CNX Gas 1Q profit up 51 percent as natural-gas prices rise

The company, which extracts methane gas from coalbeds, earned $49.9 million, or 33 cents per share, for the quarter ended March 31, compared with $33 million, or 22 cents per share, for the corresponding period last year.

CNX Gas, which is 82 percent owned by coal miner Consol Energy Inc., said results got a 2-cent-per-share boost from business interruption insurance and other one-time items.

That boost matched the amount by which its results beat Wall Street estimates. Analysts polled by Thomson Financial, on average, forecast profit of 31 cents per share for the period. Analyst estimates typically exclude one-time items.

Revenue rose 39 percent to $160.5 million, from $115.1 million last year. Analysts predicted revenue of $137.7 million.

The average price realized for the company's gas production was $8.23 per thousand cubic feet for the quarter, or $1.18 higher than the $7.05 per per thousand cubic feet received in the prior-year period.

Production rose about 10 percent from last year, to 15.9 billion cubic feet, or 174.4 million cubic feet per day.

President and Chief Executive Nicholas J. DeIuliis said the company's proved reserve base rose 6 percent and the company expects production to rise, after the mid-March return of gas production at Consol's Buchanan Mine in Virginia, where roof collapses in July caused the mine to be shut down.

CNX Gas expects to produce 72 billion cubic feet of gas in 2008, 24 percent higher than 2007. The company did not offer earnings per share or revenue guidance.

"With the additional hedging we layered in during the quarter, and with NYMEX pricing where it is today, CNX Gas could come close to funding its entire $470 million capital budget without drawing upon its line of credit," DeIuliis said in a statement.