Telemarker, I was just as confused as you on the cash flow and sent an e-mail to IR this morning requesting help in comparing it to Dain Rauscher Wessels' estimated cash flow of $2.64/share for the year. Following is Mr. MacDonald's response (he is the Director of EEX IR):
<As per the SEC, the only number I can officially report is the Cash Flow from Operations, which includes changes in working capital and other cash items and ties to the specific line in the cash flow statement. The "analyst" cash flow will exclude working capital and other items. So, to calculate the number that Dain Rauscher would be forecasting, with the income statement in our release you would start with net income and add back the various non cash items: DD&A, exploration expenses, income taxes (since
they are all deferred) and the preferred dividends since they are not paid in cash. The assumption being that working capital on an annual basis is neutral.
When the final cash flow statement comes out in the 10Q shortly, we can discuss the "operating" vs "analyst" cash flow in more detail.>
Based on this guidance, I plugged in the numbers from this morning's earnings release:
Net Income $ 987
DD&A 21,087
Exploration 4,748
Income Taxes 2,300
Preferred stock dividends 3,242
Total Net Cash Flow $32,364
Diluted shares 42,236
Cash flow per share for quarter: $0.77/share
If this cash flow is maintained for the year, it would be $3.08/share and the stock price is currently 2 7/8. They are expecting to "significantly" increase their cash flow by leasing out their recently refurbished floating production facility, they are almost at TD for a potential company-maker well at Llano (could be more than a billion bbls), and they've hit 6 of 7 wells at their newly purchased Tesoro onshore Texas properties. Anyone know of a more undervalued company? |
