Denbury Resources Inc. (NYSE:DNR) (“Denbury” or the “Company”)
today announced net income of $127 million, or $0.31 per diluted
share, on revenues of $321 million for fourth quarter 2017.
Adjusted net income(1) (a non-GAAP measure) was $48 million, or
$0.12(1)(2) per diluted share, with the difference from GAAP net
income primarily due to the exclusion of $78 million ($48 million
after tax) of expense from noncash fair value adjustments on
commodity derivatives(1) (a non-GAAP measure) and a one-time
deferred tax benefit of $132 million from the reduction of the
federal income tax rate, with the GAAP and non-GAAP measures
reconciled on tables beginning on page 8.
2017 FOURTH QUARTER
HIGHLIGHTS
- Revenue of $321 million, the highest quarterly revenue since
second quarter 2015
- Company-wide positive oil differential of $1.70/Bbl, the
highest since 2013
- General and administrative (“G&A”) expense of $21 million,
the lowest in nine years
- Adjusted net income(1) (a non-GAAP measure) of $48 million,
more than triple third quarter 2017
- Cash flow from operations of $124 million, up 89% from third
quarter 2017
Sequential and year-over-year comparisons of
selected quarterly information are shown in the following
tables:
|
|
|
|
|
Quarter Ended |
(in
millions, except per share and unit data) |
|
Dec. 31, 2017 |
|
Sept. 30, 2017 |
|
Dec. 31, 2016 |
Net income (loss) |
|
$ |
127 |
|
|
$ |
0 |
|
|
$ |
(386 |
) |
Adjusted net income
(loss)(1) (non-GAAP measure) |
|
48 |
|
|
14 |
|
|
(7 |
) |
Net income (loss) per
diluted share |
|
0.31 |
|
|
0.00 |
|
|
(0.99 |
) |
Adjusted net income
(loss) per diluted share(1)(2) (non-GAAP measure) |
|
0.12 |
|
|
0.04 |
|
|
(0.02 |
) |
Cash flows from
operations |
|
124 |
|
|
66 |
|
|
60 |
|
Adjusted cash flows
from operations(1) (non-GAAP measure) |
|
134 |
|
|
68 |
|
|
53 |
|
|
|
|
|
|
|
|
Revenues |
|
$ |
321 |
|
|
$ |
266 |
|
|
$ |
267 |
|
Payment on settlements
of commodity derivatives |
|
(9 |
) |
|
0 |
|
|
(33 |
) |
Revenues
and commodity derivative settlements combined |
|
$ |
312 |
|
|
$ |
266 |
|
|
$ |
234 |
|
|
|
|
|
|
|
|
Average realized oil
price per barrel (excluding derivative settlements) |
|
$ |
57.17 |
|
|
$ |
47.78 |
|
|
$ |
48.03 |
|
Average realized oil
price per barrel (including derivative settlements) |
|
55.49 |
|
|
47.80 |
|
|
41.93 |
|
|
|
|
|
|
|
|
Total production
(BOE/d) |
|
61,144 |
|
|
60,328 |
|
|
60,685 |
|
Lease operating
expenses per BOE |
|
$ |
18.64 |
|
|
$ |
21.22 |
|
|
$ |
18.98 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) A non-GAAP measure. See accompanying schedules that
reconcile GAAP to non-GAAP measures along with a statement
indicating why the Company believes the non-GAAP measures provide
useful information for investors.(2) Calculated using average
diluted shares outstanding of 405.8 million, 393.0 million, and
388.7 million for the three months ended December 31, 2017,
September 30, 2017 and December 31, 2016, respectively, and 395.9
million and 375.5 million for the years ended December 31, 2017 and
2016, respectively.
2017 ANNUAL RESULTS
Denbury reported annual net income for 2017 of
$163 million, or $0.41 per diluted share, on revenues of $1.1
billion. Adjusted net income(1) (a non-GAAP measure) was $55
million, or $0.14(1)(2) per diluted share, with the difference from
GAAP net income primarily due to the exclusion of $30 million ($18
million after tax) of expense from noncash fair value adjustments
on commodity derivatives(1) (a non-GAAP measure) and a one-time
deferred tax benefit of $132 million from the reduction of the
corporate tax rate, with the GAAP and non-GAAP measures reconciled
on tables beginning on page 8.
2017 ANNUAL HIGHLIGHTS
- Capital expenditures of $241 million were within operating cash
flows, $9 million below mid-year revised guidance, and $59 million
below original guidance
- G&A expense of $102 million, a decrease of 7% from
2016
- Cash flow from operations of $267 million, up 22% from
2016
- Over $500 million of bank line availability as of December 31,
2017
- Completed debt exchanges in late 2017 / early 2018 resulting in
debt principal reduction of $184 million
- Increased proved reserves to 260 MMBOE, representing 127%
replacement of 2017 production
Year-over-year comparisons of selected annual
information are shown in the following tables:
|
|
|
|
|
Year Ended |
(in
millions, except per share and unit data) |
|
Dec. 31, 2017 |
|
Dec. 31, 2016 |
Net income (loss) |
|
$ |
163 |
|
|
$ |
(976 |
) |
Adjusted net income(1)
(non-GAAP measure) |
|
55 |
|
|
14 |
|
Net income (loss) per
diluted share |
|
0.41 |
|
|
(2.61 |
) |
Adjusted net income per
diluted share(1)(2) (non-GAAP measure) |
|
0.14 |
|
|
0.04 |
|
Cash flows from
operations |
|
267 |
|
|
219 |
|
Adjusted cash flows
from operations(1) (non-GAAP measure) |
|
329 |
|
|
264 |
|
|
|
|
|
|
Revenues |
|
$ |
1,116 |
|
|
$ |
961 |
|
Receipt (payment) on
settlements of commodity derivatives |
|
(48 |
) |
|
84 |
|
Revenues
and commodity derivative settlements combined |
|
$ |
1,068 |
|
|
$ |
1,045 |
|
|
|
|
|
|
Average realized oil
price per barrel (excluding derivative settlements) |
|
$ |
50.64 |
|
|
$ |
41.12 |
|
Average realized oil
price per barrel (including derivative settlements) |
|
48.40 |
|
|
44.86 |
|
|
|
|
|
|
Total continuing
production (BOE/d) |
|
60,298 |
|
|
62,998 |
|
Lease operating
expenses per BOE |
|
$ |
20.35 |
|
|
$ |
17.71 |
|
|
|
|
|
|
|
|
|
|
(1) A non-GAAP measure. See accompanying schedules that
reconcile GAAP to non-GAAP measures along with a statement
indicating why the Company believes the non-GAAP measures provide
useful information for investors.(2) Calculated using average
diluted shares outstanding of 405.8 million, 393.0 million, and
388.7 million for the three months ended December 31, 2017,
September 30, 2017 and December 31, 2016, respectively, and 395.9
million and 375.5 million for the years ended December 31, 2017 and
2016, respectively.
MANAGEMENT COMMENT
Chris Kendall, Denbury’s CEO, commented, “I am
extremely pleased with our fourth quarter results. We nearly
doubled cash flow from the third quarter, reflecting the combined
impact of cost reductions and Denbury’s extraordinary crude oil
exposure, clearly demonstrating our upside earnings power. We
streamlined our organization to execute more efficiently and focus
on key areas of value creation. This is reflected in our
recent successful Mission Canyon well, an opportunity that is an
example of the short-cycle, high-value organic growth potential
that exists in our prolific oil fields. Our balance sheet
remains a top priority, and with an improving oil price
environment, improving operations, and lower debt from recent debt
exchanges, I believe we are on a path to significantly improving
leverage metrics. We are entering 2018 as a much stronger
company, and I am confident we will build on our 2017
accomplishments, successfully execute our 2018 plan, and continue
to strengthen the entire business.”
REVIEW OF FINANCIAL RESULTS
Denbury’s average realized oil price, excluding
derivative contracts, was $57.17 per Bbl in fourth quarter 2017,
compared to $47.78 per Bbl in third quarter 2017 (“prior quarter”),
and $48.03 per Bbl in fourth quarter 2016. Including
derivative settlements, Denbury’s average realized oil price was
$55.49 per Bbl in fourth quarter 2017, compared to $47.80 per Bbl
in the prior quarter, and $41.93 per Bbl in the prior-year fourth
quarter.
The Company’s average realized oil price in
fourth quarter 2017 was $1.70 per Bbl above NYMEX prices, compared
to $0.34 per Bbl below NYMEX prices in the prior quarter and $1.22
per Bbl below NYMEX prices in fourth quarter 2016, with the
increases primarily attributable to improvement in LLS index prices
relative to NYMEX, as well as continued improvement in Rocky
Mountain region differentials. During fourth quarter 2017,
the Company sold approximately 65% of its crude oil at prices based
on, or partially tied to, the LLS index price, and the balance at
prices based on various other indexes tied to NYMEX prices,
primarily in the Rocky Mountain region.
The Company’s total lease operating expenses in
fourth quarter 2017 were $105 million, a decrease of $13 million,
or 11%, on an absolute-dollar basis when compared to third quarter
2017, and a decrease of $1 million compared to the prior-year
fourth quarter. The sequential quarter decline was spread
across various categories, with the largest individual item being
lower CO2 costs due to a $7 million reduction recorded in fourth
quarter 2017 for pricing adjustments of certain industrial-sourced
CO2, and the prior quarter including costs related to Hurricane
Harvey. During fourth quarter 2017, the Company’s CO2 used in
its operated fields averaged 614 million cubic feet per day, an
increase of 26% when compared to third quarter 2017, primarily due
to reduced CO2 injection last quarter related to Hurricane
Harvey.
Taxes other than income, which include ad
valorem, production and franchise taxes, increased $4 million and
$6 million from third quarter 2017 and prior-year fourth quarter,
respectively, due to the increase in oil and natural gas revenues
in fourth quarter 2017.
General and administrative expenses were $21
million in fourth quarter 2017, a decrease of $7 million compared
to third quarter 2017 and a decrease of $8 million compared to the
prior-year fourth quarter. On an annual basis, general and
administrative expenses decreased $8 million, or 7%, from 2016 to
2017, with the decreases largely due to lower employee-related
costs generally due to the February 2016 and August 2017 workforce
reductions and other cost savings initiatives.
Interest expense, net of capitalized interest,
totaled $23 million in fourth quarter 2017, a slight decrease of $1
million from third quarter 2017, and a slight increase of $1
million from the prior-year fourth quarter. Interest expense
excludes approximately $15 million and $13 million in the fourth
quarters of 2017 and 2016, respectively, of interest recorded as a
reduction of debt for financial reporting purposes instead of
interest expense, due to the accounting associated with debt
exchange transactions completed in 2016 and 2017. A schedule
detailing the components of interest expense is included on page 15
of this press release.
Depletion, depreciation, and amortization
(“DD&A”) decreased to $53 million during fourth quarter 2017,
compared to $647 million in the prior-year fourth quarter.
The difference was primarily due to the prior-year period including
an accelerated depreciation charge of $591 million for the Riley
Ridge gas processing facility. Denbury’s DD&A rate,
excluding the prior-year accelerated depreciation charge, was $9.47
per BOE in fourth quarter 2017, compared to $10.05 per BOE in the
prior-year fourth quarter.
Denbury’s effective tax rates for the fourth
quarter and full-year 2017 differed from the Company’s statutory
rate of 38%, primarily due to a one-time deferred tax benefit of
$132 million reflecting the re-measurement of deferred tax assets
and liabilities resulting from the reduction of the federal income
tax rate from 35% to 21% as enacted by the Tax Cut and Jobs Act
(the “Act”) signed by the President on December 22, 2017. Our
effective tax rate for 2017 was impacted to a lesser degree by tax
valuation allowances recorded during the period, which reduced the
net deferred tax benefit recognized. Beginning in 2018, the
Company currently expects its estimated statutory rate to decrease
as a result of the Act, from 38% to 25%.
2017 FOURTH QUARTER AND ANNUAL PRODUCTION
As previously released, Denbury’s production
averaged 61,144 BOE/d during fourth quarter 2017, in line with
management’s expectations, and was 97% oil, with CO2 tertiary
properties accounting for 65% of overall production. On a
sequential-quarter basis, production in fourth quarter 2017
increased by 816 BOE/d, or 1%, from prior quarter.
Excluding sold properties, Denbury’s continuing
production for full-year 2017 averaged 60,298 BOE/d, down 4% from
the prior-year’s level. Approximately 500 BOE/d of the
year-over-year decline was attributable to downtime associated with
Hurricane Harvey, with the remainder principally from non-tertiary
natural declines. Further production information is provided
on page 13 of this press release.
FOURTH QUARTER AND FULL-YEAR 2017
RESULTS CONFERENCE CALL INFORMATION
Denbury management will host a conference call
to review and discuss fourth quarter and full-year 2017 financial
and operating results, together with its financial and operating
estimates for 2018, today, Thursday, February 22, at 10:00 A.M.
(Central). Additionally, Denbury has published presentation
materials on its website which will be referenced during the
conference call. Individuals who would like to participate
should dial 800.230.1093 or 612.332.0226 ten minutes before the
scheduled start time. To access a live audio webcast of the
conference call and accompanying slide presentation, please visit
the investor relations section of the Company’s website at
www.denbury.com. The webcast will be archived on the website,
and a telephonic replay will be accessible for at least one month
after the call by dialing 800.475.6701 or 320.365.3844 and entering
confirmation number 426558.
CONFERENCE PRESENTATION
Chris Kendall, President and CEO, and Mark
Allen, Executive VP and CFO, will be attending the J.P. Morgan 2018
Global High Yield & Leveraged Finance Conference on Monday,
February 26, 2018. An updated presentation for the conference
will be posted to the Company’s website at www.denbury.com the
morning of Monday, February 26, 2018.
ANNUAL MEETING INFORMATION
Denbury’s 2018 Annual Meeting of Stockholders
will be held on Wednesday, May 23, 2018, at 8:00 A.M. (Central), at
Denbury’s corporate offices located at 5320 Legacy Drive, Plano,
Texas. The record date for determination of shareholders
entitled to vote at the annual meeting is the close of business on
Monday, March 26, 2018.
Denbury is an independent oil and natural gas
company with operations focused in two key operating areas: the
Gulf Coast and Rocky Mountain regions. The Company’s goal is
to increase the value of its properties through a combination of
exploitation, drilling and proven engineering extraction practices,
with the most significant emphasis relating to CO2 enhanced oil
recovery operations. For more information about Denbury,
please visit www.denbury.com.
This press release, other than historical
financial information, contains forward-looking statements that
involve risks and uncertainties detailed in the Company’s filings
with the Securities and Exchange Commission, including Denbury’s
most recent report on Form 10-K. These risks and
uncertainties are incorporated by this reference as though fully
set forth herein. These statements are based on engineering,
geological, financial and operating assumptions that management
believes are reasonable based on currently available information;
however, management’s assumptions and the Company’s future
performance are both subject to a wide range of business risks, and
there is no assurance that these goals and projections can or will
be met. Actual results may vary materially. In
addition, any forward-looking statements represent the Company’s
estimates only as of today and should not be relied upon as
representing its estimates as of any future date. Denbury
assumes no obligation to update its forward-looking statements.
FINANCIAL AND STATISTICAL DATA TABLES
AND RECONCILIATION SCHEDULES
Following are unaudited financial highlights for
the comparative three month and annual periods ended
December 31, 2017 and 2016 and the three month period ended
September 30, 2017. All production volumes and dollars are
expressed on a net revenue interest basis with gas volumes
converted to equivalent barrels at 6:1.
DENBURY RESOURCES
INC.CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
The following information is based on GAAP
reported earnings, with additional required disclosures included in
the Company’s Form 10-K:
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
In thousands, except
per-share data |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Revenues and
other income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil
sales |
|
$ |
310,791 |
|
|
$ |
258,177 |
|
|
$ |
256,621 |
|
|
$ |
1,079,703 |
|
|
$ |
924,618 |
|
Natural
gas sales |
|
2,787 |
|
|
3,173 |
|
|
2,409 |
|
|
9,963 |
|
|
11,133 |
|
CO2 sales
and transportation fees |
|
7,649 |
|
|
5,669 |
|
|
6,590 |
|
|
26,182 |
|
|
24,816 |
|
Interest
income and other income |
|
5,362 |
|
|
4,600 |
|
|
939 |
|
|
13,938 |
|
|
15,029 |
|
Total
revenues and other income |
|
326,589 |
|
|
271,619 |
|
|
266,559 |
|
|
1,129,786 |
|
|
975,596 |
|
Expenses |
|
|
|
|
|
|
|
|
|
|
Lease
operating expenses |
|
104,873 |
|
|
105,949 |
|
|
117,768 |
|
|
447,799 |
|
|
414,937 |
|
Marketing
and plant operating expenses |
|
12,062 |
|
|
16,809 |
|
|
11,816 |
|
|
51,820 |
|
|
57,454 |
|
CO2
discovery and operating expenses |
|
647 |
|
|
835 |
|
|
1,346 |
|
|
3,099 |
|
|
3,374 |
|
Taxes
other than income |
|
24,359 |
|
|
17,895 |
|
|
20,233 |
|
|
87,207 |
|
|
77,892 |
|
General
and administrative expenses |
|
20,503 |
|
|
28,837 |
|
|
27,273 |
|
|
101,806 |
|
|
109,926 |
|
Interest,
net of amounts capitalized of $8,545, $7,038, $9,416, $30,762 and
$25,982, respectively |
|
23,478 |
|
|
22,138 |
|
|
24,546 |
|
|
99,263 |
|
|
125,145 |
|
Depletion, depreciation, and amortization |
|
53,265 |
|
|
647,124 |
|
|
52,101 |
|
|
207,713 |
|
|
846,043 |
|
Commodity
derivatives expense (income) |
|
87,288 |
|
|
28,133 |
|
|
25,263 |
|
|
77,576 |
|
|
127,944 |
|
Gain on
debt extinguishment |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(115,095 |
) |
Write-down of oil and natural gas properties |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
810,921 |
|
Other
expenses |
|
7,003 |
|
|
1,170 |
|
|
— |
|
|
7,003 |
|
|
37,402 |
|
Total
expenses |
|
333,478 |
|
|
868,890 |
|
|
280,346 |
|
|
1,083,286 |
|
|
2,495,943 |
|
Income (loss)
before income taxes |
|
(6,889 |
) |
|
(597,271 |
) |
|
(13,787 |
) |
|
46,500 |
|
|
(1,520,347 |
) |
Income tax provision
(benefit) |
|
|
|
|
|
|
|
|
|
|
Current
income taxes |
|
(2,045 |
) |
|
266 |
|
|
1,072 |
|
|
(20,873 |
) |
|
(785 |
) |
Deferred
income taxes |
|
(131,625 |
) |
|
(211,811 |
) |
|
(15,301 |
) |
|
(95,779 |
) |
|
(543,385 |
) |
Net income
(loss) |
|
$ |
126,781 |
|
|
$ |
(385,726 |
) |
|
$ |
442 |
|
|
$ |
163,152 |
|
|
$ |
(976,177 |
) |
|
|
|
|
|
|
|
|
|
|
|
Net income
(loss) per common share |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.32 |
|
|
$ |
(0.99 |
) |
|
$ |
— |
|
|
$ |
0.42 |
|
|
$ |
(2.61 |
) |
Diluted |
|
$ |
0.31 |
|
|
$ |
(0.99 |
) |
|
$ |
— |
|
|
$ |
0.41 |
|
|
$ |
(2.61 |
) |
|
|
|
|
|
|
|
|
|
|
|
Weighted
average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
Basic |
|
392,354 |
|
|
388,739 |
|
|
392,013 |
|
|
390,928 |
|
|
373,859 |
|
Diluted |
|
405,793 |
|
|
388,739 |
|
|
393,023 |
|
|
395,921 |
|
|
373,859 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DENBURY RESOURCES
INC.SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Reconciliation of net income (loss) (GAAP
measure) to adjusted net income (loss) (non-GAAP measure)
Adjusted net income (loss) is a non-GAAP measure
provided as a supplement to present an alternative net income
(loss) measure which excludes expense and income items (and their
related tax effects) not directly related to the Company’s ongoing
operations. Management believes that adjusted net income
(loss) may be helpful to investors by eliminating the impact of
noncash and/or special or unusual items not indicative of the
Company’s performance from period to period, and is widely used by
the investment community, while also being used by management, in
evaluating the comparability of the Company’s ongoing operational
results and trends. Adjusted net income (loss) should not be
considered in isolation, as a substitute for, or more meaningful
than, net income (loss) or any other measure reported in accordance
with GAAP, but rather to provide additional information useful in
evaluating the Company’s operational trends and performance.
|
|
|
|
|
|
|
|
|
Quarter Ended |
|
|
|
December 31, |
|
September 30, |
|
2017 |
|
2016 |
|
2017 |
In thousands |
|
|
|
|
|
|
|
|
|
|
|
|
Amount |
|
Per DilutedShare |
|
Amount |
|
Per DilutedShare |
|
Amount |
|
Per DilutedShare |
Net income (loss) (GAAP
measure) |
|
$ |
126,781 |
|
|
0.31 |
|
|
$ |
(385,726 |
) |
|
(0.99 |
) |
|
$ |
442 |
|
|
|
0.00 |
|
|
Noncash
fair value adjustments on commodity derivatives (1) |
|
78,111 |
|
|
0.19 |
|
|
(4,644 |
) |
|
(0.01 |
) |
|
25,352 |
|
|
|
0.06 |
|
|
Accelerated depreciation charge(3) |
|
— |
|
|
— |
|
|
591,025 |
|
|
1.52 |
|
|
— |
|
|
|
— |
|
|
Severance-related payments included in general and administrative
expenses(7) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6,807 |
|
|
|
0.02 |
|
|
Other(8) |
|
3,251 |
|
|
0.01 |
|
|
— |
|
|
— |
|
|
— |
|
|
|
— |
|
|
Estimated
income taxes on above adjustments to net income (loss) and other
discrete tax items(9) |
|
(160,633 |
) |
|
(0.39 |
) |
|
(207,185 |
) |
|
(0.54 |
) |
|
(18,676 |
) |
|
|
(0.04 |
) |
|
Adjusted net income
(loss) (non-GAAP measure) |
|
$ |
47,510 |
|
|
0.12 |
|
|
$ |
(6,530 |
) |
|
(0.02 |
) |
|
$ |
13,925 |
|
|
|
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended |
|
December 31, |
|
2017 |
|
2016 |
In thousands |
Amount |
|
Per DilutedShare |
|
Amount |
|
Per DilutedShare |
Net income (loss) (GAAP
measure) |
$ |
163,152 |
|
|
|
$ |
0.41 |
|
|
|
$ |
(976,177 |
) |
|
|
$ |
(2.61 |
) |
Noncash
fair value adjustments on commodity derivatives(1) |
29,781 |
|
|
|
0.08 |
|
|
|
212,125 |
|
|
|
0.56 |
|
Impairment of long-lived and other assets(2) |
— |
|
|
|
— |
|
|
|
810,921 |
|
|
|
2.16 |
|
Accelerated depreciation charge(3) |
— |
|
|
|
— |
|
|
|
591,025 |
|
|
|
1.57 |
|
Gain on
debt extinguishment(4) |
— |
|
|
|
— |
|
|
|
(115,095 |
) |
|
|
(0.31 |
) |
Legal
settlements included in other expenses(5) |
— |
|
|
|
— |
|
|
|
30,250 |
|
|
|
0.08 |
|
Write-off
of debt issuance costs included in interest expense(6) |
— |
|
|
|
— |
|
|
|
5,553 |
|
|
|
0.01 |
|
Severance-related payments included in general and administrative
expenses(7) |
6,807 |
|
|
|
0.02 |
|
|
|
9,315 |
|
|
|
0.02 |
|
Other(8) |
3,251 |
|
|
|
0.01 |
|
|
|
5,638 |
|
|
|
0.02 |
|
Estimated
income taxes on above adjustments to net income (loss) and other
discrete tax items(9) |
(147,541 |
) |
|
|
(0.38 |
) |
|
|
(559,117 |
) |
|
|
(1.46 |
) |
Adjusted net income
(non-GAAP measure) |
$ |
55,450 |
|
|
|
$ |
0.14 |
|
|
|
$ |
14,438 |
|
|
|
$ |
0.04 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) The net change between periods of the fair
market values of open commodity derivative positions, excluding the
impact of settlements on commodity derivatives during the
period.(2) Full cost pool ceiling test write-downs related to the
Company’s oil and natural gas properties during the periods
presented.(3) Accelerated depreciation charge associated with the
Riley Ridge gas processing facility and related assets.(4) Gain on
extinguishment related to open market debt purchases and the debt
exchange during the year ended December 31, 2016.(5) Settlements
related to previously outstanding litigation, the most significant
of which pertaining to a $28 million payment to Evolution in
connection with the settlement resolving all outstanding disputes
and claims.(6) Write-off of debt issuance costs
associated with the Company’s senior secured bank credit facility,
related to reductions in the Company’s lender commitments resulting
from (1) the February 2016 amendment and (2) the May 2016
redetermination.(7) Severance-related payments associated with the
Company’s August-2017 and February-2016 workforce reductions.(8)
Reduction in a contingent consideration liability related to a
prior acquisition and transaction costs related to the Company’s
privately negotiated debt exchanges for the three and twelve months
ended December 31, 2017 and costs related to the Company’s debt
exchange and a loss on sublease for the year ended December 31,
2016.(9) The estimated income tax impacts on adjustments to net
income (loss) are generally computed based upon a statutory rate of
38%, applicable to all periods presented, with the exception of (1)
the impairments of long-lived and other assets, which are computed
individually based upon the Company’s effective tax rate, (2) the
tax impact of a (benefit) shortfall on the stock-based compensation
deduction which totaled ($0.3) million, $0.2 million, and $2
million during the three months ended December 31, 2017, December
30, 2016 and September 30, 2017, respectively, and $6 million and
$10 million for the year ended December 31, 2017 and 2016,
respectively, and (3) tax benefits for enhanced oil recovery income
tax credits of $2 million and $9 million during for the three
months ended December 31, 2017 and September 30, 2017,
respectively, and $11 million for the year ended December 31,
2017. In addition, to these items, the Company recorded a
one-time deferred tax benefit of $132 million reflecting the
re-measurement of our deferred tax assets and liabilities resulting
from the reduction of the federal income tax rate from 35% to 21%
as enacted by the Tax Cut and Jobs Act, as well as valuation
allowances totaling $6 million during the three months ended
December 31, 2017, and $15 million and $3 million during the years
ended December 31, 2017 and 2016, respectively, all of which have
been adjusted in this table.
DENBURY RESOURCES
INC.SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Reconciliation of cash flows from operations
(GAAP measure) to adjusted cash flows from operations (non-GAAP
measure) to adjusted cash flows from operation less interest
treated as debt reduction (non-GAAP measure)
Adjusted cash flow from operations is a non-GAAP
measure that represents cash flows provided by operations before
changes in assets and liabilities, as summarized from the Company’s
Consolidated Statements of Cash Flows. Adjusted cash flow
from operations measures the cash flows earned or incurred from
operating activities without regard to the collection or payment of
associated receivables or payables. Adjusted cash flow from
operations less interest treated as debt reduction is an additional
non-GAAP measure that removes interest associated with the
Company’s senior secured second lien notes and convertible notes
not reflected as interest expense for financial reporting
purposes. Management believes that it is important to
consider these additional measures, along with cash flows from
operations, as it believes the non-GAAP measures can often be a
better way to discuss changes in operating trends in its business
caused by changes in production, prices, operating costs and
related factors, without regard to whether the earned or incurred
item was collected or paid during that period.
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
In thousands |
|
December 31, |
|
Sept. 30, |
|
December 31, |
|
|
2017 |
|
|
2016 |
|
|
2017 |
|
|
2017 |
|
|
2016 |
|
Net income (loss) (GAAP
measure) |
$ |
126,781 |
|
$ |
(385,726 |
) |
$ |
442 |
|
$ |
163,152 |
|
$ |
(976,177 |
) |
Adjustments to
reconcile to adjusted cash flows from operations |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depletion, depreciation, and amortization |
|
53,265 |
|
|
647,124 |
|
|
52,101 |
|
|
207,713 |
|
|
846,043 |
|
Deferred
income taxes |
|
(131,625 |
) |
|
(211,811 |
) |
|
(15,301 |
) |
|
(95,779 |
) |
|
(543,385 |
) |
Stock-based compensation |
|
2,939 |
|
|
5,313 |
|
|
3,274 |
|
|
15,154 |
|
|
14,995 |
|
Noncash
fair value adjustments on commodity derivatives |
|
78,111 |
|
|
(4,644 |
) |
|
25,352 |
|
|
29,781 |
|
|
212,125 |
|
Gain on
debt extinguishment |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(115,095 |
) |
Write-down of oil and natural gas properties |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
810,921 |
|
Other |
|
4,614 |
|
|
2,575 |
|
|
2,351 |
|
|
9,303 |
|
|
14,845 |
|
Adjusted cash flows
from operations (non-GAAP measure)(1) |
|
134,085 |
|
|
52,831 |
|
|
68,219 |
|
|
329,324 |
|
|
264,272 |
|
Net
change in assets and liabilities relating to operations |
|
(9,801 |
) |
|
7,033 |
|
|
(2,568 |
) |
|
(62,181 |
) |
|
(45,049 |
) |
Cash flows from
operations (GAAP measure) |
|
$ |
124,284 |
|
|
$ |
59,864 |
|
|
$ |
65,651 |
|
|
$ |
267,143 |
|
|
$ |
219,223 |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted cash flows
from operations (non-GAAP measure)(1) |
|
$ |
134,085 |
|
|
$ |
52,831 |
|
|
$ |
68,219 |
|
|
$ |
329,324 |
|
|
$ |
264,272 |
|
Interest
payments treated as debt reduction |
|
(14,712 |
) |
|
(12,551 |
) |
|
(12,604 |
) |
|
(52,473 |
) |
|
(32,120 |
) |
Adjusted cash flows
from operations less interest treated as debt reduction (non-GAAP
measure) |
|
$ |
119,373 |
|
|
$ |
40,280 |
|
|
$ |
55,615 |
|
|
$ |
276,851 |
|
|
$ |
232,152 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) For the quarter ended September 30, 2017 and
year ended December 31, 2017, includes severance-related payments
associated with the 2017 workforce reduction of approximately $7
million. For the year ended December 31, 2016, includes a $28
million payment to Evolution in connection with the Company’s
settlement agreement to resolve all outstanding disputes and claims
and severance-related payments associated with the 2016 workforce
reduction of approximately $9 million.
DENBURY RESOURCES
INC.SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Reconciliation of commodity derivatives income
(expense) (GAAP measure) to noncash fair value adjustments on
commodity derivatives (non-GAAP measure)
Noncash fair value adjustments on commodity
derivatives is a non-GAAP measure and is different from “Commodity
derivatives expense (income)” in the Consolidated Statements of
Operations in that the noncash fair value adjustments on commodity
derivatives represents only the net change between periods of the
fair market values of open commodity derivative positions, and
excludes the impact of settlements on commodity derivatives during
the period. Management believes that noncash fair value
adjustments on commodity derivatives is a useful supplemental
disclosure to “Commodity derivatives expense (income)” because the
GAAP measure also includes settlements on commodity derivatives
during the period; the non-GAAP measure is widely used within the
industry and by securities analysts, banks and credit rating
agencies in calculating EBITDA and in adjusting net income to
present those measures on a comparative basis across companies, as
well as to assess compliance with certain debt covenants.
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
In
thousands |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Receipt (payment) on
settlements of commodity derivatives |
|
$ |
(9,177 |
) |
|
$ |
(32,777 |
) |
|
$ |
89 |
|
|
$ |
(47,795 |
) |
|
$ |
84,181 |
|
Noncash
fair value adjustments on commodity derivatives (non-GAAP
measure) |
|
(78,111 |
) |
|
4,644 |
|
|
(25,352 |
) |
|
(29,781 |
) |
|
(212,125 |
) |
Commodity derivatives
income (expense) (GAAP measure) |
|
$ |
(87,288 |
) |
|
$ |
(28,133 |
) |
|
$ |
(25,263 |
) |
|
$ |
(77,576 |
) |
|
$ |
(127,944 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DENBURY RESOURCES
INC.SUPPLEMENTAL NON-GAAP FINANCIAL MEASURES
(UNAUDITED)
Reconciliation of net income (loss) (GAAP
measure) to adjusted EBITDAX (non-GAAP measure)
Adjusted EBITDAX is a non-GAAP financial measure
as defined in the Company’s senior secured bank credit facility
which excludes certain items that are included in net income
(loss), the most directly comparable GAAP financial measure.
Items excluded include interest, income taxes, depreciation,
depletion and amortization, impairments, and items that the Company
believes affect the comparability of operating results such as
items whose timing and/or amount cannot be reasonably estimated or
are non-recurring. Management believes Adjusted EBITDAX may
be helpful to investors in order to assess our operating
performance as compared to that of other companies in our industry,
without regard to financing methods, capital structure or
historical costs basis. It is also used to assess our ability
to incur and service debt and fund capital expenditures.
Adjusted EBITDAX should not be considered in isolation, as a
substitute for, or more meaningful than, net income (loss) or any
other measure reported in accordance with GAAP. Our Adjusted
EBITDAX may not be comparable to similarly titled measures of
another company because all companies may not calculate Adjusted
EBITDAX in the same manner. The following table presents a
reconciliation of our net income (loss) to Adjusted EBITDAX.
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
In
thousands |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Net income (loss) (GAAP
measure) |
|
$ |
126,781 |
|
|
$ |
(385,726 |
) |
|
$ |
442 |
|
|
$ |
163,152 |
|
|
$ |
(976,177 |
) |
Adjustments to
reconcile to Adjusted EBITDAX |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
23,478 |
|
|
22,138 |
|
|
24,546 |
|
|
99,263 |
|
|
125,145 |
|
Income
tax expense (benefit) |
|
(133,670 |
) |
|
(211,545 |
) |
|
(14,229 |
) |
|
(116,652 |
) |
|
(544,170 |
) |
Depletion, depreciation, and amortization |
|
53,265 |
|
|
647,124 |
|
|
52,101 |
|
|
207,713 |
|
|
846,043 |
|
Gain on
debt extinguishment |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(115,095 |
) |
Write-down of oil and natural gas properties |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
810,921 |
|
Noncash
fair value adjustments on commodity derivatives |
|
78,111 |
|
|
(4,644 |
) |
|
25,352 |
|
|
29,781 |
|
|
212,125 |
|
Stock-based compensation |
|
2,939 |
|
|
5,313 |
|
|
3,274 |
|
|
15,154 |
|
|
14,995 |
|
Noncash,
non-recurring and other(1) |
|
6,473 |
|
|
2,656 |
|
|
10,610 |
|
|
23,358 |
|
|
49,264 |
|
Adjusted EBITDAX
(non-GAAP measure) |
|
$ |
157,377 |
|
|
$ |
75,316 |
|
|
$ |
102,096 |
|
|
$ |
421,769 |
|
|
$ |
423,051 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Excludes pro forma adjustments related to qualified
acquisitions or dispositions under the Company’s senior secured
bank credit facility.
DENBURY RESOURCES
INC.OPERATING HIGHLIGHTS (UNAUDITED)
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
|
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Production
(daily – net of royalties) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil
(barrels) |
|
59,086 |
|
|
58,429 |
|
|
58,376 |
|
|
58,410 |
|
|
61,440 |
|
Gas
(mcf) |
|
12,351 |
|
|
13,538 |
|
|
11,710 |
|
|
11,329 |
|
|
15,378 |
|
BOE
(6:1) |
|
61,144 |
|
|
60,685 |
|
|
60,328 |
|
|
60,298 |
|
|
64,003 |
|
Unit sales
price (excluding derivative settlements) |
|
|
|
|
|
|
|
|
|
|
Oil (per
barrel) |
|
$ |
57.17 |
|
|
$ |
48.03 |
|
|
$ |
47.78 |
|
|
$ |
50.64 |
|
|
$ |
41.12 |
|
Gas (per
mcf) |
|
2.45 |
|
|
2.55 |
|
|
2.24 |
|
|
2.41 |
|
|
1.98 |
|
BOE
(6:1) |
|
55.74 |
|
|
46.81 |
|
|
46.67 |
|
|
49.51 |
|
|
39.95 |
|
Unit sales
price (including derivative settlements) |
|
|
|
|
|
|
|
|
|
|
Oil (per
barrel) |
|
$ |
55.49 |
|
|
$ |
41.93 |
|
|
$ |
47.80 |
|
|
$ |
48.40 |
|
|
$ |
44.86 |
|
Gas (per
mcf) |
|
2.45 |
|
|
2.55 |
|
|
2.24 |
|
|
2.41 |
|
|
1.98 |
|
BOE
(6:1) |
|
54.11 |
|
|
40.94 |
|
|
46.69 |
|
|
47.34 |
|
|
43.54 |
|
NYMEX
differentials |
|
|
|
|
|
|
|
|
|
|
Gulf
Coast region |
|
|
|
|
|
|
|
|
|
|
Oil (per
barrel) |
|
$ |
3.00 |
|
|
$ |
(0.81 |
) |
|
$ |
0.01 |
|
|
$ |
0.22 |
|
|
$ |
(1.42 |
) |
Gas (per
mcf) |
|
(0.04 |
) |
|
(0.55 |
) |
|
(0.11 |
) |
|
(0.04 |
) |
|
(0.52 |
) |
Rocky
Mountain region |
|
|
|
|
|
|
|
|
|
|
Oil (per
barrel) |
|
$ |
(0.76 |
) |
|
$ |
(2.06 |
) |
|
$ |
(0.98 |
) |
|
$ |
(1.39 |
) |
|
$ |
(3.97 |
) |
Gas (per
mcf) |
|
(0.86 |
) |
|
(0.73 |
) |
|
(1.38 |
) |
|
(1.15 |
) |
|
(0.66 |
) |
Total
company |
|
|
|
|
|
|
|
|
|
|
Oil (per
barrel) |
|
$ |
1.70 |
|
|
$ |
(1.22 |
) |
|
$ |
(0.34 |
) |
|
$ |
(0.32 |
) |
|
$ |
(2.29 |
) |
Gas (per
mcf) |
|
(0.46 |
) |
|
(0.63 |
) |
|
(0.72 |
) |
|
(0.61 |
) |
|
(0.58 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
DENBURY RESOURCES
INC.OPERATING HIGHLIGHTS (UNAUDITED)
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
Average Daily Volumes (BOE/d) (6:1) |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Tertiary oil
production |
|
|
|
|
|
|
|
|
|
|
Gulf Coast
region |
|
|
|
|
|
|
|
|
|
|
Mature
properties(1) |
|
7,232 |
|
|
8,440 |
|
|
7,450 |
|
|
7,629 |
|
|
9,040 |
|
Delhi |
|
4,906 |
|
|
4,387 |
|
|
4,619 |
|
|
4,869 |
|
|
4,155 |
|
Hastings |
|
5,747 |
|
|
4,552 |
|
|
4,867 |
|
|
4,830 |
|
|
4,829 |
|
Heidelberg |
|
4,751 |
|
|
4,924 |
|
|
4,927 |
|
|
4,851 |
|
|
5,128 |
|
Oyster
Bayou |
|
4,868 |
|
|
4,988 |
|
|
4,870 |
|
|
5,007 |
|
|
5,083 |
|
Tinsley |
|
6,241 |
|
|
6,786 |
|
|
6,506 |
|
|
6,430 |
|
|
7,192 |
|
Total
Gulf Coast region |
|
33,745 |
|
|
34,077 |
|
|
33,239 |
|
|
33,616 |
|
|
35,427 |
|
Rocky Mountain
region |
|
|
|
|
|
|
|
|
|
|
Bell
Creek |
|
3,571 |
|
|
3,269 |
|
|
3,406 |
|
|
3,313 |
|
|
3,121 |
|
Salt
Creek |
|
2,172 |
|
|
— |
|
|
2,228 |
|
|
1,115 |
|
|
— |
|
Total
Rocky Mountain region |
|
5,743 |
|
|
3,269 |
|
|
5,634 |
|
|
4,428 |
|
|
3,121 |
|
Total tertiary oil
production |
|
39,488 |
|
|
37,346 |
|
|
38,873 |
|
|
38,044 |
|
|
38,548 |
|
Non-tertiary
oil and gas production |
|
|
|
|
|
|
|
|
|
|
Gulf Coast
region |
|
|
|
|
|
|
|
|
|
|
Mississippi |
|
721 |
|
|
745 |
|
|
867 |
|
|
981 |
|
|
850 |
|
Texas |
|
4,617 |
|
|
5,143 |
|
|
4,024 |
|
|
4,493 |
|
|
4,906 |
|
Other |
|
483 |
|
|
569 |
|
|
515 |
|
|
489 |
|
|
528 |
|
Total
Gulf Coast region |
|
5,821 |
|
|
6,457 |
|
|
5,406 |
|
|
5,963 |
|
|
6,284 |
|
Rocky Mountain
region |
|
|
|
|
|
|
|
|
|
|
Cedar
Creek Anticline |
|
14,302 |
|
|
15,186 |
|
|
14,535 |
|
|
14,754 |
|
|
16,322 |
|
Other |
|
1,533 |
|
|
1,696 |
|
|
1,514 |
|
|
1,537 |
|
|
1,844 |
|
Total
Rocky Mountain region |
|
15,835 |
|
|
16,882 |
|
|
16,049 |
|
|
16,291 |
|
|
18,166 |
|
Total non-tertiary
production |
|
21,656 |
|
|
23,339 |
|
|
21,455 |
|
|
22,254 |
|
|
24,450 |
|
Total
continuing production |
|
61,144 |
|
|
60,685 |
|
|
60,328 |
|
|
60,298 |
|
|
62,998 |
|
Property
sales |
|
|
|
|
|
|
|
|
|
|
2016
property divestitures(2) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1,005 |
|
Total
production |
|
61,144 |
|
|
60,685 |
|
|
60,328 |
|
|
60,298 |
|
|
64,003 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Mature properties include Brookhaven, Cranfield, Eucutta,
Little Creek, Lockhart Crossing, Mallalieu, Martinville, McComb and
Soso fields.(2) Includes non-tertiary production in the Rocky
Mountain region related to the sale of remaining non-core assets in
the Williston Basin of North Dakota and Montana, which closed in
the third quarter of 2016.
DENBURY RESOURCES
INC.PER-BOE DATA (UNAUDITED)
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
|
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Oil and natural gas
revenues |
|
$ |
55.74 |
|
|
$ |
46.81 |
|
|
$ |
46.67 |
|
|
$ |
49.51 |
|
|
$ |
39.95 |
|
Receipt (payment) on
settlements of commodity derivatives |
|
(1.63 |
) |
|
(5.87 |
) |
|
0.02 |
|
|
(2.17 |
) |
|
3.59 |
|
Lease operating
expenses – excluding special items |
|
(18.64 |
) |
|
(18.98 |
) |
|
(21.22 |
) |
|
(20.35 |
) |
|
(17.71 |
) |
Production and ad
valorem taxes |
|
(3.85 |
) |
|
(2.99 |
) |
|
(3.32 |
) |
|
(3.60 |
) |
|
(2.94 |
) |
Marketing expenses, net
of third-party purchases, and plant operating expenses |
|
(1.75 |
) |
|
(2.05 |
) |
|
(1.75 |
) |
|
(1.80 |
) |
|
(1.92 |
) |
Production netback |
|
29.87 |
|
|
16.92 |
|
|
20.40 |
|
|
21.59 |
|
|
20.97 |
|
CO2 sales, net of
operating and exploration expenses |
|
1.24 |
|
|
0.87 |
|
|
0.95 |
|
|
1.05 |
|
|
0.92 |
|
General and
administrative expenses |
|
(3.64 |
) |
|
(5.17 |
) |
|
(4.91 |
) |
|
(4.63 |
) |
|
(4.69 |
) |
Interest expense,
net |
|
(4.17 |
) |
|
(3.97 |
) |
|
(4.42 |
) |
|
(4.51 |
) |
|
(5.34 |
) |
Other |
|
0.53 |
|
|
0.81 |
|
|
0.27 |
|
|
1.47 |
|
|
(0.58 |
) |
Changes in assets and
liabilities relating to operations |
|
(1.74 |
) |
|
1.26 |
|
|
(0.46 |
) |
|
(2.83 |
) |
|
(1.92 |
) |
Cash
flows from operations |
|
22.09 |
|
|
10.72 |
|
|
11.83 |
|
|
12.14 |
|
|
9.36 |
|
DD&A – excluding
accelerated depreciation charge |
|
(9.47 |
) |
|
(10.05 |
) |
|
(9.39 |
) |
|
(9.44 |
) |
|
(10.89 |
) |
DD&A – accelerated
depreciation charge |
|
— |
|
|
(105.86 |
) |
|
— |
|
|
— |
|
|
(25.23 |
) |
Write-down of oil and
natural gas properties |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(34.62 |
) |
Deferred income
taxes |
|
23.40 |
|
|
37.94 |
|
|
2.76 |
|
|
4.35 |
|
|
23.20 |
|
Loss on early
extinguishment of debt |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
4.91 |
|
Noncash fair value
adjustments on commodity derivatives |
|
(13.89 |
) |
|
0.83 |
|
|
(4.57 |
) |
|
(1.35 |
) |
|
(9.05 |
) |
Other noncash
items |
|
0.41 |
|
|
(2.67 |
) |
|
(0.55 |
) |
|
1.71 |
|
|
0.65 |
|
Net
income (loss) |
|
$ |
22.54 |
|
|
$ |
(69.09 |
) |
|
$ |
0.08 |
|
|
$ |
7.41 |
|
|
$ |
(41.67 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CAPITAL EXPENDITURE SUMMARY
(UNAUDITED)(1)
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
|
December 31, |
|
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Capital expenditures by
project |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tertiary
oil fields |
|
$ |
30,661 |
|
|
$ |
28,725 |
|
|
$ |
34,029 |
|
|
$ |
129,458 |
|
|
$ |
119,117 |
|
Non-tertiary fields |
|
12,624 |
|
|
11,892 |
|
|
8,251 |
|
|
53,647 |
|
|
31,034 |
|
Capitalized internal costs(2) |
|
14,884 |
|
|
20,744 |
|
|
11,015 |
|
|
52,616 |
|
|
56,260 |
|
Oil and
natural gas capital expenditures |
|
58,169 |
|
|
61,361 |
|
|
53,295 |
|
|
235,721 |
|
|
206,411 |
|
CO2
pipelines, sources and other |
|
1,859 |
|
|
1,407 |
|
|
2,718 |
|
|
5,105 |
|
|
2,235 |
|
Capital expenditures, before acquisitions and capitalized
interest |
|
60,028 |
|
|
62,768 |
|
|
56,013 |
|
|
240,826 |
|
|
208,646 |
|
Acquisitions of oil and
natural gas properties |
|
(2,238 |
) |
|
818 |
|
|
1,916 |
|
|
88,777 |
|
|
11,706 |
|
Capital expenditures, before capitalized
interest |
|
57,790 |
|
|
63,586 |
|
|
57,929 |
|
|
329,603 |
|
|
220,352 |
|
Capitalized
interest |
|
8,545 |
|
|
7,038 |
|
|
9,416 |
|
|
30,762 |
|
|
25,982 |
|
Capital expenditures, total |
|
$ |
66,335 |
|
|
$ |
70,624 |
|
|
$ |
67,345 |
|
|
$ |
360,365 |
|
|
$ |
246,334 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Capital expenditure amounts include accrued
capital.(2) Includes capitalized internal acquisition,
exploration and development costs and pre-production tertiary
startup costs.
DENBURY RESOURCES
INC.INTEREST AND FINANCING EXPENSES
(UNAUDITED)
|
|
|
|
|
|
|
Quarter Ended |
|
Year Ended |
|
|
December 31, |
|
Sept. 30, |
|
December 31, |
In thousands |
|
2017 |
|
2016 |
|
2017 |
|
2017 |
|
2016 |
Cash interest (1) |
|
$ |
45,345 |
|
|
$ |
40,261 |
|
|
$ |
45,110 |
|
|
$ |
176,307 |
|
|
$ |
170,772 |
|
Interest not reflected
as expense for financial reporting purposes (1) |
|
(14,712 |
) |
|
(12,551 |
) |
|
(12,604 |
) |
|
(52,473 |
) |
|
(32,120 |
) |
Noncash interest
expense |
|
1,390 |
|
|
1,466 |
|
|
1,456 |
|
|
6,191 |
|
|
12,475 |
|
Less: capitalized
interest |
|
(8,545 |
) |
|
(7,038 |
) |
|
(9,416 |
) |
|
(30,762 |
) |
|
(25,982 |
) |
Interest
expense, net |
|
$ |
23,478 |
|
|
$ |
22,138 |
|
|
$ |
24,546 |
|
|
$ |
99,263 |
|
|
$ |
125,145 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Cash interest is presented on an accrual basis, and includes
interest which is paid semiannually on the Company’s 9% Senior
Secured Second Lien Notes due 2021, 9¼% Senior Secured Second Lien
Notes due 2022, and 3½% Convertible Senior Notes due 2024, most of
which is accounted for as debt and therefore not reflected as
interest for financial reporting purposes.
SELECTED BALANCE SHEET AND CASH FLOW
DATA (UNAUDITED)(1)
|
|
|
|
|
December 31, |
In thousands |
|
2017 |
|
|
2016 |
|
Cash and cash
equivalents |
|
$ |
58 |
|
|
$ |
1,606 |
|
Total assets |
|
4,471,299 |
|
|
4,274,578 |
|
|
|
|
|
|
Borrowings under senior
secured bank credit facility |
|
$ |
475,000 |
|
|
$ |
301,000 |
|
Borrowings under senior
secured second lien notes (principal only)(2) |
|
996,487 |
|
|
614,919 |
|
Borrowings under senior
convertible notes (principal only) |
|
84,650 |
|
|
— |
|
Borrowings under senior
subordinated notes (principal only) |
|
1,000,527 |
|
|
1,612,603 |
|
Financing and capital
leases |
|
218,727 |
|
|
251,389 |
|
Total
debt (principal only) |
|
$ |
2,775,391 |
|
|
$ |
2,779,911 |
|
|
|
|
|
|
Total stockholders’
equity |
|
$ |
648,165 |
|
|
$ |
468,448 |
|
|
|
|
|
|
|
|
|
|
(1) The table presented does not reflect
transactions in the January 2018 exchange of $174 million of the
Company’s existing senior subordinated notes for an aggregate $134
million of additional 9¼% Senior Secured Second Lien Notes due 2022
and new 5% Convertible Senior Notes due 2023.(2) Excludes $317
million and $229 million of future interest payable on the notes as
of December 31, 2017 and December 31, 2016, respectively, accounted
for as debt for financial reporting purposes.
|
|
Year Ended |
|
|
December 31, |
In thousands |
|
2017 |
|
2016 |
Cash provided by (used
in) |
|
|
|
|
|
|
|
|
Operating
activities |
|
$ |
267,143 |
|
|
$ |
219,223 |
|
Investing
activities |
|
(357,304 |
) |
|
(205,417 |
) |
Financing
activities |
|
88,613 |
|
|
(15,012 |
) |
DENBURY CONTACTS:
Mark C. Allen, Executive Vice President and Chief Financial Officer, 972.673.2000
John Mayer, Director of Investor Relations, 972.673.2383
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