The Energy Report

Energy XXI TICKER: EXXI:NASDAQ Visit Company Website Energy XXI has implemented an 'acquire and exploit' growth strategy to build a geographically focused portfolio with some of the highest per-unit margins in the industry. It has completed five major acquisitions totaling approximately $2.5 billion since its founding in October 2005, creating a company with more than 116 million barrels of oil equivalent (BOE) of proved reserves and about 42,000 BOE per day of production, 67% of which is oil. Energy XXI operates or has an interest in 7 of the 11 largest oil fields in the Gulf of Mexico. The company's core properties are located in coastal and offshore Louisiana. Energy XXI featured in Forbes (11/21/10)

The information provided below is from analysts, newsletters and other contributors. Please contact the company and visit its website before making an investment decision.

Expert Analysis

Jeffrey Hayden, Rodman & Renshaw (2/3/12) "Energy XXI reported fiscal Q212 operating earnings per share of $1.16, beating our $0.88 estimate and the $0.71 consensus. . .higher-than-expected liquids production and better-than-expected commodity price realizations drove the beat. Adjusted cash flow per share of $2.33 also came in above our and the consensus estimate of $1.94. . .EXXI's fiscal Q212 production was up ~5% sequentially, and we're looking for an even bigger ramp over the next couple quarters. . .Energy XXI is in an enviable position, as it should put up solid growth numbers while generating significant excess cash flow."

Stephen Berman, Pritchard Capital Partners (2/3/12) "We like Energy XXI for its oil-weighted asset base, consistent cash generation and upside from the ultra-deep program, which is getting closer to becoming a significant contributor to reserves and production. . .the company continues to exploit its deep inventory of oil-weighted core shelf prospects acquired from Exxon Mobil a little over a year ago, with most results so far exceeding expectations, including work at the South Pass 89 field, where a six-well recompletion achieved payout in less than four months. Energy XXI continues to generate cash on a consistent basis, including $85M in free cash flow in fiscal Q212."

The Energy Report Interview with Bill Powers (1/31/12) "I was very impressed that Energy XXI has been able to grow production and that the company has a material oil weighting. It has a very good mix of exploration prospects as well as development prospects. . .it is trading at lower valuations than its onshore peers, but it is able to generate material cash flow. . .[I see] its debt levels as very manageable given the cash flows it will be receiving over the next two years and its significant material reserves that it can borrow against. I think Energy XXI has a pretty bright future. . .It has a very good mix of high-impact exploration and lower-risk development." More >

Zach Mabile, Iberia Capital Partners (12/28/11) "We are initiating coverage of Gulf of Mexico-focused Energy XXI with a $42 target price and an Outperform rating; we believe the company is a proven producer with vast asset potential. . .its high number of locations provides EXXI with diversification in production and reserves. The company often capitalizes on reprocessed seismic data to profit from previously overlooked opportunities and has a seismic database covering approximately 5,150 sq mi (which are primarily focused on existing operations)."

Zacks Equity Research (12/21/11) "High oil prices have been good for business for the energy explorers. Energy XXI reported a record fiscal first quarter in October. This Zacks #1 rank (Strong Buy) is still a value, with a price-to-book of just 1.9." -Zacks Equity Research

• Corporate Presentation (8/11/11)

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