Cabot Oil & Gas (COG)

Balance Sheet

During 2009 the Company reduced its overall debt level, driven primarily by the cash proceeds related to its Canadian asset sale, to $805.0 million. “Financially, we continue to have a solid balance sheet and we retain a significant level of flexibility as evident by our 30.8 percent debt to total capital ratio,” added Dinges.

Balance Sheet

During 2008, the Company raised around $800 million through new debt and equity to fund its acquisition effort for both producing property and leases. This increase gave Cabot a year-end net debt to total adjusted capital ratio of 31.9 percent versus 23.6 percent for the 2007 year-end. “While up, this level remains very low by historical standards and affords us financial strength in this very trying environment,” said Dinges.

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Balance Sheet

“Clearly a topic on everyone’s mind is the balance sheet and the Company’s underlying liquidity levels,” stated Dinges. Cabot Oil & Gas ended the quarter with approximately $47 million in cash and $165 million of capacity on its revolving credit facility. With debt totaling $820 million, the Company still has a 33 percent debt to capitalization ratio.

Balance Sheet

At year-end, the Company had a net debt to adjusted capital ratio of 23.6 percent. The debt position totaled $350 million. “These metrics highlight Cabot’s flexibility and its opportunity to expand its drilling efforts,” stated Dinges.

Balance Sheet

Cabot used the proceeds from the sale of the properties to repay outstanding debt on its revolver, repurchase shares, fund its capital program and pay the related tax liability. At year-end, debt totaled $240 million, down from last year’s $340 million. Additionally, Cabot repurchased nearly 1.1 million shares at a weighted average price of $42.71 per share during 2006. “When we have seen opportunity in our stock, we have made it a practice to repurchase it in the open market,” said Dinges. “The share repurchase in 2006 had the effect of buying reserves in the ground at about $1.80 per Mcfe, which is very competitive with our reported finding cost.”

Balance Sheet

Long-term debt increased over last year as the Company used its credit facility to fund about $70 million in acquisitions. During the course of the year, but predominately in the fourth quarter, the Company repurchased 452,300 shares of its common stock at a weighted average purchase price of $42.41. “With the inherent value in Cabot’s capital program, we recommenced buying shares in late November and early December with the market pull back,” stated Dinges. “We still see a lot of merit and long-term value for the shareholders in looking at COG stock as an investment alternative.”