Forestar Group Inc. (NYSE: FOR):
Building Momentum by Increasing Oil Production, Proven Reserves and Residential Lot Sales
“We are well positioned to accelerate value realization of our oil and gas resources by growing production and reserves, a key driver of future earnings and cash flow. Executing our strategy to drive exploration and production is clearly demonstrated in Louisiana given the significant growth in production and proven reserves. In addition, our increased residential lot sales reflect our ability to grow market share despite depressed housing starts. Residential real estate conditions in the major markets of Texas continue to experience declining finished lot inventories and minimal new development activity, which should benefit Forestar given our well positioned portfolio of over 50 active communities and significant experience in these markets,” said Jim DeCosmo, president and chief executive officer of Forestar Group Inc.
Full Year 2011 Significant HighlightsMinerals – Oil & Gas
- Oil production up over 32% compared with 2010
- Year-end 2011 proven reserves of 17.9 Bcfe, up 26% compared with 2010
- Year-end 2011 PV-10 proven reserves * up 81% or $36.7 million compared with 2010
- 36 additional oil and gas wells completed; 530 total producing wells at year-end
- Exercised working interest options in three oil wells in Louisiana
- 68,000 net mineral acres put in play through leases, seismic and exploration agreements
- Sold 1,117 developed residential lots, a 39% increase compared with 2010 – over 1,350 lots under option contracts at year-end
- Received $8.7 million from Cibolo Canyons Special Improvement District
- Sold over 17,100 acres of undeveloped land for $40.5 million through our retail sales program
- Invested $63 million in segment; investments expected to exceed return criteria and deliver near-term cash flow and earnings
- Initiated construction of 289-unit multifamily residential community in Austin, Texas
- Sold 57,000 acres of timberland in Georgia, Alabama and Texas for $87 million, effectively completing our timberland sales initiatives
- Repurchased almost one million shares of our common stock
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