UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 3, 2005 (November 3, 2005)
BERRY PETROLEUM COMPANY
(Exact Name of Registrant as Specified in its Charter)
| DELAWARE (State or Other Jurisdiction of Incorporation or Organization) |
1-9735 (Commission File Number) |
77-0079387 (IRS Employer Identification Number) |
| 5201 TRUXTUN AVE., STE. 300, BAKERSFIELD,
CA (Address of Principal Executive Offices) |
93309 (Zip Code) |
Registrant’s telephone number, including area code: (661) 616-3900
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
| Item 2.02 | Results of Operations and Financial Condition |
On November 3, 2005,
Berry Petroleum Company issued a news release announcing its financial results
for its third fiscal quarter ended September 30, 2005. The information contained in
the news release is incorporated herein by reference and furnished as Exhibit
99.1.
The information in this Current Report on Form 8-K and
Exhibit 99.1 is being furnished and shall not be deemed "filed" for the purposes
of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise
subject to the liabilities of that Section.
| Item 9.01 | Financial Statements and Exhibits |
(c) Exhibits
99.1 News release dated November 3, 2005 announcing the Registrant's financial
results for the quarter ended September 30, 2005.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereto duly authorized.
| BERRY PETROLEUM COMPANY |
||||
| By: |
/s/ Kenneth A. Olson |
|||
| Kenneth A. Olson | ||||
| Corporate Secretary | ||||
Date: November 3, 2005
Page 2 of 2
|
News
Release
Berry
Petroleum Company
Phone
(661) 616-3900
5201
Truxtun Avenue, Suite
300 E-mail:
ir@bry.com
Bakersfield,
California
93309-0640 Internet:
www.bry.com
|
|
|
Contacts:
Robert F. Heinemann, President and CEO - - Ralph J. Goehring, Executive
Vice President and CFO
|
|
BERRY
PETROLEUM EARNS
$1.52 PER SHARE
IN THIRD QUARTER
Bakersfield,
CA -November 3, 2005
- Berry
Petroleum Company (NYSE:BRY) reported net income of $34.2 million, or $1.52
per
diluted share, for the third quarter of 2005, up 88% compared to net income
of
$18.2 million, or $.82 per diluted share in the third quarter of 2004, according
to Robert F. Heinemann, president and chief executive officer. Revenues rose
to
a record $110 million in the quarter, up 51% from $73 million in the third
quarter of 2004. The average daily production of 23,647 barrels of oil
equivalent (BOE), which consists of 20,000 barrels of crude oil and 21.8
million
cubic feet of natural gas, was a record and an increase of 14% over the 20,825
BOE achieved a year ago. The third quarter 2005 average realized sales price
of
$44.25 per BOE was up 37% from the $32.28 per BOE received in the third quarter
of 2004.
Mr.
Heinemann continued, “Berry’s performance in the third quarter was outstanding.
Our quarterly earnings were a Company record as was our average daily
production, which increased 4% over the second quarter of 2005 and 14% over
last
year’s third quarter. We are continuing our growth strategy by investing record
cash flows into our core producing assets and new exploitation opportunities.
Berry raised its capital budget for 2005 by $29 million or, 27%, to $136
million
to take advantage of these investment opportunities.”
“Additionally,
in August the board approved an 8% increase in the quarterly dividend beginning
with the September 2005 payment, and issued a one-time special dividend of
$.10
per share to allow shareholders to fully participate in the Company’s
success.”
“Berry
is
currently appraising several of its new prospects, including the Company’s Lake
Canyon shallow oil and deep gas projects and the Coyote Flats Ferron gas
and
coal bed methane projects in the Uinta Basin of Utah. We are launching a
five-well development program on our Tri-State Niobrara acreage in Kansas.
The
25 well expansion of our California diatomite heavy oil project is well
underway. Success on any of these projects could be very significant to the
Company. In the fourth quarter, Berry increased its acreage position and
now
holds an interest in approximately 900,000 gross acres in the Rockies and
Mid-Continent. We completed a ‘bolt-on’ acquisition of a 50% working interest in
60,000 net acres adjacent to and immediately north of our Yuma County Niobrara
gas properties in Colorado. We also closed on previously announced acreage
in
the North Dakota Bakken play. Berry intends to appraise all these opportunities
in a decisive and expedient manner. To that end, the Company has purchased
two
drilling rigs and is working to secure the additional equipment needed to
complete the drilling of our inventory over the next several
years.”
For
the
nine months ending September 30, 2005, net income was a record $82.0 million
or
$3.65 per diluted share, up 87% from net income of $43.9 million, or $1.97
per
diluted share for the nine months ending September 30, 2004. Revenues were
$291
million in the first nine months of 2005, up 50% from $194 million in the
first
nine months of 2004. For the nine months ending September 30, 2005, average
daily production of 22,793 BOE increased by 13% and the average realized
sales
price of $40.48 per BOE was up 41% from the first nine months of 2004.
Mr.
Heinemann added, “We
are
accomplishing our diversification strategy as witnessed by our third quarter
production volumes, which were 71% heavy oil, 14% light oil and 15% natural
gas.
Our reserves and production are moving toward a more balanced mix which
will
result in a portfolio less vulnerable to commodity price swings. It is
our goal
to continue to diversify our asset base.”
Ralph
J.
Goehring, executive vice president and chief financial officer said, “Our
financial performance in the third quarter is unparalleled in the Company’s
history. The combination of record production and record high oil prices
allows
Berry to generate outstanding cash flow and returns on our investments. Net
cash
provided by operating activities was a record $122 million in the first nine
months of 2005, up 56% from $78 million in the same period in 2004. In the
first
nine months of 2005, the Company invested $78 million in capital projects,
$119
million in property acquisitions, retired debt of $44 million and paid dividends
of $10 million.”
“Our
2005
fourth quarter looks like it will be a very strong quarter for Berry. Likewise,
2006 is shaping up to be another record year in production as we target 25,000
BOE/D from existing producing assets, or 9% over our 2005 target of 23,000
BOE/D. We anticipate our 2006 capital program, excluding acquisitions, to
be at
least $150 million and funded out of cash flow.”
Teleconference
Call
A
conference call will be held Thursday, November 3, 2005 at 11:00 a.m. Eastern
Time (8:00 a.m. Pacific Time). Dial 1-866-713-8567 to participate, using
passcode 50903983. International callers may dial 617-597-5326. For a digital
replay available until November 17, 2005, dial 1-888-286-8010 (passcode
52056556). Listen live or via replay on the Web at www.bry.com. Transcripts
of
this and previous calls may be viewed at www.bry.com/tele.htm.
Berry
Petroleum Company is a publicly traded independent oil and gas production
and
exploitation company with its headquarters in Bakersfield,
California.
Safe
harbor under the “Private Securities Litigation Reform Act of
1995”
Any
statements in this news release that are not historical facts are
forward-looking statements that involve risks and uncertainties. Words such
as
"plans", "will", "intend", "could", "target", "goal",
"anticipate", "looks like" and others indicate forward-looking statements,
but
their absence does not mean that a statement is not forward-looking, if the
discussion involves strategy, beliefs, plans, targets, or intentions.
Forward-looking statements are made based on management’s current expectations
and beliefs concerning future developments and their potential effects upon
Berry Petroleum Company. Important factors which could affect actual results
are
discussed in Part II of our Form 10-K filed with the Securities and Exchange
Commission, under the heading "Other Factors Affecting the Company's Business
and Financial Results" in the section titled "Management’s Discussion and
Analysis of Financial Condition and Results of Operations."
|
CONDENSED
INCOME STATEMENTS
|
||||
|
(In
thousands, except per share data)
|
||||
|
(unaudited)
|
||||
|
Three
Months
|
Nine
Months
|
|||
|
9/30/05
|
9/30/04
|
9/30/05
|
9/30/04
|
|
|
Revenues
|
|
|
|
|
|
Sales
of oil and gas
|
$
96,439
|
$
61,560
|
$
252,635
|
$
159,520
|
|
Sales
of electricity
|
12,933
|
11,344
|
36,903
|
34,569
|
|
Interest
and other income, net
|
612
|
45
|
1,130
|
338
|
|
Total
|
109,984
|
72,949
|
290,668
|
194,427
|
|
Expenses
|
|
|
|
|
|
Operating
costs - oil &
gas production
|
28,144
|
22,487
|
77,925
|
58,721
|
|
Operating
costs - electricity generation
|
12,316
|
10,423
|
36,596
|
33,415
|
|
Exploration
costs
|
749
|
-
|
1,535
|
-
|
|
Depreciation,
depletion & amortization - oil & gas
|
8,813
|
7,500
|
26,800
|
21,497
|
|
Depreciation,
depletion & amortization - electricity
|
831
|
823
|
2,443
|
2,539
|
|
General
and
administrative
|
5,965
|
4,769
|
15,988
|
16,956
|
|
Dry
hole, abandonment & impairment
|
2,803
|
-
|
5,425
|
-
|
|
Interest
|
1,598
|
512
|
4,502
|
1,577
|
|
Total
|
61,219
|
46,514
|
171,214
|
134,705
|
|
|
|
|
|
|
|
Income
before income
taxes
|
48,765
|
26,435
|
119,454
|
59,722
|
|
Provision
for income
taxes
|
14,546
|
8,206
|
37,470
|
15,850
|
|
|
|
|
|
|
|
Net
income
|
$
34,219
|
$
18,229
|
$
81,984
|
$
43,872
|
|
|
|
|
|
|
|
Basic
net income per
share
|
$
1.55
|
$
.83
|
$
3.72
|
$
2.01
|
|
Diluted
net income per
share
|
$
1.52
|
$
.82
|
$
3.65
|
$
1.97
|
|
Cash
dividends per
share
|
$
.23
|
$
.18
|
$
.47
|
$
.40
|
|
|
|
|
|
|
|
Weighted
average capital stock outstanding:
|
|
|
|
|
|
Basic
|
22,068
|
21,934
|
22,039
|
21,875
|
|
Diluted
|
22,529
|
22,365
|
22,489
|
22,295
|
|
CONDENSED
BALANCE SHEETS
|
||
|
(In
thousands)
|
||
|
(unaudited)
|
||
|
9/30/05
|
12/31/04
|
|
|
Assets
|
||
|
Current
assets
|
$
95,468
|
$ 61,001
|
|
Properties,
buildings & equipment, net
|
512,034
|
338,706
|
|
Other
assets & deposits
|
5,750
|
12,397
|
|
$613,252
|
$412,104
|
|
|
Liabilities
& Shareholders’ Equity
|
||
|
Current
liabilities
|
$122,072
|
$ 64,841
|
|
Deferred
income taxes
|
48,221
|
47,963
|
|
Long-term
debt
|
100,000
|
28,000
|
|
Other
long-term liabilities
|
50,929
|
8,214
|
|
Shareholders’
equity
|
292,030
|
263,086
|
|
|
$613,252
|
$412,104
|
|
CONDENSED
STATEMENTS OF CASH FLOWS
|
||
|
(In
thousands)
|
||
|
(unaudited)
|
||
|
Nine
Months Ended
|
||
|
9/30/05
|
9/30/04
|
|
|
Cash
flows from operating activities:
|
||
|
Net
income
|
$
81,984
|
$
43,872
|
|
Depreciation,
depletion & amortization (DD&A)
|
29,243
|
24,036
|
|
Deferred
income taxes
|
16,939
|
6,846
|
|
Stock-based
compensation expense
|
404
|
4,520
|
|
Other,
net
|
2,404
|
205
|
|
Net
changes in operating assets and liabilities
|
(8,687)
|
(997)
|
|
Net
cash provided by operating activities
|
122,287
|
78,482
|
|
Net
cash used in investing activities
|
(196,891)
|
(55,172)
|
|
Net
cash provided by (used in) financing activities
|
66,341
|
(25,760)
|
|
Net
(decrease) increase in cash and cash equivalents
|
(8,263)
|
(2,450)
|
|
Cash
and cash equivalents at beginning of year
|
16,690
|
10,658
|
|
Cash
and cash equivalents at end of period
|
$
8,427
|
$
8,208
|
|
COMPARATIVE
OPERATING STATISTICS
|
||||||
|
(unaudited)
|
||||||
|
Three
Months Ended
|
Nine
Months Ended
|
|||||
|
|
9/30/05
|
9/30/04
|
Change
|
9/30/05
|
9/30/04
|
Change
|
|
Oil
and gas:
|
||||||
|
Net production-BOE
per day
|
23,647
|
20,825
|
+14%
|
22,793
|
20,243
|
+13%
|
|
Per
BOE:
|
||||||
|
Average
sales price before hedging
|
$
51.34
|
$
35.61
|
+44%
|
$
45.38
|
$
31.58
|
+44%
|
|
Average
sales price after hedging
|
44.25
|
32.28
|
+37%
|
40.48
|
28.81
|
+40%
|
|
Operating
costs
|
12.94
|
11.74
|
+10%
|
12.52
|
10.59
|
+18%
|
|
DD
&
A
|
4.05
|
3.91
|
+4%
|
4.31
|
3.88
|
+11%
|
|
General
& administrative expenses
|
2.74
|
2.49
|
+10%
|
2.57
|
3.06
|
-16%
|
|
Interest
expense
|
$ .73
|
$ .27
|
+170%
|
$ .72
|
$ .28
|
+157%
|
#
#
#