Cabot Oil & Gas (COG) Raises Quarterly Dividend 16.7% to $0.07, 1.3% Yield; Provides Prelim. 2019 Operating Plan & Capital Allocation Strategy

Cabot Oil & Gas (NYSE: COG) declared a quarterly dividend of $0.07 per share, or $0.28 annualized. This is a 16.7% increase from the prior dividend of $0.06.

The dividend will be payable on November 16, 2018, to stockholders of record on November 7, 2018, with an ex-dividend date of November 6, 2018.

The annual yield on the dividend is 1.3 percent.

"With the in-service of the Atlantic Sunrise pipeline project now in the rearview mirror, we have full confidence in the Company's ability to generate significant free cash flow in the coming years," commented Dinges. "As a result, we are increasing our dividend for the third time in the last 18 months as we continue to increase the focus of our capital allocation on returning cash to our shareholders."

Q4 & FY 2018 GUIDANCE

Cabot has reaffirmed its previously announced fourth-quarter 2018 net production guidance of 2,225 to 2,275 Mmcfe per day. The Company has also reaffirmed its previously announced 2018 daily production growth guidance range of 7 to 8 percent (12 to 13 percent on a debt-adjusted per share basis) and its full-year capital budget of $940 million. "Due to the recent improvement in the near-term outlook for NYMEX prices and basis differentials, we now expect to generate approximately $200 million of free cash flow during the fourth-quarter and approximately $250 million of free cash flow for the full-year, based on current strip prices", noted Dinges.

PRELIMINARY 2019 OPERATING PLAN

Cabot has provided its preliminary 2019 production growth guidance range of 20 to 25 percent (25 to 30 percent on a debt-adjusted per share basis). This production growth range is based on a capital budget of $800 million to $850 million. Based on current market indications for basis differentials at the time of this press release, Cabot expects its natural gas price realizations to average $0.30 below NYMEX for the full-year of 2019. Based on current strip prices and these differential assumptions, the Company's 2019 program is expected to deliver between $650 million and $700 million of free cash flow. "Our preliminary 2019 operating plan and capital budget can deliver greater than 60 percent growth in earningsper share, an improvement in ROCE to over 20 percent, and a free cash flow yield over seven percent based on our current market capitalization" said Dinges. "I would also highlight that our focus, first and foremost, is on maximizing returns and free cash flow with production growth simply being a result of disciplined capital allocation to high-quality assets. To the extent that our outlook for commodity prices in 2019 and beyond changes as a result of supply and demand dynamics during this coming winter heating season, we may reevaluate our plans in early 2019 to remain aligned with our strategic focus on maximizing returns and free cash flow."

CAPITAL ALLOCATION STRATEGY

Cabot plans to distribute greater than 50 percent of free cash flow to shareholders annually through a combination of dividends and share repurchases. The allocation of the remaining free cash flow will be dependent on market conditions with a focus preserving financial flexibility and increasing optionality throughout all commodity price cycles. "Given the inflection point we are reaching for free cash flow generation this year, we are excited to highlight our capital allocation plans beyond investing through the drill-bit in our high-return Marcellus Shale assets," stated Dinges. "Cabot has been at the forefront of the shift in strategy across the exploration and production sector to focusing on generating free cash flow, improving return on capital, and increasing return of capital. We believe our commitment to provide this level of payout to shareholders annually while still preserving financial flexibility to remain opportunistic through all cycles, maximizes Cabot's ability to create long-term shareholder value."

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

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