Cabot Oil & Gas (COG) Misses Q2 EPS by 6c, Increases Buyback by 20M Shares

Cabot Oil & Gas (NYSE: COG) reported Q2 EPS of $0.13, $0.06 worse than the analyst estimate of $0.19. Revenue for the quarter came in at $0 versus the consensus estimate of $384.89 million.

Second-quarter 2018 daily equivalent production was 1,895 Mmcfe per day (100 percent natural gas), a sequential increase of four percent relative to the first-quarter of 2018 when adjusting for the Eagle Ford Shale divestiture that closed in February 2018.

Third-Quarter and Full-Year 2018 Guidance Update

Cabot has provided third-quarter 2018 net production guidance of 2,100 to 2,200 Mmcfe per day. The Company has also updated its 2018 daily production growth guidance range from 10 - 15 percent to 10 - 12 percent and increased its full-year capital budget by $10 million to $960 million to reflect additional spending associated with its equity ownership in the Atlantic Sunrise pipeline project. "Due to our year-to-date actual volumes being slightly lower than originally budgeted, primarily resulting from delays in third-party compressor stations in the first-quarter and downtime on Transco and Millennium during the second-quarter, we have lowered the midpoint of our annual production growth guidance range by 1.5 percent," said Dinges. "However, we still anticipate that our 2018 exit production rate in the Marcellus will be approximately 35 percent higher than the 2017 exit rate."

For further disclosure on Cabot's natural gas pricing exposure by index and cost guidance, please see the current Guidance slide in the Investor Relations section of the Company's website.

Share Repurchase Program Update

During the second-quarter of 2018, Cabot repurchased 11.6 million shares at a weighted-average share price of $23.54, including 1.6 million shares that were previously reported in the first-quarter 2018 earnings release. Year-to-date the Company has repurchased 20.0 million shares at a weighted-average share price of $24.09. Since reactivating the share repurchase program in the second-quarter of 2017, Cabot has reduced its shares outstanding by over five percent to 441.2 million shares.

Additionally, the Board of Directors has authorized an increase in the Company's share repurchase program by 20.0 million shares, bringing the current remaining authorization to 30.1 million shares (or approximately seven percent of its current shares outstanding). All purchases will be made in accordance with applicable securities laws from time to time in open market or private transactions, depending on market conditions, and may be discontinued at any time. Based on the closing share price on July 26, 2018, the program implies approximately $745 million of additional share repurchases. "Given our strong balance sheet and our outlook for continued free cash flow expansion, we believe we can execute on this expanded share repurchase program while continuing to reinvest in returns-focused growth in the Marcellus Shale" noted Dinges.

For earnings history and earnings-related data on Cabot Oil & Gas (COG) click here.

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