Halcón Resources Corporation (NYSE:HK) (“Halcón” or the “Company”)
today announced its third quarter 2016 results.
Production for the three months ended September
30, 2016 averaged 34,185 barrels of oil equivalent per day
(Boe/d). Production was comprised of 76% oil, 13% natural gas
liquids (NGLs) and 11% natural gas for the quarter. The
Company shut-in approximately 7,000 Boe/d of net production during
the third quarter due to low commodity prices. This
production was brought back online in early October 2016.
Halcón expects fourth quarter net production to be between 39,000
and 41,000 Boe/d and D&C capex to be approximately $45 to $50
million.
Halcón generated total revenues of $102.5
million for the third quarter of 2016. In addition, Halcón
realized a net gain on settled derivative contracts of $80.0
million during the quarter.
Excluding the impact of hedges, Halcón realized
89% of the average NYMEX oil price, 18% of the average NYMEX oil
price for NGLs and 54% of the average NYMEX natural gas price
during the third quarter of 2016.
Total operating costs per unit were $24.89 per
Boe during the third quarter. After adjusting for selected
items, total operating costs per unit (see Selected Operating Data
table for additional information), were $17.33 per Boe and $17.12
per Boe for the three and nine months ended September 30, 2016,
respectively, a 5% decline from the nine month period ended a year
earlier.
Liquidity and Capital
Spending
As of September 30, 2016 Halcón’s liquidity was
approximately $369 million, which consisted of $367 million of
undrawn capacity on the Company’s revolver plus $2 million in cash
and cash equivalents. The Company’s senior revolving credit
facility is scheduled for its next borrowing base redetermination
in May of 2017. Based on current strip pricing, Halcón is
anticipated to generate positive cash flow for the remainder of
2016 and be approximately break-even for 2017 based on its
preliminary 2017 drilling plan of one rig growing to two rigs in
April of 2017.
During the third quarter of 2016, the Company
incurred capital costs of $36 million on drilling and completions,
and $2 million on infrastructure, seismic and leasehold
acquisitions. In addition, Halcón incurred $18 million for
capitalized interest, G&A and other in the third quarter.
Hedging Update
Halcón has 26,000 Bbl/d of oil hedged for the
last three months of 2016 at an average price of $76.60 per
barrel. For 2017, the Company has 14,750 Bbl/d of oil hedged
at an average price of $55.02 per barrel. Halcón estimates
the pre-tax mark-to-market value of its hedge portfolio to be
approximately $92 million as of November 7, 2016.
Operations Update
The Company is currently running 1 operated rig
in the Fort Berthold area of the Williston Basin and plans to keep
this rig running there through 2017. Halcón is tentatively
planning to add a second operated rig in the Williston Basin in
April of 2017 depending on oil prices and other factors. This
second rig will initially drill a 5 well pad in the Company’s
Williams County area before moving to the Fort Berthold area.
Halcón currently has 16 wells in the Bakken being completed or
waiting on completion.
Bakken/Three Forks
The Company operated an average of 1 rig in
the Williston Basin during the third quarter of 2016.
Halcón spudded 6 wells and put 2 wells online in
the Fort Berthold area of the Williston Basin during the
three months ended September 30, 2016. The Company
participated in 15 non-operated wells with an average working
interest of 9% during the third quarter. Production averaged
25,231 Boe/d during the third quarter of 2016 in the Williston
Basin including the impact of approximately 7,000 boe/d shut in
during the quarter.
Halcón currently has working interests in
approximately 119,000 net acres prospective for the Bakken and
Three Forks formations in the Williston Basin, substantially
all of which is held by production (HBP). With one operated
rig running, the Company plans to spud 7 gross operated wells with
an average working interest of approximately 89% and expects to put
approximately 15 gross operated wells online over the remaining
three months of 2016. Halcón also expects to participate in 5
to 10 gross non-operated wells over the last three months of 2016
with an average working interest of approximately 5%. Halcón
expects operated wells put online over the remainder of 2016 and
2017 in Fort Berthold to have an average EUR in excess of 900 MBoe.
The Company expects the wells it puts online in Williams
County in 2017 to have average EURS in excess of 700 MBoe.
The Company estimates it has approximately 100 gross operated
locations that are economic at current strip pricing in Williams
County. Current operated drilling and completion costs are
anticipated to be $5.9 million in Fort Berthold and $5.2 million in
Williams County.
Halcón is currently the operator of 216
producing Bakken wells and 68 Three Forks wells.
"El Halcón" - East Texas Eagle Ford
The Company did not run an operated rig in El
Halcón during the third quarter of 2016 and no wells were put
online during the quarter. Halcón anticipates adding a rig
back to this area when oil prices improve. Halcón is
currently evaluating the impact of enhanced frac designs on its El
Halcón acreage with the goal of improving ultimate recoveries and
economics.
Halcón currently has working interests in
approximately 80,000 net acres prospective for the Eagle Ford
formation in East Texas, approximately 82% of which is HBP.
The Company currently operates 112 El Halcón wells.
Production for the quarter averaged 6,693 Boe/d in the El Halcón
area.
Fresh Start Accounting
Halcón adopted fresh-start accounting as of
September 9, 2016, the effective date of its emergence from chapter
11 bankruptcy proceedings, resulting in the Company becoming a new
entity for financial reporting purposes. Upon the adoption of
fresh-start accounting, Halcón’s assets and liabilities were
recorded at their fair values as of the fresh-start reporting date,
and as a result the Company’s unaudited condensed consolidated
financial statements subsequent to September 9, 2016 may not be
comparable to its financial statements prior to September 9,
2016. Please review Halcón’s Form 10-Q for the third quarter
of 2016 for further details regarding fresh-start accounting and
the financial information presented at the end of this release.
Conference Call Information
Halcón Resources Corporation has scheduled a
conference call for Thursday, November 10, 2016, at 10:00 a.m. EST
(9:00 a.m. CST). Investors may participate in the conference
call via telephone by dialing (877) 810-3368 for domestic callers
or (914) 495-8561 for international callers, in both cases using
conference ID 94707346, and asking for the Halcón call a few
minutes prior to the start time.
The conference call will also be webcast live
over the Internet on the Company's website at
http://www.halconresources.com in the Investor Relations
section under Events & Presentations.
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. This release may also use the
term “EUR” to describe estimates of potentially recoverable
hydrocarbons that the SEC rules prohibit from being included in
filings with the SEC. These are based on the Company’s internal
estimates of hydrocarbon quantities that may be potentially
discovered through exploratory drilling or recovered with
additional drilling or recovery techniques. These quantities do not
constitute “reserves” within the meaning of the Society of
Petroleum Engineer’s Petroleum Resource Management System or SEC
rules and are subject to substantially greater uncertainties
relating to recovery than reserves. “EUR,” or Estimated Ultimate
Recovery, refers to our management’s internal estimates based on
per well hydrocarbon quantities that may be potentially recovered
from a hypothetical future well completed as a producer in the
area. For areas where the Company has no or very limited operating
history, EURs are based on publicly available information relating
to operations of producers operating in such areas. For areas
where the Company has sufficient operating data to make its own
estimates, EURs are based on internal estimates by the Company’s
management and reserve engineers. 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, effects on
market price of the Company's common stock and on the Company's
ability to access the capital markets, and the risks 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 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 |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited) |
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
|
|
Period from September 10,
2016 |
|
|
Period from July 1,
2016 |
|
Three
Months |
|
|
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
Operating revenues: |
|
|
|
|
|
|
|
|
Oil, natural gas and natural gas liquids sales: |
|
|
|
|
|
|
|
|
|
Oil |
|
$ |
21,260 |
|
|
|
$ |
74,002 |
|
|
$ |
121,845 |
|
|
|
Natural gas |
|
|
823 |
|
|
|
|
2,610 |
|
|
|
5,058 |
|
|
|
Natural gas
liquids |
|
|
798 |
|
|
|
|
2,488 |
|
|
|
2,615 |
|
|
|
Total
oil, natural gas and natural gas liquids sales |
|
|
22,881 |
|
|
|
|
79,100 |
|
|
|
129,518 |
|
|
Other |
|
|
226 |
|
|
|
|
247 |
|
|
|
421 |
|
|
|
Total
operating revenues |
|
|
23,107 |
|
|
|
|
79,347 |
|
|
|
129,939 |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
|
|
|
Lease operating |
|
|
3,791 |
|
|
|
|
12,473 |
|
|
|
22,248 |
|
|
|
Workover and other |
|
|
1,565 |
|
|
|
|
6,801 |
|
|
|
4,769 |
|
|
|
Taxes other than
income |
|
|
2,173 |
|
|
|
|
7,442 |
|
|
|
12,102 |
|
|
Gathering
and other |
|
|
2,637 |
|
|
|
|
7,376 |
|
|
|
9,091 |
|
|
Restructuring |
|
|
- |
|
|
|
|
95 |
|
|
|
434 |
|
|
General and
administrative |
|
|
16,681 |
|
|
|
|
17,317 |
|
|
|
21,027 |
|
|
Depletion,
depreciation and accretion |
|
|
9,051 |
|
|
|
|
25,618 |
|
|
|
77,071 |
|
|
Full cost
ceiling impairment |
|
|
420,934 |
|
|
|
|
- |
|
|
|
511,882 |
|
|
|
Total
operating expenses |
|
|
456,832 |
|
|
|
|
77,122 |
|
|
|
658,624 |
|
Income (loss) from operations |
|
|
(433,725 |
) |
|
|
|
2,225 |
|
|
|
(528,685 |
) |
Other income (expenses): |
|
|
|
|
|
|
|
|
Net gain (loss) on derivative contracts |
|
|
(7,575 |
) |
|
|
|
17,783 |
|
|
|
204,621 |
|
|
Interest expense and other, net |
|
|
(5,479 |
) |
|
|
|
(16,136 |
) |
|
|
(57,977 |
) |
|
Reorganization items |
|
|
(556 |
) |
|
|
|
913,722 |
|
|
|
- |
|
|
Gain (loss) on extinguishment of debt |
|
|
- |
|
|
|
|
- |
|
|
|
535,141 |
|
|
|
Total
other income (expenses) |
|
|
(13,610 |
) |
|
|
|
915,369 |
|
|
|
681,785 |
|
Income (loss) before income taxes |
|
|
(447,335 |
) |
|
|
|
917,594 |
|
|
|
153,100 |
|
Income tax benefit (provision) |
|
|
(3,357 |
) |
|
|
|
8,666 |
|
|
|
(6,025 |
) |
Net income (loss) |
|
|
(450,692 |
) |
|
|
|
926,260 |
|
|
|
147,075 |
|
Series A preferred dividends |
|
|
- |
|
|
|
|
(2,451 |
) |
|
|
(4,196 |
) |
Preferred dividends and accretion on redeemable noncontrolling
interest |
|
(791 |
) |
|
|
|
(7,388 |
) |
|
|
(19,351 |
) |
Net income (loss) available to common
stockholders |
|
$ |
(451,483 |
) |
|
|
$ |
916,421 |
|
|
$ |
123,528 |
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share of common
stock: |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(4.96 |
) |
|
|
$ |
7.58 |
|
|
$ |
1.05 |
|
|
|
Diluted |
|
$ |
(4.96 |
) |
|
|
$ |
6.06 |
|
|
$ |
0.88 |
|
Weighted average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
|
91,071 |
|
|
|
|
120,905 |
|
|
|
117,211 |
|
|
|
Diluted |
|
|
91,071 |
|
|
|
|
151,876 |
|
|
|
150,958 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited) (Continued) |
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
|
|
Period from September 10,
2016 |
|
|
Period from January 1,
2016 |
|
Nine Months |
|
|
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
Operating revenues: |
|
|
|
|
|
|
|
|
Oil, natural gas and natural gas liquids sales: |
|
|
|
|
|
|
|
|
|
Oil |
|
$ |
21,260 |
|
|
|
$ |
248,064 |
|
|
$ |
404,368 |
|
|
|
Natural gas |
|
|
823 |
|
|
|
|
9,511 |
|
|
|
17,595 |
|
|
|
Natural gas
liquids |
|
|
798 |
|
|
|
|
7,929 |
|
|
|
10,572 |
|
|
|
Total
oil, natural gas and natural gas liquids sales |
|
|
22,881 |
|
|
|
|
265,504 |
|
|
|
432,535 |
|
|
Other |
|
|
226 |
|
|
|
|
1,339 |
|
|
|
1,622 |
|
|
|
Total
operating revenues |
|
|
23,107 |
|
|
|
|
266,843 |
|
|
|
434,157 |
|
|
|
|
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
|
|
|
Lease operating |
|
|
3,791 |
|
|
|
|
50,032 |
|
|
|
81,266 |
|
|
|
Workover and other |
|
|
1,565 |
|
|
|
|
22,507 |
|
|
|
11,614 |
|
|
|
Taxes other than
income |
|
|
2,173 |
|
|
|
|
24,453 |
|
|
|
37,246 |
|
|
Gathering
and other |
|
|
2,637 |
|
|
|
|
29,279 |
|
|
|
30,583 |
|
|
Restructuring |
|
|
- |
|
|
|
|
5,168 |
|
|
|
2,664 |
|
|
General and
administrative |
|
|
16,681 |
|
|
|
|
83,641 |
|
|
|
68,098 |
|
|
Depletion,
depreciation and accretion |
|
|
9,051 |
|
|
|
|
120,555 |
|
|
|
297,409 |
|
|
Full cost
ceiling impairment |
|
|
420,934 |
|
|
|
|
754,769 |
|
|
|
2,014,518 |
|
|
Other
operating property and equipment impairment |
|
|
- |
|
|
|
|
28,056 |
|
|
|
- |
|
|
|
Total
operating expenses |
|
|
456,832 |
|
|
|
|
1,118,460 |
|
|
|
2,543,398 |
|
Income (loss) from operations |
|
|
(433,725 |
) |
|
|
|
(851,617 |
) |
|
|
(2,109,241 |
) |
Other income (expenses): |
|
|
|
|
|
|
|
|
Net gain (loss) on derivative contracts |
|
|
(7,575 |
) |
|
|
|
(17,998 |
) |
|
|
216,805 |
|
|
Interest expense and other, net |
|
|
(5,479 |
) |
|
|
|
(122,249 |
) |
|
|
(180,206 |
) |
|
Reorganization items |
|
|
(556 |
) |
|
|
|
913,722 |
|
|
|
- |
|
|
Gain (loss) on extinguishment of debt |
|
|
- |
|
|
|
|
81,434 |
|
|
|
557,907 |
|
|
Gain (loss) on extinguishment of Convertible Note and |
|
|
|
|
|
|
|
|
modification of February 2012 Warrants |
|
|
- |
|
|
|
|
- |
|
|
|
(8,219 |
) |
|
|
Total
other income (expenses) |
|
|
(13,610 |
) |
|
|
|
854,909 |
|
|
|
586,287 |
|
Income (loss) before income taxes |
|
|
(447,335 |
) |
|
|
|
3,292 |
|
|
|
(1,522,954 |
) |
Income tax benefit (provision) |
|
|
(3,357 |
) |
|
|
|
8,666 |
|
|
|
(6,224 |
) |
Net income (loss) |
|
|
(450,692 |
) |
|
|
|
11,958 |
|
|
|
(1,529,178 |
) |
Series A preferred dividends |
|
|
- |
|
|
|
|
(8,847 |
) |
|
|
(13,999 |
) |
Preferred dividends and accretion on redeemable noncontrolling
interest |
|
(791 |
) |
|
|
|
(35,905 |
) |
|
|
(39,069 |
) |
Net income (loss) available to common
stockholders |
|
$ |
(451,483 |
) |
|
|
$ |
(32,794 |
) |
|
$ |
(1,582,246 |
) |
|
|
|
|
|
|
|
|
|
|
Net income (loss) per share of common
stock: |
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
(4.96 |
) |
|
|
$ |
(0.27 |
) |
|
$ |
(15.28 |
) |
|
|
Diluted |
|
$ |
(4.96 |
) |
|
|
$ |
(0.27 |
) |
|
$ |
(15.28 |
) |
Weighted average common shares
outstanding: |
|
|
|
|
|
|
|
|
|
Basic |
|
|
91,071 |
|
|
|
|
120,513 |
|
|
|
103,525 |
|
|
|
Diluted |
|
|
91,071 |
|
|
|
|
120,513 |
|
|
|
103,525 |
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited) |
(In thousands, except share and per share
amounts) |
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
September 30, 2016 |
|
|
December 31, 2015 |
Current assets: |
|
|
|
|
|
Cash |
$ |
2,011 |
|
|
|
$ |
8,026 |
|
|
Accounts
receivable |
|
125,244 |
|
|
|
|
173,624 |
|
|
Receivables from derivative contracts |
|
70,835 |
|
|
|
|
348,861 |
|
|
Restricted cash |
|
165 |
|
|
|
|
16,812 |
|
|
Prepaids
and other |
|
7,713 |
|
|
|
|
9,270 |
|
|
Total
current assets |
|
205,968 |
|
|
|
|
556,593 |
|
Oil
and natural gas properties (full cost method): |
|
|
|
|
|
Evaluated |
|
1,202,727 |
|
|
|
|
7,060,721 |
|
|
Unevaluated |
|
329,218 |
|
|
|
|
1,641,356 |
|
|
Gross oil
and natural gas properties |
|
1,531,945 |
|
|
|
|
8,702,077 |
|
|
Less - accumulated
depletion |
|
(429,361 |
) |
|
|
|
(5,933,688 |
) |
|
Net oil
and natural gas properties |
|
1,102,584 |
|
|
|
|
2,768,389 |
|
Other operating property and equipment: |
|
|
|
|
|
Gas gathering and other
operating assets |
|
38,097 |
|
|
|
|
130,090 |
|
|
Less - accumulated
depreciation |
|
(203 |
) |
|
|
|
(22,435 |
) |
|
Net other
operating property and equipment |
|
37,894 |
|
|
|
|
107,655 |
|
Other noncurrent assets: |
|
|
|
|
|
Receivables from
derivative contracts |
|
2,816 |
|
|
|
|
16,614 |
|
|
Debt issuance costs,
net |
|
- |
|
|
|
|
7,633 |
|
|
Funds in escrow and
other |
|
1,786 |
|
|
|
|
1,808 |
|
Total assets |
$ |
1,351,048 |
|
|
|
$ |
3,458,692 |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Accounts payable and
accrued liabilities |
$ |
170,992 |
|
|
|
$ |
295,085 |
|
|
Liabilities from
derivative contracts |
|
1,415 |
|
|
|
|
- |
|
|
Other |
|
4,938 |
|
|
|
|
163 |
|
|
Total
current liabilities |
|
177,345 |
|
|
|
|
295,248 |
|
Long-term debt, net |
|
1,004,524 |
|
|
|
|
2,873,637 |
|
Other noncurrent liabilities: |
|
|
|
|
|
Liabilities from
derivative contracts |
|
1,122 |
|
|
|
|
290 |
|
|
Asset retirement
obligations |
|
31,082 |
|
|
|
|
46,853 |
|
|
Other |
|
4,139 |
|
|
|
|
6,264 |
|
Commitments and contingencies |
|
|
|
|
Mezzanine equity: |
|
|
|
|
|
Redeemable
noncontrolling interest |
|
- |
|
|
|
|
183,986 |
|
Stockholders' equity: |
|
|
|
|
|
Predecessor Preferred stock: 1,000,000 shares of $0.0001 par value
authorized; 244,724 |
|
|
|
|
|
shares of
5.75% Cumulative Perpetual Convertible Series A, issued and
outstanding |
|
- |
|
|
|
|
- |
|
|
Predecessor Common stock: 1,340,000,000 shares of $0.0001 par value
authorized; 122,523,559 |
|
|
|
|
|
shares
issued and outstanding |
|
- |
|
|
|
|
12 |
|
|
Predecessor Additional paid-in capital |
|
- |
|
|
|
|
3,283,097 |
|
|
Successor Common stock: 1,000,000,000 shares of $0.0001 par value
authorized; 92,638,093 |
|
|
|
|
|
shares
issued and outstanding |
|
9 |
|
|
|
|
- |
|
|
Successor Additional paid-in capital |
|
584,310 |
|
|
|
|
- |
|
|
Retained
earnings (accumulated deficit) |
|
(451,483 |
) |
|
|
|
(3,230,695 |
) |
|
Total
stockholders' equity |
|
132,836 |
|
|
|
|
52,414 |
|
Total liabilities and stockholders' equity |
$ |
1,351,048 |
|
|
|
$ |
3,458,692 |
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited) |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
|
|
Period from September 10,
2016 |
|
|
Period from July 1,
2016 |
|
Three Months |
|
|
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
Cash flows from operating activities: |
|
|
|
|
|
|
|
Net income
(loss) |
|
$ |
(450,692 |
) |
|
|
$ |
926,260 |
|
|
$ |
147,075 |
|
Adjustments
to reconcile net income (loss) to net cash |
|
|
|
|
|
|
|
provided by
(used in) operating activities: |
|
|
|
|
|
|
|
|
Depletion,
depreciation and accretion |
|
|
9,051 |
|
|
|
|
25,618 |
|
|
|
77,071 |
|
|
Full cost
ceiling impairment |
|
|
420,934 |
|
|
|
|
- |
|
|
|
511,882 |
|
|
Share-based
compensation, net |
|
|
13,196 |
|
|
|
|
1,224 |
|
|
|
3,035 |
|
|
Unrealized
loss (gain) on derivative contracts |
|
|
30,338 |
|
|
|
|
39,451 |
|
|
|
(89,741 |
) |
|
Amortization and write-off of deferred loan costs |
|
|
- |
|
|
|
|
3,347 |
|
|
|
1,910 |
|
|
Non-cash
interest and amortization of discount and premium |
|
|
377 |
|
|
|
|
246 |
|
|
|
320 |
|
|
Reorganization items |
|
|
560 |
|
|
|
|
(929,084 |
) |
|
|
|
Loss (gain)
on extinguishment of debt |
|
|
- |
|
|
|
|
- |
|
|
|
(535,141 |
) |
|
Accrued
settlements on derivative contracts |
|
|
(22,695 |
) |
|
|
|
23,072 |
|
|
|
(11,022 |
) |
|
Other
income (expense) |
|
|
(94 |
) |
|
|
|
(8,206 |
) |
|
|
797 |
|
Cash flow
from operations before changes in working capital |
|
|
975 |
|
|
|
|
81,928 |
|
|
|
106,186 |
|
Changes in
working capital |
|
|
11,347 |
|
|
|
|
(49,323 |
) |
|
|
8,478 |
|
Net cash
provided by (used in) operating activities |
|
|
12,322 |
|
|
|
|
32,605 |
|
|
|
114,664 |
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Oil and
natural gas capital expenditures |
|
|
(10,289 |
) |
|
|
|
(56,359 |
) |
|
|
(123,990 |
) |
|
Other
operating property and equipment capital expenditures |
|
|
(231 |
) |
|
|
|
(64 |
) |
|
|
(2,435 |
) |
|
Funds held
in escrow and other |
|
|
(1,721 |
) |
|
|
|
26 |
|
|
|
(24 |
) |
Net cash
provided by (used in) investing activities |
|
|
(12,241 |
) |
|
|
|
(56,397 |
) |
|
|
(126,449 |
) |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds
from borrowings |
|
|
30,000 |
|
|
|
|
461,000 |
|
|
|
283,000 |
|
|
Repayments
of borrowings |
|
|
(32,000 |
) |
|
|
|
(332,000 |
) |
|
|
(263,000 |
) |
|
Cash
payments to Noteholders and Preferred Holders |
|
|
(10,013 |
) |
|
|
|
(97,521 |
) |
|
|
- |
|
|
Debt
issuance costs |
|
|
- |
|
|
|
|
(791 |
) |
|
|
(7,091 |
) |
|
Series A
preferred dividends |
|
|
- |
|
|
|
|
- |
|
|
|
(4,656 |
) |
|
Offering
costs and other |
|
|
- |
|
|
|
|
(126 |
) |
|
|
(187 |
) |
Net cash
provided by (used in) financing activities |
|
|
(12,013 |
) |
|
|
|
30,562 |
|
|
|
8,066 |
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in
cash |
|
|
(11,932 |
) |
|
|
|
6,770 |
|
|
|
(3,719 |
) |
|
|
|
|
|
|
|
|
|
|
Cash at
beginning of period |
|
|
13,943 |
|
|
|
|
7,173 |
|
|
|
9,973 |
|
Cash at end
of period |
|
$ |
2,011 |
|
|
|
$ |
13,943 |
|
|
$ |
6,254 |
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
Cash paid
(received) for reorganization items |
|
$ |
(4 |
) |
|
|
$ |
15,362 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
Disclosure of non-cash investing and financing
activities: |
|
|
|
|
|
|
|
|
Accrued
capitalized interest |
|
$ |
- |
|
|
|
$ |
(21,579 |
) |
|
$ |
2,172 |
|
|
Asset
retirement obligations |
|
|
8 |
|
|
|
|
20 |
|
|
|
651 |
|
|
Preferred
dividends on redeemable noncontrolling interest |
|
|
|
|
|
|
|
|
paid-in-kind |
|
|
791 |
|
|
|
|
2,674 |
|
|
|
3,209 |
|
|
Accretion
of redeemable noncontrolling interest |
|
|
- |
|
|
|
|
4,714 |
|
|
|
16,142 |
|
|
Accrued
debt issuance costs |
|
|
- |
|
|
|
|
272 |
|
|
|
- |
|
|
Third Lien
Notes issued on conversion of senior notes |
|
|
- |
|
|
|
|
- |
|
|
|
1,017,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS (Unaudited) (Continued) |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
|
|
Period from September 10,
2016 |
|
|
Period from January 1,
2016 |
|
Nine Months |
|
|
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
Cash flows from operating activities: |
|
|
|
|
|
|
|
Net income
(loss) |
|
$ |
(450,692 |
) |
|
|
$ |
11,958 |
|
|
$ |
(1,529,178 |
) |
Adjustments
to reconcile net income (loss) to net cash |
|
|
|
|
|
|
|
provided by
(used in) operating activities: |
|
|
|
|
|
|
|
|
Depletion,
depreciation and accretion |
|
|
9,051 |
|
|
|
|
120,555 |
|
|
|
297,409 |
|
|
Full cost
ceiling impairment |
|
|
420,934 |
|
|
|
|
754,769 |
|
|
|
2,014,518 |
|
|
Other
operating property and equipment impairment |
|
|
- |
|
|
|
|
28,056 |
|
|
|
- |
|
|
Share-based
compensation, net |
|
|
13,196 |
|
|
|
|
4,876 |
|
|
|
11,245 |
|
|
Unrealized
loss (gain) on derivative contracts |
|
|
30,338 |
|
|
|
|
263,732 |
|
|
|
93,972 |
|
|
Amortization and write-off of deferred loan costs |
|
|
- |
|
|
|
|
6,371 |
|
|
|
6,002 |
|
|
Non-cash
interest and amortization of discount and premium |
|
|
377 |
|
|
|
|
1,515 |
|
|
|
2,029 |
|
|
Reorganization items |
|
|
560 |
|
|
|
|
(929,084 |
) |
|
|
- |
|
|
Loss (gain)
on extinguishment of debt |
|
|
- |
|
|
|
|
(81,434 |
) |
|
|
(557,907 |
) |
|
Loss (gain)
on extinguishment of Convertible Note and |
|
|
|
|
|
|
|
|
|
modification of
February 2012 Warrants |
|
|
- |
|
|
|
|
- |
|
|
|
8,219 |
|
|
Accrued
settlements on derivative contracts |
|
|
(22,695 |
) |
|
|
|
- |
|
|
|
(37,803 |
) |
|
Other
income (expense) |
|
|
(94 |
) |
|
|
|
(4,233 |
) |
|
|
5,805 |
|
Cash flow
from operations before changes in working capital |
|
|
975 |
|
|
|
|
177,081 |
|
|
|
314,311 |
|
Changes in
working capital |
|
|
11,347 |
|
|
|
|
(1,733 |
) |
|
|
17,883 |
|
Net cash
provided by (used in) operating activities |
|
|
12,322 |
|
|
|
|
175,348 |
|
|
|
332,194 |
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
|
|
|
|
|
Oil and
natural gas capital expenditures |
|
|
(10,289 |
) |
|
|
|
(226,617 |
) |
|
|
(531,741 |
) |
|
Other
operating property and equipment capital expenditures |
|
|
(231 |
) |
|
|
|
(950 |
) |
|
|
(9,913 |
) |
|
Funds held
in escrow and other |
|
|
(1,721 |
) |
|
|
|
(207 |
) |
|
|
2,988 |
|
Net cash
provided by (used in) investing activities |
|
|
(12,241 |
) |
|
|
|
(227,774 |
) |
|
|
(538,666 |
) |
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities: |
|
|
|
|
|
|
|
|
Proceeds
from borrowings |
|
|
30,000 |
|
|
|
|
886,000 |
|
|
|
1,579,000 |
|
|
Repayments
of borrowings |
|
|
(32,000 |
) |
|
|
|
(727,648 |
) |
|
|
(1,392,000 |
) |
|
Cash
payments to Noteholders and Preferred Holders |
|
|
(10,013 |
) |
|
|
|
(97,521 |
) |
|
|
- |
|
|
Debt
issuance costs |
|
|
- |
|
|
|
|
(1,977 |
) |
|
|
(25,703 |
) |
|
Series A
preferred stock issuance |
|
|
- |
|
|
|
|
- |
|
|
|
- |
|
|
Series A
preferred dividends |
|
|
- |
|
|
|
|
- |
|
|
|
(4,656 |
) |
|
Common
stock issued |
|
|
- |
|
|
|
|
- |
|
|
|
15,354 |
|
|
Offering
costs and other |
|
|
- |
|
|
|
|
(511 |
) |
|
|
(2,982 |
) |
Net cash
provided by (used in) financing activities |
|
|
(12,013 |
) |
|
|
|
58,343 |
|
|
|
169,013 |
|
|
|
|
|
|
|
|
|
|
|
Net increase (decrease) in
cash |
|
|
(11,932 |
) |
|
|
|
5,917 |
|
|
|
(37,459 |
) |
|
|
|
|
|
|
|
|
|
|
Cash at
beginning of period |
|
|
13,943 |
|
|
|
|
8,026 |
|
|
|
43,713 |
|
Cash at end
of period |
|
$ |
2,011 |
|
|
|
$ |
13,943 |
|
|
$ |
6,254 |
|
|
|
|
|
|
|
|
|
|
|
Supplemental cash flow information: |
|
|
|
|
|
|
|
|
Cash paid
(received) for reorganization items |
|
$ |
(4 |
) |
|
|
$ |
15,362 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
Disclosure of non-cash investing and financing
activities: |
|
|
|
|
|
|
|
|
Accrued
capitalized interest |
|
$ |
- |
|
|
|
$ |
(23,966 |
) |
|
$ |
(442 |
) |
|
Asset
retirement obligations |
|
|
8 |
|
|
|
|
939 |
|
|
|
2,405 |
|
|
Series A
preferred dividends paid in common stock |
|
|
- |
|
|
|
|
- |
|
|
|
9,803 |
|
|
Preferred
dividends on redeemable noncontrolling interest |
|
|
|
|
|
|
|
|
paid-in-kind |
|
|
791 |
|
|
|
|
9,329 |
|
|
|
9,340 |
|
|
Accretion
of redeemable noncontrolling interest |
|
|
- |
|
|
|
|
26,576 |
|
|
|
29,084 |
|
|
Change in
fair value of redeemable noncontrolling interest |
|
|
- |
|
|
|
|
- |
|
|
|
645 |
|
|
Accrued
debt issuance costs |
|
|
- |
|
|
|
|
1,176 |
|
|
|
- |
|
|
Common
stock issued on conversion of senior notes |
|
|
- |
|
|
|
|
- |
|
|
|
231,383 |
|
|
Third Lien
Notes issued on conversion of senior notes |
|
|
- |
|
|
|
|
- |
|
|
|
1,017,994 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
SELECTED OPERATING DATA |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2016(3) |
|
|
2015 |
|
|
2016(3) |
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
Production volumes: |
|
|
|
|
|
|
|
|
Crude oil
(MBbls) |
|
|
2,377 |
|
|
|
2,993 |
|
|
|
7,651 |
|
|
|
9,096 |
|
Natural
gas (MMcf) |
|
|
2,239 |
|
|
|
2,300 |
|
|
|
7,081 |
|
|
|
7,444 |
|
Natural
gas liquids (MBbls) |
|
|
395 |
|
|
|
371 |
|
|
|
1,176 |
|
|
|
1,046 |
|
Total
(MBoe) |
|
|
3,145 |
|
|
|
3,748 |
|
|
|
10,007 |
|
|
|
11,383 |
|
Average
daily production (Boe/d) |
|
|
34,185 |
|
|
|
40,739 |
|
|
|
36,522 |
|
|
|
41,696 |
|
|
|
|
|
|
|
|
|
|
Average
prices: |
|
|
|
|
|
|
|
|
Crude oil
(per Bbl) |
|
$ |
40.08 |
|
|
$ |
40.71 |
|
|
$ |
35.20 |
|
|
$ |
44.46 |
|
Natural
gas (per Mcf) |
|
|
1.53 |
|
|
|
2.20 |
|
|
|
1.46 |
|
|
|
2.36 |
|
Natural
gas liquids (per Bbl) |
|
|
8.32 |
|
|
|
7.05 |
|
|
|
7.42 |
|
|
|
10.11 |
|
Total per
Boe |
|
|
32.43 |
|
|
|
34.56 |
|
|
|
28.82 |
|
|
|
38.00 |
|
|
|
|
|
|
|
|
|
|
Cash
effect of derivative contracts: |
|
|
|
|
|
|
|
|
Crude oil
(per Bbl) |
|
$ |
33.56 |
|
|
$ |
37.73 |
|
|
$ |
34.97 |
|
|
$ |
33.54 |
|
Natural
gas (per Mcf) |
|
|
0.10 |
|
|
|
0.85 |
|
|
|
0.13 |
|
|
|
0.77 |
|
Natural
gas liquids (per Bbl) |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
- |
|
Total per
Boe |
|
|
25.44 |
|
|
|
30.65 |
|
|
|
26.83 |
|
|
|
27.30 |
|
|
|
|
|
|
|
|
|
|
Average prices computed after cash effect of settlement of
derivative contracts: |
|
|
|
|
|
|
|
Crude oil
(per Bbl) |
|
$ |
73.64 |
|
|
$ |
78.44 |
|
|
$ |
70.17 |
|
|
$ |
78.00 |
|
Natural
gas (per Mcf) |
|
|
1.63 |
|
|
|
3.05 |
|
|
|
1.59 |
|
|
|
3.13 |
|
Natural
gas liquids (per Bbl) |
|
|
8.32 |
|
|
|
7.05 |
|
|
|
7.42 |
|
|
|
10.11 |
|
Total per
Boe |
|
|
57.87 |
|
|
|
65.21 |
|
|
|
55.65 |
|
|
|
65.30 |
|
|
|
|
|
|
|
|
|
|
Average
cost per Boe: |
|
|
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
|
|
Lease
operating |
|
$ |
5.17 |
|
|
$ |
5.94 |
|
|
$ |
5.38 |
|
|
$ |
7.14 |
|
Workover
and other |
|
|
2.66 |
|
|
|
1.27 |
|
|
|
2.41 |
|
|
|
1.02 |
|
Taxes
other than income |
|
|
3.06 |
|
|
|
3.23 |
|
|
|
2.66 |
|
|
|
3.27 |
|
Gathering
and other, as adjusted (1) |
|
|
2.23 |
|
|
|
2.02 |
|
|
|
2.24 |
|
|
|
1.94 |
|
Restructuring |
|
|
0.03 |
|
|
|
0.12 |
|
|
|
0.52 |
|
|
|
0.23 |
|
General
and administrative, as adjusted (1) |
|
|
4.21 |
|
|
|
4.58 |
|
|
|
4.43 |
|
|
|
4.70 |
|
|
|
|
|
|
|
|
|
|
(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 |
|
$ |
10.82 |
|
|
$ |
5.61 |
|
|
$ |
10.03 |
|
|
$ |
5.98 |
|
Share-based compensation: |
|
|
|
|
|
|
|
|
Non-cash |
|
|
(4.59 |
) |
|
|
(0.81 |
) |
|
|
(1.81 |
) |
|
|
(0.99 |
) |
Transaction costs, key employee retention agreements and
other: |
|
|
|
|
|
|
|
|
Cash |
|
|
(2.02 |
) |
|
|
(0.22 |
) |
|
|
(3.79 |
) |
|
|
(0.29 |
) |
General
and administrative, as adjusted |
|
$ |
4.21 |
|
|
$ |
4.58 |
|
|
$ |
4.43 |
|
|
$ |
4.70 |
|
|
|
|
|
|
|
|
|
|
Gathering and other, as
reported |
|
$ |
3.18 |
|
|
$ |
2.43 |
|
|
$ |
3.19 |
|
|
$ |
2.69 |
|
Rig
termination / stacking charges |
|
|
(0.95 |
) |
|
|
(0.41 |
) |
|
|
(0.95 |
) |
|
|
(0.75 |
) |
Gathering and other, as
adjusted |
|
$ |
2.23 |
|
|
$ |
2.02 |
|
|
$ |
2.24 |
|
|
$ |
1.94 |
|
|
|
|
|
|
|
|
|
|
Total operating costs,
as reported |
|
$ |
24.89 |
|
|
$ |
18.48 |
|
|
$ |
23.67 |
|
|
$ |
20.10 |
|
Total
adjusting items |
|
|
(7.56 |
) |
|
|
(1.44 |
) |
|
|
(6.55 |
) |
|
|
(2.03 |
) |
Total operating costs,
as adjusted(2) |
|
$ |
17.33 |
|
|
$ |
17.04 |
|
|
$ |
17.12 |
|
|
$ |
18.07 |
|
|
|
|
|
|
|
|
|
|
(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. |
(3) For
illustrative purposes, the Company has combined the Successor and
Predecessor results to derive combined results for the three and
nine-month periods ended September 30, 2016. The combination
was generated by addition of comparable financial statement line
items. However, because of various adjustments to the consolidated
financial statements in connection with the application of
fresh-start reporting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
may not be comparable to those of the Predecessor. The
financial information preceding the table above provides the
Successor and the Predecessor GAAP results for the applicable
periods. The Company believes that subject to consideration of
the impact of fresh-start reporting, combining the results of the
Predecessor and Successor provide meaningful
information about, for instance, production, revenues and
costs, that assist a reader in understanding the Company’s
financial results for the applicable periods. |
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
SELECTED ITEM REVIEW AND RECONCILIATION
(Unaudited) |
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
Period from September 10,
2016 |
|
|
Period from July 1,
2016 |
|
Three Months |
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
As
Reported: |
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, as reported |
|
$ |
(451,483 |
) |
|
|
$ |
916,421 |
|
|
$ |
123,528 |
|
Series A preferred
dividends |
|
|
- |
|
|
|
|
2,451 |
|
|
|
4,196 |
|
Preferred dividends and
accretion on redeemable noncontrolling interest |
|
|
791 |
|
|
|
|
7,388 |
|
|
|
19,351 |
|
Net income (loss), as
reported |
|
|
(450,692 |
) |
|
|
|
926,260 |
|
|
|
147,075 |
|
|
|
|
|
|
|
|
|
Impact of
Selected Items: |
|
|
|
|
|
|
|
Unrealized loss (gain)
on derivatives contracts: |
|
|
|
|
|
|
|
Crude
oil |
|
$ |
30,323 |
|
|
|
$ |
39,271 |
|
|
$ |
(90,760 |
) |
Natural
gas |
|
|
15 |
|
|
|
|
180 |
|
|
|
1,019 |
|
Total
mark-to-market non-cash charge |
|
|
30,338 |
|
|
|
|
39,451 |
|
|
|
(89,741 |
) |
Full cost ceiling
impairment |
|
|
420,934 |
|
|
|
|
- |
|
|
|
511,882 |
|
Loss (gain) on
extinguishment of debt |
|
|
- |
|
|
|
|
- |
|
|
|
(535,141 |
) |
Deferred financing
costs expensed, net (1) |
|
|
- |
|
|
|
|
2,917 |
|
|
|
324 |
|
Reorganization
items |
|
|
556 |
|
|
|
|
(913,722 |
) |
|
|
- |
|
Restructuring |
|
|
- |
|
|
|
|
95 |
|
|
|
434 |
|
Rig termination /
stacking charges, key employee retention agreements, transaction
costs and other |
|
|
924 |
|
|
|
|
(333 |
) |
|
|
3,186 |
|
Selected items, before
income taxes |
|
|
452,752 |
|
|
|
|
(871,592 |
) |
|
|
(109,056 |
) |
Income tax effect of
selected items (2) |
|
|
- |
|
|
|
|
- |
|
|
|
(16,843 |
) |
Selected items, net of
tax |
|
|
452,752 |
|
|
|
|
(871,592 |
) |
|
|
(125,899 |
) |
|
|
|
|
|
|
|
|
As
Adjusted: |
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, excluding selected items |
|
$ |
2,060 |
|
|
|
$ |
54,668 |
|
|
$ |
21,176 |
|
Interest on convertible
debt, net |
|
|
- |
|
|
|
|
1,523 |
|
|
|
- |
|
Net income (loss)
available to common stockholders after assumed conversions,
excluding selected items (3) |
|
$ |
2,060 |
|
|
|
$ |
56,191 |
|
|
$ |
21,176 |
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per common share, as reported |
|
$ |
(4.96 |
) |
|
|
$ |
7.58 |
|
|
$ |
1.05 |
|
Impact of selected
items |
|
|
4.98 |
|
|
|
|
(7.13 |
) |
|
|
(0.87 |
) |
Basic net income (loss)
per common share, excluding selected items (3) |
|
$ |
0.02 |
|
|
|
$ |
0.45 |
|
|
$ |
0.18 |
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per common share, as reported |
|
$ |
(4.96 |
) |
|
|
$ |
6.06 |
|
|
$ |
0.88 |
|
Impact of selected
items |
|
|
4.98 |
|
|
|
|
(5.69 |
) |
|
|
(0.70 |
) |
Diluted net income
(loss) per common share, excluding selected items (3)(4) |
|
$ |
0.02 |
|
|
|
$ |
0.37 |
|
|
$ |
0.18 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities |
|
$ |
12,322 |
|
|
|
$ |
32,605 |
|
|
$ |
114,664 |
|
Changes in working
capital |
|
|
(11,347 |
) |
|
|
|
49,323 |
|
|
|
(8,478 |
) |
Cash flow from
operations before changes in working capital |
|
|
975 |
|
|
|
|
81,928 |
|
|
|
106,186 |
|
Cash components of
selected items |
|
|
23,615 |
|
|
|
|
806 |
|
|
|
13,830 |
|
Income tax effect of
selected items (2) |
|
|
- |
|
|
|
|
- |
|
|
|
(1,040 |
) |
Cash flow from
operations before changes in working capital, adjusted for selected
items (4) |
|
$ |
24,590 |
|
|
|
$ |
82,734 |
|
|
$ |
118,976 |
|
|
|
|
|
|
|
|
|
(1)
Represents charges related to the write-off of debt issuance costs
associated with the Predecessor Credit Agreement. |
|
|
|
|
|
|
|
|
(2) For
the 2016 (Successor) columns, this represents tax impact using an
estimated tax rate of 0.0% due to the Company maintaining a full
valuation allowance. |
For the
2015 (Predecessor) column, this represents tax impact using an
estimated tax rate of 37.04%. This column also includes an
adjustment for the change in valuation allowance of $(57.2
million) the three months ended September 30, 2015
(Predecessor). |
|
|
|
|
|
|
|
|
(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 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 period of September 10, 2016
through September 30, 2016 (Successor) and the period of July 1,
2016 through September 9, 2016 (Predecessor) was calculated
based upon weighted average diluted shares of 91.1 million and
151.9 million, respectively, due to the net income available to
common stockholders, excluding selected items. The impact of
selected items for the three months ended September 30, 2015
(Predecessor) was calculated based upon weighted average diluted
shares of 117.2 million due to the net income available to
Predecessor common stockholders excluding selected items. |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
SELECTED ITEM REVIEW AND RECONCILIATION
(Unaudited) (Continued) |
(In thousands, except per share
amounts) |
|
|
|
|
|
|
|
|
|
|
Successor |
|
|
Predecessor |
|
|
Period from September 10,
2016 |
|
|
Period from January 1,
2016 |
|
Nine Months |
|
|
through September 30,
2016 |
|
|
through September 9,
2016 |
|
Ended September 30,
2015 |
As
Reported: |
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, as reported |
|
$ |
(451,483 |
) |
|
|
$ |
(32,794 |
) |
|
$ |
(1,582,246 |
) |
Series A preferred
dividends |
|
|
- |
|
|
|
|
8,847 |
|
|
|
13,999 |
|
Preferred dividends and
accretion on redeemable noncontrolling interest |
|
|
791 |
|
|
|
|
35,905 |
|
|
|
39,069 |
|
Net income (loss), as
reported |
|
|
(450,692 |
) |
|
|
|
11,958 |
|
|
|
(1,529,178 |
) |
|
|
|
|
|
|
|
|
Impact of
Selected Items: |
|
|
|
|
|
|
|
Unrealized loss (gain)
on derivatives contracts: |
|
|
|
|
|
|
|
Crude
oil |
|
$ |
30,323 |
|
|
|
$ |
262,813 |
|
|
$ |
90,150 |
|
Natural
gas |
|
|
15 |
|
|
|
|
919 |
|
|
|
3,822 |
|
Total
mark-to-market non-cash charge |
|
|
30,338 |
|
|
|
|
263,732 |
|
|
|
93,972 |
|
Full cost ceiling
impairment |
|
|
420,934 |
|
|
|
|
754,769 |
|
|
|
2,014,518 |
|
Other operating
property and equipment impairment |
|
|
- |
|
|
|
|
28,056 |
|
|
|
- |
|
Loss (gain) on
extinguishment of debt |
|
|
- |
|
|
|
|
(81,434 |
) |
|
|
(557,907 |
) |
Loss (gain) on
extinguishment of Convertible Note and modification of February
2012 Warrants |
|
|
- |
|
|
|
|
- |
|
|
|
8,219 |
|
Deferred financing
costs expensed, net (1) |
|
|
- |
|
|
|
|
3,582 |
|
|
|
1,203 |
|
Reorganization
items |
|
|
556 |
|
|
|
|
(913,722 |
) |
|
|
- |
|
Restructuring |
|
|
- |
|
|
|
|
5,168 |
|
|
|
2,664 |
|
Rig termination /
stacking charges, key employee retention agreements, transaction
costs and other |
|
|
924 |
|
|
|
|
40,689 |
|
|
|
20,083 |
|
Selected items, before
income taxes |
|
|
452,752 |
|
|
|
|
100,840 |
|
|
|
1,582,752 |
|
Income tax effect of
selected items (2) |
|
|
- |
|
|
|
|
- |
|
|
|
(39,517 |
) |
Selected items, net of
tax |
|
|
452,752 |
|
|
|
|
100,840 |
|
|
|
1,543,235 |
|
|
|
|
|
|
|
|
|
As
Adjusted: |
|
|
|
|
|
|
|
Net income (loss)
available to common stockholders, excluding selected items |
|
$ |
2,060 |
|
|
|
$ |
112,798 |
|
|
$ |
14,057 |
|
Interest on convertible
debt, net |
|
|
- |
|
|
|
|
10,778 |
|
|
|
- |
|
Net income (loss)
available to common stockholders after assumed conversions,
excluding selected items (3) |
|
$ |
2,060 |
|
|
|
$ |
123,576 |
|
|
$ |
14,057 |
|
|
|
|
|
|
|
|
|
Basic net income (loss)
per common share, as reported |
|
$ |
(4.96 |
) |
|
|
$ |
(0.27 |
) |
|
$ |
(15.28 |
) |
Impact of selected
items |
|
|
4.98 |
|
|
|
|
1.21 |
|
|
|
15.42 |
|
Basic net income (loss)
per common share, excluding selected items (3) |
|
$ |
0.02 |
|
|
|
$ |
0.94 |
|
|
$ |
0.14 |
|
|
|
|
|
|
|
|
|
Diluted net income
(loss) per common share, as reported |
|
$ |
(4.96 |
) |
|
|
$ |
(0.27 |
) |
|
$ |
(15.28 |
) |
Impact of selected
items |
|
|
4.98 |
|
|
|
|
1.13 |
|
|
|
15.42 |
|
Diluted net income
(loss) per common share, excluding selected items (3)(4) |
|
$ |
0.02 |
|
|
|
$ |
0.86 |
|
|
$ |
0.14 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by
(used in) operating activities |
|
$ |
12,322 |
|
|
|
$ |
175,348 |
|
|
$ |
332,194 |
|
Changes in working
capital |
|
|
(11,347 |
) |
|
|
|
1,733 |
|
|
|
(17,883 |
) |
Cash flow from
operations before changes in working capital |
|
|
975 |
|
|
|
|
177,081 |
|
|
|
314,311 |
|
Cash components of
selected items |
|
|
23,615 |
|
|
|
|
66,092 |
|
|
|
54,849 |
|
Income tax effect of
selected items (2) |
|
|
- |
|
|
|
|
- |
|
|
|
(6,314 |
) |
Cash flow from
operations before changes in working capital, adjusted for selected
items (4) |
|
$ |
24,590 |
|
|
|
$ |
243,173 |
|
|
$ |
362,846 |
|
|
|
|
|
|
|
|
|
(1)
Represents charges related to the write-off of debt issuance costs
associated with the Predecessor Credit Agreement. |
|
|
|
|
|
|
|
|
(2) For
the 2016 (Successor) columns, this represents tax impact using an
estimated tax rate of 0.0% due to the Company maintaining a full
valuation allowance. |
For the
2015 (Predecessor) column, this represents tax impact using an
estimated tax rate of 37.04%. This column also includes an
adjustment for the change in valuation allowance of $546.7
million for the nine months ended September 30, 2015
(Predecessor). |
|
|
|
|
|
|
|
|
(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 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 period of September 10, 2016
through September 30, 2016 (Successor) and the period of
January 1, 2016 through September 9, 2016 (Predecessor) was
calculated based upon weighted average diluted shares of 91.1
million and 144.3 million, respectively, due to the net income
available to common stockholders, excluding selected items.
The impact of selected items for the nine months ended September
30, 2015 (Predecessor) was calculated based upon weighted average
diluted shares of 103.6 million, due to the net income
available to Predecessor common stockholders excluding selected
items. |
|
|
|
|
|
|
|
|
HALCÓN RESOURCES CORPORATION |
EBITDA RECONCILIATION
(Unaudited) |
(In thousands) |
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2016(2) |
|
|
2015 |
|
|
2016(2) |
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
Net income (loss), as
reported |
|
$ |
475,568 |
|
|
$ |
147,075 |
|
|
$ |
(438,734 |
) |
|
$ |
(1,529,178 |
) |
Interest
expense |
|
|
29,780 |
|
|
|
57,259 |
|
|
|
132,933 |
|
|
|
174,666 |
|
Depletion, depreciation and accretion |
|
|
34,669 |
|
|
|
77,071 |
|
|
|
129,606 |
|
|
|
297,409 |
|
Full cost
ceiling impairment |
|
|
420,934 |
|
|
|
511,882 |
|
|
|
1,175,703 |
|
|
|
2,014,518 |
|
Other
operating property and equipment impairment |
|
|
- |
|
|
|
- |
|
|
|
28,056 |
|
|
|
- |
|
Income
tax provision (benefit) |
|
|
(5,309 |
) |
|
|
6,025 |
|
|
|
(5,309 |
) |
|
|
6,224 |
|
Share-based compensation |
|
|
14,420 |
|
|
|
3,035 |
|
|
|
18,072 |
|
|
|
11,245 |
|
Interest
income |
|
|
(13 |
) |
|
|
(17 |
) |
|
|
(33 |
) |
|
|
(89 |
) |
(Gain)
loss on sale of other assets |
|
|
592 |
|
|
|
50 |
|
|
|
430 |
|
|
|
1,380 |
|
EBITDA(1) |
|
$ |
970,641 |
|
|
$ |
802,380 |
|
|
$ |
1,040,724 |
|
|
$ |
976,175 |
|
Impact of non-recurring
items: |
|
|
|
|
|
|
|
|
Restructuring |
|
|
95 |
|
|
|
434 |
|
|
|
5,168 |
|
|
|
2,664 |
|
Reorganization items |
|
|
(913,166 |
) |
|
|
- |
|
|
|
(913,166 |
) |
|
|
- |
|
Loss
(gain) on extinguishment of debt |
|
|
- |
|
|
|
(535,141 |
) |
|
|
(81,434 |
) |
|
|
(557,907 |
) |
Loss
(gain) on extinguishment of Convertible Note and modification of
February 2012 Warrants |
|
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
8,219 |
|
Loss
(gain) on mark-to-market of embedded derivative and tranche
rights |
|
|
(8,754 |
) |
|
|
762 |
|
|
|
(5,734 |
) |
|
|
3,814 |
|
Unrealized loss (gain) on derivatives contracts |
|
|
69,789 |
|
|
|
(89,741 |
) |
|
|
294,070 |
|
|
|
93,972 |
|
Transaction costs, key employee retention agreements and other |
|
|
6,342 |
|
|
|
822 |
|
|
|
37,883 |
|
|
|
3,609 |
|
Rig
termination / stacking charges |
|
|
3,003 |
|
|
|
1,551 |
|
|
|
9,464 |
|
|
|
8,585 |
|
Adjusted EBITDA(1) |
|
$ |
127,950 |
|
|
$ |
181,067 |
|
|
$ |
386,975 |
|
|
$ |
539,131 |
|
|
|
|
|
|
|
|
|
|
(1)
EBITDA and Adjusted EBITDA 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 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. |
|
|
|
|
|
|
|
|
|
(2) For
illustrative purposes, the Company has combined the Successor and
Predecessor results to derive combined results for the three and
nine-month periods ended September 30, 2016. The combination
was generated by addition of comparable financial statement line
items. However, because of various adjustments to the consolidated
financial statements in connection with the application of
fresh-start reporting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
may not be comparable to those of the Predecessor. The
financial information preceding the table above provides the
Successor and the Predecessor GAAP results for the applicable
periods. The Company believes that subject to consideration of
the impact of fresh-start reporting, combining the results of the
Predecessor and Successor provide meaningful
information about, for instance, production, revenues and
costs, that assist a reader in understanding the Company’s
financial results for the applicable periods. |
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