paul F. Boling, Chief Financial Officer
(281) 496-1352
CARRIZO OIL & GAS, INC. ANNOUNCES FIRST QUARTER 2004 FINANCIAL RESULTS AND
RECORD REVENUES
HOUSTON, May 13, 2004-- Carrizo Oil & Gas, Inc. (Nasdaq: CRZO) today reported
the Company's financial results for the first quarter of 2004, which included
the following highlights:
o Production of 1.86 Bcfe.
o Record quarterly revenue of $10.9 million.
o Net Income of $2.0 million.
o EBITDA of $7.1 million.
Revenues for the three months ended March 31, 2004 were $10.9 million as
compared to $10.7 million during the quarter ended March 31, 2003. The increase
in revenues was driven by higher prevailing oil and natural gas prices partially
offset by lower production. Production volumes during the three months ended
March 31, 2004 were 1.86 Bcfe as compared to 1.94 Bcfe during the first quarter
of 2003. Carrizo's average oil sales price increased 12 percent to $33.33 per
barrel from $29.74 per barrel during the first quarter of 2003, while the
average natural gas sales price was virtually unchanged at $5.95 compared to
$5.91 per Mcf in the first quarter of 2003. The above prices include the cash
effect of hedging activities.
After dividends, accretion of discount on preferred stock and the cumulative
effect of change in accounting principle, the Company reported net income change
in accounting principle available to common shares of $2.0 million, or $0.12 and
$0.10 per basic and diluted share, respectively, for the three months ended
March 31, 2004, as compared to $2.7 million, or $0.19 and $0.16 per basic and
diluted share, respectively, for the same quarter during 2003.
EBITDA (earnings before interest, income tax, depreciation and amortization
expenses, and certain other non-cash items) during the first quarter of 2004 was
$7.1 million, or $0.43 and $0.37 per basic and diluted share, respectively, as
compared to $7.5 million, or $0.53 and $0.43 per basic and diluted share,
respectively, during the first quarter of 2003.
Oil and gas operating expenses, including production taxes, were unchanged at
$1.7 million during the three months ended March 31, 2004 as compared to the
first quarter of 2003 and the fourth quarter of 2003.
Depreciation, depletion and amortization expenses ("DD&A") were $3.2 million
during the three months ended March 31, 2004 ($1.74 per Mcfe) as compared to
$3.0 million ($1.57 per Mcfe) during the first quarter of 2003. The increase in
DD&A expense was due to an increase in the DD&A rate primarily due to additions
to the proved property cost base.
General and administrative expenses ("G&A") increased to $2.1 million during the
three months ended March 31, 2004 from $1.4 million during the same quarter of
2003. The increase in G&A was due primarily to higher incentive compensation
costs and higher professional fees in connection with the 2003 year-end audit.
"We are very pleased with our first quarter financial results and drilling
success", commented S.P. Johnson IV, Carrizo's President and Chief Executive
Officer. "This high level of EBITDA, combined with the proceeds from our recent
equity offering allows us to increase our working interest in a very successful
drilling program at high commodity prices and relatively low service costs. We
remain on track with reaching our drilling targets this year, with seven wells
currently drilling in our core Gulf Coast region."
Carrizo Oil & Gas, Inc., is a Houston-based energy company actively engaged in
the exploration, development, exploitation and production of oil and natural gas
primarily in proven onshore trends along the Texas and Louisiana Gulf Coast
regions. Carrizo controls significant prospective acreage blocks and utilizes
advanced 3-D seismic techniques to identify potential oil and gas reserves and
drilling opportunities.
Statements in this news release, including but not limited to those relating to
the Company's or management's intentions, beliefs, expectations, hopes,
projections, assessment of risks, estimations, plans or predictions for the
future including potential effects or timing, cash flow, reserve growth and
shareholder value, the expected timing of drilling of additional wells and other
statements that are not historical facts are forward looking statements that are
based on current expectations. Although the Company believes that its
expectations are based on reasonable assumptions, it can give no assurance that
these expectations will prove correct. Important factors that could cause actual
results to differ materially from those in the forward looking statements
include the results and dependence on exploratory drilling activities, operating
risks, oil and gas price levels, land issues, availability of equipment, weather
and other risks described in the Company's Form 10-K for the year ended December
31, 2003 and its other filings with the Securities and Exchange Commission.
(Financial Highlights to Follow)
CARRIZO OIL & GAS, INC.
STATEMENTS OF OPERATIONS
(unaudited)
THREE MONTHS ENDED
MARCH 31,
---------------------------------
2004 2003
--------------- ---------------
Oil and natural gas revenues $ 10,873,404 $ 10,663,453
--------------- ---------------
Costs and expenses:
Oil and natural gas operating expenses 1,676,209 1,719,811
Depreciation, depletion and amortization 3,246,596 3,035,886
General and administrative expenses 2,132,508 1,382,671
Accretion expense related to asset retirement obligations 6,442 8,001
Stock option compensation expense (benefit) 9,682 (9,480)
--------------- ---------------
Total costs and expenses 7,071,437 6,136,889
--------------- ---------------
Operating income 3,801,967 4,526,564
--------------- ---------------
Equity in loss of Pinnacle Gas Resources, Inc. (243,785) -
Other income and expenses, net 9,005 99,914
Interest income 12,780 17,743
Interest expense, net of amounts capitalized (43,397) (4,963)
--------------- ---------------
Income before income taxes 3,536,570 4,639,258
--------------- ---------------
Income tax expense 1,353,148 1,668,740
--------------- ---------------
Net income before cumulative effect of change in accounting principle 2,183,422 2,970,518
--------------- ---------------
Dividends and accretion of discount on preferred stock 197,995 181,045
--------------- ---------------
Net income available to common shares before cumulative effect of
change in accounting principle 1,985,427 2,789,473
--------------- ---------------
Cumulative effect of change in accounting principle - 128,374
--------------- ---------------
Net income available to common shares $ 1,985,427 $ 2,661,099
=============== ===============
EBITDA (see table below) $ 7,064,010 $ 7,541,991
=============== ===============
Basic net income per common share:
Net income before cumulative effect of change in accounting principle $ 0.12 $ 0.20
Cumulative effect of change in accounting principle 0.00 (0.01)
--------------- ---------------
Basic net income per common share $ 0.12 $ 0.19
=============== ===============
Diluted net income per common share:
Net income before cumulative effect of change in accounting principle $ 0.10 $ 0.17
Cumulative effect of change in accounting principle 0.00 (0.01)
--------------- ---------------
Diluted net income per common share $ 0.10 $ 0.16
=============== ===============
Basic weighted average common shares outstanding 16,613,430 14,198,134
--------------- ---------------
Diluted weighted average common shares outstanding 19,284,153 17,456,766
--------------- ---------------
(more)
CARRIZO OIL & GAS, INC.
CONDENSED BALANCE SHEET
03/31/04 12/31/03
--------------- ---------------
(unaudited)
ASSETS:
Cash and cash equivalents $ 4,892,495 $ 3,322,057
Other current assets 10,729,039 11,003,512
Net property and equipment 153,723,334 135,273,200
Other assets 527,930 567,755
Investment in Pinnacle Gas Resources, Inc. 6,384,592 6,636,589
--------------- ---------------
TOTAL ASSETS $ 176,257,390 $ 156,803,113
=============== ===============
LIABILITIES AND EQUITY:
Accounts payable and accrued liabilities $ 24,349,870 $ 24,001,971
Current maturities of long-term debt 1,358,519 2,139,549
Long-term notes payable 97,310 7,121,646
Long-term subordinated notes payable 27,381,964 26,991,413
Deferred income taxes 13,787,701 12,479,553
Other liabilities 905,506 883,117
Convertible participating preferred stock 7,312,098 7,114,103
Equity 101,064,422 76,071,761
--------------- ---------------
TOTAL LIABILITIES AND EQUITY $ 176,257,390 $ 156,803,113
=============== ===============
(1) Income tax expense for the three months ended March 31, 2004 includes a
$1,308,148 provision for deferred income taxes and a $45,000 provision for
currently payable franchise taxes. Income tax expense for the three months
ended March 31, 2003 includes a $1,623,740 provision for deferred income
taxes and a $45,000 provision for currently payable franchise taxes.
(2) Long-term notes payable at December 31, 2003 includes a note in the
principal amount $863,246 payable by CCBM, Inc. (a wholly-owned subsidiary
of the Company) to Rocky Mountain Gas, Inc. recourse solely to CCBM, Inc.'s
interests in certain undeveloped oil and natural gas leases in Wyoming and
Montana. At March 31, 2004 and December 31, 2003 current maturities of
long-term debt include $704,832 and $863,246, respectively, related to the
CCBM, Inc. note.
(3) Subordinated notes payable are presented net of discounts of $320,463 and
$342,012 as of March 31, 2004 and December 31, 2003, respectively.
(4) Stock option compensation expense (benefit) is a non-cash charge (benefit)
resulting from the change in the price of the stock underlying employee
stock options that were repriced in February 2000.
(5) In February 2002, the Company consummated the sale of $6 million of
convertible participating preferred stock and warrants to purchase the
Company's common stock. Convertible preferred stock is presented net of
discounts.
(6) The Company adopted Financial Accounting Standards Board Statement of
Financial Accounting Standards ("SFAS") No. 143, "Accounting for Asset
Retirement Obligations" on January 1, 2003, resulting in a charge of
$128,374 for the quarter ended March 31, 2003 to record the cumulative
effect of the change in accounting principle. (more)
CARRIZO OIL & GAS, INC.
NON-GAAP DISCLOSURES
(unaudited)
THREE MONTHS ENDED
MARCH 31,
---------------------------------
Reconciliation of Net Income to EBITDA 2004 2003
- --------------------------------------------------------------------- --------------- ---------------
Net income before cumulative effect of change in accounting principle $ 2,183,422 $ 2,970,518
--------------- ---------------
Cumulative effect of change in accounting principle - 128,374
--------------- ---------------
Net Income $ 2,183,422 $ 2,842,144
--------------- ---------------
Adjustments:
Depreciation, depletion and amortization 3,246,596 3,035,886
Interest expense, net of amounts capitalized and interest income 30,617 (12,780)
Income taxes 1,353,148 1,668,740
Equity in Pinnacle Gas Resources, Inc. 243,785 -
Accretion expense related to asset retirement obligations 6,442 8,001
--------------- ---------------
EBITDA, as defined $ 7,064,010 $ 7,541,991
=============== ===============
EBITDA per basic common share $ 0.43 $ 0.53
=============== ===============
EBITDA per diluted common share $ 0.37 $ 0.43
=============== ===============
OTHER FINANCIAL DISCLOSURES
(unaudited)
Operating Cash Flow
- -----------------------------------------------------------------------------------------------------------------
Operating Cash Flow $ 6,321,269 $ 6,881,626
=============== ===============
Operating Cash Flow per basic common share $ 0.38 $ 0.48
=============== ===============
Operating Cash Flow per diluted common share $ 0.33 $ 0.39
=============== ===============
PRODUCTION VOLUMES AND PRICES
(unaudited)
Production volumes-
Oil and condensate (Bbls) 87,123 139,070
Natural gas (Mcf) 1,338,776 1,103,602
Natural gas equivalent (Mcfe) 1,861,514 1,938,022
Average sales prices-
Oil and condensate (per Bbl) $33.33 $ 29.74
Natural gas (per Mcf) $ 5.95 $ 5.91
Natural gas equivalent (per Mcfe) $ 5.84 $ 5.50
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