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Energy XXI (Bermuda) plans to keep stockpiling cash to pay down debt
By Lisa Kerner
Charlotte, N.C., Feb. 2 - Energy XXI (Bermuda) Ltd. reported record earnings for the fourth straight quarter, chairman and chief executive officer John Schiller said during the company's fiscal second quarter earnings call on Thursday.
Crude oil production and EBITDA also exceeded expectations, Schiller said, attributing the record results to a 20% increase in production from properties acquired in December 2010 and a 41% increase in oil prices.
For the 2012 fiscal second quarter ended Dec. 31, Energy XXI reported EBITDA of $225.6 million, compared with the prior-year's fiscal second-quarter EBITDA of $97.8 million.
Net income attributable to common shareholders for the period was $93.4 million, or $1.11 per diluted share, on revenues of $340.6 million and production of 42,700 barrels of oil equivalent per day.
Chief financial officer West Griffin said while EBITDA more than doubled from last year, net income jumped almost nine times from the same quarter in the prior year.
The increase has enabled Energy XXI to pay down debt "at an amazing pace," said Griffin.
Energy XXI reduced its net debt to $950 million at Dec. 31 from $1.27 billion at Dec. 31, 2010. During the same period, net debt to total capitalization was reduced to 44% from 58%, said Griffin.
The company's revolver is paid off, and Energy XXI has about $100 million of cash in the bank.
The only real remaining debt, according to Griffin, consists of two long notes that are callable in December 2014.
Energy XXI plans to reduce debt by stockpiling cash.
During the 2012 fiscal second quarter, capital expenditures totaled $134.5 million. Total capital expenditures are expected to be between $450 million and $500 million for fiscal 2012 ending June 30.
Energy XXI is a Hamilton, Bermuda-based oil and natural gas exploration and production company.
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