Oasis Petroleum Inc. Announces Quarter Ended June 30, 2017 Earnings
HOUSTON, Aug. 2, 2017 /PRNewswire/ -- Oasis Petroleum Inc. (NYSE: OAS) ("Oasis" or the "Company") today announced financial results for the quarter ended June 30, 2017 and provided an operational update.
Highlights include:
-- Completed and placed on production 15 gross (10.8 net) operated wells in
the Williston Basin in the second quarter of 2017, 60% of which were
completed in June.
-- Produced over 66,000 barrels of oil equivalent per day ("Boepd") in July
2017, up from 61,943 Boepd produced in the second quarter of 2017.
-- Expect to complete 48 gross operated wells and produce between 67,500
and 69,500 Boepd in the second half of 2017 and continue to expect to
hit exit rate of 72,000 Boepd.
"Oasis is well positioned to execute our plan for the second half of 2017, as we integrate our second internal frac spread and efficiently increase completion activity," said Taylor L. Reid, Oasis' Director, President, and Chief Operating Officer. "Our completion design innovation across our core acreage position, including Wild Basin, Indian Hills, and Alger, continues to deliver uplifts in production, and our wells remain highly economic in the current commodity price environment."
"The next six months represent the heart of our 2017 program and will lay the groundwork for everything to come in 2018 and beyond," added Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer. "The quality of the asset base we have built and the strength of the team we have assembled to develop it give me great conviction around the future success of Oasis. We are confident in our ability to execute and to manage our business prudently in what continues to be a constantly changing market."
Operational and Financial Update
Select operational and financial statistics are in the following table:
Quarter Ended:
6/30/2017 3/31/2017 6/30/2016
--------- --------- ---------
Production data:
Oil (Bopd) 47,795 49,281 41,176
Natural gas (Mcfpd) 84,890 83,470 49,983
Total production (Boepd) 61,943 63,192 49,507
Percent Oil 77% 78% 83%
Average sales prices:
Oil, without derivative
settlements (per Bbl) $44.61 $47.03 $40.81
Differential to NYMEX West
Texas Intermediate crude oil
index prices ("WTI") (per
Bbl) 3.68 4.88 4.85
Natural gas (per Mcf)(1) 3.19 3.81 1.42
Revenues ($ in millions):
Oil $194.0 $208.6 $152.9
Natural gas 24.6 28.7 6.4
Bulk oil sales 8.1 27.6 -
Midstream services ("OMS") 15.6 14.6 6.9
Well services ("OWS") 11.8 5.6 12.8
---- --- ----
Total revenues $254.1 $285.1 $179.0
====== ====== ======
OMS and OWS operating expenses
($ in millions):
OMS $3.3 $3.3 $1.7
OWS 8.1 3.9 7.1
Select operating expenses:
LOE ($ per Boe) $7.92 $7.71 $7.00
MT&G ($ per Boe)(2) 2.17 1.77 1.55
DD&A ($ per Boe) 22.23 22.27 27.19
Exploration and production
("E&P") general and
administrative expenses
("G&A") ($ per Boe) 3.52 3.54 3.93
Production taxes (% of oil and
gas revenues) 8.7% 8.6% 9.0%
(1) Natural gas
prices include
the value for
natural gas and
natural gas
liquids.
(2) Excludes non-
cash valuation
charges on
pipeline
imbalances.
Second quarter production was adversely impacted by additional workover activity and a completion schedule weighted towards the end of the quarter. Oasis invested incremental dollars on workovers during the latter part of the quarter, which coupled with late quarter completions, drove July production to over 66,000 Boepd.
G&A totaled $23.5 million in the second quarter of 2017, $21.9 million in the second quarter of 2016 and $23.8 million in the first quarter of 2017. Amortization of stock-based compensation, which is included in G&A, was $7.1 million, or $1.26 per Boe, in the second quarter of 2017 as compared to $6.2 million, or $1.39 per Boe, in the second quarter of 2016 and $6.7 million, or $1.18 per Boe, in the first quarter of 2017. G&A for the Company's E&P segment totaled $19.8 million in the second quarter of 2017, $17.7 million in the second quarter of 2016 and $20.1 million in the first quarter of 2017.
Interest expense was $36.8 million for the second quarter of 2017 compared to $35.0 million for the second quarter of 2016 and $36.3 million for the first quarter of 2017. Capitalized interest totaled $2.8 million for the second quarter of 2017, $4.8 million for the second quarter of 2016 and $2.8 million for the first quarter of 2017. Cash Interest totaled $35.5 million for the second quarter of 2017, $37.8 million for the second quarter of 2016 and $35.1 million for the first quarter of 2017. For a definition of Cash Interest and a reconciliation of interest expense to Cash Interest, see "Non-GAAP Financial Measures" below.
For the three months ended June 30, 2017, the Company recorded an income tax expense of $2.3 million, resulting in a 12.4% effective tax rate as a percentage of its pre-tax income for the quarter. The Company recorded an income tax expense of $16.0 million, resulting in a 40.2% effective tax rate as a percentage of its pre-tax income for the three months ended March 31, 2017.
For the second quarter of 2017, the Company reported net income of $16.6 million, or $0.07 per diluted share, as compared to a net loss of $89.9 million, or $0.51 per diluted share, for the second quarter of 2016. Excluding certain non-cash items and their tax effect, Adjusted Net Loss (non-GAAP) was $11.2 million, or $0.05 per diluted share, in the second quarter of 2017, compared to Adjusted Net Loss of $19.4 million, or $0.11 per diluted share, in the second quarter of 2016. For a definition of Adjusted Net Income (Loss) and a reconciliation of net income (loss) to Adjusted Net Income (Loss), see "Non-GAAP Financial Measures" below. Adjusted EBITDA for the second quarter of 2017 was $141.3 million, compared to Adjusted EBITDA of $132.2 million for the second quarter of 2016. For a definition of Adjusted EBITDA and a reconciliation of net income (loss) and net cash provided by (used in) operating activities to Adjusted EBITDA, see "Non-GAAP Financial Measures" below.
Capital Expenditures
The following table depicts the Company's total CapEx by category:
1Q 2017 2Q 2017 YTD 2017
------- ------- --------
CapEx ($ in thousands):
E&P $90,780 $100,822 $191,602
OMS 13,144 53,777 66,921
OWS - 268 268
Other(1) 5,871 18,108 23,979
----- ------ ------
Total CapEx(2) $109,795 $172,975 $282,770
======== ======== ========
(1) Other CapEx
includes asset
acquisitions,
primarily
related to
midstream
assets, of $17.2
million for the
six months ended
June 30, 2017
and other items,
such as
administrative
capital and
capitalized
interest.
(2) CapEx reflected
in the table
above differs
from the amounts
shown in the
statement of
cash flows in
the Company's
condensed
consolidated
financial
statements
because amounts
reflected in the
table above
include changes
in accrued
liabilities from
the previous
reporting period
for capital
expenditures,
while the
amounts
presented in the
statement of
cash flows are
presented on a
cash basis.
Hedging Activity
As of August 1, 2017, the Company had the following outstanding commodity derivative contracts, which settle monthly and are priced off of WTI for crude oil and NYMEX Henry Hub for natural gas:
Crude
oil
(Volume
in
Mbopd) 1H17 2H17 1H18 2H18
---- ---- ---- ----
Swaps
Volume 19.3 22.7 22.0 20.0
Price $49.20 $49.90 $51.17 $51.11
Collars
Volume 8.0 8.0 1.0 1.0
Floor $46.25 $46.25 $50.00 $50.00
Ceiling $54.37 $54.37 $55.70 $55.70
3-way
Volume 6.0 6.0 - -
Sub-
Floor $31.67 $31.67 - -
Floor $45.83 $45.83 - -
Ceiling $59.94 $59.94 - -
Total
Crude
Oil
Volume 33.3 36.7 23.0 21.0
---- ---- ---- ----
Natural
Gas
(Volume
in
MMBtupd)
Swaps
Volume 16.5 20.0 15.0 15.0
Price $3.31 $3.32 $3.04 $3.04
The June 2017 crude oil derivative contracts settled at a net $3.3 million received in July 2017 and will be included in the Company's third quarter 2017 derivative settlements.
Conference Call Information
Investors, analysts and other interested parties are invited to listen to the conference call:
Date: Thursday, August 3, 2017
Time: 10:00 a.m. Central Time
Dial-in: 888-317-6003
Intl. Dial in: 412-317-6061
Conference ID: 3753112
Website: www.oasispetroleum.com
----------------------
A recording of the conference call will be available beginning at 12:00 p.m. Central Time on the day of the call and will be available until Thursday, August 10, 2017 by dialing:
Replay dial-in: 877-344-7529
Intl. replay: 412-317-0088
Replay code: 10110100
The conference call will also be available for replay for approximately 30 days at www.oasispetroleum.com.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including the Company's drilling program, production, derivative instruments, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Company based on management's experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, changes in oil and natural gas prices, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Company's ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Company's business and other important factors that could cause actual results to differ materially from those projected as described in the Company's reports filed with the SEC.
Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.
About Oasis Petroleum Inc.
Oasis is an independent exploration and production company focused on the acquisition and development of unconventional oil and natural gas resources, primarily operating in the Williston Basin. For more information, please visit the Company's website at www.oasispetroleum.com.
Oasis Petroleum Inc.
Condensed Consolidated Balance Sheet
(Unaudited)
June 30, 2017 December 31, 2016
------------- -----------------
(In thousands, except share data)
ASSETS
Current assets
Cash and cash equivalents $11,440 $11,226
Accounts receivable, net 218,302 204,335
Inventory 17,942 10,648
Prepaid expenses 10,610 7,623
Derivative instruments 31,851 362
Other current assets 62 4,355
Total current assets 290,207 238,549
------- -------
Property, plant and equipment
Oil and gas properties (successful
efforts method) 7,488,075 7,296,568
Other property and equipment 695,592 618,790
Less: accumulated depreciation,
depletion, amortization and
impairment (2,252,653) (1,995,791)
Total property, plant and equipment,
net 5,931,014 5,919,567
--------- ---------
Derivative instruments 11,834 -
Long-term inventory 8,762 -
Other assets 19,904 20,516
Total assets $6,261,721 $6,178,632
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $12,257 $4,645
Revenues and production taxes payable 143,715 139,737
Accrued liabilities 139,766 119,173
Accrued interest payable 39,128 39,004
Derivative instruments - 60,469
Advances from joint interest partners 5,816 7,597
Other current liabilities - 10,490
--- ------
Total current liabilities 340,682 381,115
------- -------
Long-term debt 2,359,683 2,297,214
Deferred income taxes 527,181 513,529
Asset retirement obligations 51,059 48,985
Derivative instruments - 11,714
Other liabilities 5,506 2,918
----- -----
Total liabilities 3,284,111 3,255,475
--------- ---------
Commitments and contingencies
Stockholders' equity
Common stock, $0.01 par value:
450,000,000 shares authorized;
238,642,598 shares issued and
237,410,395 shares outstanding at
June 30, 2017 and 237,201,064 shares
issued and 236,344,172 shares
outstanding at December 31, 2016 2,345 2,331
Treasury stock, at cost: 1,232,203
and 856,892 shares at June 30, 2017
and December 31, 2016, respectively (21,401) (15,950)
Additional paid-in capital 2,362,084 2,345,271
Retained earnings 634,582 591,505
------- -------
Total stockholders' equity 2,977,610 2,923,157
--------- ---------
Total liabilities and stockholders'
equity $6,261,721 $6,178,632
========== ==========
Oasis Petroleum Inc.
Condensed Consolidated Statement of Operations
(Unaudited)
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands, except per share data)
Revenues
Oil and gas revenues $218,633 $159,337 $455,885 $276,652
Bulk oil sales 8,091 - 35,722 -
Midstream revenues 15,566 6,910 30,172 13,893
Well services revenues 11,801 12,833 17,428 18,818
Total revenues 254,091 179,080 539,207 309,363
------- ------- ------- -------
Operating expenses
Lease operating expenses 44,665 31,523 88,537 62,587
Midstream operating expenses 3,263 1,740 6,590 3,478
Well services operating
expenses 8,088 7,135 11,990 9,786
Marketing, transportation
and gathering expenses 12,039 6,491 22,990 15,043
Bulk oil purchases 7,980 - 35,982 -
Production taxes 18,971 14,367 39,270 25,120
Depreciation, depletion and
amortization 125,291 122,488 251,957 244,937
Exploration expenses 1,667 340 3,156 703
Impairment 3,200 23 5,882 3,585
General and administrative
expenses 23,548 21,876 47,382 46,242
------ ------ ------ ------
Total operating expenses 248,712 205,983 513,736 411,481
------- ------- ------- -------
Loss on sale of properties - (1,311) - (1,311)
--- ------ --- ------
Operating income (loss) 5,379 (28,214) 25,471 (103,429)
----- ------- ------ --------
Other income (expense)
Net gain (loss) on
derivative instruments 50,532 (90,846) 106,607 (76,471)
Interest expense, net of
capitalized interest (36,838) (34,979) (73,159) (73,718)
Gain on extinguishment of
debt - 11,642 - 18,658
Other income (expense) (166) (32) (150) 447
---- --- ---- ---
Total other income (expense) 13,528 (114,215) 33,298 (131,084)
------ -------- ------ --------
Income (loss) before income
taxes 18,907 (142,429) 58,769 (234,513)
Income tax benefit (expense) (2,339) 52,498 (18,376) 80,127
------ ------ ------- ------
Net income (loss) $16,568 $(89,931) $40,393 $(154,386)
======= ======== ======= =========
Earnings (loss) per share:
Basic $0.07 $(0.51) $0.17 $(0.91)
Diluted 0.07 (0.51) 0.17 (0.91)
Weighted average shares outstanding:
Basic 233,283 176,984 233,176 169,953
Diluted 234,917 176,984 236,281 169,953
Oasis Petroleum Inc.
Selected Financial and Operational Statistics
(Unaudited)
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
Operating results (in thousands):
Revenues
Oil $194,005 $152,900 $402,599 $264,106
Natural gas 24,628 6,437 53,286 12,546
Bulk oil sales 8,091 - 35,722 -
Midstream 15,566 6,910 30,172 13,893
Well services 11,801 12,833 17,428 18,818
------ ------ ------ ------
Total revenues $254,091 $179,080 $539,207 $309,363
-------- -------- -------- --------
Production data:
Oil (MBbls) 4,349 3,747 8,785 7,617
Natural gas (MMcf) 7,725 4,549 15,237 8,802
Oil equivalents (MBoe) 5,637 4,505 11,324 9,084
Average daily production (Boe
per day) 61,943 49,507 62,564 49,911
Average sales prices:
Oil, without derivative
settlements (per Bbl) $44.61 $40.81 $45.83 $34.67
Oil, with derivative
settlements (per Bbl)(1) 42.56 48.94 40.72 48.30
Natural gas (per Mcf)(2) 3.19 1.42 3.50 1.43
Costs and expenses (per Boe of production):
Lease operating expenses $7.92 $7.00 $7.82 $6.89
Marketing, transportation and
gathering expenses(3) 2.17 1.55 1.97 1.58
Production taxes 3.37 3.19 3.47 2.77
Depreciation, depletion and
amortization 22.23 27.19 22.25 26.96
General and administrative
expenses ("G&A") 4.18 4.86 4.18 5.09
Exploration and production
G&A 3.52 3.93 3.53 4.27
(1) Realized prices
include gains or
losses on cash
settlements for
commodity
derivatives, which
do not qualify for
or were not
designated as
hedging instruments
for accounting
purposes. Cash
settlements
represent the
cumulative gains and
losses on the
Company's derivative
instruments for the
periods presented
and do not include a
recovery of costs
that were paid to
acquire or modify
the derivative
instruments that
were settled.
(2) Natural gas prices
include the value
for natural gas and
natural gas liquids.
(3) Excludes non-cash
valuation charges on
pipeline imbalances.
Oasis Petroleum Inc.
Condensed Consolidated Statement of Cash Flows
(Unaudited)
Six Months Ended June 30,
2017 2016
---- ----
(In thousands)
Cash flows from operating activities:
Net income (loss) $40,393 $(154,386)
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation, depletion and
amortization 251,957 244,937
Gain on extinguishment of debt - (18,658)
Loss on sale of properties - 1,311
Impairment 5,882 3,585
Deferred income taxes 18,376 (80,127)
Derivative instruments (106,607) 76,471
Stock-based compensation
expenses 13,823 12,979
Deferred financing costs
amortization and other 8,871 6,552
Working capital and other changes:
Change in accounts receivable (13,743) 4,297
Change in inventory (1,007) 2,054
Change in prepaid expenses (264) 1,423
Change in other current assets 280 (114)
Change in long-term inventory
and other assets (8,768) 100
Change in accounts payable,
interest payable and accrued
liabilities 11,158 (18,034)
Change in other current
liabilities (10,490) 9,001
Change in other liabilities - 10
Net cash provided by operating
activities 209,861 91,401
------- ------
Cash flows from investing activities:
Capital expenditures (252,461) (231,341)
Proceeds from sale of properties 4,000 11,679
Costs related to sale of
properties - (310)
Derivative settlements (8,899) 103,790
Advances from joint interest
partners (1,781) 769
------ ---
Net cash used in investing
activities (259,141) (115,413)
-------- --------
Cash flows from financing activities:
Proceeds from revolving credit
facility 484,000 359,000
Principal payments on revolving
credit facility (429,000) (462,000)
Repurchase of senior unsecured
notes - (56,925)
Deferred financing costs - (751)
Proceeds from sale of common
stock - 182,953
Purchases of treasury stock (5,451) (1,520)
Other (55) -
Net cash provided by financing
activities 49,494 20,757
------ ------
Increase (decrease) in cash and
cash equivalents 214 (3,255)
Cash and cash equivalents:
Beginning of period 11,226 9,730
End of period $11,440 $6,475
======= ======
Supplemental non-cash transactions:
Change in accrued capital
expenditures $19,017 $(17,015)
Change in asset retirement
obligations 1,759 (8,785)
Notes payable from acquisition 4,875 -
Non-GAAP Financial Measures
Cash Interest is a supplemental non-GAAP financial measure that is used by management and external users of the Company's financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Cash Interest as interest expense plus capitalized interest less amortization and write-offs of deferred financing costs and debt discounts included in interest expense. Cash Interest is not a measure of interest expense as determined by United States generally accepted accounting principles, or GAAP.
The following table presents a reconciliation of the GAAP financial measure of interest expense to the non-GAAP financial measure of Cash Interest for the periods presented:
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands)
Interest expense $36,838 $34,979 $73,159 $73,718
Capitalized interest 2,816 4,835 5,636 9,303
Amortization of deferred
financing costs (1,709) (2,030) (3,399) (5,947)
Amortization of debt
discount (2,480) - (4,835) -
------ --- ------ ---
Cash Interest $35,465 $37,784 $70,561 $77,074
======= ======= ======= =======
Adjusted EBITDA and Free Cash Flow are supplemental non-GAAP financial measures that are used by management and external users of the Company's financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted EBITDA as earnings before interest expense, income taxes, depreciation, depletion, amortization, exploration expenses and other similar non-cash charges. The Company defines Free Cash Flow as Adjusted EBITDA less Cash Interest and CapEx, excluding capitalized interest. Adjusted EBITDA and Free Cash Flow are not measures of net income (loss) or cash flows as determined by GAAP.
The following table presents reconciliations of the GAAP financial measures of net income (loss) and net cash provided by (used in) operating activities to the non-GAAP financial measures of Adjusted EBITDA and Free Cash Flow for the periods presented:
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands)
Net income (loss) $16,568 $(89,931) $40,393 $(154,386)
Loss on sale of properties - 1,311 - 1,311
Gain on extinguishment of debt - (11,642) - (18,658)
Net (gain) loss on derivative
instruments (50,532) 90,846 (106,607) 76,471
Derivative settlements(1) (939) 30,477 (8,899) 103,790
Interest expense, net of
capitalized interest 36,838 34,979 73,159 73,718
Depreciation, depletion and
amortization 125,291 122,488 251,957 244,937
Impairment 3,200 23 5,882 3,585
Exploration expenses 1,667 340 3,156 703
Stock-based compensation
expenses 7,115 6,249 13,823 12,979
Income tax (benefit) expense 2,339 (52,498) 18,376 (80,127)
Other non-cash adjustments (213) (484) 699 723
Adjusted EBITDA 141,334 132,158 291,939 265,046
------- ------- ------- -------
Cash interest (35,465) (37,784) (70,561) (77,074)
Capital expenditures(2) (172,975) (131,288) (282,770) (219,243)
Capitalized interest 2,816 4,835 5,636 9,303
----- ----- ----- -----
Free Cash Flow $(64,290) $(32,079) $(55,756) $(21,968)
======== ======== ======== ========
Net cash provided by operating
activities $102,062 $137,452 $209,861 $91,401
Derivative settlements(1) (939) 30,477 (8,899) 103,790
Interest expense, net of
capitalized interest 36,838 34,979 73,159 73,718
Exploration expenses 1,667 340 3,156 703
Deferred financing costs
amortization and other (3,931) (1,486) (8,871) (6,552)
Changes in working capital 5,850 (69,120) 22,834 1,263
Other non-cash adjustments (213) (484) 699 723
Adjusted EBITDA 141,334 132,158 291,939 265,046
------- ------- ------- -------
Cash interest (35,465) (37,784) (70,561) (77,074)
Capital expenditures(2) (172,975) (131,288) (282,770) (219,243)
Capitalized interest 2,816 4,835 5,636 9,303
----- ----- ----- -----
Free Cash Flow $(64,290) $(32,079) $(55,756) $(21,968)
======== ======== ======== ========
(1) Cash settlements
represent the
cumulative gains and
losses on the
Company's derivative
instruments for the
periods presented
and do not include a
recovery of costs
that were paid to
acquire or modify
the derivative
instruments that
were settled.
(2) CapEx reflected in
the table above
differs from the
amounts shown in the
statement of cash
flows in the
Company's condensed
consolidated
financial statements
because amounts
reflected in the
table above include
changes in accrued
liabilities from the
previous reporting
period for capital
expenditures, while
the amounts
presented in the
statement of cash
flows are presented
on a cash basis.
The following tables present reconciliations of the GAAP financial measure of income (loss) before income taxes to the non-GAAP financial measure of Adjusted EBITDA for the Company's three reportable business segments on a gross basis for the periods presented:
Exploration and Production
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands)
Income (loss) before income
taxes $(3,900) $(158,978) $16,836 $(264,744)
Loss on sale of properties - 1,669 - 1,669
Gain on extinguishment of debt - (11,642) - (18,658)
Net (gain) loss on derivative
instruments (50,532) 90,846 (106,607) 76,471
Derivative settlements(1) (939) 30,477 (8,899) 103,790
Interest expense, net of
capitalized interest 36,838 34,979 73,159 73,718
Depreciation, depletion and
amortization 122,785 120,039 247,193 240,881
Impairment 3,200 23 5,882 1,154
Exploration expenses 1,667 340 3,156 703
Stock-based compensation
expenses 6,897 6,077 13,395 12,625
Other non-cash adjustments (213) (484) 699 723
---- ---- --- ---
Adjusted EBITDA $115,803 $113,346 $244,814 $228,332
======== ======== ======== ========
(1) Cash settlements
represent the
cumulative gains and
losses on the
Company's derivative
instruments for the
periods presented
and do not include a
recovery of costs
that were paid to
acquire or modify
the derivative
instruments that
were settled.
Midstream Services
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands)
Income before income taxes $23,106 $18,040 $43,867 $33,198
Gain on sale of properties - (358) - (358)
Depreciation, depletion and
amortization 3,753 1,732 7,211 3,415
Impairment - - - 2,431
Stock-based compensation
expenses 365 224 713 443
--- --- --- ---
Adjusted EBITDA $27,224 $19,638 $51,791 $39,129
======= ======= ======= =======
Well Services
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands)
Income (loss) before income
taxes $1,950 $(2,142) $(1,637) $1,885
Depreciation, depletion and
amortization 3,057 3,895 6,222 8,127
Stock-based compensation
expenses 338 235 734 899
--- --- --- ---
Adjusted EBITDA $5,345 $1,988 $5,319 $10,911
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Adjusted Net Income (Loss) and Adjusted Diluted Earnings (Loss) Per Share are supplemental non-GAAP financial measures that are used by management and external users of the Company's financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted Net Income (Loss) as net income (loss) after adjusting first for (1) the impact of certain non-cash items, including non-cash changes in the fair value of derivative instruments, impairment, and other similar non-cash charges, or non-recurring items and then (2) the non-cash and non-recurring items' impact on taxes based on the Company's effective tax rate applicable to those adjusting items in the same period. Adjusted Net Income (Loss) is not a measure of net income (loss) as determined by GAAP. The Company defines Adjusted Diluted Earnings (Loss) Per Share as Adjusted Net Income (Loss) divided by diluted weighted average shares outstanding.
The following table presents reconciliations of the GAAP financial measure of net income (loss) to the non-GAAP financial measure of Adjusted Net Income (Loss) and the GAAP financial measure of diluted earnings (loss) per share to the non-GAAP financial measure of Adjusted Diluted Earnings (Loss) Per Share for the periods presented:
Three Months Ended June 30, Six Months Ended June 30,
2017 2016 2017 2016
---- ---- ---- ----
(In thousands, except per share data)
Net income (loss) $16,568 $(89,931) $40,393 $(154,386)
Loss on sale of properties - 1,311 - 1,311
Gain on extinguishment of debt - (11,642) - (18,658)
Net (gain) loss on derivative
instruments (50,532) 90,846 (106,607) 76,471
Derivative settlements(1) (939) 30,477 (8,899) 103,790
Impairment 3,200 23 5,882 3,585
Amortization of deferred
financing costs 1,709 2,030 3,399 5,947
Amortization of debt discount 2,480 - 4,835 -
Other non-cash adjustments (213) (484) 699 723
Tax impact(2) 16,575 (42,075) 37,679 (64,731)
------ ------- ------ -------
Adjusted Net Loss $(11,152) $(19,445) $(22,619) $(45,948)
======== ======== ======== ========
Diluted earnings (loss) per
share $0.07 $(0.51) $0.17 $(0.91)
Loss on sale of properties - 0.01 - 0.01
Gain on extinguishment of debt - (0.07) - (0.11)
Net (gain) loss on derivative
instruments (0.22) 0.51 (0.45) 0.45
Derivative settlements(1) - 0.17 (0.04) 0.61
Impairment 0.01 - 0.02 0.02
Amortization of deferred
financing costs 0.01 0.01 0.01 0.03
Amortization of debt discount 0.01 - 0.02 -
Tax impact(2) 0.07 (0.23) 0.17 (0.37)
---- ----- ---- -----
Non-GAAP Diluted Loss Per Share $(0.05) $(0.11) $(0.10) $(0.27)
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Diluted weighted average shares
outstanding 234,917 176,984 236,281 169,953
Effective tax rate applicable to
adjustment items 37.4% 37.4% 37.4% 37.4%
(1) Cash settlements
represent the
cumulative gains and
losses on the
Company's derivative
instruments for the
periods presented
and do not include a
recovery of costs
that were paid to
acquire or modify
the derivative
instruments that
were settled.
(2) The tax impact is
computed utilizing
the Company's
effective tax rate
applicable to the
adjustments for
certain non-cash
and non-recurring
items.
View original content:http://www.prnewswire.com/news-releases/oasis-petroleum-inc-announces-quarter-ended-june-30-2017-earnings-300498752.html
SOURCE Oasis Petroleum Inc.
