Halcón Resources Corporation (NYSE:HK) (“Halcón” or the “Company”)
today announced its fourth quarter and full year 2015 results.
Production for the three months and full year
ended December 31, 2015 averaged 41,087 barrels of oil equivalent
per day (Boe/d) and 41,542 Boe/d, respectively. Production
was comprised of 77% oil, 11% natural gas liquids (NGLs) and 12%
natural gas for the quarter and 79% oil, 10% NGLs and 11% natural
gas for the year.
Halcón generated total revenues of $116.1
million for the fourth quarter of 2015. Revenues for the full
year 2015 totaled $550.3 million.
Excluding the impact of hedges, Halcón realized
88% of the average NYMEX oil price, 18% of the average NYMEX oil
price for NGLs and 88% of the average NYMEX natural gas price
during the fourth quarter 2015. For the full year 2015,
excluding the impact of hedges, the Company realized 87% of the
average NYMEX oil price, 19% of the average NYMEX oil price for
NGLs and 85% of the average NYMEX natural gas price. Realized
hedge proceeds totaled $129 million in the fourth quarter and $440
million for the full year 2015.
Total operating costs per unit, after adjusting
for selected items (see Selected Operating Data table for
additional information), decreased by 16% to $17.80 per Boe during
the three months ended December 31, 2015, compared to the same
period of 2014. Total operating costs per unit for the full
year, after adjusting for selected items (see Selected Operating
Data table for additional information), were $18.00 per Boe,
representing a decrease of 25% versus 2014.
After adjusting for selected items primarily
related to a non-cash, pre-tax full cost ceiling impairment charge
and a non-cash, pre-tax gain on the extinguishment of debt (see
Selected Item Review and Reconciliation table for additional
information), net income was $59.3 million, or $0.41 per diluted
share, and $128.4 million, or $0.97 per diluted share, for the
fourth quarter and full year 2015, respectively. Halcón
reported a net loss available to common stockholders of $424.7
million, or $3.56 per diluted share for the fourth quarter and $2.0
billion, or $18.66 per diluted share for the year.
Liquidity and Capital
Spending
As of December 31, 2015 Halcón’s liquidity was
approximately $789 million, which consisted of cash on hand plus
undrawn capacity on the Company’s senior secured revolving credit
facility with a $827 million borrowing base. The Company is
currently working with its senior revolver lenders on its spring
2016 redetermination and expects the borrowing base to be revised
to between $650 million and $700 million.
During the fourth quarter of 2015, the Company
incurred capital costs of $58 million on drilling and completions,
and less than $2 million on infrastructure, seismic and leasehold
acquisitions. In addition, Halcón incurred $42 million for
capitalized interest, G&A and other.
The Company incurred capital costs of $322
million on drilling and completions, $11 million on
infrastructure/seismic and $12 million on leasehold acquisitions in
2015. In addition, Halcón incurred $142 million for
capitalized interest, G&A and other.
Hedging Update
Halcón has 25,497 barrels per day of oil hedged
for 2016 at an average price of $80.59 per barrel. For 2017,
the Company has 3,750 barrels per day of oil hedged at an average
price of $65.75 per barrel. Halcón estimates the pre-tax
mark-to-market value of its hedge portfolio to be approximately
$381 million as of February 24, 2016.
2015 Proved Reserves
The Company's estimated proved reserves as of
December 31, 2015 were approximately 146.8 million barrels of oil
equivalent (MMBoe). Year-end 2015 estimated proved reserves were
82% oil, 9% NGLs and 9% natural gas on an equivalent basis. Of
total estimated proved reserves, 83% were in the Williston Basin,
15% were in the East Texas Eagle Ford ("El Halcón") and 2% were in
other areas. Year-end 2015 estimated proved reserves were
approximately 95% Company-operated and 56% proved developed.
Halcón's estimated proved reserves at December
31, 2015 were prepared by the independent reserve engineering firm
Netherland, Sewell and Associates, Inc. in accordance with
Securities and Exchange Commission guidelines using NYMEX prices of
$50.28 per barrel for oil and $2.59 per million British Thermal
Unit for natural gas, before adjustments for energy content,
quality, midstream fees and basis
differentials.
Operations Update
The Company is currently running 2 operated rigs
in the Fort Berthold area of the Williston Basin but will scale
down to 1 rig operating in the Fort Berthold area by the end of
March 2016. Although Halcón currently has 1 operated rig
running in its El Halcón area, the Company does not plan to run any
rigs in this area after March of 2016 until oil prices
improve. The Company currently has 13 wells in the Bakken and
2 wells in the East Texas Eagle Ford being completed or waiting on
completion.
Bakken/Three Forks
The Company operated an average of 2 rigs and
2.2 rigs in the Williston Basin during the fourth quarter
and full year 2015, respectively.
Halcón spudded 10 wells and put 5 wells online
in the Williston Basin during the three months
ended December 31, 2015. The Company also participated in 27
non-operated wells during the quarter with an average working
interest of approximately 1.4%. Production averaged 29,721 Boe/d
during the fourth quarter of 2015 in the Williston Basin.
For the full year 2015, Halcón spudded 39 wells
and put 39 wells online in the Williston Basin. The Company
also participated in 100 non-operated wells during the year with an
average working interest of approximately 1.7%.
Halcón plans to concentrate its efforts in its
highest return area (Fort Berthold Indian Reservation, or FBIR) in
2016 and anticipates spending approximately 80% to 85% of its total
drilling and completions budget in the FBIR area of
the Williston Basin.
During 2015, the Company put 33 operated wells
online in the FBIR with an average EUR of 800 MBoe (25 Middle
Bakken, 8 Three Forks). In 2016, Halcón expects wells put
online to have an average EUR of approximately 900 MBoe as it
focuses drilling on the best parts of its acreage
position.
In 2015, the Company put 6 operated Middle
Bakken wells online in Williams County with an average EUR of 553
MBoe. Although Halcón does not plan to drill in Williams
County in 2016, any wells drilled in this area would generate a
positive return at current strip prices based on 2015
EURs.
The Company continues to improve on well costs
with current FBIR AFEs at $6.2 million and Williams County AFEs at
$5.7 million.
Halcón currently has working interests in
approximately 123,000 net acres prospective for the Bakken and
Three Forks formations in the Williston Basin, substantially
all of which are held by production (HBP). The Company plans to
operate an average of 1 rig and spud 15 to 20 gross operated wells
in 2016 with an average working interest of approximately 60%.
Halcón also expects to participate in 50 to 65 gross non-operated
wells in 2016 with an average working interest of approximately
1.5%.
The Company is currently the operator of 204
producing Bakken wells and 65 Three Forks wells. Halcón currently
has 12 Bakken wells and 5 Three Forks wells being completed or
waiting on completion on its operated acreage.
"El Halcón" - East Texas Eagle Ford
The Company operated an average of 1 rig in El
Halcón during the fourth quarter and full year 2015. Halcón spudded
4 wells and put 4 wells online in the play during the three months
ended December 31, 2015. For the full year 2015, the Company
spudded 16 wells and put 19 wells online. Production averaged
7,278 Boe/d during the fourth quarter of 2015 in El Halcón.
Halcón currently has working interests in
approximately 92,000 net acres prospective for the Eagle Ford
formation in East Texas, approximately 72% of which is HBP.
The Company plans to operate 1 rig through the first quarter of
2016 and spud 2 gross operated wells with an average working
interest of approximately 98%. Halcón anticipates spending
approximately 15% to 20% of its total drilling and completions
budget in the play in 2016.
There are currently 110 Company-operated El
Halcón wells producing and 1 Halcón-operated well currently
drilling along with 2 Halcón-operated wells being completed or
waiting on completion.
Conference Call and Webcast
Information
Halcón Resources Corporation (NYSE:HK) has
scheduled a conference call for Friday February 26, 2016, at 10:00
a.m. EST (9:00 a.m. CST). To participate in the conference call,
dial (877) 810-3368 for domestic callers, and (914) 495-8561 for
international callers a few minutes before the call begins and
reference Halcón Resources conference ID 34260487. The conference
call will also be webcast live over the Internet on Halcón
Resources’ website at http://www.halconresources.com in the
Investor Relations section under Events & Presentations.
A telephonic replay of the call will be available approximately two
hours after the live broadcast ends and will be accessible until
March 4, 2016. To access the replay, dial (855) 859-2056 for
domestic callers or (404) 537-3406 for international callers, in
both cases referencing conference ID 34260487.
About Halcón Resources
Halcón Resources Corporation is an independent
energy company engaged in the acquisition, production, exploration
and development of onshore oil and natural gas properties in the
United States.
For more information contact Quentin Hicks,
Senior Vice President of Finance & Investor Relations, at
832-538-0557 or qhicks@halconresources.com.
Forward-Looking Statements
This release may contain forward-looking
statements within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. Statements that are not strictly
historical statements constitute forward-looking statements
and may often, but not always, be identified by the use
of such words such as "expects", "believes", "intends",
"anticipates", "plans", "estimates", "potential",
"possible", or "probable" or statements that certain
actions, events or results "may", "will", "should", or "could" be
taken, occur or be achieved. Forward-looking statements are
based on current beliefs and expectations and
involve certain assumptions or estimates that
involve various risks and uncertainties that could cause
actual results to differ materially from those reflected in the
statements. These risks include, but are not limited to, those set
forth in the Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 2015 and other filings submitted by the
Company to the U.S. Securities and Exchange Commission
(SEC), copies of which may be obtained from the SEC's website
at www.sec.gov or through the Company's website
at www.halconresources.com. Readers should not place
undue reliance on any such forward-looking statements, which are
made only as of the date hereof. The Company has no duty,
and assumes no obligation, to update forward-looking
statements as a result of new information, future events
or changes in the Company's expectations.
HALCÓN RESOURCES CORPORATION |
|
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited) |
|
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
Operating revenues: |
|
|
|
|
|
|
|
|
|
|
Oil, natural gas and natural gas liquids sales: |
|
|
|
|
|
|
|
|
|
|
|
Oil |
|
$ |
107,978 |
|
|
$ |
223,215 |
|
|
$ |
512,346 |
|
|
$ |
1,071,319 |
|
|
|
|
Natural
gas |
|
|
4,914 |
|
|
|
9,136 |
|
|
|
22,509 |
|
|
|
37,101 |
|
|
|
|
Natural gas
liquids |
|
|
3,052 |
|
|
|
9,064 |
|
|
|
13,624 |
|
|
|
37,460 |
|
|
|
|
|
Total oil,
natural gas and natural gas liquids sales |
|
|
115,944 |
|
|
|
241,415 |
|
|
|
548,479 |
|
|
|
1,145,880 |
|
|
|
Other |
|
|
177 |
|
|
|
(1,956 |
) |
|
|
1,799 |
|
|
|
2,381 |
|
|
|
|
|
Total operating
revenues |
|
|
116,121 |
|
|
|
239,459 |
|
|
|
550,278 |
|
|
|
1,148,261 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
|
|
|
|
|
Lease
operating |
|
|
22,324 |
|
|
|
34,539 |
|
|
|
103,590 |
|
|
|
130,239 |
|
|
|
|
Workover and other |
|
|
9,248 |
|
|
|
3,643 |
|
|
|
20,862 |
|
|
|
16,193 |
|
|
|
|
Taxes
other than income |
|
|
11,644 |
|
|
|
23,329 |
|
|
|
48,890 |
|
|
|
106,331 |
|
|
|
Gathering
and other |
|
|
9,698 |
|
|
|
8,600 |
|
|
|
40,281 |
|
|
|
26,719 |
|
|
|
Restructuring |
|
|
222 |
|
|
|
- |
|
|
|
2,886 |
|
|
|
987 |
|
|
|
General and
administrative |
|
|
19,668 |
|
|
|
26,422 |
|
|
|
87,766 |
|
|
|
116,532 |
|
|
|
Depletion,
depreciation and accretion |
|
|
66,795 |
|
|
|
145,465 |
|
|
|
364,204 |
|
|
|
534,421 |
|
|
|
Full cost
ceiling impairment |
|
|
611,787 |
|
|
|
178,503 |
|
|
|
2,626,305 |
|
|
|
239,668 |
|
|
|
Other
operating property and equipment impairment |
|
|
- |
|
|
|
31,769 |
|
|
|
- |
|
|
|
35,558 |
|
|
|
|
|
Total operating
expenses |
|
|
751,386 |
|
|
|
452,270 |
|
|
|
3,294,784 |
|
|
|
1,206,648 |
|
|
Income (loss) from operations |
|
|
(635,265 |
) |
|
|
(212,811 |
) |
|
|
(2,744,506 |
) |
|
|
(58,387 |
) |
|
Other income (expenses): |
|
|
|
|
|
|
|
|
|
|
Net gain (loss) on derivative contracts |
|
|
93,459 |
|
|
|
510,367 |
|
|
|
310,264 |
|
|
|
518,956 |
|
|
|
Interest expense and other, net |
|
|
(52,672 |
) |
|
|
(38,575 |
) |
|
|
(232,878 |
) |
|
|
(145,689 |
) |
|
|
Gain (loss) on extinguishment of debt |
|
|
203,897 |
|
|
|
- |
|
|
|
761,804 |
|
|
|
- |
|
|
|
Gain (loss) on extinguishment of Convertible Note
and |
|
|
|
|
|
|
|
|
|
|
|
modification of February 2012 Warrants |
|
|
- |
|
|
|
- |
|
|
|
(8,219 |
) |
|
|
- |
|
|
|
Total other income (expenses) |
|
|
244,684 |
|
|
|
471,792 |
|
|
|
830,971 |
|
|
|
373,267 |
|
|
Income (loss) before income taxes |
|
|
(390,581 |
) |
|
|
258,981 |
|
|
|
(1,913,535 |
) |
|
|
314,880 |
|
|
Income tax benefit (provision) |
|
|
(2,862 |
) |
|
|
(219 |
) |
|
|
(9,086 |
) |
|
|
1,076 |
|
|
Net income (loss) |
|
|
(393,443 |
) |
|
|
258,762 |
|
|
|
(1,922,621 |
) |
|
|
315,956 |
|
|
Series A preferred dividends |
|
|
(3,518 |
) |
|
|
(4,960 |
) |
|
|
(17,517 |
) |
|
|
(19,838 |
) |
|
Preferred dividends and accretion on redeemable noncontrolling
interest |
|
(27,751 |
) |
|
|
(6,457 |
) |
|
|
(66,820 |
) |
|
|
(13,176 |
) |
|
Net income (loss) available to common
stockholders |
|
$ |
(424,712 |
) |
|
$ |
247,345 |
|
|
$ |
(2,006,958 |
) |
|
$ |
282,942 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share of common
stock: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(3.56 |
) |
|
$ |
2.96 |
|
|
$ |
(18.66 |
) |
|
$ |
3.40 |
|
|
|
|
Diluted |
|
$ |
(3.56 |
) |
|
$ |
2.38 |
|
|
$ |
(18.66 |
) |
|
$ |
2.93 |
|
|
Weighted average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
|
|
Basic |
|
|
119,420 |
|
|
|
83,457 |
|
|
|
107,531 |
|
|
|
83,155 |
|
|
|
|
Diluted |
|
|
119,420 |
|
|
|
107,844 |
|
|
|
107,531 |
|
|
|
108,481 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
|
CONSOLIDATED BALANCE SHEETS
(Unaudited) |
|
(In thousands, except share and per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31, |
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
Current assets: |
|
|
|
|
|
|
Cash |
|
$ |
8,026 |
|
|
$ |
43,713 |
|
|
|
Accounts receivable |
|
|
173,624 |
|
|
|
276,559 |
|
|
|
Receivables from derivative contracts |
|
|
348,861 |
|
|
|
352,530 |
|
|
|
Restricted cash |
|
|
16,812 |
|
|
|
16,131 |
|
|
|
Inventory |
|
|
4,635 |
|
|
|
4,693 |
|
|
|
Prepaids and other |
|
|
4,635 |
|
|
|
9,079 |
|
|
|
Total current assets |
|
|
556,593 |
|
|
|
702,705 |
|
|
Oil
and natural gas properties (full cost method): |
|
|
|
|
|
|
Evaluated |
|
|
7,060,721 |
|
|
|
6,390,820 |
|
|
|
Unevaluated |
|
|
1,641,356 |
|
|
|
1,829,786 |
|
|
|
Gross oil and natural gas properties |
|
|
8,702,077 |
|
|
|
8,220,606 |
|
|
|
Less
- accumulated depletion |
|
|
(5,933,688 |
) |
|
|
(2,953,038 |
) |
|
|
Net oil and natural gas properties |
|
|
2,768,389 |
|
|
|
5,267,568 |
|
|
Other operating property and equipment: |
|
|
|
|
|
|
Gas
gathering and other operating assets |
|
|
130,090 |
|
|
|
126,804 |
|
|
|
Less
- accumulated depreciation |
|
|
(22,435 |
) |
|
|
(14,798 |
) |
|
|
Net other operating property and equipment |
|
|
107,655 |
|
|
|
112,006 |
|
|
Other noncurrent assets: |
|
|
|
|
|
|
Receivables from derivative contracts |
|
|
16,614 |
|
|
|
151,324 |
|
|
|
Debt
issuance costs, net |
|
|
7,633 |
|
|
|
4,656 |
|
|
|
Deferred income taxes |
|
|
- |
|
|
|
136,826 |
|
|
|
Equity in oil and natural gas partnership |
|
|
209 |
|
|
|
4,309 |
|
|
|
Funds in escrow and other |
|
|
1,599 |
|
|
|
3,833 |
|
|
Total assets |
|
$ |
3,458,692 |
|
|
$ |
6,383,227 |
|
|
|
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
295,085 |
|
|
$ |
607,750 |
|
|
|
Asset retirement obligations |
|
|
163 |
|
|
|
106 |
|
|
|
Current portion of deferred income taxes |
|
|
- |
|
|
|
136,826 |
|
|
|
Total current liabilities |
|
|
295,248 |
|
|
|
744,682 |
|
|
Long-term debt, net |
|
|
2,873,637 |
|
|
|
3,695,488 |
|
|
Other noncurrent liabilities: |
|
|
|
|
|
|
Liabilities from derivative contracts |
|
|
290 |
|
|
|
9,387 |
|
|
|
Asset retirement obligations |
|
|
46,853 |
|
|
|
38,371 |
|
|
|
Other |
|
|
6,264 |
|
|
|
5,964 |
|
|
Commitments and
contingencies |
|
|
|
|
|
Mezzanine equity: |
|
|
|
|
|
|
Redeemable noncontrolling interest |
|
|
183,986 |
|
|
|
117,166 |
|
|
Stockholders' equity: |
|
|
|
|
|
|
Preferred stock: 1,000,000 shares of $0.0001 par value
authorized; 244,724 and 345,000 |
|
|
|
|
|
|
shares of 5.75% Cumulative Perpetual Convertible
Series A, issued and outstanding |
|
|
|
|
|
|
at December 31, 2015 and 2014, respectively |
|
|
- |
|
|
|
- |
|
|
|
Common stock: 1,340,000,000 shares of $0.0001 par value
authorized; |
|
|
|
|
|
|
122,523,559 and 85,561,662 shares issued and
outstanding |
|
|
|
|
|
|
at December 31, 2015 and 2014, respectively |
|
|
12 |
|
|
|
8 |
|
|
|
Additional paid-in capital |
|
|
3,283,097 |
|
|
|
2,995,436 |
|
|
|
Accumulated deficit |
|
|
(3,230,695 |
) |
|
|
(1,223,275 |
) |
|
|
Total
stockholders' equity |
|
|
52,414 |
|
|
|
1,772,169 |
|
|
Total liabilities and stockholders'
equity |
|
$ |
3,458,692 |
|
|
$ |
6,383,227 |
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited) |
|
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
Cash flows from operating activities: |
|
|
|
|
|
|
|
|
|
Net income
(loss) |
|
$ |
(393,443 |
) |
|
$ |
258,762 |
|
|
$ |
(1,922,621 |
) |
|
$ |
315,956 |
|
|
Adjustments
to reconcile net income (loss) to net cash |
|
|
|
|
|
|
|
|
|
provided by
(used in) operating activities: |
|
|
|
|
|
|
|
|
|
|
Depletion, depreciation and accretion |
|
|
66,795 |
|
|
|
145,465 |
|
|
|
364,204 |
|
|
|
534,421 |
|
|
|
Full
cost ceiling impairment |
|
|
611,787 |
|
|
|
178,503 |
|
|
|
2,626,305 |
|
|
|
239,668 |
|
|
|
Other operating property and equipment impairment |
|
|
- |
|
|
|
31,769 |
|
|
|
- |
|
|
|
35,558 |
|
|
|
Share-based compensation, net |
|
|
3,284 |
|
|
|
4,896 |
|
|
|
14,529 |
|
|
|
18,733 |
|
|
|
Unrealized loss (gain) on derivative contracts |
|
|
35,310 |
|
|
|
(469,625 |
) |
|
|
129,282 |
|
|
|
(508,285 |
) |
|
|
Amortization and write-off of deferred loan costs |
|
|
1,355 |
|
|
|
1,117 |
|
|
|
7,357 |
|
|
|
4,315 |
|
|
|
Non-cash interest and amortization of discount and premium |
|
|
480 |
|
|
|
804 |
|
|
|
2,509 |
|
|
|
2,780 |
|
|
|
Loss
(gain) on extinguishment of debt |
|
|
(203,897 |
) |
|
|
- |
|
|
|
(761,804 |
) |
|
|
- |
|
|
|
Loss
(gain) on extinguishment of Convertible Note and |
|
|
|
|
|
|
|
|
|
|
|
modification of
February 2012 Warrants |
|
|
- |
|
|
|
- |
|
|
|
8,219 |
|
|
|
- |
|
|
|
Accrued settlements on derivative contracts |
|
|
(9,208 |
) |
|
|
(25,868 |
) |
|
|
(47,011 |
) |
|
|
(25,868 |
) |
|
|
Other expense (income) |
|
|
3,129 |
|
|
|
(1,841 |
) |
|
|
8,934 |
|
|
|
(2,435 |
) |
|
Cash flow
from operations before changes in working capital |
|
|
115,592 |
|
|
|
123,982 |
|
|
|
429,903 |
|
|
|
614,843 |
|
|
Changes in
working capital, net of acquisitions |
|
|
19,213 |
|
|
|
(37,938 |
) |
|
|
37,096 |
|
|
|
53,091 |
|
|
Net cash
provided by (used in) operating activities |
|
|
134,805 |
|
|
|
86,044 |
|
|
|
466,999 |
|
|
|
667,934 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
|
|
Oil
and natural gas capital expenditures |
|
|
(127,678 |
) |
|
|
(345,692 |
) |
|
|
(659,419 |
) |
|
|
(1,524,341 |
) |
|
|
Proceeds received from sales of oil and natural gas assets |
|
|
111 |
|
|
|
4,210 |
|
|
|
1,222 |
|
|
|
484,184 |
|
|
|
Advance on carried interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(189,442 |
) |
|
|
Other operating property and equipment capital expenditures |
|
|
(925 |
) |
|
|
(2,727 |
) |
|
|
(10,838 |
) |
|
|
(43,083 |
) |
|
|
Funds held in escrow and other |
|
|
26 |
|
|
|
368 |
|
|
|
1,903 |
|
|
|
1,589 |
|
|
Net cash
provided by (used in) investing activities |
|
|
(128,466 |
) |
|
|
(343,841 |
) |
|
|
(667,132 |
) |
|
|
(1,271,093 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
|
|
Proceeds from borrowings |
|
|
255,000 |
|
|
|
532,000 |
|
|
|
1,834,000 |
|
|
|
2,276,000 |
|
|
|
Repayments of borrowings |
|
|
(251,804 |
) |
|
|
(320,000 |
) |
|
|
(1,643,804 |
) |
|
|
(1,719,000 |
) |
|
|
Debt
issuance costs |
|
|
(3,865 |
) |
|
|
(62 |
) |
|
|
(29,568 |
) |
|
|
(819 |
) |
|
|
Series A preferred dividends |
|
|
(3,521 |
) |
|
|
(4,960 |
) |
|
|
(8,177 |
) |
|
|
(4,960 |
) |
|
|
Common stock issued |
|
|
2 |
|
|
|
- |
|
|
|
15,356 |
|
|
|
- |
|
|
|
HK
TMS, LLC preferred stock issued |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
110,051 |
|
|
|
HK
TMS, LLC tranche rights |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
4,516 |
|
|
|
Preferred dividends on redeemable noncontrolling interest |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
(3,518 |
) |
|
|
Restricted cash |
|
|
(133 |
) |
|
|
(147 |
) |
|
|
(543 |
) |
|
|
(16,131 |
) |
|
|
Offering costs and other |
|
|
(246 |
) |
|
|
(9 |
) |
|
|
(2,818 |
) |
|
|
(2,101 |
) |
|
Net cash
provided by (used in) financing activities |
|
|
(4,567 |
) |
|
|
206,822 |
|
|
|
164,446 |
|
|
|
644,038 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
increase (decrease) in cash |
|
|
1,772 |
|
|
|
(50,975 |
) |
|
|
(35,687 |
) |
|
|
40,879 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash at
beginning of period |
|
|
6,254 |
|
|
|
94,688 |
|
|
|
43,713 |
|
|
|
2,834 |
|
|
Cash at end
of period |
|
$ |
8,026 |
|
|
$ |
43,713 |
|
|
$ |
8,026 |
|
|
$ |
43,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
|
|
SELECTED OPERATING DATA |
|
|
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Production volumes: |
|
|
|
|
|
|
|
|
|
|
Crude oil (MBbls) |
|
|
2,923 |
|
|
|
3,444 |
|
|
|
12,019 |
|
|
|
12,787 |
|
|
|
Natural gas (MMcf) |
|
|
2,679 |
|
|
|
2,620 |
|
|
|
10,123 |
|
|
|
8,812 |
|
|
|
Natural gas liquids (MBbls) |
|
|
411 |
|
|
|
358 |
|
|
|
1,457 |
|
|
|
1,113 |
|
|
|
Total (MBoe) |
|
|
3,780 |
|
|
|
4,239 |
|
|
|
15,163 |
|
|
|
15,369 |
|
|
|
Average daily production (Boe) |
|
|
41,087 |
|
|
|
46,076 |
|
|
|
41,542 |
|
|
|
42,107 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
prices: |
|
|
|
|
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
36.94 |
|
|
$ |
64.81 |
|
|
$ |
42.63 |
|
|
$ |
83.78 |
|
|
|
Natural gas (per Mcf) |
|
|
1.83 |
|
|
|
3.49 |
|
|
|
2.22 |
|
|
|
4.21 |
|
|
|
Natural gas liquids (per Bbl) |
|
|
7.43 |
|
|
|
25.32 |
|
|
|
9.35 |
|
|
|
33.66 |
|
|
|
Total per Boe |
|
|
30.67 |
|
|
|
56.95 |
|
|
|
36.17 |
|
|
|
74.56 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash
effect of derivative contracts: |
|
|
|
|
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
43.11 |
|
|
$ |
11.79 |
|
|
$ |
35.87 |
|
|
$ |
0.94 |
|
|
|
Natural gas (per Mcf) |
|
|
1.03 |
|
|
|
0.05 |
|
|
|
0.84 |
|
|
|
(0.15 |
) |
|
|
Natural gas liquids (per Bbl) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
Total per Boe |
|
|
34.07 |
|
|
|
9.61 |
|
|
|
28.99 |
|
|
|
0.69 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average prices computed after cash effect of settlement of
derivative contracts: |
|
|
|
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
80.05 |
|
|
$ |
76.60 |
|
|
$ |
78.50 |
|
|
$ |
84.72 |
|
|
|
Natural gas (per Mcf) |
|
|
2.86 |
|
|
|
3.54 |
|
|
|
3.06 |
|
|
|
4.06 |
|
|
|
Natural gas liquids (per Bbl) |
|
|
7.43 |
|
|
|
25.32 |
|
|
|
9.35 |
|
|
|
33.66 |
|
|
|
Total per Boe |
|
|
64.74 |
|
|
|
66.56 |
|
|
|
65.16 |
|
|
|
75.25 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
cost per Boe: |
|
|
|
|
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
|
|
|
|
Lease operating |
|
$ |
5.91 |
|
|
$ |
8.15 |
|
|
$ |
6.83 |
|
|
$ |
8.47 |
|
|
|
Workover and other |
|
|
2.45 |
|
|
|
0.86 |
|
|
|
1.38 |
|
|
|
1.05 |
|
|
|
Taxes other than income |
|
|
3.08 |
|
|
|
5.50 |
|
|
|
3.22 |
|
|
|
6.92 |
|
|
|
Gathering and other (1) |
|
|
2.21 |
|
|
|
1.96 |
|
|
|
2.00 |
|
|
|
1.72 |
|
|
|
Restructuring |
|
|
0.06 |
|
|
|
- |
|
|
|
0.19 |
|
|
|
0.06 |
|
|
|
General and administrative, as
adjusted (1) |
|
|
4.15 |
|
|
|
4.80 |
|
|
|
4.57 |
|
|
|
5.98 |
|
|
|
Depletion |
|
|
17.03 |
|
|
|
33.66 |
|
|
|
23.37 |
|
|
|
34.09 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents gathering and other and general and administrative costs
per Boe, adjusted for items noted in the reconciliation below: |
|
|
|
|
|
|
|
|
|
|
|
|
General and
administrative: |
|
|
|
|
|
|
|
|
|
|
General and administrative, as
reported |
|
$ |
5.20 |
|
|
$ |
6.23 |
|
|
$ |
5.79 |
|
|
$ |
7.58 |
|
|
|
Share-based compensation: |
|
|
|
|
|
|
|
|
|
|
Non-cash |
|
|
(0.87 |
) |
|
|
(1.15 |
) |
|
|
(0.96 |
) |
|
|
(1.22 |
) |
|
|
Acquisition and merger transaction
costs: |
|
|
|
|
|
|
|
|
|
|
Cash |
|
|
(0.18 |
) |
|
|
(0.28 |
) |
|
|
(0.26 |
) |
|
|
(0.38 |
) |
|
|
General and administrative, as
adjusted |
|
$ |
4.15 |
|
|
$ |
4.80 |
|
|
$ |
4.57 |
|
|
$ |
5.98 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gathering and other, as
reported |
|
$ |
2.57 |
|
|
$ |
2.03 |
|
|
$ |
2.66 |
|
|
$ |
1.74 |
|
|
|
Total adjusting
items |
|
|
(0.36 |
) |
|
|
(0.07 |
) |
|
|
(0.66 |
) |
|
|
(0.02 |
) |
|
|
Gathering and other, as
adjusted |
|
$ |
2.21 |
|
|
$ |
1.96 |
|
|
$ |
2.00 |
|
|
$ |
1.72 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating costs,
as reported |
|
$ |
19.21 |
|
|
$ |
22.77 |
|
|
$ |
19.88 |
|
|
$ |
25.76 |
|
|
|
Total adjusting
items |
|
|
(1.41 |
) |
|
|
(1.50 |
) |
|
|
(1.88 |
) |
|
|
(1.62 |
) |
|
|
Total operating costs,
as adjusted (2) |
|
$ |
17.80 |
|
|
$ |
21.27 |
|
|
$ |
18.00 |
|
|
$ |
24.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) Represents lease operating, workover and other
expense, taxes other than income, gathering and other expense and
general and administrative costs per Boe, adjusted for items noted
in reconciliation above. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
|
SELECTED ITEM REVIEW AND RECONCILIATION
(Unaudited) |
|
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended December 31, |
|
Years Ended December 31, |
|
|
|
|
2015 |
|
|
|
2014 |
|
|
|
2015 |
|
|
|
2014 |
|
|
As
Reported: |
|
|
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, as reported |
|
$ |
(424,712 |
) |
|
$ |
247,345 |
|
|
$ |
(2,006,958 |
) |
|
$ |
282,942 |
|
|
Series A preferred
dividends |
|
|
3,518 |
|
|
|
4,960 |
|
|
|
17,517 |
|
|
|
19,838 |
|
|
Preferred dividends and
accretion on redeemable noncontrolling interest |
|
|
27,751 |
|
|
|
6,457 |
|
|
|
66,820 |
|
|
|
13,176 |
|
|
Net income (loss) |
|
$ |
(393,443 |
) |
|
$ |
258,762 |
|
|
$ |
(1,922,621 |
) |
|
$ |
315,956 |
|
|
|
|
|
|
|
|
|
|
|
|
Impact of
Selected Items: |
|
|
|
|
|
|
|
|
|
Unrealized loss (gain)
on derivatives contracts: |
|
|
|
|
|
|
|
|
|
Crude oil |
|
$ |
33,291 |
|
|
$ |
(464,055 |
) |
|
$ |
123,441 |
|
|
$ |
(499,882 |
) |
|
Natural gas |
|
|
2,019 |
|
|
|
(5,571 |
) |
|
|
5,841 |
|
|
|
(6,644 |
) |
|
Total mark-to-market non-cash
charge |
|
|
35,310 |
|
|
|
(469,626 |
) |
|
|
129,282 |
|
|
|
(506,526 |
) |
|
Full cost ceiling
impairment |
|
|
611,787 |
|
|
|
178,503 |
|
|
|
2,626,305 |
|
|
|
239,668 |
|
|
Other operating
property and equipment impairment |
|
|
- |
|
|
|
31,769 |
|
|
|
- |
|
|
|
35,558 |
|
|
Loss (gain) on
extinguishment of debt |
|
|
(203,897 |
) |
|
|
- |
|
|
|
(761,804 |
) |
|
|
- |
|
|
Loss (gain) on
extinguishment of Convertible Note and modification of February
2012 Warrants |
|
|
- |
|
|
|
- |
|
|
|
8,219 |
|
|
|
- |
|
|
Deferred financing
costs expensed, net(1) |
|
|
128 |
|
|
|
- |
|
|
|
1,331 |
|
|
|
499 |
|
|
Restructuring |
|
|
222 |
|
|
|
- |
|
|
|
2,886 |
|
|
|
987 |
|
|
Rig termination /
stacking charges and other |
|
|
4,915 |
|
|
|
(725 |
) |
|
|
24,998 |
|
|
|
4,052 |
|
|
Selected items, before
income taxes |
|
|
448,465 |
|
|
|
(260,079 |
) |
|
|
2,031,217 |
|
|
|
(225,762 |
) |
|
Income tax effect of
selected items(2) |
|
|
- |
|
|
|
21,926 |
|
|
|
- |
|
|
|
(18,447 |
) |
|
Selected items, net of
tax |
|
$ |
448,465 |
|
|
$ |
(238,153 |
) |
|
$ |
2,031,217 |
|
|
$ |
(244,209 |
) |
|
|
|
|
|
|
|
|
|
|
|
As
Adjusted: |
|
|
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, excluding selected items |
|
$ |
55,022 |
|
|
$ |
20,609 |
|
|
$ |
108,596 |
|
|
$ |
71,747 |
|
|
Net income (loss) from
assumed conversions |
|
|
4,245 |
|
|
|
- |
|
|
|
19,799 |
|
|
|
- |
|
|
Net income (loss)
available to common stockholders after assumed conversions,
excluding selected items(3) |
|
$ |
59,267 |
|
|
$ |
20,609 |
|
|
$ |
128,395 |
|
|
$ |
71,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per common share, as reported |
|
$ |
(3.56 |
) |
|
$ |
2.96 |
|
|
$ |
(18.66 |
) |
|
$ |
3.40 |
|
|
Impact of selected
items |
|
|
4.02 |
|
|
|
(2.71 |
) |
|
|
19.67 |
|
|
|
(2.54 |
) |
|
Basic net income (loss)
per common share, excluding selected items(3) |
|
$ |
0.46 |
|
|
$ |
0.25 |
|
|
$ |
1.01 |
|
|
$ |
0.86 |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per common share, as reported |
|
$ |
(3.56 |
) |
|
$ |
2.38 |
|
|
$ |
(18.66 |
) |
|
$ |
2.93 |
|
|
Impact of selected
items |
|
|
3.97 |
|
|
|
(2.13 |
) |
|
|
19.63 |
|
|
|
(2.08 |
) |
|
Diluted net income
(loss) per common share, excluding selected items(3)(4) |
|
$ |
0.41 |
|
|
$ |
0.25 |
|
|
$ |
0.97 |
|
|
$ |
0.85 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities |
|
$ |
134,805 |
|
|
$ |
86,044 |
|
|
$ |
466,999 |
|
|
$ |
667,934 |
|
|
Changes in working
capital, net of acquisitions |
|
|
(19,213 |
) |
|
|
37,938 |
|
|
|
(37,096 |
) |
|
|
(53,091 |
) |
|
Cash flow from
operations before changes in working capital |
|
|
115,592 |
|
|
|
123,982 |
|
|
|
429,903 |
|
|
|
614,843 |
|
|
Cash components of
selected items |
|
|
11,467 |
|
|
|
1,506 |
|
|
|
66,316 |
|
|
|
6,931 |
|
|
Income tax effect of
selected items(2) |
|
|
- |
|
|
|
(558 |
) |
|
|
- |
|
|
|
(2,567 |
) |
|
Cash flow from
operations before changes in working capital, adjusted for selected
items(4) |
|
$ |
127,059 |
|
|
$ |
124,930 |
|
|
$ |
496,219 |
|
|
$ |
619,207 |
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Represents charges related to the write-off of debt issuance costs
associated with decreases in the Company’s borrowing base under its
senior revolving credit facility. |
|
|
|
(2) For
the 2015 columns, this represents the tax impact using an estimated
tax rate of 0.0% due to the Company maintaining a full valuation
allowance. For the 2014 columns, this represents tax
impact using an estimated tax rate of 37.04%. These columns include
a $(74.4) million (quarter-to-date) and $(102.1) million
(year-to-date) adjustment for the change in valuation
allowance. |
(3) Net
income (loss) and earnings per share excluding selected items and
cash flow from operations before changes in working capital
adjusted for selected items are non-GAAP measures. These
financial measures are presented based on management's belief that
they will 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. These financial
measures are not measures of financial performance under GAAP
and should not be considered as an alternative to net income,
earnings per share and cash flow from operations, as defined by
GAAP. These financial measures may not be comparable to
similarly named non-GAAP financial measures that other companies
may use and may not be useful in comparing the performance of those
companies to Halcón's performance. |
|
(4) The
impact of selected items for the three months ended and year ended
December 31, 2015 was calculated based upon weighted average
diluted shares of 144.8 million and 131.8
million, respectively, due to the net income available to
common stockholders, excluding selected items. |
|
|
|
|
|
|
|
|
|
|
|
Quentin Hicks
SVP, Finance & Investor Relations
(832) 538-0557
Halcon Resources (NYSE:HK)
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