Cimarex Energy (XEC)

[dan_s]

My forecast model had XEC earning $1.57 for Q4, so they came in 1 cent above my forecast. I will be working on it today and post an updated forecast model this afternoon that will include a revised Fair Value estimate. - Dan

Cimarex beats by $0.05, beats on revs (XEC) 107.10 : Reports Q4 (Dec) earnings of $1.58 per share, excluding non-recurring items, $0.05 better than the Thomson Reuters consensus of $1.53; revenues rose 24.1% year/year to $408 mln vs the $400 mln consensus.
> Year-end 2010 proved reserves grew 23% to 1.88 trillion cubic feet equivalent (Tcfe), up from 1.53 Tcfe at year-end 2009. Proved reserves are 77% developed for both year-end 2010 and year-end 2009.
> First-quarter 2011 production is projected to range between 582-602 MMcfe/d, which has been negatively impacted by 10-15 MMcfe/d from weather related down time.
> "Full-year 2011 production is projected to be in the range of 615-645 MMcfe/d.
> Full-year 2011 exploration and development (E&D) capital investment is expected to be principally funded from cash flow.
> At the present time, based on current market prices and service costs, we would expect that 2011 capital expenditures may range from $1.2-$1.4 billion. We have a large inventory of drilling opportunities and limited lease expirations."

[dan_s]

I'm going to wait until I listen to the XEC conference call before I finish my forecast for 2011.

The market views XEC as a "gasser" yet 56% of their 2010 revenues came from the sales of oil and NGLs. That percentage will go up in 2011 as this year's capital program is focused on increasing liquids production.

I love companies that have strong Balance Sheets and funding growth with operating cash flows.