Spinnaker Exploration Company Reports Another Record Quarter

Apr 25, 2001, 01:00 ET from Spinnaker Exploration Company

    HOUSTON, April 25 /PRNewswire/ -- Spinnaker Exploration Company
 (NYSE:   SKE) today reported record first quarter 2001 earnings, revenues, cash
 flow and production.  Unit costs also declined during the period reported.
     Spinnaker reported net income of $28.1 million, or $1.00 per diluted
 share, in the first quarter of 2001 compared to first quarter 2000 net income
 of $3.1 million, or $0.15 per diluted share.  Net cash flow from operations
 before working capital changes was $63.1 million, or $2.24 per diluted share,
 in the first quarter of 2001 compared to first quarter 2000 net cash flow from
 operations before working capital changes of $10.9 million, or $0.51 per
 diluted share.
     Revenues were $67.0 million in the first quarter of 2001 compared to first
 quarter 2000 revenues of $13.9 million. Income from operations was
 $42.8 million in the first quarter of 2001 compared to first quarter 2000
 income from operations of $2.9 million.  Realized prices averaged $5.42 per
 thousand cubic feet of natural gas ("Mcf") and $28.18 per barrel of oil in the
 first quarter of 2001 compared to first quarter 2000 average realized prices
 of $2.76 per Mcf and $22.11 per barrel.
     Production was 12.4 billion cubic feet of natural gas equivalent ("Bcfe")
 in the first quarter of 2001 compared to first quarter 2000 production of
 4.9 Bcfe, representing an increase of 7.5 Bcfe, or 153%.  In addition,
 production increased 10% from the fourth quarter of 2000.  The current daily
 production rate increased 124% to approximately 150 million cubic feet of gas
 equivalent ("MMcfe") from a rate of approximately 67 MMcfe at the end of the
 first quarter of 2000.
     Per unit lease operating expenses decreased to $0.22 in the first quarter
 of 2001 from $0.33 in the same period in 2000, or a decrease of approximately
 34%.  The rate decreases were primarily due to reduced workover activities as
 well as continued efficiencies gained in core operating areas in the first
 quarter of 2001.  Per unit depreciation, depletion and amortization expense
 decreased approximately 2% in the first quarter of 2001 compared to the same
 period in 2000.
     Cash capital expenditures totaled $59.4 million in the first quarter of
 2001.  Cash and short-term investments were $115.7 million at March 31, 2001.
 The income tax rate and cash tax rate were 36% and 0%, respectively, in the
 first quarter of 2001.
     Spinnaker Exploration Company is an independent energy company engaged in
 the exploration, development and production of natural gas and oil in the U.S.
 Gulf of Mexico.
     Certain statements in this press release are forward-looking and are based
 upon Spinnaker's current belief as to the outcome and timing of future events
 that are subject to numerous uncertainties.  Important factors that could
 cause actual results to differ materially from those in the forward-looking
 statements herein include the timing and extent of changes in commodity prices
 for natural gas and oil, operating risks and other risk factors as described
 in Spinnaker's Annual Report on Form 10-K for the year ended December 31, 2000
 and its other filings with the Securities and Exchange Commission.  Should one
 or more of these risks or uncertainties occur, or should underlying
 assumptions prove incorrect, Spinnaker's actual results and plans could differ
 materially from those expressed in the forward-looking statements.  The
 forward-looking statements in this press release are made only as of the date
 hereof, and Spinnaker undertakes no obligation to update such forward-looking
 statements.
 
 
                         SPINNAKER EXPLORATION COMPANY
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share amounts)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                             March 31,
                                                      2001               2000
 
     REVENUES                                       $67,453            $13,867
 
     EXPENSES:
        Lease operating expenses                      2,691              1,609
        Depreciation, depletion and amortization -
         natural gas and oil properties              19,342              7,765
        Depreciation and amortization -  other           96                 69
        General and administrative                    2,532              1,498
             Total expenses                          24,661             10,941
     INCOME FROM OPERATIONS                          42,792              2,926
 
     OTHER INCOME (EXPENSE):
        Interest income                               1,345                244
        Interest expense                               (156)               (84)
             Total other income (expense)             1,189                160
     INCOME BEFORE INCOME TAXES                      43,981              3,086
        Income tax provision                         15,833                ---
     NET INCOME                                     $28,148             $3,086
 
     NET INCOME PER COMMON SHARE:
        Basic                                         $1.05              $0.15
        Diluted                                       $1.00              $0.15
 
     WEIGHTED AVERAGE NUMBER OF COMMON
      SHARES OUTSTANDING:
        Basic                                        26,772             20,417
        Diluted                                      28,196             21,259
 
 
                         SPINNAKER EXPLORATION COMPANY
                               SUMMARY STATISTICS
                 (In thousands, except per share/unit amounts)
                                  (Unaudited)
 
                                                               Three Months
                                           Three Months Ended      Ended
                                                March 31,       December 31,
                                             2001       2000       2000
 
     Total Amounts:
       Net income                           $28,148     $3,086    $22,012
       Net cash flow from operations
        before working capital changes       63,057     10,920     55,289
       Adjusted EBITDA  (A)                  62,230     10,760     53,563
 
     Totals Per Share:
       Net income:
            Basic                             $1.05      $0.15      $0.84
            Diluted                            1.00       0.15       0.79
       Net cash flow from operations
        before working capital changes         2.24       0.51       1.99
 
     Production Quantities:
       Natural gas (MMcf)                    11,969      4,556     11,291 (B)
       Oil (MBbls)                               77         58         76
       Natural gas and oil (MMcfe)           12,430      4,904     11,747 (B)
 
     Average Daily Production:
       Natural gas (MMcf)                       133         50        123 (B)
       Oil (MBbls)                              0.9        0.6        0.8
       Natural gas and oil (MMcfe)              138         54        128 (B)
 
     Revenues:
       Natural gas sales                    $81,455    $11,739    $65,562
       Oil sales                              2,163      1,620      2,544
       Natural gas and oil hedging income
        (loss)                              (16,600)       508     (9,490)
       Other                                    435        ---        ---
            Total                           $67,453    $13,867    $58,616
 
     Average Sales Price Per Unit:
       Natural gas revenues from
        production (per Mcf)                  $6.81      $2.58      $6.05
       Effects of hedging activities (per
        Mcf)                                  (1.39)      0.18      (0.85)
            Average price (per Mcf)           $5.42      $2.76      $5.20
 
       Oil and condensate revenues from
        production (per Bbl)                 $28.18     $27.93     $33.46
       Effects of hedging activities
        (per Bbl)                               ---      (5.82)     (4.06)
            Average price (per Bbl)          $28.18     $22.11     $29.40
 
       Total revenues from production
        (per Mcfe)                            $6.73      $2.72      $6.03
       Effects of hedging activities
        (per Mcfe)                            (1.34)      0.11      (0.84)
            Total average price (per Mcfe)    $5.39      $2.83      $5.19
 
     Cost Data:
       Lease operating expenses              $2,691     $1,609     $2,656
       Depreciation, depletion and
        amortization-natural gas and oil
        properties                           19,342      7,765     17,806
 
     Average Costs (per Mcfe):
       Lease operating expenses               $0.22      $0.33      $0.24
       Depreciation, depletion and
        amortization-natural gas and oil
        properties                             1.56       1.58       1.58
 
     Weighted Average Number of Common
      Shares Outstanding:
       Basic                                 26,772     20,417     26,317
       Diluted                               28,196     21,259     27,816
 
     (A) Adjusted EBITDA represents earnings before interest, income taxes and
         depreciation, depletion and amortization.
 
     (B) Natural gas production in the fourth quarter of 2000 excludes the
         downward adjustment of approximately 454 MMcf related to
         the loss of Dulcimer royalty relief in 2000. All other related
         information includes the effects of this adjustment to production.
 
 
                         SPINNAKER EXPLORATION COMPANY
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)
                                  (Unaudited)
 
                                                   March 31,       December 31,
                                                      2001             2000
 
     Cash and cash equivalents                      $66,611           $63,910
     Short-term investments                          49,042            22,387
     Accounts receivable and other current
      assets                                         50,897            51,996
        Total current assets                        166,550           138,293
 
     Property and equipment                         434,582           381,809
     Less: Accumulated depreciation,
      depletion and amortization                    (97,226)          (77,428)
        Total property and equipment                337,356           304,381
 
     Other                                               30                30
        Total assets                               $503,936          $442,704
 
     Accounts payable                               $34,342           $28,616
     Accrued liabilities                             48,436            35,672
        Total current liabilities                    82,778            64,288
 
     Deferred income taxes                           26,249            17,157
 
     Equity                                         394,909           361,259
        Total liabilities and equity               $503,936          $442,704
 
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SOURCE Spinnaker Exploration Company
    HOUSTON, April 25 /PRNewswire/ -- Spinnaker Exploration Company
 (NYSE:   SKE) today reported record first quarter 2001 earnings, revenues, cash
 flow and production.  Unit costs also declined during the period reported.
     Spinnaker reported net income of $28.1 million, or $1.00 per diluted
 share, in the first quarter of 2001 compared to first quarter 2000 net income
 of $3.1 million, or $0.15 per diluted share.  Net cash flow from operations
 before working capital changes was $63.1 million, or $2.24 per diluted share,
 in the first quarter of 2001 compared to first quarter 2000 net cash flow from
 operations before working capital changes of $10.9 million, or $0.51 per
 diluted share.
     Revenues were $67.0 million in the first quarter of 2001 compared to first
 quarter 2000 revenues of $13.9 million. Income from operations was
 $42.8 million in the first quarter of 2001 compared to first quarter 2000
 income from operations of $2.9 million.  Realized prices averaged $5.42 per
 thousand cubic feet of natural gas ("Mcf") and $28.18 per barrel of oil in the
 first quarter of 2001 compared to first quarter 2000 average realized prices
 of $2.76 per Mcf and $22.11 per barrel.
     Production was 12.4 billion cubic feet of natural gas equivalent ("Bcfe")
 in the first quarter of 2001 compared to first quarter 2000 production of
 4.9 Bcfe, representing an increase of 7.5 Bcfe, or 153%.  In addition,
 production increased 10% from the fourth quarter of 2000.  The current daily
 production rate increased 124% to approximately 150 million cubic feet of gas
 equivalent ("MMcfe") from a rate of approximately 67 MMcfe at the end of the
 first quarter of 2000.
     Per unit lease operating expenses decreased to $0.22 in the first quarter
 of 2001 from $0.33 in the same period in 2000, or a decrease of approximately
 34%.  The rate decreases were primarily due to reduced workover activities as
 well as continued efficiencies gained in core operating areas in the first
 quarter of 2001.  Per unit depreciation, depletion and amortization expense
 decreased approximately 2% in the first quarter of 2001 compared to the same
 period in 2000.
     Cash capital expenditures totaled $59.4 million in the first quarter of
 2001.  Cash and short-term investments were $115.7 million at March 31, 2001.
 The income tax rate and cash tax rate were 36% and 0%, respectively, in the
 first quarter of 2001.
     Spinnaker Exploration Company is an independent energy company engaged in
 the exploration, development and production of natural gas and oil in the U.S.
 Gulf of Mexico.
     Certain statements in this press release are forward-looking and are based
 upon Spinnaker's current belief as to the outcome and timing of future events
 that are subject to numerous uncertainties.  Important factors that could
 cause actual results to differ materially from those in the forward-looking
 statements herein include the timing and extent of changes in commodity prices
 for natural gas and oil, operating risks and other risk factors as described
 in Spinnaker's Annual Report on Form 10-K for the year ended December 31, 2000
 and its other filings with the Securities and Exchange Commission.  Should one
 or more of these risks or uncertainties occur, or should underlying
 assumptions prove incorrect, Spinnaker's actual results and plans could differ
 materially from those expressed in the forward-looking statements.  The
 forward-looking statements in this press release are made only as of the date
 hereof, and Spinnaker undertakes no obligation to update such forward-looking
 statements.
 
 
                         SPINNAKER EXPLORATION COMPANY
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In thousands, except per share amounts)
                                  (Unaudited)
 
                                                        Three Months Ended
                                                             March 31,
                                                      2001               2000
 
     REVENUES                                       $67,453            $13,867
 
     EXPENSES:
        Lease operating expenses                      2,691              1,609
        Depreciation, depletion and amortization -
         natural gas and oil properties              19,342              7,765
        Depreciation and amortization -  other           96                 69
        General and administrative                    2,532              1,498
             Total expenses                          24,661             10,941
     INCOME FROM OPERATIONS                          42,792              2,926
 
     OTHER INCOME (EXPENSE):
        Interest income                               1,345                244
        Interest expense                               (156)               (84)
             Total other income (expense)             1,189                160
     INCOME BEFORE INCOME TAXES                      43,981              3,086
        Income tax provision                         15,833                ---
     NET INCOME                                     $28,148             $3,086
 
     NET INCOME PER COMMON SHARE:
        Basic                                         $1.05              $0.15
        Diluted                                       $1.00              $0.15
 
     WEIGHTED AVERAGE NUMBER OF COMMON
      SHARES OUTSTANDING:
        Basic                                        26,772             20,417
        Diluted                                      28,196             21,259
 
 
                         SPINNAKER EXPLORATION COMPANY
                               SUMMARY STATISTICS
                 (In thousands, except per share/unit amounts)
                                  (Unaudited)
 
                                                               Three Months
                                           Three Months Ended      Ended
                                                March 31,       December 31,
                                             2001       2000       2000
 
     Total Amounts:
       Net income                           $28,148     $3,086    $22,012
       Net cash flow from operations
        before working capital changes       63,057     10,920     55,289
       Adjusted EBITDA  (A)                  62,230     10,760     53,563
 
     Totals Per Share:
       Net income:
            Basic                             $1.05      $0.15      $0.84
            Diluted                            1.00       0.15       0.79
       Net cash flow from operations
        before working capital changes         2.24       0.51       1.99
 
     Production Quantities:
       Natural gas (MMcf)                    11,969      4,556     11,291 (B)
       Oil (MBbls)                               77         58         76
       Natural gas and oil (MMcfe)           12,430      4,904     11,747 (B)
 
     Average Daily Production:
       Natural gas (MMcf)                       133         50        123 (B)
       Oil (MBbls)                              0.9        0.6        0.8
       Natural gas and oil (MMcfe)              138         54        128 (B)
 
     Revenues:
       Natural gas sales                    $81,455    $11,739    $65,562
       Oil sales                              2,163      1,620      2,544
       Natural gas and oil hedging income
        (loss)                              (16,600)       508     (9,490)
       Other                                    435        ---        ---
            Total                           $67,453    $13,867    $58,616
 
     Average Sales Price Per Unit:
       Natural gas revenues from
        production (per Mcf)                  $6.81      $2.58      $6.05
       Effects of hedging activities (per
        Mcf)                                  (1.39)      0.18      (0.85)
            Average price (per Mcf)           $5.42      $2.76      $5.20
 
       Oil and condensate revenues from
        production (per Bbl)                 $28.18     $27.93     $33.46
       Effects of hedging activities
        (per Bbl)                               ---      (5.82)     (4.06)
            Average price (per Bbl)          $28.18     $22.11     $29.40
 
       Total revenues from production
        (per Mcfe)                            $6.73      $2.72      $6.03
       Effects of hedging activities
        (per Mcfe)                            (1.34)      0.11      (0.84)
            Total average price (per Mcfe)    $5.39      $2.83      $5.19
 
     Cost Data:
       Lease operating expenses              $2,691     $1,609     $2,656
       Depreciation, depletion and
        amortization-natural gas and oil
        properties                           19,342      7,765     17,806
 
     Average Costs (per Mcfe):
       Lease operating expenses               $0.22      $0.33      $0.24
       Depreciation, depletion and
        amortization-natural gas and oil
        properties                             1.56       1.58       1.58
 
     Weighted Average Number of Common
      Shares Outstanding:
       Basic                                 26,772     20,417     26,317
       Diluted                               28,196     21,259     27,816
 
     (A) Adjusted EBITDA represents earnings before interest, income taxes and
         depreciation, depletion and amortization.
 
     (B) Natural gas production in the fourth quarter of 2000 excludes the
         downward adjustment of approximately 454 MMcf related to
         the loss of Dulcimer royalty relief in 2000. All other related
         information includes the effects of this adjustment to production.
 
 
                         SPINNAKER EXPLORATION COMPANY
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)
                                  (Unaudited)
 
                                                   March 31,       December 31,
                                                      2001             2000
 
     Cash and cash equivalents                      $66,611           $63,910
     Short-term investments                          49,042            22,387
     Accounts receivable and other current
      assets                                         50,897            51,996
        Total current assets                        166,550           138,293
 
     Property and equipment                         434,582           381,809
     Less: Accumulated depreciation,
      depletion and amortization                    (97,226)          (77,428)
        Total property and equipment                337,356           304,381
 
     Other                                               30                30
        Total assets                               $503,936          $442,704
 
     Accounts payable                               $34,342           $28,616
     Accrued liabilities                             48,436            35,672
        Total current liabilities                    82,778            64,288
 
     Deferred income taxes                           26,249            17,157
 
     Equity                                         394,909           361,259
        Total liabilities and equity               $503,936          $442,704
 
                     MAKE YOUR OPINION COUNT -  Click Here
                http://tbutton.prnewswire.com/prn/11690X66482331
 
 SOURCE  Spinnaker Exploration Company