Natural gas is a commodity business and money is made in commodities by continually lowering costs. Cabot Oil & Gas has lowered its operating expenses 21%.

Cabot Oil & Gas has done something remarkable for a commodity business where lowering costs is the key to everything good. It has lowered its year over year first quarter operating expenses by an astounding 21%. The result is not only higher net income, but also improved cash flow. More importantly, Cabot is now positioned to take advantage of increased demand likely to come from completion of the Atlantic Sunrise pipeline and two big natural gas power plants in Northeastern Pennsylvania.

Reading company financials can be boring stuff unless you know what to look for and in commodity businesses it’s always the ability to lower costs. It’s the thing that allows companies to survive price downturns and soar financially when those prices later recover as they inevitability do. Supply and demand serve to constantly correct each other. Companies who are able to consistently apply management and technology to the lowering of their operating expenses per unit position themselves for whatever the future brings.

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http://naturalgasnow.org/cabot-oil-gas-shows-done-lowering-operating-expenses-21/