DOW JONES NEWSWIRES
Questar Corp.'s (STR) fourth-quarter net income dropped 7.3% on
$54.3 million of mark-to-market losses on natural gas-swaps.
The natural gas company also lowered its 2009 estimates, as
Questar accounts for significantly lower prices. It now sees
earnings of $2.50 to $2.70 a share, down from its November view of
$3.05 to $3.25 a share, and lowered its production forecast to 180
billion to 186 billion cubic feet of natural gas equivalent from
its October view of 185 billion to 193 billion cubic feet.
Shares slumped 8.7% in after-hours trading to $31.56.
Meanwhile Questar posted fourth-quarter net income of $121.2
million, or 69 cents a share, down from $130.8 million, or 74 cents
a share, a year earlier. Excluding the effect of net mark-to-market
losses on natural gas basis-only swaps and after-tax gains on asset
sales, Questar's earnings were 99 cents.
Revenue grew 18% to $878.8 million on natural-gas hedges.
Analysts polled by Thomson Reuters expected per-share earnings
of 84 cents on revenue of $655 million.
Output jumped 32% as realized natural gas prices increased 17%.
The exploration and production segment has hedged about 72% of
forecast natural gas and oil-equivalent production for 2009 with
fixed-price swaps.
Questar in November reported promising results from one of its
wells in the Haynesville Shale in Louisiana, which could drive
long-term growth. Additionally, natural gas is a popular
alternative to oil energy, and natural gas companies could get a
boost from President Barack Obama's push for domestic sources of
fuel.
-By John Kell, Dow Jones Newswires; 201-938-5285;
john.kell@dowjones.com