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FORM 10-Q FOR QUARTER ENDED September 30, 2006

PDF Version

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549


FORM 10-Q


(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934



For the Quarterly Period Ended September 30, 2006


Commission File Number 1-8754

SWIFT ENERGY COMPANY
(Exact Name of Registrant as Specified in its Charter)

TEXAS 20-3940661
(State of Incorporation) (I.R.S. Employer Identification No.)
 

 
16825 Northchase Dr., Suite 400
Houston, Texas 77060
(Address of principal executive offices) (Zip Code)



(281) 874-2700
(Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months, and (2) has been subject to such filing requirements for the past 90 days.

Yes    √          No___

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act.

Large accelerated filer   √          Accelerated filer___    Non-accelerated filer___

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes___          No   √  

Indicate the number of shares outstanding of each of the Issuer's classes
of common stock, as of the latest practicable date.

Common Stock 29,527,985 Shares
($.01 Par Value) (Outstanding at October 31, 2006)
(Class of Stock)
 

 

SWIFT ENERGY COMPANY
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2006
INDEX

 

PART I. FINANCIAL INFORMATION PAGE
ITEM 1. Condensed Consolidated Financial Statements
Condensed Consolidated Balance Sheets
- September 30, 2006 and December 31, 2005		 3
Condensed Consolidated Statements of Income
- For the Three-month and Nine-month periods ended September 30, 2006 and 2005		 4
Condensed Consolidated Statements of Stockholders' Equity
- For the Nine-month period ended September 30, 2006 and year ended December 31, 2005		 5
Condensed Consolidated Statements of Cash Flows
- For the Nine-month periods ended September 30, 2006 and 2005		 6
Notes to Condensed Consolidated Financial Statements 7
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 25
ITEM 3. Quantitative and Qualitative Disclosures About Market Risk  38
ITEM 4. Controls and Procedures  39
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 40
Item 1A. Risk Factors 40
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds None
Item 3. Defaults Upon Senior Securities None
Item 4. Submission of Matters to a Vote of Security Holders 40
Item 5. Other Information None
Item 6. Exhibits 41
SIGNATURES 42


SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS

 

September 30, 2006 December 31, 2005
ASSETS
Current Assets:
  Cash and cash equivalents

$95,117,902

$53,004,562
   Accounts receivable --
      Oil and gas sales 59,980,011

45,518,260
      Joint interest owners 1,167,963

1,082,187
      Other receivables 17,701,312

3,795,080
   Other current assets 38,394,344

11,655,046
---------------------- ----------------------
         Total Current Assets 212,361,532 115,055,135
---------------------- ----------------------
Property and Equipment:
   Oil and gas, using full-cost accounting
      Proved properties 1,979,294,070

1,731,866,298
      Unproved properties 84,541,410

87,553,220
---------------------- ----------------------

2,063,835,480

1,819,419,518
   Furniture, fixtures and other equipment 26,701,704

15,313,277
---------------------- ----------------------

2,090,537,184

1,834,732,795
   Less--Accumulated depreciation, depletion,
       and amortization (875,819,720) (755,699,056)
---------------------- ----------------------

1,214,717,464

1,079,033,739
---------------------- ----------------------
Other Assets:
   Debt issuance costs 7,130,221

8,026,780
   Restricted assets 2,293,895

2,296,968
---------------------- ----------------------

9,424,116

10,323,748
---------------------- ----------------------
$1,436,503,112 $1,204,412,622
=========== ===========


Liabilities and Stockholders' Equity

See accompanying notes to condensed consolidated financial statements.

SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS

 

September 30, 2006 December 31, 2005
Liabilities and Stockholders' Equity
Current Liabilities:
   Accounts payable and accrued liabilities

$55,293,512

$51,973,004
   Accrued capital costs 42,974,178

30,073,728
   Accrued interest 10,336,338

8,508,196
   Undistributed oil and gas revenues 8,948,655

7,866,086
---------------------- ----------------------
      Total Current Liabilities 117,552,683

98,421,014
---------------------- ----------------------
Long-Term Debt

350,000,000

350,000,000
Deferred Income Taxes 196,797,908

129,306,891
Asset Retirement Obligation 20,089,268

19,095,368
Lease Incentive Obligation 1,787,893

271,182
Commitments and Contingencies
Stockholders' Equity:
   Preferred stock $.01 par value, 5,000,000 shares authorized,
      none outstanding --- ---
   Common stock, $.01 par value, 85,000,000 shares authorized,
      29,727,913 and 29,458,974 shares issued, and 29,300,827
      and 29,009,530 shares outstanding, respectively 297,279

294,590
   Additional paid-in capital 374,559,260

365,085,695
   Treasury stock held, at cost, 427,086 and 449,444 shares, respectively (6,124,944)

(6,445,586)
   Unearned compensation

---

(5,849,820)
   Retained earnings 380,597,278

254,302,757
   Accumulated other comprehensive income (loss), net of income tax 946,487

(69,469)
-------------- ----------------------

750,275,360

607,318,167
-------------- ----------------------
$1,436,503,112 $1,204,412,622
========== ==========



See accompanying notes to condensed consolidated financial statements.

SWIFT ENERGY COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME

 

Three Months Ended

Nine Months Ended

09/30/06

09/30/05

09/30/06

09/30/05
Revenues:
Oil and gas sales  

$173,368,549

  

$101,007,524

  

$453,315,519

  

$301,451,257
Price-risk management and other, net

90,303

 (154,019)  

3,489,510

 (677,143)  
      ---------------     ---------------------     ---------------     ---------------------  

173,458,852

100,853,505

456,805,029

300,774,114
--------------- --------------- --------------- ---------------
Costs and Expenses:
General and administrative, net 8,018,260

5,803,946

23,323,223

15,674,141
  Depreciation, depletion and amortization 45,867,715

23,870,287

120,151,446

76,853,296
Accretion of asset retirement obligation 171,545

191,529

665,812

565,531
Lease operating costs 12,926,110

12,221,153

45,843,648

34,835,158
  Severance and other taxes 18,489,838

9,670,565

49,210,714

29,582,400
  Interest expense, net 5,776,220

6,194,370

17,436,326

18,825,273
      ---------------     ---------------     ---------------     ---------------  

91,249,688

57,951,850

256,631,169

176,335,799
---------------     ---------------     ---------------     ---------------
Income Before Income Taxes

82,209,164

42,901,655

200,173,860

124,438,315
Provision for Income Taxes

31,397,597

15,394,756

73,879,339

43,360,606
---------------     ---------------------     ---------------     ---------------------
Net Income  

$50,811,567

  

$27,506,899

  

$126,294,521

  

$81,077,709
========= ========= ========= =========
Per Share Amounts
Basic: Net Income  

$1.74

  

$0.96

  

$4.33

  

$2.86
========= ========= ========= =========
Diluted: Net Income  

$1.68

  

$0.92

  

$4.20

  

$2.77
========= ========= ========= =========
Weighted Average Shares Outstanding

29,251,945

28,632,895

29,161,278

28,390,120
    ========= ========= ========= =========  

 



See accompanying notes to condensed consolidated financial statements.

SWIFT ENERGY COMPANY AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

 

Additional Other 
Common Paid-In    Treasury Unearned Retained Comprehensive
Stock(1) Capital Stock Compensation Earnings Income (Loss) Total

Balance, December 31, 2004

  

$285,706

  

$343,536,298

  

$(6,896,245)

  

$(1,728,585)

  

$138,524,301

  

$450,665

$474,172,140

   Stock issued for benefit plans

     (31,424 shares) --- 435,134 450,659 --- --- --- 885,793

   Stock options exercised

     (840,847 shares)

8,409

9,804,555

---

---

---

---

9,812,964

   Tax benefits from exercise of stock options

---

4,366,236

---

---

---

---

4,366,236

   Employee stock purchase plan

     (32,495 shares)

325

642,354

---

---

---

---

642,679

   Issuance of restricted stock

     (15,000 shares)

150

---

---

---

---

---

150

   Grants of restricted stock

     (158,500 shares)

---

6,668,608

---

(6,072,008)

---

---

596,600

   Forfeitures of restricted stock

---

(367,490)

---

367,490

---

---

---

   Amortization of restricted stock compensation

---

---

---

1,583,283

---

---

1,583,283

Comprehensive Income:

   Net income

---

---

---

---

115,778,456

---

115,778,456

   Other Comprehensive Income

---

---

---

---

---

(520,134)

 

(520,134)

--------------

     Total Comprehensive Income

 

---

 

---

 

---

 

---

 

---

 

---

 

115,258,322
----------- ----------- ----------- ----------- ----------- ----------- -----------

Balance, December 31, 2005

 

$294,590

  

$365,085,695

  

$(6,445,586)

  

$(5,849,820)

  

$254,302,757

$(69,469)

  

$607,318,167
======= ======= ======= ======= ======= ======= =======

   Stock issued for benefit plans

     (22,358 shares)

---

714,049

320,642

---

---

---

1,034,691

   Stock options exercised

     (210,738 shares)

2,107

3,615,470

---

---

---

---

3,617,577

   Adoption of SFAS No. 123R

---

(5,875,280)

---

5,849,820

---

---

(25,460)

   Excess tax benefits from stock-based awards

---

2,772,329

---

---

---

---

2,772,329

   Employee stock purchase plan

     (22,425 shares)

224

671,106

---

---

---

---

671,330

   Issuance of restricted stock

     (35,776 shares)

358

(358)

---

---

---

---

---

   Amortization of stock compensation

---

7,576,249

---

---

---

---

7,576,249

Comprehensive Income:

   Net income

---

---

---

---

126,294,521

---

126,294,521

   Other Comprehensive Income

---

---

---

---

---

1,015,956

 

1,015,956

-----------

     Total Comprehensive Income

 

---

 

---

 

---

 

---

 

---

 

---

 

127,310,477
----------- ----------- ----------- ----------- ----------- ----------- -----------

Balance, September 30, 2006

$297,279

  

$374,559,260

$(6,124,944)

  

$---

$380,597,278

 

$946,487

$750,275,360