GeoMet, Inc (Home) Home   |   Contact Us    
Corporate Governance News

GeoMet, Inc (Home)

Investor Relations

GeoMet, Inc. Announces Results for the Quarter and Nine Months Ended September 30, 2008

Houston, Texas—November 10, 2008-GeoMet, Inc. (NASDAQ: GMET) (“GeoMet” or the “Company”) today announced its results for the quarter ended September30, 2008.

J. Darby Seré, GeoMet’s Chairman and Chief Executive Officer, commented on the Company’s results for the quarter ended September30, 2008: “We achieved another quarter of strong operating and financial performance and the fundamentals of our business remain solid. We are well capitalized and we are positioned to continue to grow our reserves and production during a period of lower natural gas prices and more restrained capital budgets within the industry.”

Third Quarter 2008 Results

For the quarter ended September 30, 2008, GeoMet recorded:

  • Gas Sales—Gas sales for the quarter were $18.7 million, a 65% increase from gas sales of $11.3 million in the third quarter of 2007. The average natural gas price during the quarter was $10.26 per Mcf as compared to the prior year period average of $6.26 per Mcf. The average natural gas price, adjusted for realized hedging gains and losses, was $9.49 per Mcf during the third quarter of 2008 versus $6.95 per Mcf for the same period in 2007.
  • Adjusted EBITDA—Adjusted EBITDA for the quarter increased 86% to $10.3 million from $5.5 million in the prior year period. Adjusted EBITDA is a non-GAAP measure. See the accompanying table for reconciliations of net income to EBITDA and of EBITDA to Adjusted EBITDA.
  • Adjusted Net Income—Adjusted net income for the quarter was $4.1 million, up 230% from $1.2 million, in the third quarter of 2007. Adjusted net income is a non-GAAP measure. See the accompanying table for a reconciliation of net income to adjusted net income.

For the quarter ended September30, 2008, GeoMet recorded net income of $17.5 million, or $0.44 per fully diluted share, as compared to a net income of $1.6 million, or $0.04 per fully diluted share, for the same period in 2007. During these periods, the Company’s earnings were impacted by unrealized gains from the change in the market value of its natural gas derivative contracts. In the most recent quarter, the Company experienced an unrealized gain from such natural gas derivative contracts of $21.6 million ($13.4 million after income taxes) as compared to an unrealized gain of $0.5 million ($0.4 million after income taxes) for the same period in 2007.

Average net gas sales volumes for the quarter ended September30, 2008 were 19.8 MMcf per day, a 1% increase from the same period in 2007. Had the net gas sales volumes in the third quarter of 2007 not included 0.9 MMcf per day related to the sale of an overriding royalty interest that was effected on July 1, 2008, the comparable year over year increase in net gas sales volumes would have been 6.0%.

Capital expenditures for the quarter ended September30, 2008 were $22.0 million, compared to $15.0 million for the same period in the prior year.

Nine Months Ended September 30, 2008r 2008 Results

For the nine months ended September 30, 2008, GeoMet recorded:

  • Gas Sales— Gas sales for the nine months ended September30, 2008 were $55.0 million, a 50% increase from gas sales of $36.6 million for the same period of 2007. The average natural gas price during the nine months ended September30, 2008 was $9.91 per Mcf as compared to $6.94 per Mcf for the same period in 2007. The average natural gas price, adjusted for realized hedging gains and losses, was $9.54 per Mcf during nine months ended September30, 2008 versus $7.42 per Mcf for the same period in 2007.
  • Adjusted EBITDA—Adjusted EBITDA for the nine months ended September 30, 2008 increased 69% to $31.1 million from $18.4 million for the same period of 2007. Adjusted EBITDA is a non-GAAP measure. See the accompanying table for reconciliations of net income to EBITDA and of EBITDA to Adjusted EBITDA.
  • Adjusted Net Income—Adjusted net income for the nine months ended September30, 2008 was $11.7 million, up 133% from $5.0 million, in the same period of 2007. Adjusted net income is a non-GAAP measure. See the accompanying table for a reconciliation of net income to adjusted net income.

For the nine months ended September30, 2008, GeoMet recorded net income of $12.2 million, or $0.31 per fully diluted share, as compared to a net income of $3.6 million, or $0.09 per fully diluted share, for the same period in 2007. During these periods, the earnings were impacted by unrealized gains and losses from the change in the market value of its natural gas derivative contracts. For the nine months ended September30, 2008, the Company experienced an unrealized gain from such natural gas derivative contracts of $0.8 million ($0.5 million after income taxes) as compared to an unrealized loss of $2.2 million ($1.5 million after income taxes) for the same period in 2007.

Average net gas sales volumes for the nine months ended September30, 2008 were 20.2 MMcf per day, a 5% increase from the same period in 2007. Had the net gas sales volumes for the nine months ended September30, 2007 not included 1.0 MMcf per day related to the sale of an overriding royalty interest that was effected on July 1, 2008, the comparable year over year increase in net gas sales volumes would have been 7.9%.

Capital expenditures for the nine months ended September30, 2008 were $43.2 million, compared to $45.1 million for the same period in the prior year.

Third Quarter and Nine Months Ended September 30, 2008 Financial Schedules

Conference Call Information

GeoMet will hold its quarterly conference call to discuss Third quarter of 2008 results on November 10, 2008 at 10:30 a.m. Central Time. To participate, dial (888)571-8168 a few minutes before the call begins. Please reference GeoMet, Inc. conference ID 69475433. The call will also be broadcast live over the Internet from the Company’s website at www.geometinc.com. A replay of the conference call will be archived on the Company’s website shortly after the end of the call on November 10, 2008.

Forward-Looking Statements Notice

This press release may contain “forward-looking statements” within the meaning of Section27A of the Securities Act of 1933, as amended, and Section21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are subject to certain risks, trends and uncertainties that could cause actual results to differ materially from those projected. Among those risks, trends and uncertainties are our estimate of the sufficiency of our existing capital sources, our ability to raise additional capital to fund cash requirements for future operations, the uncertainties involved in estimating quantities of proved oil and natural gas reserves, in prospect development and property acquisitions and in projecting future rates of production, the timing of development expenditures and drilling of wells, and the operating hazards attendant to the oil and gas business. In particular, careful consideration should be given to cautionary statements made in the various reports the Company has filed with the SEC. GeoMet undertakes no duty to update or revise these forward-looking statements.

About GeoMet, Inc.

GeoMet, Inc. is an independent energy company primarily engaged in the exploration for and development and production of natural gas from coal seams (“coalbed methane”) and non-conventional shallow gas. Our principal operations and producing properties are located in the Cahaba Basin in Alabama and the Central Appalachian Basin in West Virginia and Virginia. We also control additional coalbed methane and oil and gas development rights, principally in Alabama, British Columbia, Virginia, and West Virginia.

For more information please contact Stephen M. Smith at (713)287-2251 or ssmith@geometcbm.com or visit our website at www.geometinc.com.