Prima (NASDAQ:PENG)
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Prima Energy Corporation Reports Third Quarter Results and Update on Activities
DENVER, Nov. 6 /PRNewswire-FirstCall/ -- Prima Energy Corporation reported its
results of operations for the quarter and nine months ended September 30, 2003
and provided an update of its commodity hedging transactions, operating
activities, and estimated production for the remainder of 2003.
Results of Operations for the Three- and Nine- Month Periods Ended September 30,
2003
Quarter Ended September 30, 2003
The Company reported third quarter 2003 net income of $6,593,000, representing a
543% increase compared to third quarter 2002 net income of $1,026,000. These
amounts equate to $0.50 and $0.08 per diluted share in the recent quarter and
the same period last year, respectively. Cash flow from operations before
changes in operating assets and liabilities totaled $13,540,000 in the third
quarter of 2003, 282% above the $3,540,000 reported for the comparable quarter
of 2002. Cash flow from operations before changes in operating assets and
liabilities is a non-GAAP financial measure derived from net cash provided by
operating activities -- see "Reconciliation of Non- GAAP Financial Measure" in a
table below.
Revenues for the 2003-quarter totaled $18,229,000 compared to $7,432,000 in the
third quarter of 2002. Oil and gas sales in the third quarter of 2003 totaled
$15,259,000, compared to $5,455,000 in the same quarter of 2002, for an increase
of 180%. The improvement was attributable to the combined effects of a 49%
year-over-year increase in production volumes and an 87% increase in average
realized oil and gas prices. During the recent quarter, natural gas accounted
for 85% of the Company's total production and 81% of its oil and gas sales,
compared to 78% and 55%, respectively, in the third quarter of 2002.
Prima's natural gas production increased by 63%, to 3,272,000 Mcf in the latest
quarter, from 2,002,000 Mcf in the third quarter last year. Oil production
totaled approximately 97,000 barrels in the third quarter of 2003, compared to
96,000 barrels in the same quarter of 2002, for an increase of 1%. On an
equivalent unit basis, production expanded from 2,577,000 Mcfe in the third
quarter of 2002 to 3,852,000 Mcfe in the recent quarter. This increase was due
to Powder River Basin CBM operations, which generated net gas production of
1,635,000 Mcf in the third quarter of 2003, compared to 308,000 Mcf in the third
quarter of 2002. CBM production is primarily attributable to the Porcupine-Tuit
property, which began producing during the third quarter of 2002.
Average sales prices received for natural gas production were $3.76 per Mcf in
the third quarter of 2003 and $1.50 per Mcf in the 2002 quarter, representing a
year-over-year increase of $2.26 per Mcf, or 151%. Average prices received per
barrel of oil were $30.64 in the recent quarter and $25.50 in the same period
last year, for an increase of $5.14 per barrel or 20%. On an energy equivalent
basis, the average price received was $3.96 per Mcfe in the latest quarter
compared to $2.12 per Mcfe in the prior-year period. Hedging gains included in
oil and gas revenues for the third quarter of 2003 increased average price
realizations by $0.10 per Mcf of natural gas, $0.12 per barrel and $0.09 per
Mcfe. Hedging losses included in oil and gas revenues for the third quarter of
2002 decreased average price realizations by $2.66 per barrel of oil and $0.10
per Mcfe.
Third quarter 2003 revenues included $680,000 of net gains recognized on
ineffective hedges, which consisted of contracts for forward sales of NYMEX
natural gas, which don't qualify as effective cash flow hedges without
corresponding basis-differential hedges. In the third quarter of the prior
year, $143,000 of net losses were reported on similar transactions.
Depletion expense in the third quarter of 2003 was $0.93 per Mcfe, compared to
$0.90 per Mcfe in the third quarter last year. Lease operating expenses
averaged $0.21 per Mcfe produced in the 2003 quarter compared to $0.27 per Mcfe
in the 2002 quarter. The lower LOE per unit primarily reflected the expanded
production base in Wyoming over which field office expenses have been spread as
production from the Porcupine-Tuit property has increased. Production taxes
were $0.37 and $0.17 per Mcfe in the 2003 and 2002 quarters, respectively,
reflecting higher product prices in 2003 and an increased proportion of sales
derived from Wyoming, which has a higher severance tax rate than Colorado.
Total lifting costs were 15% of oil and gas revenues and $0.58 per Mcfe during
the third quarter of 2003, compared to 21% and $0.44 per Mcfe in the same period
in 2002. General and administrative expenses increased $65,000 in the recent
quarter, compared to the prior year, primarily due to higher payroll taxes
attributable to exercises of employee stock options.
Reported oilfield service revenues and expenses in the quarter ended September
30, 2003 were $2,207,000 and $1,470,000, respectively, for a gross margin of
$737,000. In the same quarter last year, reported oilfield service revenues and
expenses totaled $1,964,000 and $1,779,000, respectively, for a gross margin of
$185,000. Revenues and costs related to services provided on Prima-operated
properties are eliminated in consolidation, and represented approximately 32% of
the service companies' revenues in the 2003-period compared to 22% in the same
quarter last year. The 12% year-over-year increase in reported revenues,
despite the increased portion of work conducted on behalf of Prima, reflected
higher utilization and billing rates in response to greater demand. The 17%
reduction in costs reflected the increased amount eliminated in consolidation,
due to the greater portion of work performed for Prima, and a change in the mix
of activities conducted for the Company.
Income taxes totaled 33% of pre-tax income in the recent quarter, compared to
16% in the prior year's quarter, due to permanent differences that did not
increase proportionately with pre-tax income and the cessation of Section 29 tax
credits at the end of 2002.
Nine Months Ended September 30, 2003
For the nine months ended September 30, 2003, Prima reported net income of
$17,238,000, or $1.32 per diluted share, compared to net income of $2,294,000,
or $0.17 per diluted share, for the nine months ended September 30, 2002. Cash
flow from operating activities before changes in operating assets and
liabilities aggregated $34,423,000 for the first nine months of 2003 compared to
$14,404,000 for the first nine months of 2002.
Net income for the first nine months of 2003 included an adjustment for the
cumulative effect of a change in accounting principle, in conjunction with
adoption of Statement of Financial Accounting Standards No. 143, which relates
to accounting for asset retirement obligations. Adoption of SFAS 143 resulted
in a non-cash, after-tax credit of $403,000 or $0.03 per diluted share,
reflecting the net historical effects of providing for estimated future costs
for abandonment of oil and gas properties and the impact on depletion expense of
incorporating estimated equipment salvage values.
Revenues during the first nine months of 2003 included $1,986,000 of net gains
recognized on ineffective hedges, comprised of forward sales of NYMEX natural
gas. In the first nine months of the prior year, the Company reported net
losses of $2,780,000 on similar contracts, as mark-to-market gains recorded on
open positions at the end of 2001 were partially reversed upon subsequent
improvement in gas prices. Results for the first nine months of 2002 also
reflected a current tax provision that exceeded the total tax provision by
$823,000, due to the reversal of certain timing differences.
Revenues for the first nine months of 2003 totaled $50,279,000, compared to
$21,557,000 for the first nine months of 2002. Oil and gas sales totaled
$41,605,000 during the 2003 period, compared to $17,460,000 in the first nine
months of 2002, for an increase of 138%. The increase was attributable to the
combined effects of a 48% year-over-year increase in production volumes and a
61% increase in average prices realized per equivalent unit of oil and gas
production.
Prima's net natural gas production during the first nine months of 2003 and 2002
totaled 9,378,000 Mcf and 5,834,000 Mcf, respectively, reflecting an increase of
3,544,000 Mcf, or 61%. Net oil production was 285,000 barrels and 279,000
barrels for the same nine-month periods, representing an increase of 6,000
barrels or 2%. On an equivalent unit basis, the Company's production increased
from 7,507,000 Mcfe in the first nine months of 2002 to 11,088,000 Mcfe during
the same period in 2003.
The average price received for natural gas production during the nine months
ended September 30, 2003 was $3.48 per Mcf, compared to $1.85 per Mcf for the
nine months ended September 30, 2002, representing an increase of $1.63 or 88%.
Average prices received for oil during the same periods were $31.49 and $23.90
per barrel, respectively, for a year-over-year increase of $7.59 or 32%. On an
Mcf equivalent basis, the average price received for the Company's production
was $3.75 for the nine months ended September 30, 2003 compared to $2.33 for the
nine months ended September 30, 2002. Gains and losses on hedges included in
oil and gas revenues for the first nine months of 2003 had the effect of
decreasing the average price realized per Mcf of natural gas by $0.01,
increasing the average price realized per barrel of oil by $0.18, with no net
impact on the average price realized per Mcfe. Hedging losses included in oil
and gas revenues for the first nine months of 2002 decreased average price
realizations by $1.48 per barrel of oil and $0.05 per Mcfe.
Depletion expense for oil and gas properties was $10,358,000, or $0.93 per Mcfe,
during the first nine months of 2003, compared to $6,757,000, or $0.90 per Mcfe,
produced during the first nine months of 2002. Lease operating expenses
declined from an average $0.30 per Mcfe in the nine months ended September 30,
2002 to an average $0.23 per Mcfe in the nine months ended September 30, 2003,
due primarily to the impact of production at Porcupine- Tuit. Production taxes
were $0.36 and $0.19 per Mcfe in the 2003 and 2002 nine-month periods,
respectively, reflecting higher product prices in 2003 and an increased
proportion of sales derived from Wyoming. Total lifting costs were 16% of oil
and gas revenues and $0.60 per Mcfe for the first nine months of 2003, compared
to 21% and $0.49 per Mcfe for the same period in 2002. General and
administrative expenses of $2,471,000 for the nine months ended September 30,
2003 were $83,000, or 3%, higher than the comparable period in 2002.
Oilfield service revenues from third parties declined by 1%, from $6,403,000 in
the first nine months of 2002 to $6,335,000 during the latest nine-month period.
Related oilfield service costs were $4,917,000 in the nine months ended
September 30, 2003, compared to $5,258,000 for the same period of 2002, a
decrease of $341,000 or 6%. For the nine months ended September 30, 2003, 24%
of fees billed by the service companies were for Prima-owned property interests,
compared to 16% for the nine months ended September 30, 2002. An overall
increase in billings was approximately offset by increased amounts related to
Prima wells. Reported costs declined as a result of the increased portion
eliminated in consolidation.
The Company's income tax provision was 33% of pre-tax income in the latest
nine-month period, compared to 13% in the first nine months of 2002, due to
permanent differences that did not increase proportionately with pre-tax income
and the cessation of Section 29 tax credits at the end of 2002.
Commodity Hedging
Prima realized net settlement gains totaling $213,000 on derivatives positions
closed out during October 2003. At the close of business on October 31, 2003,
open derivatives instruments (all relating to crude oil) showed net unrealized
gains aggregating $76,000, as follows:
Time Period Market Total Volumes Contract Unrealized
Index (Bbls) Price Gains
December 2003 NYMEX 15,000 $30.64 $23,000
January - March 2004 NYMEX 45,000 29.75 53,000
Total Unrealized Gains $76,000
Operating Activities and Production
Prima invested $18,287,000 in oil and gas properties during the first nine
months of 2003, including $17,590,000 on well costs and related development
activities and $697,000 for undeveloped acreage. Operations included drilling
97 (68.9 net) wells, including 21 (20.2 net) wells in the Denver Basin, 63 (47.6
net) CBM wells in the Powder River Basin, 12 (1.0 net) wells in the Wind River
Basin, and one (0.1 net) well in the Washakie Basin. Additional development
costs were also incurred in re-fracturing 28 (27.1 net) wells in the Denver
Basin, completing two Denver Basin wells drilled in late 2002, and for
infrastructure facilities in the CBM area. All drilling and recompletion
operations have been successful, with wells placed on production, restored to
production, or awaiting hook up. During the first nine months of 2003, Prima
also expended $793,000 for other property and equipment, and $2,111,000 for the
purchase of approximately 112,000 shares of treasury stock at an average cost of
$18.87 per share. Costs incurred during the first nine months of 2003 were
partially offset by approximately $1,664,000 of proceeds realized from the sale
of oil and gas properties.
Prima's net working capital increased from $35,954,000 at the end of 2002 to
$53,081,000 at September 30, 2003. Working capital at the end of the period
included $51,875,000 of cash equivalents and short-term investments, and Prima
continues to be free of long-term debt. This strong financial condition
provides the Company considerable flexibility in responding to opportunities and
scheduling capital investments to take advantage of market conditions.
Activities during the recent quarter included drilling and completing 23 (22.2
net) wells in the Porcupine-Tuit project area. These, and four wells previously
drilled in the area, were hooked up between late September and mid- October.
Gross production at Porcupine-Tuit has increased from approximately 21,000 Mcfd
in September 2003 prior to tie in of new wells, to a recent rate in excess of
28,000 Mcfd. Prima owns net revenue interests in the 85 wells at Porcupine-Tuit
averaging approximately 78%. One additional well is scheduled to be drilled and
hooked up at Porcupine-Tuit in the current quarter.
Seventeen (11.9 net) additional Powder River Basin CBM wells were drilled during
the third quarter of 2003, targeting multiple coals in the Company's Kingsbury,
North Shell Draw and Cedar Draw project areas. Prima is currently evaluating
alternative proposals for installation of gas gathering and compression
facilities in these areas, and anticipates hooking up the recently drilled
wells, along with 104 previously drilled wells and additional planned wells,
beginning in the first quarter of 2004. This area encompasses the Company's
pilot project in the Kingsbury area, where 16 wells were placed on pump
approximately ten months ago to begin de-watering and evaluating the deeper Cook
and Wall coals. These wells, particularly the eight completed in the Wall coal,
continue to produce water at rates indicating good permeability, and three of
the Wall-coal wells began producing small amounts of gas in September or
October. Significant future activity is planned in the adjoining Kingsbury,
Cedar Draw, and North Shell Draw areas, to develop multiple coals found at
depths ranging from approximately 600 feet to 2,000 feet. Subject to being able
to obtain regulatory approvals, among other factors, activities planned for the
current quarter in these project areas include drilling 15 to 20 CBM wells and
deepening 16 previously drilled CBM wells to lower coals.
Prima drilled 14 (13.2 net) wells and recompleted nine (9.0 net) wells in the
Denver Basin in the third quarter of 2003. Planned fourth quarter activities in
this area include drilling approximately ten wells and recompleting
approximately 14 wells. At Cave Gulch, in the Wind River Basin, Prima
participated in drilling five (0.3 net) wells and recompleting one (0.1 net)
well in the third quarter, and anticipates participating in drilling
approximately four wells in the current quarter. The Company also participated,
with a 12.5% non-operated working interest, in drilling the Vermillion Federal
#27-6 exploratory well in the Washakie Basin in Wyoming. The well, which was
drilled to a depth of 10,890 feet and logged apparent pay in multiple sands, is
currently being completed, after which further development plans for the
5,300-acre block will be considered.
During the recent quarter, Prima also initiated completion and testing of the
Ferron sand in the Scofield-Thorpe #22-41 well on the Coyote Flats prospect, in
Carbon County, Utah. This 100%-owned well was drilled in late 2002 to test the
Emery coals and Ferron sand, but was temporarily suspended after production
casing was set. The Company is currently testing the Ferron sandstone reservoir
at depths between 5,995-6,055 feet. The Ferron sandstone has been productive at
Clear Creek Field, located eight miles southwest of the Scofield-Thorpe #22-41
well, and is currently productive at Gordon Creek Field, located ten miles
southeast of the well. Prima is currently conducting a 30-day flow test on the
well, which will be followed by a 7-day pressure buildup test. During the flow
test, gas rates of 900 Mcfd and water rates of 150 bpd have been measured, with
gradually increasing gas rates and decreasing water rates. The objective of the
pressure buildup test will be to determine well performance parameters that can
be used to assess the economics of installing a natural gas pipeline to this
location and drilling additional Ferron sandstone wells on the Coyote Flats
acreage. A multi-well pilot program to further evaluate Emery coal potential is
also anticipated to get underway in 2004. Prima controls approximately 75,000
gross (72,000 net) undeveloped acres within the Coyote Flats Prospect area.
On the Merna Prospect, located on the Merna anticlinal structure in the northern
Green River Basin in Sublette County, Wyoming, the Company is currently
participating in the Sage Flat Federal #17-20 well. Prima holds a 6.3% working
interest before payout and a 10.9% working interest after payout in this EOG
Resources, Inc. operated well, which will target the over- pressured Lance at a
depth of approximately 13,000 feet. In addition, the Company owns an average
35% working interest in 74,000 gross acres in the greater Merna area. The Sage
Flat Federal #17-20 well is located three miles north of the Miller Federal #7-4
well that was drilled during the second half of 2002, and which exhibited strong
gas shows at high pressure while drilling but which was subsequently completed
for only modest gas rates.
Prima recently exchanged acreage in the Powder River Basin CBM play with another
operator. The acreage traded by the Company, primarily in the Deadman Draw
area, had been attributed approximately 8 Bcf of proved reserves. The acreage
received by Prima, in the Fortification Creek and Kingsbury project areas, does
not currently have attributed proved reserves but has greater probable reserves
and higher projected value to the Company. The trade strengthens Prima's
position at Fortification Creek, a project area with multiple deep thick coal
targets, located ten miles west of North Shell Draw, to 4,900 gross (4,500 net)
acres.
Prima's capital expenditures for all of 2003 are currently expected to aggregate
between $29 million and $31 million, including $10 million to $12 million in the
current quarter. The Company also estimates that its net oil and gas production
in the current quarter will total approximately 4.0 Bcfe, bringing the total for
2003 to approximately 15.1 Bcfe. This target represents approximately a 43%
increase over total net production reported in 2002.
Conference Call
Prima will hold a conference call on Friday, November 7, 2003, at 9:30 a.m. MST
to review its third quarter financial results and provide an update on
operations. Interested parties may access the conference call by dialing (800)
227-9428 and providing conference I.D. "Prima." Replays will be available from
11:30 a.m. MST, November 7 through 10:00 p.m. MST November 14, 2003, by dialing
(888) 274-8336 (no reservation number necessary).
The conference call will also be webcast live over the Internet and can be
accessed by following the link from Prima Energy's website at
http://www.primaenergy.com/ . To listen to the live call from our website,
please access the website at least fifteen minutes early to register, and
download and install any necessary audio software. A replay from the Internet
site will be available shortly after the call is completed, and will be
available for 90 days.
Prima is a Denver-based independent energy company engaged in the exploration
for, acquisition, development and production of natural gas and crude oil.
Through wholly owned subsidiaries, Prima is also engaged in natural gas and oil
property operations, oilfield services and natural gas and crude oil marketing.
The Company's current activities are principally conducted in the Rocky Mountain
region of the United States.
This press release contains projections or forward-looking statements, which are
made pursuant to the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. Such statements include, but are not limited to,
statements related to drilling and construction plans, other investment
activities, projected production levels, and anticipated production commencement
dates. The words "anticipate," "expect," "plan," "target," "estimate," or
"project" and similar expressions identify forward-looking statements. Any such
statements or projections reflect the Company's current views with respect to
future events and financial performance. No assurances can be given, however,
that these events will occur or that such projections will be achieved, and
actual results could differ materially from those projected. Prima does not
undertake to update, revise or correct any of the forward-looking information.
A discussion of important factors that could cause actual results to differ
materially from those projected is included in the Company's most recent Annual
Report on Form 10-K filed with the Securities and Exchange Commission.
Financial data follows (note: certain prior-year amounts have been reclassified
to conform to current-year presentations). In addition, a copy of the Company's
Form 10-Q for the quarter ended September 30, 2003 and Form 10-K for the year
ended December 31, 2002 are, or will be, available on the Company's Website at
http://www.primaenergy.com/ .
PRIMA ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
REVENUES
Oil and gas sales $15,259,000 $5,455,000 $41,605,000 $17,460,000
Gains (losses) on
derivatives
instruments, net 680,000 (143,000) 1,986,000 (2,780,000)
Oilfield services 2,207,000 1,964,000 6,335,000 6,403,000
Interest, dividend
and other income 83,000 156,000 353,000 474,000
18,229,000 7,432,000 50,279,000 21,557,000
EXPENSES
Depreciation,
depletion and
amortization:
Depletion of oil
and gas properties 3,599,000 2,320,000 10,358,000 6,757,000
Depreciation of
property and
equipment 236,000 202,000 798,000 846,000
Lease operating
expense 805,000 685,000 2,600,000 2,261,000
Ad valorem and
production taxes 1,444,000 448,000 4,010,000 1,413,000
Cost of oilfield
services 1,470,000 1,779,000 4,917,000 5,258,000
General and
administrative 837,000 772,000 2,471,000 2,388,000
8,391,000 6,206,000 25,154,000 18,923,000
Income before income
taxes and cumulative
effect of change in
accounting principle 9,838,000 1,226,000 25,125,000 2,634,000
Provision for income
taxes 3,245,000 200,000 8,290,000 340,000
Net income before
cumulative effect
of change in
accounting principle 6,593,000 1,026,000 16,835,000 2,294,000
Cumulative effect
of change in
accounting principle -- -- 403,000 --
NET INCOME $6,593,000 $1,026,000 $17,238,000 $2,294,000
Basic net income
per share before
cumulative effect
of change in
accounting principle $0.51 $0.08 $1.32 $0.18
Cumulative effect
of change in
accounting principle -- -- 0.03 --
BASIC NET INCOME
PER SHARE $0.51 $0.08 $1.35 $0.18
Diluted net income
per share before
cumulative effect
of change in
accounting principle $0.50 $0.08 $1.29 $0.17
Cumulative effect
of change in
accounting principle -- -- 0.03 --
DILUTED NET INCOME
PER SHARE $0.50 $0.08 $1.32 $0.17
Weighted Average
Common Shares
Outstanding 12,817,576 12,772,513 12,790,069 12,768,043
Weighted Average
Common Shares
Outstanding
Assuming Dilution 13,080,193 13,221,889 13,039,712 13,261,851
PRODUCTION:
Natural gas (Mcf) 3,272,000 2,002,000 9,378,000 5,834,000
Oil (barrels) 97,000 96,000 285,000 279,000
Net equivalent
units (Mcfe) 3,852,000 2,577,000 11,088,000 7,507,000
AVERAGE PRICES:
Natural gas
(per Mcf) $3.76 $1.50 $3.48 $1.85
Oil (per barrel) $30.64 $25.50 $31.49 $23.90
Net equivalent
units (Mcfe) $3.96 $2.12 $3.75 $2.33
PRIMA ENERGY CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
2003 2002
OPERATING ACTIVITIES
Net income $17,238,000 $2,294,000
Adjustments to reconcile
net income to net cash
provided by operating activities:
Depreciation, depletion
and amortization 11,156,000 7,603,000
Deferred income taxes 4,931,000 (823,000)
Unrealized (gains) losses on
derivatives instruments 154,000 4,500,000
Cumulative effect of change in
accounting principle (403,000) --
Tax benefit from exercise of
stock options 1,411,000 824,000
Other (64,000) 6,000
Net changes in operating assets
and liabilities (2,053,000) (1,078,000)
Net cash provided by
operating activities 32,370,000 13,326,000
INVESTING ACTIVITIES
Additions to oil and gas properties (18,287,000) (12,040,000)
Proceeds from sales of oil &
gas properties 1,664,000 13,544,000
Purchases of other property, net (793,000) (496,000)
Proceeds from sales of available
for sale securities, net 356,000 692,000
Net cash (used in) provided
by investing activities (17,060,000) 1,700,000
NET FINANCING ACTIVITIES (1,215,000) (1,192,000)
INCREASE (DECREASE) IN CASH AND CASH
EQUIVALENTS 14,095,000 13,834,000
CASH AND CASH EQUIVALENTS,
beginning of period 36,263,000 23,337,000
CASH AND CASH EQUIVALENTS,
end of period $50,358,000 $37,171,000
PRIMA ENERGY CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
September 30, December 31,
2003 2002
(Unaudited)
ASSETS
Current assets $64,101,000 $47,257,000
Oil and gas properties - net 97,425,000 88,538,000
Other property and equipment - net 4,696,000 4,839,000
Other assets 1,298,000 1,293,000
$167,520,000 $141,927,000
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities $11,020,000 $11,303,000
Non-current ad valorem taxes 3,084,000 2,077,000
Deferred income taxes 26,491,000 21,281,000
Other liabilities 1,860,000 --
Stockholders' equity 125,065,000 107,266,000
$167,520,000 $141,927,000
RECONCILIATION OF NON-GAAP FINANCIAL MEASURE
Cash flow from operations before changes in operating assets and liabilities is
presented because of its acceptance as an indicator of the ability of an oil and
gas exploration and production company to internally fund exploration and
development activities. This measure should not be considered as an alternative
to net cash provided by operating activities as defined by generally accepted
accounting principles. A reconciliation of cash flow from operations before
changes in operating assets and liabilities to net cash provided by operating
activities is shown below:
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
Net cash provided by
operating activities $17,650,000 $5,187,000 $32,370,000 $13,326,000
Net changes in
operating assets
and liabilities (4,110,000) (1,647,000) 2,053,000 1,078,000
Cash flow from
operations before
changes in operating
assets and
liabilities $13,540,000 $3,540,000 $34,423,000 $14,404,000
DATASOURCE: Prima Energy Corporation
CONTACT: Richard H. Lewis, President and Chief Executive Officer, or
Neil L. Stenbuck, Executive Vice President and Chief Financial Officer, both
of Prima Energy Corporation, +1-303-297-2100
Web site: http://www.primaenergy.com/