SilverBow Resources, Inc. (NYSE: SBOW) (“SilverBow” or the
“Company”) today announced operating and financial results for the
fourth quarter and full year 2018.
Highlights for the fourth quarter
include:
- Net production averaged approximately
227 million cubic feet of natural gas equivalent per day
(“MMcfe/d”), an 18% increase over third quarter
- Revenues of $88.2 million, up 36% from
third quarter on crude oil and natural gas realizations of 104% and
105% of WTI and Henry Hub, respectively, excluding hedging
- Net Income of $56.8 million
- Adjusted EBITDA (a non-GAAP measure) of
$56.5 million, a 27% increase quarter over quarter
- SilverBow's McMullen Oil area delivers
a 30-day average initial production ("IP") rate of 147 barrels of
oil equivalent per day ("Boe/d") per 1,000' of lateral (94%
liquids) per well from latest two-well pad
Highlights for the full year 2018
include:
- Net production averaged approximately
185 MMcfe/d, a 20% increase year over year
- Lease operating expenses of $0.26/Mcfe
down from $0.39/Mcfe, a 33% decrease from prior year
- Net Income of $74.6 million
- Adjusted EBITDA (a non-GAAP measure) of
$168.4 million, a 38% increase year over year
- Year-end 2018 estimated proved reserves
of 1.3 Tcfe (41% proved developed), up 31% from prior year with a
Standardized Measure of $994 million and a PV-10 (a non-GAAP
measure) of $1.1 billion at SEC pricing
- Maintained reserve life index in excess
of 16 years
2019 Capital Program and
Guidance:
- Full-year capital program of $250-$260
million, a 17% decrease from prior year
- Full year estimated production guidance
of 225-239 MMcfe/d, implying a 25% increase year over year based on
the mid-point, with a 17% increase in gas and 69% increase in
liquids
- Capital program balances investment
between SilverBow's gas and liquids opportunities
- 2019 focus on becoming cash flow
positive while still generating meaningful annual production
growth
Adjusted EBITDA and PV-10 are non-GAAP measures and are
reconciled at the end of this press release.
MANAGEMENT COMMENTS
Sean Woolverton, SilverBow’s Chief Executive Officer, commented,
"2018 proved to be another great year for SilverBow. We pursued a
more active drilling program specifically designed to delineate our
asset base. We completed more wells than originally planned and
selectively moved toward high intensity slickwater fracs resulting
in better well results. Our fourth quarter numbers were bolstered
by successful liquids drilling, furthering the Company's move
toward a more a balanced production mix. By leveraging our
competitive lifting costs and taking advantage of our proximity to
key downstream markets and favorable basis differentials, we
continue to create sustainable value for our shareholders."
Woolverton commented further, “By focusing on repeatable results
and continual per-unit cost reductions, we achieved our goal of
expanding our full year Adjusted EBITDA margin to 65% of oil and
gas sales. Our full year 2018 production increased 20%, and our
lease operating expenses declined 33% on a per unit basis compared
to full year 2017. Our growth profile is further supported by a
deep inventory of high quality drilling locations providing over 15
years of development at a two-rig pace. As of year-end 2018, our
proved reserves were 1.3 Tcfe with a PV-10 of $1.1 billion, an
increase of 31% and 40%, respectively, from 2017. With a strong
balance sheet and ongoing cost initiatives, our 2019 capital
program should allow us to reach cash flow positive in the second
half of 2019 while still generating meaningful annual production
growth."
OPERATIONS HIGHLIGHTS
During the fourth quarter 2018, the Company brought 12 net wells
online. For the full year, the Company drilled 33 net wells and
completed 32 net wells. The number of wells completed is above the
Company's prior guidance of 25-27 net wells. The Company drilled in
all areas of its portfolio during 2018 and more recently has
increased its investment in liquids opportunities.
In the Webb County Gas area, which includes Fasken, the Company
brought 13 net wells online in 2018. The Company focused on
developing its high return Lower Eagle Ford wells and strategically
appraising and delineating its Upper Eagle Ford locations. The
Fasken development demonstrates the Company’s shift to selectively
employing high intensity slickwater fracs across its portfolio. For
the second half of 2018, the Company averaged a completion
intensity of approximately 2,700 pounds of proppant per lateral
foot and 59 barrels of fluid per lateral foot, an increase of 71%
and 161%, respectively, from the first half of the year. The
Company continues to value Fasken's consistent performance, low
operating expense and upside potential.
In the La Salle Condensate area, which includes Artesia, the
Company brought five net wells online in 2018. Due to operational
improvements and service price reductions, the Company realized an
18% reduction in total well cost per foot from a two-well pad that
was brought online in the third quarter and a three-well pad that
was brought online in the fourth quarter. All five wells were
completed similarly and averaged approximately 2,400 pounds of
proppant per foot and 64 barrels of slickwater fluid per foot.
Based on these results, the Company plans to accelerate the
development of the La Salle Condensate area in 2019, which it
believes will increase its oil and natural gas liquids
production.
In the Southern Eagle Ford Gas fairway, which includes Oro
Grande, Uno Mas and south AWP, the Company carried forward its
successful delineation and appraisal across its 60,000 gross acre
position. The Company continues to realize operational efficiencies
with its NMC 6H well costing 30% less and being drilled 35% faster
than the average of its NMC 1H through NMC 5H wells. In addition,
the Company continued to add to its position through leasing and
acreage trades. The Company swapped 2,300 net isolated acres for
4,300 net acres contiguous to its Southern Eagle Ford Gas area. In
total, this acreage trade added 35 gross drilling locations.
Additionally, the acreage the Company traded away was stranded and
would have required a significant amount of midstream capital
investment in order to develop.
In the McMullen Oil area, which includes north AWP and where the
Company had not been active for several years, the team set a
Company record by drilling an 11,400 foot lateral in the fourth
quarter with a second well on this pad also exceeding 11,000 feet.
During 2018, the Company decreased its drilling cost per lateral
foot on a recent three-well pad by 27% compared to a three-well pad
drilled in 2014. These developments have affected both the cost and
the speed of drilling, with the team setting a spud to total depth
Company record of 6.8 days on the SMR 21H, a 31% reduction from the
prior Company record.
In 2018, the Company conducted numerous initiatives to reduce
capital expenditures, including moving to offline production
cementing, using significant amounts of regional sand and the more
widespread utilization of simultaneous-operations. Offline
production cementing, which allows drilling rigs to reduce walking
time in-between wells, saved roughly one-half day per well on
multi-well pads. In 2018, the Company pumped over 200 million
pounds of regional sand, over 30% of the total sand pumped for the
year, and aims to increase this percentage in 2019 due to its
compelling value proposition. The Company's use of
simultaneous-operations, including flowback and drill out
activities, helped decrease the time to bring a well online by two
days on average. These shortened cycle times, combined with
our artificial intelligence guided rate-transient analysis, allow
the Company to turn wells online faster and manage them better
during the critical initial flowback period.
PRODUCTION VOLUMES, OPERATING COSTS, AND REALIZED
PRICES
The Company's total net production for the fourth quarter
averaged approximately 227 MMcfe/d, which was above the midpoint of
guidance. Production mix for the fourth quarter consisted of
approximately 6% crude oil, 84% natural gas, and 10% NGLs.
Lease operating expenses of $0.23/Mcfe were lower than the
$0.34/Mcfe reported in the fourth quarter 2017, a decrease of 33%.
Lease operating expenses for the fourth quarter and full year 2018
were within the Company’s guidance range, primarily driven by
continued cost reduction initiatives.
After deducting $1.7 million of non-cash compensation expense,
cash general and administrative costs of $4.0 million were
significantly lower than the $5.0 million reported in the fourth
quarter 2017. Cash general and administrative costs compared
favorably to guidance due to ongoing efforts to reduce
administrative costs.
Fourth quarter transportation and processing expenses came in at
$0.35/Mcfe, while production and ad valorem taxes were 3.7% of oil
and gas revenue. Production and ad valorem taxes came in below the
low end of the Company's guidance range.
The Company’s average realized natural gas price, excluding the
effect of hedging, was $3.84/Mcf in the fourth quarter compared to
$2.97/Mcf in the third quarter. The average realized crude oil
selling price, excluding the effect of hedging, was $61.19/Bbl in
the fourth quarter, down from $71.68/Bbl in the third quarter. The
average realized NGL selling price in the fourth quarter was
$22.81/Bbl, compared to $30.59/Bbl in the third quarter. The
Company continues to benefit from strong basis pricing in the Eagle
Ford. Crude oil and natural gas realizations in the fourth quarter
were 104% and 105% of WTI and Henry Hub, respectively, excluding
hedging.
YEAR-END 2018 RESERVES
The Company reported year-end estimated proved reserves of 1.35
trillion cubic feet equivalent (Tcfe), an increase of 31% over
year-end 2017. Specific highlights from the Company’s year-end
reserve report include:
- Finding and development costs of
$0.74/Mcfe
- All-sources reserve replacement of
617%
- Standardized Measure of $994
million
- PV-10 value (non-GAAP measure) of $1.1
billion, an increase of 40% over prior year
The table below reconciles 2017 reserves to 2018 reserves:
Total (MMcfe) Proved reserves as
of December 31, 2017 1,024,421 Extensions, discoveries and other
additions 450,354 Revisions of previous estimates (34,443 )
Purchases of minerals in place 427 Sales of minerals in place
(27,867 ) Production (67,530 ) Proved reserves as of December 31,
2018 1,345,362
The Company's total estimated proved reserves at
December 31, 2018, were approximately 6% crude oil, 81%
natural gas, and 13% NGLs, while 41% of its total proved reserves
were developed. All of the Company's proved reserves are located in
Texas. Total capital costs incurred during 2018 were $308.3
million, which included approximately $284.5 million for
development costs, $22.7 million for leasehold acquisition and
prospect costs, and $1.1 million for property acquisitions.
The SEC prices used for reporting the Company's year-end 2018
estimated proved reserves, which have been adjusted for basis and
quality differentials, were $3.04 per Mcf for natural gas, $26.63
per Bbl for natural gas liquids and $66.96 per Bbl for crude oil
compared to $2.95 per Mcf, $20.32 per Bbl, and $50.38 per Bbl in
2017. Using the SEC prices, the pre-tax present value of future net
cash flows discounted at 10% (“PV-10”) of the year-end 2018 proved
reserves was $1.1 billion with a Standardized Measure of $994
million.
FINANCIAL RESULTS
The Company reported total oil and gas revenues of $88.2 million
for the fourth quarter, up 36% over the third quarter. On a GAAP
basis, the Company reported net income of $56.8
million for the fourth quarter, which includes a net gain on
the value of the Company's hedge portfolio of $20.9 million.
The Company reported Adjusted EBITDA of $56.5 million for
the fourth quarter, up 27% over the third quarter. Adjusted EBITDA
is a non-GAAP financial measure. Please see the tables included
with today's news release for a reconciliation of net income to
Adjusted EBITDA.
Capital expenditures incurred during the fourth quarter totaled
approximately $95 million.
2019 CAPITAL PROGRAM
The Company provided its 2019 capital budget range of $250-$260
million, which provides for 26-27 net operated wells drilled
compared to 33 net operated wells in 2018. Approximately 85% of the
2019 capital budget is allocated toward drilling and completion,
driven primarily by 18-19 net wells in the La Salle Condensate
area, two net wells in the McMullen Oil area, five net wells in the
Southern Eagle Ford gas fairway and one net well in the Webb County
gas area.
For 2019, the Company will be moving to a one-rig program in the
second quarter. It will be retaining its super-spec rig which has
walking capabilities. The Company will be utilizing this rig
primarily on development drilling, but will continue drilling some
delineation and appraisal wells in support of the Company's
strategic goal of moving into development mode for all of its
areas. The Company is already seeing pricing across drilling and
completions services reminiscent of 2015 and is selectively locking
in long-term contracts with limited to no commitment of activity
levels for volume of sales.
2019 GUIDANCE
For the first quarter, the Company is guiding for estimated
production of 210-217 MMcfe/d. For the full year, the Company is
guiding for estimated production of 225-239 MMcfe/d, implying a 25%
increase year over year based on the mid-point of the guidance
range. Additional detail concerning the Company's first quarter and
full year 2019 financial and operational guidance can be found in
the table included with today’s news release and the Corporate
Presentation uploaded to the Investor Relations section of the
Company’s website.
HEDGING UPDATE
Hedging continues to be an important element of SilverBow’s
strategy. The Company maintains an active hedging program to
provide predictable cash flows while still allowing for flexibility
in capturing price increases. As of December 31, 2018, the
Company had approximately 65% of total estimated production volumes
hedged for full year 2019, using the mid-point of production
guidance. The Company continues to layer on additional hedges when
prices are favorable, including both oil and gas basis. Please see
the Company's Form 10-K filing, which the Company expects to file
on Thursday, February 28, 2019, for a detailed summary of
derivative contracts.
CAPITAL STRUCTURE AND LIQUIDITY
The Company's liquidity as of December 31, 2018, was
$217.5 million, primarily consisting of $2.5 million of cash and
$215.0 million of availability under the Company’s credit facility.
The Company believes it has sufficient liquidity to meet its
obligations for at least the next twelve months and execute its
long-term development plans. As of January 31, 2019, the
Company had 11.7 million total common shares outstanding.
CONFERENCE CALL & UPDATED INVESTOR PRESENTATION
The Company will host a conference call for investors
on Thursday, February 28, 2019, at 8:00 a.m. Central
Time (9:00 a.m. Eastern Time). Interested investors can listen
to the call by dialing 1-877-420-2751 (U.S.) or 1-442-275-1680
(International) and requesting "Fourth Quarter and Full Year 2018
Earnings Conference Call" or by visiting the SilverBow website.
A simultaneous webcast of the call may be accessed over the
internet by visiting our website at www.sbow.com, clicking on
“Investor Relations” and “Events and Presentations” and then
clicking on the “Fourth Quarter and Full Year 2018 Earnings
Conference Call” link. The webcast will be archived for replay on
the SilverBow website for 14 days. Additionally, an updated
Corporate Presentation will be uploaded to the Investor Relations
section of the Company's website before the conference call.
ABOUT SILVERBOW RESOURCES, INC.
SilverBow Resources, Inc. (NYSE: SBOW) is a Houston-based energy
company actively engaged in the exploration, development, and
production of oil and gas in the Eagle Ford Shale in South Texas.
With almost 30 years of history operating in South Texas, the
Company possesses a significant understanding of regional
reservoirs which we leverage to assemble high-quality drilling
inventory while continuously enhancing our operations to maximize
returns on capital invested.
For more information, please visit www.sbow.com.
FORWARD-LOOKING STATEMENTS
This release includes “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.
These forward-looking statements represent management's
expectations or beliefs concerning future events, and it is
possible that the results described in this release will not be
achieved. These forward-looking statements are subject to a number
of risks and uncertainties, many of which are beyond our control,
which could cause actual results to differ materially from the
results discussed in the forward-looking statements, including
among other things: oil and natural gas price levels and
volatility, our ability to satisfy our short- or long-term
liquidity needs; our ability to execute our business strategy,
including the success of our drilling and development efforts;
timing, cost and amount of future production of oil and natural
gas; and other factors discussed in the Company’s reports filed
with the SEC, including its Annual Report on Form 10-K for the year
ended December 31, 2018. All statements, other than statements of
historical fact included in this press release, regarding our
strategy, future operations, financial position, future cash flows,
estimated production levels, expected oil and natural gas pricing,
estimated oil and natural gas reserves or the present value
thereof, reserve increases, capital expenditures, budget, projected
costs, prospects, plans and objectives of management are
forward-looking statements.
All forward-looking statements speak only as of the date this
news release. You should not place undue reliance on these
forward-looking statements. Although we believe that our plans,
intentions and expectations reflected in or suggested by the
forward-looking statements we make in this release are reasonable,
we can give no assurance that these plans, intentions or
expectations will be achieved. The risk factors and other factors
noted herein and in the Company's SEC filings could cause its
actual results to differ materially from those contained in any
forward-looking statement. These cautionary statements qualify all
forward-looking statements attributable to us or persons acting on
our behalf.
All subsequent written and oral forward-looking statements
attributable to us or to persons acting on our behalf are expressly
qualified in their entirety by the foregoing. We undertake no
obligation to publicly release the results of any revisions to any
such forward-looking statements that may be made to reflect events
or circumstances after the date of this release or to reflect the
occurrence of unanticipated events. New factors emerge from time to
time, and it is not possible for us to predict all such
factors.
(Financial Highlights to Follow)
Consolidated Balance Sheets
SilverBow Resources, Inc. and Subsidiaries
(in thousands, except share amounts)
December 31, 2018 December 31, 2017
ASSETS Current Assets: Cash and cash equivalents $ 2,465 $
7,806 Accounts receivable, net 46,472 27,263 Fair value of
commodity derivatives 15,261 5,148 Other current assets 2,126
2,352 Total Current Assets 66,324 42,569
Property and Equipment: Property and Equipment, Full Cost
Method, including $56,715 and $50,377 of unproved property costs
not being amortized 986,100 712,166 Less – Accumulated
depreciation, depletion, amortization and impairment (284,804 )
(216,769 ) Property and Equipment, Net 701,296 495,397 Fair Value
of long-term commodity derivatives 4,333 2,553 Other Long-Term
Assets 5,567 10,751 Total Assets $ 777,520 $
551,270
LIABILITIES AND STOCKHOLDERS’ EQUITY Current
Liabilities: Accounts payable and accrued liabilities $ 48,921 $
44,437 Fair value of commodity derivatives 2,824 5,075 Accrued
capital costs 38,073 10,883 Accrued interest 1,513 2,106
Undistributed oil and gas revenues 14,681 12,996
Total Current Liabilities 106,012 75,497
Long-term debt 387,988 265,325 Deferred tax liabilities, net 1,014
— Asset retirement obligations 3,956 8,678 Fair value of long-term
commodity derivatives 3,723 2,758 Other long-term liabilities —
5,554 Commitments and Contingencies Stockholders' Equity: Preferred
stock, $.01 par value, 10,000,000 shares authorized, none issued —
— Common stock, $.01 par value, 40,000,000 shares authorized,
11,757,972 and 11,621,385 shares issued and 11,692,101 and
11,570,621 shares outstanding 118 116 Additional paid-in capital
286,281 279,111 Treasury stock held, at cost, 65,871 and 50,764
shares (1,870 ) (1,452 ) Retained earnings (Accumulated deficit)
(9,702 ) (84,317 ) Total Stockholders’ Equity 274,827
193,458 Total Liabilities and Stockholders’ Equity $ 777,520
$ 551,270 See accompanying Notes to Consolidated
Financial Statements.
Consolidated Statements of
Operations
SilverBow Resources, Inc. and Subsidiaries
(in thousands, except per-share amounts)
Year EndedDecember 31,
2018
Year EndedDecember 31,
2017
Revenues: Oil and gas sales $ 257,286 $ 195,910 Operating
Expenses: General and administrative, net 22,570 30,000
Depreciation, depletion, and amortization 68,035 46,933 Accretion
of asset retirement obligations 419 2,322 Lease operating expense
17,643 21,908 Transportation and gas processing 23,848 19,360
Severance and other taxes 11,394 8,205 Total
Operating Expenses 143,909 128,728 Operating
Income (Loss) 113,377 67,182 Non-Operating Income (Expense)
Net gain (loss) on commodity derivatives (9,777 ) 17,913 Interest
expense, net (27,666 ) (15,070 ) Other income (expense), net (391 )
(8 ) Income (Loss) Before Income Taxes 75,543 70,017
Provision (Benefit) for Income Taxes 928 (1,954 ) Net
Income (Loss) $ 74,615 $ 71,971 Per Share
Amounts: Basic: Net Income (Loss) $ 6.40 $ 6.28
Diluted: Net Income (Loss) $ 6.34 $ 6.25 Weighted Average
Shares Outstanding - Basic 11,655 11,453 Weighted Average
Shares Outstanding - Diluted 11,764 11,514
Consolidated Statements of Operations
(Unaudited)
SilverBow Resources, Inc. and Subsidiaries
(in thousands, except per-share amounts)
Three MonthsEnded December
31,2018
Three MonthsEnded December
31,2017
Revenues: Oil and gas sales $ 88,152 $ 58,694 Operating
Expenses: General and administrative, net 5,714 7,324 Depreciation,
depletion, and amortization 23,041 14,558 Accretion of asset
retirement obligations 88 600 Lease operating expense 4,715 5,528
Transportation and gas processing 7,263 5,293 Severance and other
taxes 3,238 1,828 Total Operating Expenses 44,059
35,131 Operating Income (Loss) 44,093 23,563
Non-Operating Income (Expense) Net gain (loss) on commodity
derivatives 20,930 3,448 Interest expense, net (7,979 ) (3,953 )
Other income (expense), net 86 125 Income
(Loss) Before Income Taxes 57,130 23,183 Provision (Benefit)
for Income Taxes 379 (1,954 ) Net Income (Loss) $
56,751 $ 25,137 Per Share Amounts:
Basic: Net Income (Loss) $ 4.85 $ 2.17 Diluted: Net Income
(Loss) $ 4.82 $ 2.17 Weighted Average Shares Outstanding -
Basic 11,692 11,561 Weighted Average Shares Outstanding -
Diluted 11,783 11,602
Consolidated Statements of Cash
Flows
SilverBow Resources, Inc. and Subsidiaries
(in thousands)
Year EndedDecember
31,2018
Year EndedDecember
31,2017
Cash Flows from Operating Activities: Net income (loss) $ 74,615 $
71,971 Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities- Depreciation,
depletion, and amortization 68,035 46,933 Accretion of asset
retirement obligations 419 2,322 Deferred income tax benefit 1,014
— Share-based compensation expense 5,980 6,849 (Gain) Loss on
derivatives, net 9,777 (17,913 ) Cash settlements (paid) received
on derivatives (19,677 ) (1,411 ) Settlements of asset retirement
obligations (187 ) (2,335 ) Write-down of debt issuance cost —
2,676 Other 5,293 (559 ) Change in operating assets and
liabilities- (Increase) decrease in accounts receivable and other
assets (20,470 ) (7,169 ) Increase (decrease) in income taxes
payable 53 — Increase (decrease) in accrued interest (593 ) 385
Net Cash Provided by (Used in) Operating Activities 121,573
107,838 Cash Flows from Investing Activities: Additions to property
and equipment (266,532 ) (192,982 ) Acquisition of producing
properties (1,002 ) (9,426 ) Proceeds from the sale of property and
equipment 27,673 702 Payments on property sale obligations (8,740 )
— Transfer of company funds in restricted cash (222 ) 26 Net
Cash Provided by (Used in) Investing Activities (248,823 ) (201,680
) Cash Flows from Financing Activities: Proceeds from long-term
debt issuances — 198,000 Proceeds from bank borrowings 306,800
404,700 Payments of bank borrowings (184,800 ) (529,700 ) Net
proceeds from issuances of common stock 709 39,179 Purchase of
treasury shares (418 ) (777 ) Payments of debt issuance costs (602
) (10,031 ) Net Cash Provided by (Used in) Financing Activities
121,689 101,371 Net Increase (Decrease) in Cash and Cash
Equivalents and Restricted Cash (5,561 ) 7,529 Cash, Cash
Equivalents and Restricted Cash at Beginning of Year 8,026
497 Cash, Cash Equivalents and Restricted Cash at End of
Year $ 2,465 $ 8,026 Supplemental Disclosures
of Cash Flows Information: Cash paid during period for interest,
net of amounts capitalized $ 24,794 $ 10,428 Changes in capital
accounts payable and capital accruals $ 45,349 $ 9,894 Changes in
other long-term liabilities for capital expenditures $ (5,000 ) $
5,000
SilverBow Resources, Inc.
Non-GAAP Financial Measures
Reconciliation of Net Income (GAAP) to
Adjusted EBITDA (Non-GAAP)
(In thousands)
(Unaudited)
We present adjusted EBITDA attributable to common stockholders
(“Adjusted EBITDA”) in addition to our reported net income (loss)
in accordance with U.S. GAAP. Adjusted EBITDA is a non-GAAP
financial measure that is used as a supplemental financial measure
by our management and by external users of our financial
statements, such as investors, commercial banks and others, to
assess our operating performance as compared to that of other
companies in our industry, without regard to financing methods,
capital structure or historical costs basis. It is also used to
assess our ability to incur and service debt and fund capital
expenditures. When we refer to the term Adjusted EBITDA margin, we
mean Adjusted EBITDA divided by Oil and Gas Sales.
Our Adjusted EBITDA should not be considered an alternative to
net income (loss), operating income (loss), cash flows provided by
(used in) operating activities or any other measure of financial
performance or liquidity presented in accordance with U.S. GAAP.
Our Adjusted EBITDA may not be comparable to similarly titled
measures of another company because all companies may not calculate
Adjusted EBITDA in the same manner.
Year Ended December 31,
2018
Year Ended December 31,
2017
Net Income (Loss) $ 74,615 $ 71,971 Plus: Depreciation,
depletion and amortization 68,035 46,933 Accretion of asset
retirement obligations 419 2,322 Interest expense 27,666 15,070
Derivative (gain)/loss 9,777 (17,913 ) Derivative cash settlements
collected/(paid) (1) (19,060 ) (1,545 ) Income tax
expense/(benefit) 928 (1,954 ) Share-based compensation expense
5,980 6,849
Adjusted EBITDA $ 168,360 $
121,733 (1) This includes accruals for settled
contracts covering commodity deliveries during the period where the
actual cash settlements occur outside of the period.
Three Months Ended December 31,
2018
Three Months Ended December 31,
2017
Net Income (Loss) $ 56,751 $ 25,137 Plus: Depreciation,
depletion and amortization 23,041 14,558 Accretion of asset
retirement obligations 88 600 Interest expense 7,979 3,953
Derivative (gain)/loss (20,930 ) (3,448 ) Derivative cash
settlements collected/(paid) (1) (12,523 ) 807 Income tax
expense/(benefit) 379 (1,954 ) Share-based compensation expense
1,739 2,311
Adjusted EBITDA $ 56,524 $
41,964 (1) This includes accruals for settled
contracts covering commodity deliveries during the period where the
actual cash settlements occur outside of the period.
Standardized Measure of Discounted Future Net Cash
Flows
The following table provides a reconciliation between the
Standardized Measure (the most directly comparable financial
measure calculated in accordance with U.S. GAAP) and PV-10 Value of
the Company's proved reserves:
As of December 31, (in
millions)
2018 2017
2016 PV-10 Value $ 1,128
$ 805 $ 442 Less:
Future income taxes (discounted at 10%) 134 73
35
Standardized Measure of Discounted Future Net
Cash Flows $ 994 $ 732
$ 407
Production Volumes & Pricing
(Unaudited)
SilverBow Resources, Inc. and
Subsidiaries
Year Ended December 31,
2018
Year Ended December 31,
2017
Production volumes: Oil (MBbl) (1) 688 685 Natural gas (MMcf)
56,665 45,751 Natural gas liquids (MBbl) (1) 1,123
1,046 Total (MMcfe) 67,530
56,135 Oil, Natural gas and Natural gas liquids
sales: Oil $ 45,375 $ 34,903 Natural gas 183,272 138,404 Natural
gas liquids 28,639 22,602 Total $
257,286 $ 195,910 Average realized price: Oil
(per Bbl) $ 65.93 $ 50.98 Natural gas (per Mcf) 3.23 3.03 Natural
gas liquids (per Bbl) 25.51 21.61
Average per Mcfe $ 3.81 $ 3.49 (1) Oil and
NGLs are converted at the rate of one barrel of oil equivalent to
six Mcfe
Three Months Ended December 31,
2018
Three Months Ended December 31,
2017
Production volumes: Oil (MBbl) (1) 215 229 Natural gas (MMcf)
17,584 12,847 Natural gas liquids (MBbl) (1) 330
347 Total (MMcfe) 20,855
16,302 Oil, Natural gas and Natural gas liquids sales: Oil $
13,173 $ 13,180 Natural gas 67,455 37,055 Natural gas liquids
7,526 8,459 Total $ 88,154
$ 58,694 Average realized price: Oil (per Bbl) $
61.19 $ 57.64 Natural gas (per Mcf) 3.84 2.88 Natural gas liquids
(per Bbl) 22.81 24.37 Average per Mcfe
$ 4.23 $ 3.60 (1) Oil and NGLs are converted
at the rate of one barrel of oil equivalent to six Mcfe
Finding and Development (“F&D”)
Cost Calculation:
(Unaudited)
F&D costs are commonly used to assist in the evaluation of
how much it costs the Company, on a per Mcfe basis, to add proved
reserves. We present F&D costs in addition to and used in
conjunction with our financial statements prepared in accordance
with U.S. GAAP. Due to various factors, including but not limited
to timing differences, F&D costs do not necessarily reflect
precisely the costs associated with particular reserves. Further,
our F&D costs may not be comparable to similarly titled
measures of another company because all companies may not calculate
F&D costs in the same manner.
F&D All-In costs are calculated by dividing the total
acquisition, exploration, and development costs for the year by
extensions, discoveries, and other additions, purchases of minerals
in place, and total revisions for the year.
Reserve replacement ratio is calculated by dividing the sum of
extensions, discoveries, and other additions, purchases of minerals
in place, and total revisions for the year by production.
F&D Cost Reconciliation (in thousands)
Year Ended December 31,
2018
Lease acquisitions and prospect costs $ 22,681 Exploration —
Development 284,525 Acquisition of property 1,096 Total
acquisition, exploration and development $ 308,302
(in MMcfe) Proved reserves as of December 31, 2017 1,024,421
Extensions, discoveries, and other additions (1) 450,354 Revisions
of previous estimates (34,443 ) Purchases of minerals in place 427
Sales of minerals in place (27,867 ) Production (67,530 )
Proved reserves as of December 31, 2018 1,345,362
F&D Costs ($/Mcfe) $ 0.74 Reserve replacement ratio 617
%
(1) The additions in 2018 were primarily
due to additions from drilling results and leasing of adjacent
acreage.
First Quarter 2019 & Full Year 2019
Guidance
Guidance 1Q 2019
FY 2019 Production Volumes:
Oil (Bbls/d) 2,650 - 2,750 3,500 - 3,800
Natural Gas (MMcf/d) 173 - 179 176 - 187 NGLs (Bbls/d)
3,450 - 3,550 4,600 - 4,900
Total Reported Production (MMcfe/d) 210 - 217
225 - 239
Product Pricing :
Crude Oil NYMEX Differential ($/Bbl) $1.50 - $2.50 N/A Natural Gas
NYMEX Differential ($/Mcf) $0.05 - $0.10 N/A Natural Gas Liquids (%
of WTI) 35% - 37% N/A
Operating Costs & Expenses
: Lease Operating Expenses ($/Mcfe) $0.29 - $0.30 $0.30 - $0.33
Transportation & Processing ($/Mcfe) $0.35 - $0.36 $0.32 -
$0.34 Production Taxes (% of Revenue) 5.5% - 6.5% 5.5% - 6.5% Cash
G&A, net ($MM) $5.2 - $5.7 $20.0 - $23.0 DD&A Expense
($/Mcfe) $1.10 - $1.15 $1.10 - $1.25 Cash Interest Expense ($MM)
$7.5 - $8.5 N/A
View source
version on businesswire.com: https://www.businesswire.com/news/home/20190227005865/en/
Jeff MagidsSenior Manager, Finance & Investor Relations(281)
874-2700, (800) 777-2412
SilverBow Resources (NYSE:SBOW)
Historical Stock Chart
From Mar 2024 to Apr 2024
SilverBow Resources (NYSE:SBOW)
Historical Stock Chart
From Apr 2023 to Apr 2024