UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): July 24, 2015
CABOT OIL & GAS CORPORATION
(Exact name of registrant as specified in its charter)
|
| | | | |
Delaware | | 1-10447 | | 04-3072771 |
(State or other jurisdiction of incorporation) | | (Commission File Number) | | (I.R.S. Employer Identification No.) |
|
| | |
Three Memorial City Plaza | | |
840 Gessner Road, Suite 1400 | | |
Houston, Texas | | 77024 |
(Address of principal executive offices) | | (Zip Code) |
Registrant’s telephone number, including area code: (281) 589-4600
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)
Item 2.02 Results of Operations and Financial Condition.
On July 24, 2015, we issued a press release with respect to our 2015 second quarter earnings. The press release is furnished as Exhibit 99.1 to this Current Report. The press release contains certain measures (discussed below) which may be deemed “non-GAAP financial measures” as defined in Item 10 of Regulation S-K of the Securities Exchange Act of 1934, as amended. In each case, the most directly comparable GAAP financial measure and information reconciling the GAAP and non-GAAP measures is also included in the press release.
Exhibit 99.1 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and will not be incorporated by reference into any registration statement filed under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.
From time to time management discloses Discretionary Cash Flow, EBITDAX, Net Income Excluding Selected Items, Earnings per Share Excluding Selected Items and Net Debt calculations and ratios. These non-GAAP financial measures, to the extent included in Exhibit 99.1, are reconciled to the most comparable GAAP financial measures in Exhibit 99.1.
Discretionary Cash Flow is defined as net income plus non-cash charges and exploratory dry hole cost. Discretionary Cash Flow is widely accepted as a financial indicator of an oil and gas company’s ability to generate cash which is used to internally fund exploration and development activities, pay dividends and service debt. Discretionary Cash Flow is presented based on management’s belief that this non-GAAP measure is useful information to investors when comparing our cash flows with the cash flows of other companies that use the full cost method of accounting for oil and gas producing activities or have different financing and capital structures or tax rates. Discretionary Cash Flow is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operating activities, as defined by GAAP, or as a measure of liquidity, or an alternative to net income.
EBITDAX is defined as net income plus interest expense, income taxes expense, depreciation, depletion and amortization (including property impairments), exploration expense, gains and losses resulting from the sale of assets, non-cash gains and losses on derivative instruments, and stock-based compensation expense and other. EBITDAX is presented based on management’s belief that this non-GAAP measure is useful information to investors when evaluating our ability to internally fund exploration and development activities and to service or incur debt without regard to financial or capital structure. EBITDAX is not a measure of financial performance under GAAP and should not be considered as alternative to cash flows from operating activities or net income, as defined by GAAP, or as a measure of liquidity.
Net Income Excluding Selected Items and Earnings per Share Excluding Selected Items are presented based on management’s belief that these non-GAAP measures enable a user of the financial information to understand the impact of these items on reported results. Additionally, this presentation provides a beneficial comparison to similarly adjusted measurements of prior periods. Net Income and Earnings per Share Excluding Selected Items is not a measure of financial performance under GAAP and should not be considered as an alternative to net income and earnings per share, as defined by GAAP.
The total debt to total capitalization ratio is calculated by dividing total debt by the sum of total debt and total stockholders’ equity. This ratio is a measurement which is presented in our annual and interim filings and management believes this ratio is useful to investors in determining the Company’s leverage. Net Debt and the Net Debt to Total Capitalization ratio are non-GAAP measures which have been presented in Exhibit 99.1. Net Debt is calculated by subtracting cash and cash equivalents from total debt. Management believes that these measurements are also useful to investors since the Company has the ability to and may decide to use a portion of its cash and cash equivalents to retire debt. Additionally, as the Company may incur additional expenditures without increasing debt, it is appropriate to apply cash and cash equivalents to debt in calculating the Net Debt to Total Capitalization ratio.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
99.1 Press release issued by Cabot Oil & Gas Corporation dated July 24, 2015
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | |
| CABOT OIL & GAS CORPORATION |
| |
| |
| By: | /s/ TODD M. ROEMER |
| | Todd M. Roemer |
| | Controller |
Date: July 24, 2015
EXHIBIT INDEX
|
| | | |
99.1 |
| — | Press release issued by Cabot Oil & Gas Corporation dated April 24, 2015 |
Exhibit 99.1
|
| | |
July 24, 2015 | | FOR MORE INFORMATION CONTACT |
| | Matt Kerin (281) 589-4642 |
Cabot Oil & Gas Corporation Announces Second Quarter 2015 Financial and Operating Results
HOUSTON, July 24, 2015/PRNewswire/ -- Cabot Oil & Gas Corporation (NYSE: COG) today reported its financial and operating results for the second quarter of 2015. “Despite our strategic decision to curtail Marcellus volumes in the second quarter due to the adverse price environment, Cabot still generated production growth and reduced unit costs year-over-year,” said Dan O. Dinges, Chairman, President and Chief Executive Officer. “Our top-tier Marcellus asset affords us the ability to reduce our gross production volumes by approximately 500 million cubic feet (Mmcf) per day and still report positive normalized results.”
Second Quarter 2015 Financial Results
Equivalent production in the second quarter of 2015 was 138.0 billion cubic feet equivalent (Bcfe), consisting of 128.4 billion cubic feet (Bcf) of natural gas and 1.6 million barrels (Mmbbls) of liquids (crude oil/condensate/natural gas liquids). These figures represent increases of 8 percent, 5 percent, and 68 percent, respectively, compared to the second quarter of 2014.
Cash flow from operations in the second quarter of 2015 was $171.2 million, compared to $329.6 million in the second quarter of 2014. Discretionary cash flow in the second quarter of 2015 was $183.2 million, compared to $332.3 million in the second quarter of 2014. Net loss in the second quarter of 2015 was $27.5 million, or $0.07 per share, compared to net income of $118.4 million, or $0.28 per share, in the second quarter of 2014. Excluding the effect of selected items including a $36.5 million after-tax non-cash mark-to-market loss on natural gas derivatives, net income was $14.6 million, or $0.03 per share, in the second quarter of 2015, compared to $115.3 million, or $0.28 per share, in the second quarter of 2014. EBITDAX in the second quarter of 2015 was $203.9 million, compared to $367.1 million in the second quarter of 2014. Significant reductions in realized prices for both natural gas and oil were the primary drivers for the lower results in the quarter, partially offset by higher equivalent production. See the supplemental tables at the end of this press release for a reconciliation of non-GAAP measures including discretionary cash flow, net income excluding selected items, EBITDAX and net debt to adjusted capitalization ratio.
Natural gas price realizations, including the effect of hedges, were $2.15 per thousand cubic feet (Mcf) in the second quarter of 2015, down 38 percent compared to the second quarter of 2014. Excluding the impact of hedges, natural gas price realizations for
the quarter were $1.75 per Mcf, representing an $0.89 discount to NYMEX settlement prices. Oil price realizations were $56.10 per barrel (Bbl), down 43 percent compared to the second quarter of 2014.
Total per unit costs (including financing) decreased to $2.52 per thousand cubic feet equivalent (Mcfe) in the second quarter of 2015, an improvement of 3 percent from $2.59 per Mcfe in the second quarter of 2014. “Our cash unit costs in the Marcellus during the second quarter were approximately $0.85 per Mcf, while our Eagle Ford cash unit costs were approximately $15.00 per Bbl,” expressed Dinges. “With the expectation of prolonged weakness in commodity prices, we continue to focus on reducing costs and maximizing operating efficiencies throughout the organization.”
Cabot drilled or participated in a total of 37 net wells during the second quarter of 2015 and incurred a total of $228.2 million in capital expenditures associated with activity during the second quarter. “For a majority of the second quarter the Company’s total rig count stood at four, with the expectation of holding this level flat through the remainder of the year and into the first part of 2016,” commented Dinges. “We do not believe that accelerating activity and allocating incremental capital in this commodity price environment is the appropriate investment decision, especially in light of a more favorable outlook for Cabot’s realized natural gas prices upon in-service of Constitution Pipeline in the second half of 2016.”
Year-To-Date 2015 Financial Results
Production during the six-month period ended June 30, 2015 was 309.4 Bcfe, consisting of 290.2 Bcf of natural gas and 3.2 Mmbbls of liquids. These figures represent increases of 25 percent, 22 percent, and 95 percent, respectively, compared to the six-month period ended June 30, 2014.
For the six-month period ended June 30, 2015, cash flow from operations was $438.6 million, compared to $584.9 million for the six-month period ended June 30, 2014. Discretionary cash flow was $423.4 million for the six-month period ended June 30, 2015, compared to $651.8 million for the six-month period ended June 30, 2014. For the six-month period ended June 30, 2015, net income was $12.7 million, or $0.03 per share, compared to $225.5 million, or $0.54 per share, for the six-month period ended June 30, 2014. Excluding the effect of selected items including a $38.8 million after-tax non-cash mark-to-market loss on natural gas derivatives, net income was $64.0 million, or $0.15 per share, compared to $225.0 million, or $0.54 per share, for the six-month period ended June 30, 2014. EBITDAX for the six-month period ended June 30, 2015 was $483.3 million, compared to $719.8 million for the six-month period ended June 30, 2014.
Natural gas price realizations, including the effect of hedges, were $2.32 per Mcf for the six-month period ended June 30, 2015, down 36 percent compared to the six-month period ended June 30, 2014. Oil price realizations were $50.00 per Bbl, down 49 percent compared to the six-month period ended June 30, 2014.
Total per unit costs (including financing) decreased to $2.41 per Mcfe for the six-month period ended June 30, 2015, an improvement of 8 percent from $2.63 per Mcfe for the six-month period ended June 30, 2014.
Cabot drilled or participated in a total of 78 net wells during the six-month period ended June 30, 2015 and incurred a total of $540.4 million in capital expenditures associated with activity during this period. “Over 80 percent of the net wells drilled during the first half of the year were on pad locations required to meet our obligation for continuous development or acreage capture,” stated Dinges. “We continue to prudently manage our capital program with a near-term focus on holding our acreage positions in our two core plays and improving our operating efficiencies.”
Operational Highlights
Marcellus Shale
During the second quarter of 2015, the Company averaged 1,341 Mmcf per day of net Marcellus production (1,575 gross operated Mmcf per day), an increase of 7 percent over the prior year’s comparable quarter. As previously announced, the Company curtailed a significant amount of its production volumes in the second quarter due to weakness in regional natural gas prices throughout Appalachia. Cabot does not anticipate an improvement in price realizations during the third quarter and as a result has initiated third quarter Marcellus gross production guidance at 1,550 to 1,600 Mmcf per day, in line with its guidance for the second quarter.
Cabot is currently operating three rigs in the Marcellus Shale and plans to remain at this level for the remainder of the year.
Eagle Ford Shale
Cabot’s net production in the Eagle Ford Shale during the second quarter of 2015 was 17,889 barrels of oil equivalent (Boe) per day, an increase of 74 percent over the prior year’s comparable quarter.
Cabot is currently operating one rig in the Eagle Ford Shale and plans to remain at this level for the remainder of the year.
Financial Position and Liquidity
As of June 30, 2015, the Company's net debt to adjusted capitalization ratio was 48.0 percent, compared to 44.7 percent at December 31, 2014 (detailed in the table below). The Company's total debt was $1,995 million, of which $383 million was outstanding under the Company's $1.8 billion revolving credit facility.
Third Quarter and Full-Year 2015 Guidance
The Company has provided third quarter net production guidance of 1,375 to 1,425 Mmcf per day for natural gas and 15,750 to 17,000 Bbls per day for liquids. The Company expects its natural gas price realizations before the impact of hedges to average between $0.95 and $1.05 below NYMEX settlement prices for the third quarter.
Cabot’s full-year equivalent production growth guidance range of 10 to 18 percent remains unchanged. Cabot's 2015 capital program also remains unchanged at $900 million. “We front-end loaded this year’s investment program, which will significantly reduce our run-rate capital spending for the second half of the year,” highlighted Dinges. For further disclosure on Cabot's natural gas pricing exposure by index and updated unit cost guidance, please see the current Guidance slide in the Investor Relations section of the Company's website.
Conference Call
A conference call is scheduled for Friday, July 24, 2015, at 9:30 a.m. Eastern Time to discuss second quarter 2015 financial and operating results. To access the live audio webcast, please visit the Investor Relations section of the Company's website at www.cabotog.com. A replay of the call will also be available on the Company's website. The latest financial guidance, including the Company's hedge positions, is also available in the Investor Relations section of the Company's website.
Cabot Oil & Gas Corporation, headquartered in Houston, Texas is a leading independent natural gas producer, with its entire resource base located in the continental United States. For additional information, visit the Company's homepage at www.cabotog.com.
The statements regarding future financial performance and results and the other statements which are not historical facts contained in this release are forward-looking statements that involve risks and uncertainties, including, but not limited to, market factors, the market price (including regional basis differentials) of natural gas and oil, results of future drilling and marketing activity, future production and costs, and other factors detailed in the Company's Securities and Exchange Commission filings.
FOR MORE INFORMATION CONTACT
Matt Kerin (281) 589-4642
OPERATING DATA
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| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
PRODUCED NATURAL GAS (Bcf) & LIQUIDS (Mbbl) | | | | | | | |
Natural Gas | | | | | | | |
Appalachia | 125.9 |
| | 118.4 |
| | 285.0 |
| | 231.2 |
|
Other | 2.5 |
| | 3.4 |
| | 5.2 |
| | 6.4 |
|
Total | 128.4 |
| | 121.8 |
| | 290.2 |
| | 237.6 |
|
| | | | | | | |
Crude/Condensate/NGL | 1,612 |
| | 961 |
| | 3,206 |
| | 1,647 |
|
| | | | | | | |
Equivalent Production (Bcfe) | 138.0 |
| | 127.6 |
| | 309.4 |
| | 247.5 |
|
| | | | | | | |
PRICES(1) | | | | | | | |
Average Produced Gas Sales Price ($/Mcf) | | | | | | | |
Appalachia | $ | 2.14 |
| | $ | 3.44 |
| | $ | 2.31 |
| | $ | 3.57 |
|
Other | $ | 2.49 |
| | $ | 4.65 |
| | $ | 2.75 |
| | $ | 4.80 |
|
Total | $ | 2.15 |
| | $ | 3.47 |
| | $ | 2.32 |
| | $ | 3.60 |
|
| | | | | | | |
Average Crude/Condensate Price ($/Bbl) | $ | 56.10 |
| | $ | 98.84 |
| | $ | 50.00 |
| | $ | 98.39 |
|
| | | | | | | |
WELLS DRILLED | | | | | | | |
Gross | 44 |
| | 49 |
| | 87 |
| | 76 |
|
Net | 37 |
| | 35 |
| | 78 |
| | 62 |
|
Gross success rate | 100 | % | | 100 | % | | 100 | % | | 100 | % |
(1) These realized prices include the impact of derivative instrument settlements.
|
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
Realized Impacts to Gas Pricing | $ | 0.40 |
| | $ | (0.30 | ) | | $ | 0.31 |
| | $ | (0.45 | ) |
Realized Impacts to Oil Pricing | $ | — |
| | $ | (1.25 | ) | | $ | — |
| | $ | (0.89 | ) |
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS (Unaudited)
(In thousands, except per share amounts)
|
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
OPERATING REVENUES | |
| | |
| | |
| | |
|
Natural gas | $ | 224,806 |
| | $ | 437,761 |
| | $ | 584,997 |
| | $ | 870,571 |
|
Crude oil and condensate | 81,233 |
| | 86,341 |
| | 143,791 |
| | 145,485 |
|
Gain (loss) on derivative instruments | (6,819 | ) | | (2,329 | ) | | 27,304 |
| | (2,329 | ) |
Brokered natural gas | 3,813 |
| | 8,140 |
| | 8,640 |
| | 21,293 |
|
Other | 3,264 |
| | 3,274 |
| | 6,330 |
| | 7,970 |
|
| 306,297 |
| | 533,187 |
| | 771,062 |
| | 1,042,990 |
|
OPERATING EXPENSES | |
| | |
| | |
| | |
|
Direct operations | 36,112 |
| | 35,605 |
| | 72,129 |
| | 71,439 |
|
Transportation and gathering | 98,295 |
| | 83,976 |
| | 219,531 |
| | 161,741 |
|
Brokered natural gas | 2,885 |
| | 7,031 |
| | 6,624 |
| | 18,891 |
|
Taxes other than income | 11,611 |
| | 12,816 |
| | 22,891 |
| | 25,860 |
|
Exploration | 5,298 |
| | 4,676 |
| | 14,030 |
| | 11,150 |
|
Depreciation, depletion and amortization | 152,513 |
| | 157,563 |
| | 328,009 |
| | 304,981 |
|
General and administrative (excluding stock-based compensation) | 11,354 |
| | 13,853 |
| | 27,973 |
| | 32,318 |
|
Stock-based compensation(1) | 8,624 |
| | 6,274 |
| | 14,534 |
| | 9,445 |
|
| 326,692 |
| | 321,794 |
| | 705,721 |
| | 635,825 |
|
Earnings (loss) on equity method investments | 1,512 |
| | 756 |
| | 2,933 |
| | 756 |
|
Gain (loss) on sale of assets | (79 | ) | | (1,496 | ) | | 59 |
| | (2,781 | ) |
INCOME (LOSS) FROM OPERATIONS | (18,962 | ) | | 210,653 |
| | 68,333 |
| | 405,140 |
|
Interest expense | 24,168 |
| | 16,334 |
| | 47,734 |
| | 32,891 |
|
Income (loss) before income taxes | (43,130 | ) | | 194,319 |
| | 20,599 |
| | 372,249 |
|
Income tax (benefit) expense | (15,622 | ) | | 75,899 |
| | 7,852 |
| | 146,798 |
|
NET INCOME (LOSS) | $ | (27,508 | ) | | $ | 118,420 |
| | $ | 12,747 |
| | $ | 225,451 |
|
Earnings (loss) per share - Basic | $ | (0.07 | ) | | $ | 0.28 |
| | $ | 0.03 |
| | $ | 0.54 |
|
Weighted-average common shares outstanding | 413,713 |
| | 417,291 |
| | 413,530 |
| | 417,097 |
|
(1) Includes the impact of the Company’s performance share awards, restricted stock, stock appreciation rights and expense associated with the Supplemental Employee Incentive Plan.
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited)
(In thousands) |
| | | | | | | |
| June 30,
2015 | | December 31,
2014 |
Assets | |
| | |
|
Current assets | $ | 254,993 |
| | $ | 413,447 |
|
Properties and equipment, net (Successful efforts method) | 5,132,655 |
| | 4,925,711 |
|
Other assets | 117,272 |
| | 98,558 |
|
Total assets | $ | 5,504,920 |
| | $ | 5,437,716 |
|
| | | |
Liabilities and Stockholders’ Equity | |
| | |
|
Current liabilities | $ | 278,852 |
| | $ | 499,018 |
|
Long-term debt | 1,995,000 |
| | 1,752,000 |
|
Deferred income taxes | 878,069 |
| | 843,876 |
|
Other liabilities | 207,083 |
| | 200,089 |
|
Stockholders’ equity | 2,145,916 |
| | 2,142,733 |
|
Total liabilities and stockholders’ equity | $ | 5,504,920 |
| | $ | 5,437,716 |
|
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited)
(In thousands)
|
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
Cash Flows From Operating Activities | |
| | |
| | |
| | |
|
Net income (loss) | $ | (27,508 | ) | | $ | 118,420 |
| | $ | 12,747 |
| | $ | 225,451 |
|
Deferred income tax expense | (7,921 | ) | | 60,850 |
| | 7,160 |
| | 118,453 |
|
(Gain) loss on sale of assets | 79 |
| | 1,496 |
| | (59 | ) | | 2,781 |
|
Exploratory dry hole cost | 16 |
| | 114 |
| | 178 |
| | 2,154 |
|
(Gain) loss on derivative instruments | 6,819 |
| | 2,329 |
| | (27,304 | ) | | 2,329 |
|
Net cash received (paid) in settlement of derivative instruments | 51,045 |
| | (15,262 | ) | | 88,730 |
| | (15,262 | ) |
Income charges not requiring cash | 160,694 |
| | 164,349 |
| | 341,948 |
| | 315,922 |
|
Changes in assets and liabilities | (12,014 | ) | | (2,726 | ) | | 15,191 |
| | (66,880 | ) |
Net cash provided by operations | 171,210 |
| | 329,570 |
| | 438,591 |
| | 584,948 |
|
| | | | | | | |
Cash Flows From Investing Activities | |
| | |
| | |
| | |
|
Capital expenditures | (250,001 | ) | | (278,912 | ) | | (645,092 | ) | | (617,613 | ) |
Acquisitions | (16,149 | ) | | — |
| | (16,300 | ) | | — |
|
Proceeds from sale of assets | (79 | ) | | (863 | ) | | 3,002 |
| | (755 | ) |
Restricted cash | — |
| | 19,712 |
| | — |
| | 28,094 |
|
Investment in equity method investments | (5,036 | ) | | (16,293 | ) | | (10,114 | ) | | (22,230 | ) |
Net cash used in investing | (271,265 | ) | | (276,356 | ) | | (668,504 | ) | | (612,504 | ) |
| | | | | | | |
Cash Flows From Financing Activities | |
| | |
| | |
| | |
|
Net increase (decrease) in debt | 118,000 |
| | (29,000 | ) | | 243,000 |
| | 46,000 |
|
Dividends paid | (8,274 | ) | | (8,347 | ) | | (16,537 | ) | | (16,679 | ) |
Stock-based compensation tax benefit | 2,049 |
| | 4,311 |
| | 5,486 |
| | 20,354 |
|
Capitalized debt issuance costs | (7,838 | ) | | — |
| | (7,838 | ) | | — |
|
Other | (2,599 | ) | | 1 |
| | 79 |
| | 91 |
|
Net cash provided by (used in) financing | 101,338 |
| | (33,035 | ) | | 224,190 |
| | 49,766 |
|
| | | | | | | |
Net (decrease) increase in cash and cash equivalents | $ | 1,283 |
| | $ | 20,179 |
| | $ | (5,723 | ) | | $ | 22,210 |
|
Selected Item Review and Reconciliation of Net Income and Earnings Per Share
(In thousands, except per share amounts) |
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
As reported - net income (loss) | $ | (27,508 | ) | | $ | 118,420 |
| | $ | 12,747 |
| | $ | 225,451 |
|
Reversal of selected items, net of tax: | |
| | |
| | |
| | |
|
(Gain) loss on sale of assets | 50 |
| | 901 |
| | (37 | ) | | 1,674 |
|
(Gain) loss on derivative instruments (1) | 36,543 |
| | (7,786 | ) | | 38,816 |
| | (7,786 | ) |
Drilling rig termination fees | 44 |
| | — |
| | 3,256 |
| | — |
|
Stock-based compensation expense | 5,446 |
| | 3,777 |
| | 9,184 |
| | 5,686 |
|
Net income (loss) excluding selected items | $ | 14,575 |
| | $ | 115,312 |
| | $ | 63,966 |
| | $ | 225,025 |
|
As reported - earnings (loss) per share | $ | (0.07 | ) | | $ | 0.28 |
| | $ | 0.03 |
| | $ | 0.54 |
|
Per share impact of reversing selected items | 0.10 |
| | — |
| | 0.12 |
| | — |
|
Earnings per share including reversal of selected items | $ | 0.03 |
| | $ | 0.28 |
| | $ | 0.15 |
| | $ | 0.54 |
|
Weighted average common shares outstanding | 413,713 |
| | 417,291 |
| | 413,530 |
| | 417,097 |
|
(1) Effective April 1, 2014, the Company elected to discontinue hedge accounting for its commodity derivatives on a prospective basis. This amount represents the non-cash mark-to-market changes of our commodity derivative instruments recorded in gain (loss) on derivative instruments in the Condensed Consolidated Statement of Operations.
Discretionary Cash Flow Calculation and Reconciliation
(In thousands) |
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
Discretionary Cash Flow | |
| | |
| | |
| | |
|
As reported - net income (loss) | $ | (27,508 | ) | | $ | 118,420 |
| | $ | 12,747 |
| | $ | 225,451 |
|
Plus (less): | |
| | |
| | |
| | |
|
Deferred income tax expense | (7,921 | ) | | 60,850 |
| | 7,160 |
| | 118,453 |
|
(Gain) loss on sale of assets | 79 |
| | 1,496 |
| | (59 | ) | | 2,781 |
|
Exploratory dry hole cost | 16 |
| | 114 |
| | 178 |
| | 2,154 |
|
(Gain) loss on derivative instruments | 6,819 |
| | 2,329 |
| | (27,304 | ) | | 2,329 |
|
Net cash received (paid) in settlement of derivative instruments | 51,045 |
| | (15,262 | ) | | 88,730 |
| | (15,262 | ) |
Income charges not requiring cash | 160,694 |
| | 164,349 |
| | 341,948 |
| | 315,922 |
|
Discretionary Cash Flow | 183,224 |
| | 332,296 |
| | 423,400 |
| | 651,828 |
|
Changes in assets and liabilities | (12,014 | ) | | (2,726 | ) | | 15,191 |
| | (66,880 | ) |
Net cash provided by operations | $ | 171,210 |
| | $ | 329,570 |
| | $ | 438,591 |
| | $ | 584,948 |
|
EBITDAX Calculation and Reconciliation
(in thousands)
|
| | | | | | | | | | | | | | | |
| Quarter Ended
June 30, | | Six Months Ended
June 30, |
| 2015 | | 2014 | | 2015 | | 2014 |
As reported - net income (loss) | $ | (27,508 | ) | | $ | 118,420 |
| | $ | 12,747 |
| | $ | 225,451 |
|
Plus (less): | | | | | | | |
Interest expense | 24,168 |
| | 16,334 |
| | 47,734 |
| | 32,891 |
|
Income tax (benefit) expense | (15,622 | ) | | 75,899 |
| | 7,852 |
| | 146,798 |
|
Depreciation, depletion and amortization | 152,513 |
| | 157,563 |
| | 328,009 |
| | 304,981 |
|
Exploration | 5,298 |
| | 4,676 |
| | 14,030 |
| | 11,150 |
|
(Gain) loss on sale of assets | 79 |
| | 1,496 |
| | (59 | ) | | 2,781 |
|
Non-cash (gain) loss on derivative instruments | 57,864 |
| | (12,933 | ) | | 61,426 |
| | (12,933 | ) |
Stock-based compensation and other | 7,112 |
| | 5,660 |
| | 11,602 |
| | 8,689 |
|
EBITDAX | $ | 203,904 |
| | $ | 367,115 |
| | $ | 483,341 |
| | $ | 719,808 |
|
Net Debt Reconciliation
(In thousands) |
| | | | | | | |
| June 30,
2015 | | December 31,
2014 |
Long-term debt | $ | 1,995,000 |
| | $ | 1,752,000 |
|
Stockholders’ equity | 2,145,916 |
| | 2,142,733 |
|
Total Capitalization | $ | 4,140,916 |
| | $ | 3,894,733 |
|
| | | |
Total debt | $ | 1,995,000 |
| | $ | 1,752,000 |
|
Less: Cash and cash equivalents | (15,231 | ) | | (20,954 | ) |
Net Debt | $ | 1,979,769 |
| | $ | 1,731,046 |
|
| | | |
Net debt | $ | 1,979,769 |
| | $ | 1,731,046 |
|
Stockholders’ equity | 2,145,916 |
| | 2,142,733 |
|
Total Adjusted Capitalization | $ | 4,125,685 |
| | $ | 3,873,779 |
|
| | | |
Total debt to total capitalization ratio | 48.2 | % | | 45.0 | % |
Less: Impact of cash and cash equivalents | 0.2 | % | | 0.3 | % |
Net Debt to Adjusted Capitalization Ratio | 48.0 | % | | 44.7 | % |
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