For 2012, the Company reported net income of $431.7 million, or $4.15 per diluted share, as compared to net income of $548.1 million, or $5.28 per diluted share, for 2011. The Company’s 2012 results were impacted by several non-cash items including: (1) a $103.9 million unrealized mark-to-market gain on commodity derivatives, (2) $12.4 million of leasehold abandonments, (3) $3.2 million of other settlements and (4) an $18.7 million loss related to the sale of non-core assets included in discontinued operations. Excluding these items and their tax effects, the 2012 adjusted net income (non-GAAP) was $388.6 million, or $3.74 per diluted share. Excluding similar non-cash items and their tax impact, adjusted net income (non-GAAP) for 2011 was $430.1 million, or $4.15 per diluted share. For a description and a reconciliation of net income (GAAP) to adjusted net income (non-GAAP), please see “Supplemental Non-GAAP Financial Measures” below.
EBITDAX was $1,475.6 million in 2012, an increase of 16% from $1,275.2 million in 2011. For a description and a reconciliation of net income (GAAP) to EBITDAX (non-GAAP), please see “Supplemental Non-GAAP Financial Measures” below.
Oil and natural gas sales from continuing operations for 2012 increased 12% when compared to 2011. This increase was attributable to a 27% increase in production from continuing operations in 2012 compared to 2011, which was partially offset by a 34% decrease in the Company’s unhedged realized natural gas price and a 4% decrease in the Company’s unhedged realized oil price. Oil and natural gas production expense from continuing operations for 2012, including oil and natural gas taxes, totaled $343.7 million, or $12.29 per barrel of oil equivalent (“Boe”), a 3% decrease per Boe from 2011 . This decrease was due primarily to lower oil and natural gas taxes, which averaged $5.39 per Boe in 2012 as compared to $5.96 per Boe in 2011. The decrease in oil and natural gas taxes per Boe over 2011 was primarily due to lower realized oil and natural gas prices.
Depreciation, depletion and amortization expense (“DD&A”) from continuing operations for 2012 totaled $575.1 million, or $20.56 per Boe, a 13% increase per Boe from 2011.