PITTSBURGH, April 29 /PRNewswire-FirstCall/ -- CNX Gas
Corporation (NYSE: CXG), a leading Appalachian producer, reported
net income attributable to CNX Gas shareholders of $45.6 million, or $0.30 per diluted share, for the quarter ended
March 31, 2010. This compares to
$54.9 million, or $0.36 per diluted share, for the quarter ended
March 31, 2009.
Production was 24.0 billion cubic feet (Bcf), or 267 million
cubic feet (MMcf) per day, for the quarter ended March 31, 2010. This was 9% higher than the 22.0
Bcf, or 245 MMcf per day, for the year-ago quarter, but slightly
lower than the 25.1 Bcf produced in the fourth quarter of 2009.
Approximately 0.6 Bcf of production was deferred due to the loss of
power for several days related to a severe winter storm in our
Northern Appalachia producing
region in the quarter ended March 31,
2010.
"CNX Gas has drilled its best ever horizontal Marcellus Shale
wells during the first quarter," said J.
Brett Harvey, chairman and chief executive officer. "One
well, GH 2B CV, has averaged 5.0 MMcf per day for the first 47 days
of production. It peaked at 5.7 MMcf per day. This production is
remarkable when one considers that the lateral is only 2,300 feet.
Based on this early production, we think it is reasonable to assume
reserves for this well in excess of 5 Bcf.
"A second well, GH 10 CV, has only 1,500 feet of lateral, but
has a current daily production rate of 4.3 MMcf. This well is still
inclining after being on line for 17 days, with an average
production rate of 4.1 MMcf per day.
"A third well, GH 11B CV, had its last three stages fraced, as
had been anticipated in the prior earnings release," continued Mr.
Harvey. "This well, with only 1,800 feet of lateral, is now
producing 2.2 MMcf per day from only those three stages. As we move
to our new drilling area on June 1," continued Mr. Harvey, "we
expect to see proportionate increases in production and reserves as
we increase our laterals to 3,000 feet and beyond."
CNX Gas increased production by 9% in the first quarter of 2010,
as compared with the prior year's first quarter, while paying down
about $9 million of short term debt.
The daily production rate of 267 MMcf was down 6 MMcf from the 2009
fourth quarter, as unusually heavy snows slowed the pace of
drilling.
TABLE 1
FINANCIAL AND OPERATIONAL RESULTS -
Quarter-To-Quarter
Comparison
|
|
|
Quarter
Ended
Mar. 31,
2010
|
Quarter
Ended
Mar. 31,
2009
|
|
Total Revenue and Other
Income
|
$192.3
|
$178.4
|
|
Net Income attributable to CNX Gas
shareholders
|
$45.6
|
$54.9
|
|
Earnings per Share -
Diluted
|
$0.30
|
$0.36
|
|
Net Cash from Operating
Activities
|
$75.2
|
$126.4
|
|
EBITDA
|
$107.6
|
$114.1
|
|
EBIT
|
$75.5
|
$91.3
|
|
Total Period Production
(Bcf)
|
24.0
|
22.0
|
|
Average Daily Production
(MMcf)
|
267
|
245
|
|
Capital Expenditures
|
$65.3
|
$133.6
|
|
Financial results are in millions of
dollars except per share amounts. Production results are
net of royalties.
|
|
|
|
|
Quarter-to-Quarter Analysis
The average price realized for the company's gas production was
$7.24 per Mcf for the quarter ended
March 31, 2010, or $0.13 lower than the $7.37 per Mcf received for the quarter ended
March 31, 2009. The average realized
price for the just-ended quarter included 13.0 Bcf hedged at
$8.76 per Mcf.
All-in unit costs for company production, exclusive of
royalties, were $3.75 per Mcf in the
just-ended quarter, or an increase of $0.46 from the $3.29 per Mcf for the quarter ended March 31, 2009. Unit production taxes were higher
in the just-ended quarter because the prior year's first quarter
contained a favorable revision to an estimate of a pending
litigation settlement. Unit production DD&A was higher in the
just-ended quarter as the increase in 2009 drilling capital
exceeded the increase in proved developed producing reserves in
Northern Appalachia.
As a result of slightly lower average sales prices and higher
unit costs, pre-tax unit margins for company production were
$3.49 per Mcf in the just-ended
quarter, a decrease of $0.59 from the
$4.08 per Mcf in the quarter ended
March 31, 2009.
TABLE
2
PRICE AND COST
DATA PER NET MCF -
Quarter-To-Quarter Comparison
|
|
|
Quarter
Ended
Mar. 31,
2010
|
Quarter
Ended
Mar. 31,
2009
|
|
|
|
|
|
Average Sales Price
|
$7.24
|
$7.37
|
|
|
|
|
|
Costs – Production
|
|
|
|
Lifting
|
$0.48
|
$0.49
|
|
Production Taxes
|
$0.11
|
$0.03
|
|
DD&A
|
$1.09
|
$0.81
|
|
Total Production Costs
|
$1.68
|
$1.33
|
|
|
|
|
|
Costs – Gathering
|
|
|
|
Operating Costs
|
$0.87
|
$0.78
|
|
Transportation
|
$0.28
|
$0.21
|
|
DD&A
|
$0.24
|
$0.23
|
|
Total Gathering Costs
|
$1.39
|
$1.22
|
|
|
|
|
|
Costs − Administration
|
$0.68
|
$0.74
|
|
|
|
|
|
Total Costs
|
$3.75
|
$3.29
|
|
|
|
|
|
Margin
|
$3.49
|
$4.08
|
|
Note: Costs − Administration exclude incentive
compensation and other corporate items.
|
|
|
|
|
Safety
During the first quarter, CNX Gas employees continued to work
without incurring a lost time accident. As of March 31, the cumulative time worked by employees
without a lost time incident was 4.2 million hours.
Central Appalachia Operations
Total production in Central
Appalachia, which includes Virginia CBM and Chattanooga
Shale, was 18.5 Bcf in the quarter ended March 31, 2010. This was 1.3 Bcf higher than the
17.2 Bcf produced in the quarter ended March
31, 2009. The Central
Appalachia March run rate was 210 MMcf per day.
CNX Gas drilled 30 vertical frac wells in its Virginia CBM
Operations during the quarter. The company expects to drill 175
wells in Virginia in 2010 with a
drilling budget of $50 million.
CNX Gas drilled 13 horizontal wells in the Chattanooga Shale
during the quarter. For 2010, CNX Gas expects to drill 25
Chattanooga Shale wells for about $28
million, and three-to-five Huron Shale wells for about
$8-12 million.
Northern Appalachia Operations
Total production in Northern
Appalachia, which includes Mountaineer CBM, Nittany CBM, and
Marcellus Shale, was 5.5 Bcf in the quarter ended March 31, 2010. This was 0.7 Bcf more than the
4.8 Bcf produced in the quarter ended March
31, 2009. The Northern
Appalachia March run rate was 64 MMcf per day.
Of this Northern Appalachian production, 1.4 Bcf was from the
Marcellus Shale in the just-ended quarter, versus a minimal amount
in the same quarter last year.
No coalbed methane wells were drilled in Northern Appalachia during the quarter. For
2010, CNX Gas expects to drill 5 horizontal CBM wells in
Mountaineer and some ancillary wells for about $17 million.
For the entire horizontal Marcellus Shale program to date, 18
horizontal wells have been drilled. The reserves associated with
the first 11 wells total 35.6 Bcf, or about 3.3 Bcf per well. The
laterals on these wells averaged less than 2,000 feet.
Upcoming drilling in the Marcellus Shale is expected to be
predominantly horizontal and on multiple-well pads, with laterals
closer to 3,000-3,500 feet. For 2010, the company expects to drill
approximately two dozen horizontal wells, with a drilling budget of
about $110 million.
CNX Gas successfully increased its acreage with Marcellus Shale
potential by 10,000 in the quarter, to a total of 260,000. Of this,
approximately 180,000 acres is considered to be Tier 1.
Financial Update
CNX Gas intends to invest $400
million in 2010, with $221 for
drilling, $121 million for midstream,
and the remainder for land.
The company ended the quarter with $49.2
million drawn on its $200
million credit facility. The amount drawn is down
$8.7 million from December 31, 2009. Cash on hand was $1.1 million.
CNX Gas also has outstanding letters of credit of $14.9 million. Total funds available are
$137.0 million.
Annualized return on capital employed for the quarter was 11.7%,
on an after tax basis.
Guidance
The 2010 production guidance remains at 100 Bcf.
Total hedged production in the 2010 second quarter is 13.6 Bcf,
at an average price of $8.15 per
Mcf.
TABLE 3
GUIDANCE
|
|
|
Actual
2009
|
2010
|
2011
|
2012
|
|
Total Yearly
Production (Bcf)
|
94.4
|
100
|
NA
|
NA
|
|
Volumes Hedged
(Bcf)
|
51.6
|
48.4
|
22.6
|
15.1
|
|
Average Hedge
Price ($/Mcf)
|
$8.76
|
$7.85
|
$6.84
|
$6.84
|
|
|
|
|
|
|
|
|
Natural Gas Outlook
At the close of the winter heating season, natural gas in
storage was at 1,638 Bcf. This was 160 Bcf above the five-year
average, but 16 Bcf below last year's level. Gas prices have
weakened to about the $4.00 per Mcf
level, as rising rig counts have caused concern that rising
production could more than offset rising demand from an economic
recovery. CNX Gas will add a second horizontal rig to its Marcellus
Shale drilling program on June 1. CNX
Gas, with its low costs and rising production volumes, is expected
to outperform its peers during this period of price weakness.
Conference Call Information
CNX Gas and CONSOL Energy will co-host a conference call today
at 10:00 a.m. Eastern Time to discuss
the company's first quarter results. The teleconference can be
heard "live" at the investor relations portion of the company web
site: www.cnxgas.com.
Investor Contact:
Dan Zajdel at (724) 485-4169
|
|
Media Contact: Joe
Cerenzia at (724) 485-4062
|
|
|
Definition: EBIT is defined as earnings (excluding
cumulative effect of accounting change) before deducting net
interest expense (interest expense less interest income) and income
taxes. EBITDA is defined as earnings (excluding cumulative
effect of accounting change) before deducting net interest expense
(interest expense less interest income), income taxes, and
depreciation, depletion and amortization. Although EBIT and
EBITDA are not measures of performance calculated in accordance
with generally accepted accounting principles, management believes
that they are useful to an investor in evaluating CNX Gas because
they are widely used to evaluate a company's operating performance
before debt expense and its cash flow. EBIT and EBITDA do not
purport to represent cash generated by operating activities and
should not be considered in isolation or as a substitute for
measures of performance in accordance with generally accepted
accounting principles. In addition, because all companies do
not calculate EBIT and EBITDA identically, the presentation here
may not be comparable to similarly titled measures of other
companies. Reconciliation of EBITDA and EBIT to the income
statement is as follows:
CNX Gas
EBIT & EBITDA Reconciliation
(000) Omitted
|
|
|
Quarter
Ended
Mar. 31,
2010
|
Quarter
Ended
Mar. 31,
2009
|
|
Net Income attributable to CNX
Gas shareholders
|
$45,627
|
$54,904
|
|
Add: Interest
Expense
|
1,915
|
1,957
|
|
Less: Interest Income
|
11
|
11
|
|
Add: Income Taxes
|
27,967
|
34,440
|
|
Earnings Before Interest & Taxes
(EBIT)
|
75,498
|
91,290
|
|
Add: Depreciation, Depletion,
& Amortization
|
32,092
|
22,819
|
|
EBITDA
|
$107,590
|
$114,109
|
|
|
|
|
|
|
CNX Gas
Capital Employed and Return
on Capital Employed
(000) Omitted
Capital employed is a
measure of net investment. When viewed from the perspective of how
the capital is used, it includes CNX Gas' property, plant, and
equipment and other assets less liabilities.
|
|
Capital Employed
|
As of
March
31,
2010
|
As of
December
31,
2009
|
|
|
|
|
|
Total assets
|
$2,263,985
|
$2,171,382
|
|
Less liabilities:
|
|
|
|
Total current liabilities
(other than current portion of indebtedness)
|
(155,660)
|
(150,778)
|
|
Total long-term liabilities
(other than indebtedness)
|
(400,534)
|
(381,548)
|
|
Total Capital Employed
|
$1,707,791
|
$1,639,056
|
|
|
|
|
|
|
Return on average capital employed (ROCE) is a performance
measure ratio. ROCE is defined as net income plus after-tax
interest expense, divided by average capital employed. Below is a
calculation of ROCE for the March
2010 quarter. In order to annualize the result on a
compounded basis, a "1" is added to the quarterly ROCE, before it
is raised to the fourth power.
|
|
Return on Capital Employed
|
Quarter
Ended
March
31,
2010
|
|
|
|
|
Net Income
|
$45,627
|
|
Financing costs
(after-tax):
|
(1,187)
|
|
Earnings excluding financing
costs
|
$46,814
|
|
Average capital employed
|
$1,673,423
|
|
Return on average capital
employed
|
2.8%
|
|
Return on average capital
employed-annualized
|
11.7%
|
|
|
|
|
|
Although ROCE is not a measure of performance calculated in
accordance with generally accepted accounting principles,
management believes that ROCE is a useful measure because it
indicates the return on all capital, which includes equity and
debt, employed in the business. Management believes that ROCE is an
additional measure of efficiency when considered in conjunction
with return on equity, which measures the return on only the
shareholders' equity component of total capital employed.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
Various statements in this document, including those that
express a belief, expectation, or intention, as well as those that
are not statements of historical fact, are forward-looking
statements (as defined in Section 21E of the Securities
Exchange Act of 1934 and the Private Securities Litigation Reform
Act of 1995). The forward-looking statements may include
projections and estimates concerning the timing and success of
specific projects, our future production, revenues, income and
capital spending. When we use the words "believe," "intend,"
"expect," "may," "should," "anticipate," "could," "would," "will,"
"estimate," "plan," "predict," "project," or their negatives, or
other similar expressions, the statements which include those words
are usually forward-looking statements. When we describe strategy
that involves risks or uncertainties, we are making forward-looking
statements. The forward-looking statements in this document speak
only as of the date of this document; we disclaim any obligation to
update these statements unless required by securities law, and we
caution you not to rely on them unduly. We have based these
forward-looking statements on our current expectations and
assumptions about future events. While our management considers
these expectations and assumptions to be reasonable, they are
inherently subject to significant business, economic, competitive,
regulatory and other risks, contingencies and uncertainties, most
of which are difficult to predict and many of which are beyond our
control. These risks, uncertainties and contingencies include, but
are not limited to: our business strategy; our financial
position, cash flow and liquidity; the deteriorating economic
conditions in the United States
and globally; declines in the prices we receive for our gas
affecting our operating results and cash flow; uncertainties in
estimating our gas reserves and replacing our gas reserves;
uncertainties in exploring for and producing gas; our inability to
obtain additional financing necessary in order to fund our
operations, capital expenditures and to meet our other obligations;
disruptions to, capacity constraints in or other limitations on the
pipeline systems which deliver our gas; the cost of disposing of
water from our coalbed methane and Marcellus Shale gas wells; the
cost of removing impurities from the gas we produce; the
availability of personnel and equipment, including our inability to
retain and attract key personnel; increased costs; the effects of
government regulation, permitting and other legal requirements;
legal uncertainties regarding the ownership of the coalbed methane
estate, and costs associated with perfecting title for gas rights
in some of our properties; litigation concerning real property
rights, intellectual property rights, royalty calculations and
other matters; our relationships and arrangements with CONSOL
Energy; and other factors discussed in our Annual Report on Form
10-K for the fiscal year ended December 31,
2009 under "Risk Factors," as updated by any subsequent Form
10-Qs, which are on file at the Securities and Exchange
Commission.
|
|
CNX GAS
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF INCOME
|
|
(Unaudited)
|
|
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the
Three
|
|
|
|
|
|
Months
Ended
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
2010
|
|
2009
|
|
|
|
Revenue and Other Income:
|
|
|
|
|
|
|
|
Outside
|
$
172,981
|
|
$
161,340
|
|
|
|
Related Party Sales
|
1,032
|
|
1,000
|
|
|
|
Royalty Interest Gas
Sales
|
14,339
|
|
12,632
|
|
|
|
Purchased Gas Sales
|
3,016
|
|
1,465
|
|
|
|
Other Income
|
896
|
|
1,947
|
|
|
|
Total Revenue and Other
Income
|
192,264
|
|
178,384
|
|
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
Lifting Costs
|
14,138
|
|
11,428
|
|
|
|
Gathering and Compression
Costs
|
27,692
|
|
21,846
|
|
|
|
Royalty Interest Gas
Costs
|
12,214
|
|
10,601
|
|
|
|
Purchased Gas Costs
|
2,308
|
|
1,530
|
|
|
|
Exploration and Other
Costs
|
4,220
|
|
2,207
|
|
|
|
General and
Administrative
|
16,331
|
|
16,250
|
|
|
|
Other Corporate
Expenses
|
7,954
|
|
665
|
|
|
|
Depreciation, Depletion
and
|
|
|
|
|
|
|
|
Amortization
|
32,092
|
|
22,819
|
|
|
|
Interest Expense
|
1,915
|
|
1,957
|
|
|
|
Total Costs and
Expenses
|
118,864
|
|
89,303
|
|
|
|
Earnings Before Income Taxes
and
|
|
|
|
|
|
|
|
Noncontrolling
Interest
|
|
73,400
|
|
89,081
|
|
|
|
Noncontrolling Interest
|
|
(194)
|
|
(263)
|
|
|
|
Earnings Before Income
Taxes
|
73,594
|
|
89,344
|
|
|
|
Income Taxes
|
|
27,967
|
|
34,440
|
|
|
|
Net Income Attributable to CNX Gas
Shareholders
|
|
$
45,627
|
|
$
54,904
|
|
|
|
Earnings Per Share:
|
|
|
|
|
|
|
|
Basic
|
$
0.30
|
|
$
0.36
|
|
|
|
Dilutive
|
$
0.30
|
|
$
0.36
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Number of
|
|
|
|
|
|
|
|
Common Shares
Outstanding:
|
|
|
|
|
|
|
|
Basic
|
150,990,184
|
|
150,971,679
|
|
|
|
Dilutive
|
151,389,003
|
|
151,232,901
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNX GAS
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
2010
|
|
2009
|
|
ASSETS
|
|
|
|
|
Current Assets:
|
|
|
|
|
Cash and Cash
Equivalents
|
$
1,093
|
|
$
1,124
|
|
Accounts and Notes
Receivable:
|
|
|
|
|
Trade
|
46,749
|
|
43,421
|
|
Other
Receivables
|
579
|
|
975
|
|
Derivatives
|
124,811
|
|
99,265
|
|
Other
|
4,544
|
|
3,829
|
|
Total Current
Assets
|
177,776
|
|
148,614
|
|
|
|
|
|
|
Property, Plant and
Equipment:
|
|
|
|
|
Property, Plant and
Equipment
|
2,480,394
|
|
2,409,751
|
|
Less - Accumulated
Depreciation, Depletion
|
|
|
|
|
and
Amortization
|
466,390
|
|
433,201
|
|
Total Property,
Plant and Equipment - Net
|
2,014,004
|
|
1,976,550
|
|
|
|
|
|
|
Other Assets:
|
|
|
|
|
Investment in
Affiliates
|
24,074
|
|
24,591
|
|
Derivatives
|
44,200
|
|
18,218
|
|
Other
|
3,931
|
|
3,409
|
|
|
|
|
|
|
Total Other
Assets
|
72,205
|
|
46,218
|
|
|
|
|
|
|
TOTAL
ASSETS
|
$
2,263,985
|
|
$
2,171,382
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNX GAS
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
BALANCE SHEETS
|
|
(Dollars in
thousands, except per share data)
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
March
31,
|
|
December
31,
|
|
|
|
|
2010
|
|
2009
|
|
LIABILITIES AND STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
Accounts Payable
|
|
|
$
63,724
|
|
$
53,516
|
|
Accrued Royalties
|
|
|
14,860
|
|
14,898
|
|
Accrued Severance
Taxes
|
|
|
952
|
|
1,037
|
|
Related Parties
|
|
|
2,725
|
|
5,171
|
|
Short-Term Notes
Payable
|
|
|
49,150
|
|
57,850
|
|
Deferred Income Taxes
|
|
|
44,895
|
|
34,871
|
|
Accrued Income Taxes
|
|
|
20,157
|
|
31,765
|
|
Current Portion of Long-Term
Debt
|
|
|
8,756
|
|
8,616
|
|
Other Current
Liabilities
|
|
|
8,347
|
|
9,520
|
|
Total Current
Liabilities
|
|
|
213,566
|
|
217,244
|
|
|
|
|
|
|
|
|
Long-Term Debt:
|
|
|
|
|
|
|
Long-Term Debt
|
|
|
8,876
|
|
10,062
|
|
Capital Lease
Obligations
|
|
|
54,733
|
|
55,628
|
|
Total Long-Term
Debt
|
|
|
63,609
|
|
65,690
|
|
|
|
|
|
|
|
|
Deferred Credits and Other
Liabilities:
|
|
|
|
|
|
|
Deferred Income Taxes
|
|
|
356,536
|
|
334,493
|
|
Gas Well Plugging
|
|
|
8,341
|
|
8,312
|
|
Postretirement Benefits Other
Than Pensions.
|
|
|
3,699
|
|
3,642
|
|
Other
|
|
|
31,958
|
|
35,101
|
|
Total Deferred
Credits and Other Liabilities
|
|
|
400,534
|
|
381,548
|
|
|
|
|
|
|
|
|
Total
Liabilities
|
|
|
677,709
|
|
664,482
|
|
Stockholders' Equity:
|
|
|
|
|
|
|
Common Stock, $.01 par
value;
|
|
|
|
|
|
|
200,000,000 Shares Authorized,
151,020,666 Issued and
|
|
|
|
|
|
|
Outstanding at March 31,
2010 and 150,986,918 Issued and
|
|
|
|
|
|
|
Outstanding at December
31, 2009
|
|
|
1,510
|
|
1,510
|
|
Capital in Excess of Par
Value
|
|
|
808,683
|
|
806,527
|
|
Preferred Stock, 5,000,000
Shares Authorized; None Issued and Outstanding
|
|
|
-
|
|
-
|
|
Retained Earnings
|
|
|
679,044
|
|
633,417
|
|
Other Comprehensive
Income
|
101,288
|
|
69,816
|
|
Total CNX Gas
Shareholders' Equity
|
|
|
1,590,525
|
|
1,511,270
|
|
Noncontrolling
Interest
|
|
|
(4,249)
|
|
(4,370)
|
|
Total
Equity
|
|
|
1,586,276
|
|
1,506,900
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
|
|
$
2,263,985
|
|
$
2,171,382
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNX GAS
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF STOCKHOLDERS' EQUITY
|
|
(Dollars in
Thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Accumulated
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
|
|
Total
CNX
|
|
|
|
|
|
|
|
|
|
|
Capital
in
|
|
|
|
Compre-
|
|
Gas
Stock-
|
|
Non-
|
|
|
|
|
|
|
Common
|
|
Excess
of
|
|
Retained
|
|
hensive
|
|
holders'
|
|
controlling
|
|
Total
|
|
|
|
|
Stock
|
|
Par
Value
|
|
Earnings
|
|
Income
|
|
Equity
|
|
Interest
|
|
Equity
|
|
|
Balance -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2009
|
$
1,510
|
|
$
806,527
|
|
$
633,417
|
|
$
69,816
|
|
$
1,511,270
|
|
$
(4,370)
|
|
$
1,506,900
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Attributable to
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNX Gas
Shareholders
|
|
-
|
|
-
|
|
45,627
|
|
-
|
|
45,627
|
|
-
|
|
45,627
|
|
|
Gas Cash Flow Hedge
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(net of $20,128
tax)
|
-
|
|
-
|
|
-
|
|
31,451
|
|
31,451
|
|
-
|
|
31,451
|
|
|
Actuarially Determined
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities
Adjustment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(net of $14
tax)
|
-
|
|
-
|
|
-
|
|
21
|
|
21
|
|
-
|
|
21
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Comprehensive Income
|
-
|
|
-
|
|
45,627
|
|
31,472
|
|
77,099
|
|
|
|
77,099
|
|
|
Stock Options Exercised
|
-
|
|
705
|
|
-
|
|
-
|
|
705
|
|
-
|
|
705
|
|
|
Tax Benefit from
Stock-Based
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Compensation
|
-
|
|
128
|
|
-
|
|
-
|
|
128
|
|
-
|
|
128
|
|
|
Amortization of Restricted
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Unit
Grants
|
-
|
|
1,200
|
|
-
|
|
-
|
|
1,200
|
|
-
|
|
1,200
|
|
|
Amortization of Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Option Grants
|
-
|
|
123
|
|
-
|
|
-
|
|
123
|
|
-
|
|
123
|
|
|
Noncontrolling Interest
|
-
|
|
-
|
|
-
|
|
-
|
|
-
|
|
121
|
|
121
|
|
|
Balance -
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2010
|
$
1,510
|
|
$
808,683
|
|
$
679,044
|
|
$
101,288
|
|
$
1,590,525
|
|
$
(4,249)
|
|
$
1,586,276
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CNX GAS
CORPORATION AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
(Unaudited)
|
|
(Dollars in
thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Three
Months Ended
|
|
|
|
|
|
March
31,
|
|
|
|
|
|
2010
|
|
2009
|
|
|
Operating Activities:
|
|
|
|
|
|
|
|
Net Income Attributable to CNX Gas
Shareholders
|
|
$
45,627
|
|
$
54,904
|
|
|
|
Adjustments to Reconcile Net Income to
Net Cash
|
|
|
|
|
|
|
|
Provided by Operating
Activities:
|
|
|
|
|
|
|
|
Depreciation, Depletion and
Amortization
|
32,092
|
|
22,819
|
|
|
|
Stock-based Compensation
|
1,323
|
|
1,121
|
|
|
|
(Gain) Loss on the Sale of
Assets
|
(8)
|
|
-
|
|
|
|
Change in Noncontrolling
Interest
|
(194)
|
|
(263)
|
|
|
|
Deferred Income Taxes
|
11,835
|
|
18,536
|
|
|
|
Equity in Loss (Earnings) of
Affiliates
|
517
|
|
(262)
|
|
|
|
Changes in Operating
Assets:
|
|
|
|
|
|
|
|
Accounts Receivable
|
(2,932)
|
|
27,130
|
|
|
|
Related Party
Receivable
|
(2,446)
|
|
(1,961)
|
|
|
|
Other Current Assets
|
(715)
|
|
414
|
|
|
|
Changes in Other Assets
|
(522)
|
|
469
|
|
|
|
Changes in Operating
Liabilities:
|
|
|
|
|
|
|
|
Accounts Payable
|
1,335
|
|
6,967
|
|
|
|
Income Taxes
|
(11,608)
|
|
15,833
|
|
|
|
Other Current
Liabilities
|
(1,296)
|
|
(15,928)
|
|
|
|
Changes in Other
Liabilities
|
(2,590)
|
|
(5,294)
|
|
|
|
Other
|
4,785
|
|
1,952
|
|
|
|
Net Cash Provided by
Operating Activities
|
75,203
|
|
126,437
|
|
|
Investing Activities:
|
|
|
|
|
|
|
|
Capital Expenditures
|
(65,314)
|
|
(133,550)
|
|
|
|
Proceeds From Sale of
Assets
|
8
|
|
-
|
|
|
|
Net Cash Used in
Investing Activities
|
(65,306)
|
|
(133,550)
|
|
|
Financing Activities:
|
|
|
|
|
|
|
|
Capital Lease Payments
|
(946)
|
|
(976)
|
|
|
|
Variable Interest Entity
Debt
|
(1,115)
|
|
(1,092)
|
|
|
|
(Payments on) Proceeds from Short-Term
Borrowings
|
(8,700)
|
|
7,700
|
|
|
|
Exercise of Stock Options
|
705
|
|
1
|
|
|
|
Noncontrolling Interest
Distribution
|
-
|
|
(200)
|
|
|
|
Tax Benefit from Stock-Based
Compensation
|
128
|
|
-
|
|
|
|
Net Cash (Used in)
Provided by Financing Activities
|
(9,928)
|
|
5,433
|
|
|
Net Decrease in Cash and Cash
Equivalents
|
(31)
|
|
(1,680)
|
|
|
Cash and Cash Equivalents at Beginning
of Period
|
1,124
|
|
1,926
|
|
|
|
Cash and Cash
Equivalents at End of Period
|
$
1,093
|
|
$
246
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
SOURCE CNX Gas Corporation