EQT notches 40 percent hike in quarterly profit
EQT Corp.'s stock hit a five-year high on Thursday as the company announced record production and a nearly 40 percent increase in profit during the first three months of 2013.
Downtown-based EQT earned $100.3 million, or 66 cents per share, compared with $72 million, or 48 cents per share, in the same period a year ago. Revenue rose to $558.7 million from $450 million a year ago.
The company's stock jumped $5.38, or nearly 8 percent, to close at $73.96 per share.
“Great results,” Neal Dingmann, an analyst with SunTrust Robinson Humphrey Inc. said, beginning the question-answer period of the company's earnings call. “You guys continue to have just great results ... particularly in the Marcellus.”
With more wells coming online, the company doubled its gas production from Marcellus shale compared to a year ago on nearly unchanged exploration and production costs of $28.6 million. EQT produced 54.5 billion cubic feet of gas from 276 Marcellus wells. Nearly 70 percent of its gas production comes from the shale formation.
The company finished pipelines ahead of schedule and had wells that produced 4 percent more than expected. Some wells in Greene County stretch more than 7,000 feet sideways underground, as part of well pads producing around 100 million cubic feet per day, CEO David L. Porges said.
Beyond the Marcellus, EQT is drilling wells in other Appalachian shale formations. The company has cash on hand to spend and company officials are confident it can “support growth of more than 20 percent for several years,” Porges said.
To do that, EQT is trying to consolidate around its Marcellus shale drilling business. On Thursday, its officials claimed they're one step closer to a big milestone in that effort.
EQT wants to sell its utility arm to Peoples Natural Gas Co. in a $720 million deal and said Wednesday the Federal Trade Commission is giving the companies permission to proceed.
The FTC had raised anti-competition concerns about the deal in 2009. This month it let an April 22 deadline pass without asking for more information from the companies, which EQT said it views as a sign the commission isn't objecting.
“You will have a lot of incremental cash coming in the door,” said Holly Stewart, an analyst at Howard Weil Inc. “It's a high-class problem to have.”
Timothy Puko is a Trib Total Media staff writer. Reach him at 412-320-7991 or firstname.lastname@example.org.