Encore Acquisition falls to 2Q loss

Oil and natural gas producer Encore Acquisition Co. on Wednesday said it moved to loss in the second quarter due mostly to a one-time mark-to-market charge of $219.5 million.

Losses totaled $35.7 million, or 68 cents per share, in the second quarter of 2008 compared with a profit $15.2 million, or 28 cents per share, in the second quarter of 2007.

The 2008 quarter included a net derivatives loss of $257.8 million from a variety of one-time charges including the a mark-to-market loss, comprising settlement payments, premium amortization and amortization of deferred hedge loss.

Excluding those charges, the company earned $88.6 million, or $1.65 per share.

Revenue jumped to a record $357.3 million from $189.6 million in the year-ago period.

Analysts surveyed by Thomson Financial, on average, expected more modest earnings of $1.59 per share on revenue of $304.5 million. Analysts typically exclude one-time items from their estimates.

Shares of Encore Acquisition fell $5.17, or 9.6 percent, to $48.52 in morning trading.