Bloomberg News

Cobalt Tumbles 10% on Bigger-Than-Expected Loss: Houston Mover

February 22, 2012

Feb. 21 (Bloomberg) -- Cobalt International Energy Inc., the deep-water oil explorer whose largest investors include Goldman Sachs Group Inc., fell 10 percent after posting a fourth-quarter loss almost twice the average estimate.

The shares declined by $3.17 to $30.86 at 10:10 a.m. in New York, after earlier dropping to $30.57, the largest decline since Nov. 1. Before today, the stock had more than doubled in the past year as Cobalt announced discoveries off the coast of Africa and in the Gulf of Mexico, including a field the company said may hold 1 billion barrels of crude.

Cobalt’s loss widened to $51.1 million, or 13 cents a share, from $29.8 million, or 9 cents, a year earlier, the Houston-based company said today in a Business Wire statement. The average of 10 analysts’ estimates compiled by Bloomberg was for a per-share loss of 7.4 cents.

Cobalt’s costs for exploration failures jumped more than fivefold to $8.87 million from a year earlier, according to today’s statement.

In a separate announcement today, the company said it plans to sell 15.7 million new shares and some of its shareholders will sell an additional 31.3 million. The underwriters of the offering have been granted the option to sell an additional 7.05 million shares, the company said.

The proceeds from the sale will be used to fund drilling and general corporate expenses, according to the statement. Cobalt was founded in 2005 and first sold shares to the public in December 2009.

--Editors: Susan Warren, Steven Frank

To contact the reporter on this story: Joe Carroll in Chicago at jcarroll8@bloomberg.net

To contact the editor responsible for this story: Susan Warren at susanwarren@bloomberg.net


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