Crescent Energy Reports First Quarter 2022 Financial and Operating Results
Increased 2022 Outlook Based on Updated Commodity Prices
Declared Cash Dividend of $0.17 per Share, a 40% Increase Quarter over Quarter
HOUSTON–(BUSINESS WIRE)–$CRGY–Crescent Energy Company (NYSE: CRGY) today announced financial and operating results for the first quarter of 2022 and increased its quarterly cash dividend by 40% to $0.17 per share. The Company plans to host a conference call and webcast to discuss the results at 10 a.m. CT, Wednesday, May 11, 2022. Details can be found in this release.
Recent Highlights
- Produced 120 MBoe/d (54% liquids) and incurred $85 million of capital
- Generated $406 million net loss (including $498 million of unrealized derivative losses)
- Reported $195 million of Adjusted EBITDAX(1), $371 million of Unhedged Adjusted EBITDAX(1) and $90 million of Levered Free Cash Flow(1)
- Closed accretive acquisition of Uinta Basin assets (the “Uinta Acquisition”) on March 30, 2022 for total cash consideration of approximately $690 million(2)
- Exited the quarter at 1.3x Net LTM Leverage(1)
- Continued to advance ESG initiatives – joined the Oil & Gas Methane Partnership 2.0 initiative and plan to publish second ESG report this summer with ESG targets focused on EHS and emissions
-
Raised the mid-point of 2022 Adjusted EBITDAX(1) and Levered Free Cash Flow(1) guidance to $1.35 billion and $575 million, respectively, to reflect current commodity prices
- $650 million capital program focused on high-return multi-year inventory in Eagle Ford and Uinta
Crescent CEO David Rockecharlie said, “We delivered strong operating results in the first quarter, generated significant free cash flow and solid investment returns and increased our quarterly dividend to $0.17 per share. At the end of March, we closed the accretive acquisition of Uinta Basin assets, which significantly increased our scale and added high margin oil production at a very attractive price. Today, Crescent remains well positioned with scale in high-return basins, a clear framework to return cash to shareholders, a strong balance sheet and a track record of making accretive acquisitions.”
First Quarter 2022 Results
Crescent produced 120 net MBoe/d in the first quarter 2022, in line with previous guidance (excluding Uinta Acquisition). Average realized price for the first quarter 2022, excluding the effect of commodity derivatives, was $54.28 per barrel of oil equivalent, compared to $48.87 for the fourth quarter 2021, an 11% increase. Excluding the effect of commodity derivatives, averaged realized price by commodity in the first quarter was $93.47 per barrel of oil, $4.77 per Mcf of gas and $38.97 per barrel of NGL.
Operating expense, excluding production and other taxes, of $15.97 per Boe, was in line with previous guidance (excluding Uinta Acquisition) when adjusting for certain contractual commodity-linked costs (~$0.25-$0.50 per Boe)(3), which increased in the higher commodity price environment relative to guidance issued at $75 / Bbl WTI. These higher contractual commodity-linked costs were more than offset by higher realized prices and improved margins. General and administrative expense totaled $2.08 per Boe, including non-cash equity compensation and certain non-recurring transaction related costs. Adjusted Recurring Cash G&A(1) totaled $1.69 per Boe, which was in line with previous guidance (excluding Uinta Acquisition).
During the quarter, Crescent incurred approximately $85 million in capital expenditures, excluding acquisitions. The Company operated one rig in the Eagle Ford during the quarter and brought online 9 gross (9 net) operated wells. In addition, Crescent participated in 7 gross (1 net) non-operated wells in the Eagle Ford. Upon closing the Uinta Acquisition, Crescent took over operations from the previous operator and has maintained their two rig development program.
Crescent generated $406 million net loss (including $498 million of unrealized derivative losses), $195 million of Adjusted EBITDAX(1), $371 million of Unhedged Adjusted EBITDAX(1) and $90 million of Levered Free Cash Flow(1) for the period.
Financial Position
As of March 31, 2022, the Company had principal amount of indebtedness of $1.6 billion and net debt of approximately $1.5 billion, consisting of $700 million of senior unsecured notes and $941 million of outstanding borrowings on its revolving credit facility (the “Credit Facility”). In connection with the closing of the Uinta Acquisition in March, the Company’s borrowing base was increased to $1.8 billion with an elected commitment of $1.3 billion. In February 2022, Crescent issued $200 million in aggregate principal amount of 7.250% senior notes due 2026 at 101% of par and used the proceeds to repay amounts outstanding on the Credit Facility. Total liquidity as of March 31, 2022 was $451 million, including outstanding letters of credit of $21 million and cash and cash equivalents of $113 million. Crescent exited the quarter with a Net LTM Leverage(1) ratio of 1.3x. The Company expects to generate significant free cash flow for the remainder of 2022, which is expected to be used to fund dividends and further strengthen the balance sheet.
Dividend
Consistent with the Company’s framework to return cash to shareholders, the Board of Directors approved a quarterly cash dividend of $0.17 per share, a 40% increase relative to the prior quarter, or $0.68 per share on an annualized basis. The quarterly dividend is payable on June 7, 2022 to shareholders of record as of the close of business on May 24, 2022. Subject to board approval and applicable law, Crescent intends to pay a $0.17 per share quarterly dividend for the remainder of 2022.
2022 Guidance (Including Uinta Acquisition)
Crescent increased the midpoint of its 2022 outlook for Adjusted EBITDAX(1) and Levered Free Cash Flow(1) (including Uinta Acquisition) by 17% and 35%, respectively, based on the strength of commodity prices. Full-year production and capital guidance was reiterated and remains unchanged. Operating expense, excluding production taxes, also remained unchanged with the exception of an increase to reflect a portion of costs that are contractually indexed to commodity prices. Today, Crescent continues to operate one rig in the Eagle Ford and two rigs in the Uinta Basin.
|
|
Prior at $75/Bbl and $3.75/MMBtu |
|
Updated at $100/Bbl and $6.00/MMBtu |
|
EBITDAX and Levered Free Cash Flow |
|
|
|
|
Adjusted EBITDAX (non-GAAP)(1) |
$1,100 – $1,200 MM |
|
$1,300 – $1,400 MM |
|
Unhedged Adj. EBITDAX (non-GAAP)(1) |
$1,400 – $1,500 MM |
|
$2,125 – $2,225 MM |
|
Levered Free Cash Flow (non-GAAP)(1) |
$375 – $475 MM |
|
$525 – $625 MM |
|
Production(4) |
134 – 148 MBoe/d |
|
134 – 148 MBoe/d |
|
% Oil / % Liquids |
~45% / ~58% |
|
~45% / ~58% |
|
Capital (Excluding Acquisitions) |
$600 – $700 MM |
|
$600 – $700 MM |
|
Per Unit Expenses |
|
|
|
|
Operating Expense, excluding production taxes(3) |
$12.75 – $13.75 / Boe |
|
$13.25 – $14.25 / Boe |
|
Production taxes (% commodity revenue) |
7 – 8% |
|
7 – 8% |
|
Adj. Recurring Cash G&A (Incl. Manager Comp)(1) |
$1.45 – $1.55 / Boe |
|
$1.45 – $1.55 / Boe |
|
Note: All amounts are approximations based on currently available information and estimates and are subject to change based on events and circumstances after the date hereof. Please see “Cautionary Statement Regarding Forward-Looking Information.” |
Commodity Hedging
Crescent is approximately 60% hedged for the remainder of 2022 at the midpoint of its production guidance range. The following table details the Company’s open commodity derivative contracts related to swaps and collars as of April 29, 2022. The Company’s full hedge book, including basis and calendar month average roll hedges is available in its presentation on the Company’s website.
|
|
WTI |
Brent |
Natural Gas |
NGLs |
||||
|
Swaps: |
|
|
|
|
|
|
|
|
|
|
Volume (MBbl) |
Avg Price ($/Bbl) |
Volume (MBbl) |
Avg Price ($/Bbl) |
Volume (BBtu) |
Avg Price ($/MMBtu) |
Volume (MBbl) |
Avg Price ($/Bbl) |
|
Q2’22 |
3,715 |
$65.20 |
125 |
$56.35 |
21,690 |
$2.77 |
873 |
$17.13 |
|
Q3’22 |
3,580 |
$64.59 |
126 |
$56.36 |
20,634 |
$2.76 |
768 |
$32.74 |
|
Q4’22 |
3,301 |
$64.08 |
126 |
$56.36 |
20,180 |
$2.78 |
736 |
$32.55 |
|
2023 |
9,710 |
$60.00 |
527 |
$52.52 |
62,248 |
$2.73 |
1,379 |
$40.80 |
|
2024 |
5,721 |
$63.82 |
276 |
$68.65 |
9,604 |
$4.14 |
|
|
|
|
WTI |
Brent |
Natural Gas |
NGLs |
||||||||
|
Collars: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Volume (MBbl) |
Avg Put Price ($/Bbl) |
Avg Call Price ($/Bbl) |
Volume (MBbl) |
Avg Put Price ($/Bbl) |
Avg Call Price ($/Bbl) |
Volume (BBtu) |
Avg Put Price ($/MMBtu) |
Avg Call Price ($/MMBtu) |
Volume (MBbl) |
Avg Put Price ($/Bbl) |
Avg Call Price ($/Bbl) |
|
2023 |
1,155 |
$48.68 |
$57.87 |
— |
$— |
$— |
550 |
$2.63 |
$3.01 |
— |
$— |
$— |
|
2024 |
— |
$— |
$— |
— |
$— |
$— |
18,300 |
$3.38 |
$4.56 |
— |
$— |
$— |
First Quarter 2022 Conference Call Information
Crescent plans to host a conference call to discuss its first quarter 2022 financial and operating results. Details are below. A webcast replay will be available on the website following the call. In connection with the call, Crescent has provided information in an earnings presentation on its website, www.crescentenergyco.com, regarding its first quarter 2022 financial and operating results.
Date: Wednesday, May 11, 2022
Time: 10 a.m. CT (11 a.m. ET)
Conference Dial-In: 877-407-0989 / 201-389-0921 (Domestic / International)
Webcast Link: https://ir.crescentenergyco.com/events-presentations/
|
(1) |
Non-GAAP financial measure. Please see “Reconciliation of Non-GAAP Measures” for discussion and reconciliations of such measures to their most directly comparable financial measures calculated and presented in accordance with U.S. generally accepted accounting principles (“GAAP”). |
|
(2) |
Includes net cash paid at closing, restructuring costs associated with the assumption of certain derivatives and certain transaction fees. |
|
(3) |
Includes certain costs that are contractually indexed to commodity prices, such as CO2 purchase costs related to Crescent’s CO2 flood asset in Wyoming, and certain gathering and transportation expenses. These contractual commodity indexed operating expenses move in tandem with commodity prices and as commodity prices increase, higher contractual commodity-linked operating costs are offset by higher realizations. |
|
(4) |
In addition to its production, the Company projects generating $45-$50 million of Midstream and other revenue. |
About Crescent Energy Company
Crescent is a well-capitalized, U.S. independent energy company with a portfolio of assets in key proven basins across the lower 48 states and substantial cash flow supported by a predictable base of production. Crescent’s core leadership team is a group of experienced investment, financial and industry professionals who continue to execute on the strategy management has employed since 2011. The Company’s mission is to invest in energy assets and deliver better returns, operations and stewardship. For additional information, please visit www.crescentenergyco.com.
Cautionary Statement Regarding Forward-Looking Statements
This communication 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, as amended. These statements are based on current expectations, including with respect to the Uinta Acquisition. The words and phrases “should,” “could,” “may,” “will,” “believe,” “plan,” “intend,” “expect,” “potential,” “possible,” “anticipate,” “estimate,” “forecast,” “view,” “efforts,” “goal” and similar expressions identify forward-looking statements and express the Company’s expectations about future events. All statements, other than statements of historical facts, included in this communication that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the Company’s control. Such risks and uncertainties include, but are not limited to, weather, political, economic and market conditions, including a decline in the price and market demand for natural gas, natural gas liquids and crude oil, the impact of pandemics such as COVID-19, actions by the Organization of the Petroleum Exporting Countries (“OPEC”) and non-OPEC oil producing countries, the impact of armed conflict, including in Ukraine, the timing and success of business development efforts, and other uncertainties. Consequently, actual future results could differ materially from expectations. The Company assumes no duty to update or revise their respective forward-looking statements based on new information, future events or otherwise.
Financial Presentation
On December 7, 2021, Crescent was formed through the merger of Independence Energy (“Independence”), and Contango Oil and Gas (“Contango”). Referenced results for the three months ended March 31, 2022 reflect the combined Company. Referenced results for the three months ended December 31, 2021 reflect legacy results of Independence from October 1 through December 6, 2021 and 25 days of Crescent results beginning December 7, 2021. Referenced results for the three months ended March 31, 2021 reflect only legacy Independence.
|
Crescent Operational Summary |
||||||||
|
|
For the three months ended |
|||||||
|
|
March 31, 2022 |
|
March 31, 2021 |
|
December 31, 2021 |
|||
|
Average daily net sales volumes: |
|
|
|
|
|
|||
|
Oil (MBbls/d) |
|
44 |
|
|
37 |
|
|
37 |
|
Natural gas (MMcf/d) |
|
333 |
|
|
231 |
|
|
267 |
|
NGLs (MBbls/d) |
|
20 |
|
|
16 |
|
|
18 |
|
Total (MBoe/d) |
|
120 |
|
|
91 |
|
|
99 |
|
Average realized prices, before effects of derivative settlements: |
|
|
|
|
|
|||
|
Oil ($/Bbl) |
$ |
93.47 |
|
$ |
56.93 |
|
$ |
75.73 |
|
Natural gas ($/Mcf) |
|
4.77 |
|
|
3.89 |
|
|
5.06 |
|
NGLs ($/Bbl) |
|
38.97 |
|
|
24.98 |
|
|
39.68 |
|
Total ($/Boe) |
|
54.28 |
|
|
37.17 |
|
|
48.87 |
|
Average realized prices, after effects of derivative settlements: |
|
|
|
|
|
|||
|
Oil ($/Bbl) |
$ |
68.36 |
|
$ |
50.28 |
|
$ |
56.31 |
|
Natural gas ($/Mcf) |
|
3.11 |
|
|
3.88 |
|
|
2.80 |
|
NGLs ($/Bbl) |
|
24.81 |
|
|
16.87 |
|
|
25.01 |
|
Total ($/Boe) |
|
38.02 |
|
|
33.04 |
|
|
32.95 |
|
Expense (per Boe) |
|
|
|
|
|
|||
|
Operating expense, excluding production and other taxes |
$ |
15.97 |
|
$ |
13.72 |
|
$ |
15.79 |
|
Production and other taxes |
|
4.30 |
|
|
3.20 |
|
|
3.17 |
|
Depreciation, depletion and amortization |
|
9.16 |
|
|
10.19 |
|
|
8.78 |
|
General and administrative expense |
|
2.08 |
|
|
0.81 |
|
|
4.91 |
|
Non-GAAP expense (per Boe) |
|
|
|
|
|
|||
|
Adjusted Recurring Cash G&A |
|
1.69 |
|
|
0.32 |
|
|
0.89 |
|
Crescent Income Statement |
|||||||||||
|
|
For the three months ended |
||||||||||
|
(in thousands, except per share data) |
March 31, 2022 |
|
March 31, 2021 |
|
December 31, 2021 |
||||||
|
Revenues: |
|
|
|||||||||
|
Oil |
$ |
372,509 |
|
|
$ |
188,923 |
|
|
$ |
255,270 |
|
|
Natural gas |
|
143,311 |
|
|
|
81,043 |
|
|
|
124,027 |
|
|
Natural gas liquids |
|
71,179 |
|
|
|
36,099 |
|
|
|
63,917 |
|
|
Midstream and other |
|
11,911 |
|
|
|
11,796 |
|
|
|
20,045 |
|
|
Total revenues |
|
598,910 |
|
|
|
317,861 |
|
|
|
463,259 |
|
|
Expenses: |
|
|
|
|
|
||||||
|
Lease operating expense |
|
94,823 |
|
|
|
56,658 |
|
|
|
67,535 |
|
|
Workover expense |
|
9,959 |
|
|
|
2,261 |
|
|
|
3,019 |
|
|
Asset operating expense |
|
16,619 |
|
|
|
7,127 |
|
|
|
21,634 |
|
|
Gathering, transportation and marketing |
|
48,276 |
|
|
|
43,172 |
|
|
|
51,003 |
|
|
Production and other taxes |
|
46,484 |
|
|
|
26,313 |
|
|
|
28,716 |
|
|
Depreciation, depletion and amortization |
|
99,019 |
|
|
|
83,869 |
|
|
|
79,665 |
|
|
Exploration expense |
|
91 |
|
|
|
56 |
|
|
|
347 |
|
|
Midstream operating expense |
|
3,078 |
|
|
|
3,732 |
|
|
|
4,541 |
|
|
General and administrative expense |
|
22,522 |
|
|
|
6,629 |
|
|
|
44,567 |
|
|
Gain on sale of assets |
|
(4,790 |
) |
|
|
— |
|
|
|
624 |
|
|
Total expenses |
|
336,081 |
|
|
|
229,817 |
|
|
|
301,651 |
|
|
Income (loss) from operations |
|
262,829 |
|
|
|
88,044 |
|
|
|
161,608 |
|
|
Other income (expense): |
|
|
|
|
|
||||||
|
Gain (loss) on derivatives |
|
(673,486 |
) |
|
|
(246,814 |
) |
|
|
19,012 |
|
|
Interest expense |
|
(16,524 |
) |
|
|
(7,383 |
) |
|
|
(12,930 |
) |
|
Other income (expense) |
|
(1,499 |
) |
|
|
(102 |
) |
|
|
174 |
|
|
Income from equity method investments |
|
948 |
|
|
|
— |
|
|
|
368 |
|
|
Total other income (expense) |
|
(690,561 |
) |
|
|
(254,299 |
) |
|
|
6,624 |
|
|
Income (loss) before taxes |
|
(427,732 |
) |
|
|
(166,255 |
) |
|
|
168,232 |
|
|
Income tax benefit (expense) |
|
21,725 |
|
|
|
(13 |
) |
|
|
713 |
|
|
Net income (loss) |
|
(406,007 |
) |
|
|
(166,268 |
) |
|
|
168,945 |
|
|
Less: net (income) loss attributable to Predecessor |
|
— |
|
|
|
155,629 |
|
|
|
(246,636 |
) |
|
Less: net (income) loss attributable to noncontrolling interests |
|
(470 |
) |
|
|
10,639 |
|
|
|
(446 |
) |
|
Less: net loss attributable to redeemable noncontrolling interests |
|
321,477 |
|
|
|
— |
|
|
|
58,761 |
|
|
Net loss attributable to Crescent Energy |
$ |
(85,000 |
) |
|
$ |
— |
|
|
$ |
(19,376 |
) |
|
Net loss per share: |
|
|
|
|
|
||||||
|
Class A common stock – basic and diluted |
$ |
(2.03 |
) |
|
|
|
$ |
(0.46 |
) |
||
|
Class B common stock – basic and diluted |
$ |
— |
|
|
|
|
$ |
— |
|
||
|
Weighted average shares outstanding: |
|
|
|
|
|
||||||
|
Class A common stock – basic and diluted |
|
41,954 |
|
|
|
|
|
41,954 |
|
||
|
Class B common stock – basic and diluted |
|
127,536 |
|
|
|
|
|
127,536 |
|
||
|
Crescent Balance Sheet |
|||||||
|
|
March 31, 2022 |
|
December 31, 2021 |
||||
|
|
(in thousands, except share data) |
||||||
|
ASSETS |
|
|
|
||||
|
Current assets: |
|
|
|
||||
|
Cash and cash equivalents |
$ |
112,548 |
|
|
$ |
128,578 |
|
|
Accounts receivable, net |
|
508,199 |
|
|
|
321,855 |
|
|
Accounts receivable – affiliates |
|
5,135 |
|
|
|
20,341 |
|
|
Drilling advances |
|
2,090 |
|
|
|
200 |
|
|
Prepaid and other current assets |
|
21,108 |
|
|
|
8,644 |
|
|
Total current assets |
|
649,080 |
|
|
|
479,618 |
|
|
Property, plant and equipment: |
|
|
|
||||
|
Oil and natural gas properties at cost, successful efforts method |
|
|
|
||||
|
Proved |
|
6,899,590 |
|
|
|
6,043,602 |
|
|
Unproved |
|
377,772 |
|
|
|
308,721 |
|
|
Oil and natural gas properties at cost, successful efforts method |
|
7,277,362 |
|
|
|
6,352,323 |
|
|
Field and other property and equipment, at cost |
|
144,836 |
|
|
|
144,318 |
|
|
Total property, plant and equipment |
|
7,422,198 |
|
|
|
6,496,641 |
|
|
Less: accumulated depreciation, depletion, amortization and impairment |
|
(2,034,508 |
) |
|
|
(1,941,528 |
) |
|
Property, plant and equipment, net |
|
5,387,690 |
|
|
|
4,555,113 |
|
|
Goodwill |
|
76,826 |
|
|
|
76,564 |
|
|
Derivative assets – noncurrent |
|
— |
|
|
|
579 |
|
|
Investment in equity affiliates |
|
20,113 |
|
|
|
15,415 |
|
|
Other assets |
|
40,777 |
|
|
|
30,173 |
|
|
TOTAL ASSETS |
$ |
6,174,486 |
|
|
$ |
5,157,462 |
|
|
|
|
|
|
||||
|
|
|
|
|
||||
|
|
|
|
|
||||
|
|
|
|
|
||||
|
|
|
|
|
||||
|
LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY |
|
|
|
||||
|
Current liabilities: |
|
|
|
||||
|
Accounts payable and accrued liabilities |
$ |
529,746 |
|
|
$ |
337,881 |
|
|
Accounts payable – affiliates |
|
32,286 |
|
|
|
8,675 |
|
|
Derivative liabilities – current |
|
654,409 |
|
|
|
253,525 |
|
|
Financing lease obligations – current |
|
1,726 |
|
|
|
1,606 |
|
|
Other current liabilities |
|
15,730 |
|
|
|
14,438 |
|
|
Total current liabilities |
|
1,233,897 |
|
|
|
616,125 |
|
|
Long-term debt |
|
1,626,873 |
|
|
|
1,030,406 |
|
|
Derivative liabilities – noncurrent |
|
357,396 |
|
|
|
133,471 |
|
|
Asset retirement obligations |
|
290,612 |
|
|
|
258,102 |
|
|
Deferred tax liability |
|
35,647 |
|
|
|
82,537 |
|
|
Financing lease obligations – noncurrent |
|
3,489 |
|
|
|
3,512 |
|
|
Other liabilities |
|
18,537 |
|
|
|
13,652 |
|
|
Total liabilities |
|
3,566,451 |
|
|
|
2,137,805 |
|
|
Commitments and contingencies |
|
|
|
||||
|
Redeemable noncontrolling interests |
|
2,176,060 |
|
|
|
2,325,013 |
|
|
Equity: |
|
|
|
||||
|
Class A common stock, $0.0001 par value; 1,000,000,000 shares authorized, 43,105,376 shares issued and 41,954,385 shares outstanding as of March 31, 2022 and December 31, 2021 |
|
4 |
|
|
|
4 |
|
|
Class B common stock, $0.0001 par value; 500,000,000 shares authorized and 127,536,463 shares issued and outstanding as of March 31, 2022 and December 31, 2021 |
|
13 |
|
|
|
13 |
|
|
Preferred stock, $0.0001 par value; 500,000,000 shares authorized and 1,000 Series I preferred shares issued and outstanding as of March 31, 2022 and December 31, 2021 |
|
— |
|
|
|
— |
|
|
Treasury stock, at cost; 1,150,991 shares of Class A common stock as of March 31, 2022 and December 31, 2021 |
|
(18,448 |
) |
|
|
(18,448 |
) |
|
Additional paid-in capital |
|
541,181 |
|
|
|
720,016 |
|
|
Accumulated deficit |
|
(104,376 |
) |
|
|
(19,376 |
) |
|
Noncontrolling interests |
|
13,601 |
|
|
|
12,435 |
|
|
Total equity |
|
431,975 |
|
|
|
694,644 |
|
|
TOTAL LIABILITIES, REDEEMABLE NONCONTROLLING INTERESTS AND EQUITY |
$ |
6,174,486 |
|
|
$ |
5,157,462 |
|
|
Crescent Cash Flow Statement |
|||||||
|
|
For the three months ended |
||||||
|
|
March 31, 2022 |
|
March 31, 2021 |
||||
|
Cash flows from operating activities: |
(in thousands) |
||||||
|
Net income (loss) |
$ |
(406,007 |
) |
|
$ |
(166,268 |
) |
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities |
|
|
|
||||
|
Depreciation, depletion and amortization |
|
99,019 |
|
|
|
83,869 |
|
|
Deferred income taxes (benefit) |
|
(26,675 |
) |
|
|
— |
|
|
(Gain) loss on derivatives |
|
673,486 |
|
|
|
246,814 |
|
|
Net cash (paid) received on settlement of derivatives |
|
(175,801 |
) |
|
|
(30,555 |
) |
|
Non-cash equity-based compensation expense |
|
11,115 |
|
|
|
3,337 |
|
|
Amortization of debt issuance costs and discount |
|
1,597 |
|
|
|
850 |
|
|
Gain on sale of oil and natural gas properties |
|
(4,790 |
) |
|
|
— |
|
|
Restructuring of acquired derivative contracts |
|
(51,994 |
) |
|
|
— |
|
|
Other |
|
(2,781 |
) |
|
|
(2 |
) |
|
Changes in operating assets and liabilities: |
|
|
|
||||
|
Accounts receivable |
|
(179,180 |
) |
|
|
(41,295 |
) |
|
Accounts receivable – affiliates |
|
15,206 |
|
|
|
— |
|
|
Prepaid and other current assets |
|
(14,469 |
) |
|
|
19,947 |
|
|
Accounts payable and accrued liabilities |
|
174,512 |
|
|
|
9,103 |
|
|
Accounts payable – affiliates |
|
23,611 |
|
|
|
(357 |
) |
|
Other |
|
442 |
|
|
|
808 |
|
|
Net cash provided by operating activities |
|
137,291 |
|
|
|
126,251 |
|
|
Cash flows from investing activities: |
|
|
|
||||
|
Development of oil and natural gas properties |
|
(93,816 |
) |
|
|
(29,380 |
) |
|
Acquisitions of oil and natural gas properties |
|
(620,342 |
) |
|
|
(64,090 |
) |
|
Proceeds from the sale of oil and natural gas properties |
|
764 |
|
|
|
3 |
|
|
Purchases of restricted investment securities – HTM |
|
(1,800 |
) |
|
|
(3,165 |
) |
|
Maturities of restricted investment securities – HTM |
|
1,800 |
|
|
|
3,165 |
|
|
Other |
|
— |
|
|
|
(472 |
) |
|
Net cash used in investing activities |
|
(713,394 |
) |
|
|
(93,939 |
) |
|
Cash flows from financing activities: |
|
|
|
||||
|
Proceeds from the issuance of Senior Notes and related premium |
|
202,000 |
|
|
|
— |
|
|
Revolving Credit Facility borrowings |
|
771,000 |
|
|
|
— |
|
|
Revolving Credit Facility repayments |
|
(373,000 |
) |
|
|
— |
|
|
Payment of debt issuance costs |
|
(15,831 |
) |
|
|
(211 |
) |
|
Prior Credit Agreement borrowings |
|
— |
|
|
|
42,100 |
|
|
Prior Credit Agreement repayments |
|
— |
|
|
|
(66,900 |
) |
|
Repayments of finance lease obligations |
|
(456 |
) |
|
|
(104 |
) |
|
Member distributions |
|
— |
|
|
|
(9,448 |
) |
|
Dividend to Class A common stock |
|
(5,035 |
) |
|
|
— |
|
|
Distributions to redeemable noncontrolling interests related to Class A common stock dividend |
|
(15,323 |
) |
|
|
— |
|
|
Distributions to redeemable noncontrolling interests related to Manager Compensation |
|
(2,726 |
) |
|
|
— |
|
|
Noncontrolling interest distributions |
|
(645 |
) |
|
|
(289 |
) |
|
Noncontrolling interest contributions |
|
1,533 |
|
|
|
— |
|
|
Net cash provided by (used in) financing activities |
|
561,517 |
|
|
|
(34,852 |
) |
|
Net change in cash, cash equivalents and restricted cash |
|
(14,586 |
) |
|
|
(2,540 |
) |
|
Cash, cash equivalents and restricted cash, beginning of period |
|
135,117 |
|
|
|
41,420 |
|
|
Cash, cash equivalents and restricted cash, end of period |
$ |
120,531 |
|
|
$ |
38,880 |
|
Reconciliation of Non-GAAP Measures
This release includes financial measures that have not been calculated in accordance with GAAP. These non-GAAP measures include Adjusted EBITDAX, Levered Free Cash Flow, Unhedged Adjusted EBITDAX, Adjusted Recurring Cash G&A and Net LTM Leverage. These non-GAAP measures should be read in conjunction with the information contained in Crescent’s audited combined and consolidated financial statements prepared in accordance with GAAP.
Due to the forward-looking nature of certain non-GAAP measures presented in this release for the year ending December 31, 2022, including Adjusted EBITDAX, Levered Free Cash Flow, Unhedged Adjusted EBITDAX and Adjusted Recurring Cash G&A and Net LTM Leverage for such period, no reconciliations of the non-GAAP measures to their most directly comparable GAAP measure is available without unreasonable efforts. This is due to the inherent difficulty of forecasting the timing or amount of various reconciling items that would impact the most directly comparable forward-looking GAAP financial measure, that have not yet occurred, are out of the Company’s control and/or cannot be reasonably predicted. Accordingly, such reconciliations are excluded from this release. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures.
Contacts
Emily Newport
IR@crescentenergyco.com
