Wednesday, May 2, 2012

Chesapeake Energy Earnings Report For 1st Quarter 2012

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Chesapeake Energy Corporation (NYSE:CHK) today announced financial and operational results for the 2012 first quarter. For the 2012 first quarter, Chesapeake reported a net loss to common stockholders of $71 million ($0.11 per fully diluted common share), ebitda of $597 million (defined as net income (loss) before income taxes, interest expense, and depreciation, depletion and amortization) and operating cash flow of $910 million (defined as cash flow from operating activities before changes in assets and liabilities) on revenue of $2.419 billion and production of 333 billion cubic feet of natural gas equivalent (bcfe).

The company’s 2012 first quarter results include various items that are typically not included in published estimates of the company’s financial results by certain securities analysts. Excluding such items for the 2012 first quarter, Chesapeake reported adjusted net income to common stockholders of $94 million ($0.18 per fully diluted common share) and adjusted ebitda of $838 million. The primary excluded item from the 2012 first quarter reported results is a net unrealized noncash after tax mark to market loss of $167 million resulting from the company’s natural gas, liquids and interest rate hedging programs. A reconciliation of operating cash flow, ebitda, adjusted ebitda and adjusted net income to comparable financial measures calculated in accordance with generally accepted accounting principles is presented on pages 18 – 20 of this release......Click here to read the entire earnings report

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Rajiv Srinivasan said...

Great Post, Ray. I was hoping this would not fall under the radar. This is a disappointing report from a company that I think has a lot of potential. CHK has had a rough week, and these sort of PR hurdles are difficult to overcome with just production.

Been following your blog for a while man, it's been a great addition to my newsfeed. Keep it up, hope to keep in touch. all the best

Ray @ The Crude Oil Trader said...

Great point Rajiv. We did not sell our position in CHK this week like so many have but we have not added to it either. Feel like betting against CHK is like betting against nat gas and we won't be doing that. People that say it's early to enter natural gas right now are the same people that won't have positions in it 10 years from now and they will miss one of the biggest moves in energy in a century.