COMSTOCK RESOURCES, INC. QUARTERLY REPORT For the Quarter Ended March 31, 2025
Comstock Resources, Inc. (CRK) reported its quarterly financial results for the period ended March 31, 2025. The company’s revenue increased by 12% to $143.6 million compared to the same period last year, driven by higher oil and natural gas prices. Net income rose to $34.4 million, or $0.12 per diluted share, compared to a net loss of $13.4 million, or $0.05 per diluted share, in the same period last year. The company’s operating cash flow increased by 21% to $74.1 million, and its total debt decreased by 10% to $444.1 million. The company’s balance sheet showed a cash and cash equivalents balance of $143.1 million and a working capital deficit of $34.1 million. The company’s management discussed the results in the MD&A section, highlighting the impact of higher commodity prices and the company’s efforts to reduce debt and improve its financial position.
Overview of Comstock Resources, Inc. Financial Report
Financial Performance Comstock Resources, Inc. reported a net loss of $115.4 million, or $0.40 per share, for the first quarter of 2025. This was primarily due to net losses of $330.3 million related to the company’s derivative financial instruments, which was driven by a significant increase in future NYMEX natural gas prices. However, the company reported income from operations of $126.2 million for the quarter, compared to a loss from operations of $12.8 million in the first quarter of 2024.
Revenue and Profit Trends
- Gas service revenues increased 109% to $99.9 million in Q1 2025, primarily due to higher natural gas prices related to sales of natural gas purchased to utilize the company’s excess transport capacity.
- Costs and expenses increased, with gas service expenses up 140% to $116.8 million due to higher natural gas prices related to purchases of third-party natural gas for resale.
- Depreciation, depletion, and amortization (DD&A) decreased 12% to $167.9 million due to lower production in Q1 2025.
- The company reported an income tax benefit of $143.3 million in Q1 2025, compared to a $8.3 million benefit in Q1 2024.
Strengths and Weaknesses Strengths:
- Increased gas service revenues due to higher natural gas prices
- Reduced production and ad valorem taxes, gathering and transportation costs, and DD&A
Weaknesses:
- Significant net losses from derivative financial instruments due to rising natural gas prices
- Increased gas service expenses from higher natural gas prices
Outlook Comstock Resources expects to spend an additional $780 million to $880 million in the remaining nine months of 2025 on drilling, completion, infrastructure, and other activities. The company has $1.0 billion in liquidity, including $990 million in unused borrowing capacity under its bank credit facility, which it plans to use to fund future development and exploration activities. However, the company’s ability to complete acquisitions may be impacted by lack of access to debt or equity markets due to general economic conditions.
