DENVER, July 28, 2021 /PRNewswire/ -- Antero
Resources Corporation (NYSE: AR) ("Antero Resources", "Antero",
or the "Company") today announced its second quarter 2021 financial
and operational results. The relevant consolidated financial
statements are included in Antero Resource's Quarterly Report on
Form 10-Q for the quarter ended June
30, 2021.
Second Quarter 2021 Highlights Include:
- Net production averaged 3,324 MMcfe/d, including 173,000
Bbl/d of liquids
- Realized natural gas equivalent price averaged $3.78 per Mcfe, a $0.95 per Mcfe premium to NYMEX pricing
-
- Realized C3+ NGL prices averaged $40.32 per barrel, or 61% of WTI, a 159% increase
from the year ago period
- Net loss was $523 million,
which included a $757 million
unrealized hedging loss; Adjusted Net Income was $42 million (Non-GAAP)
- Adjusted EBITDAX was $319
million (Non-GAAP); net cash provided by operating
activities was $309 million
- Free Cash Flow was $105
million (Non-GAAP)
- Net Debt at quarter end was $2.4
billion, a $158 million
reduction from March 31, 2021 and a
$591 million reduction from year end
2020 (Non-GAAP)
- Net Debt to last twelve months Adjusted EBITDAX declined to
1.7x
- Credit facility was undrawn and liquidity was $1.9 billion as of June
30, 2021
- Increased full year 2021 natural gas realization guidance by
$0.05 per Mcf to a premium to NYMEX
of $0.15 to $0.25 per Mcf
- Reduced full year 2021 net marketing expense guidance by 22%
to a range of $0.06 to $0.08 per Mcfe
- Announced pilot with Project Canary to certify the Company's
Responsibly Sourced Gas (RSG)
- Established company records for completion stages per day
for the quarter and on a pad at 9.8 and 10.8 stages per day,
respectively
- Drilled the Company's longest lateral to date in the
Marcellus with a lateral length of 18,858 feet
Paul Rady, Chairman, President
and Chief Executive Officer of Antero Resources commented, "Today's
macro backdrop highlights Antero's core strengths, which include
liquids rich development and a firm transportation portfolio that
delivers natural gas and NGL realizations at a premium to benchmark
prices. Driven by strong international demand and flat U.S.
supply, C3+ NGL prices during the quarter were nearly triple the
year ago period. In addition, at a time when tight takeaway
capacity in the Appalachian Basin is resulting in wider
differentials, our firm transportation enabled us to realize a
pre-hedge natural gas price at an $0.18 per Mcf premium to NYMEX. The result
of these competitive advantages was Free Cash Flow of $105 million during the quarter. Based on
today's strip prices, we are targeting over $750 million in Free Cash Flow in 2021, which we
intend to use for additional debt reduction."
Mr. Rady continued, "We are committed to maintaining our
leadership position in ESG. Our pilot with Project Canary is
expected to certify a portion of the Company's assets on the
quality of the engineering design we utilize and the operational
practices that we employ, while underscoring the high environmental
standards by which Antero's natural gas is produced. Natural
gas is key to the energy transition and will be critical in
delivering a low carbon, affordable fuel to an expanding global
economy."
Michael Kennedy, Chief Financial
Officer and Senior Vice President of Finance of Antero Resources
said, "Since the end of 2020, we have reduced absolute debt by
nearly $600 million, resulting in a
leverage profile of 1.7x. Based on today's NGL and natural
gas future strips, we expect to achieve our goal of absolute debt
under $2 billion in early 2022.
Further, based on today's strip prices, we expect Free Cash Flow in
2022 to be higher than in 2021, driving leverage toward 1.0x by
year end 2022. As we approach our balance sheet
objectives, we will be opportunistic in further debt pay down and
returning capital to our shareholders."
For a discussion of the non-GAAP financial measures including
Adjusted Net Income, Adjusted EBITDAX, Free Cash Flow and Net Debt
please see "Non-GAAP Financial Measures."
Guidance Update
Antero increased guidance for its realized natural gas price to
a premium to NYMEX of $0.15 to
$0.25 per Mcf from a range of
$0.10 to $0.20 per Mcf previously, reflecting a 33%
increase at the midpoint. The increase was driven primarily by
tighter differentials in the NYMEX related markets where Antero's
gas is sold.
Net marketing expense guidance was reduced by 22% at the
midpoint, reflecting higher third party marketing volumes and the
mitigation of excess firm transportation expense year-to-date.
Cash production expense guidance was increased by 2% to a range
of $2.23 to $2.28 per Mcfe reflecting higher fuel and ad
valorem costs due to the increase in commodity prices.
Antero increased its land capital budget by $22.5 million at the midpoint to reflect
accelerated leasehold spend as the company continues to focus on
organically expanding its core liquids rich inventory.
An outage at the Sherwood processing facility occurred on
June 30, 2021 and lasted four days,
resulting in 10 Bcfe of deferred production. The outage
primarily impacted third quarter 2021 production volumes as the
facility ramped back up over several days in early July. This
downtime is expected to result in full year 2021 production at the
lower end of the 3.3 to 3.4 Bcfe guidance range.
|
Full Year 2021
–
Initial
|
|
Full Year 2021
–
Revised
|
|
Midpoint
|
|
Low
|
|
High
|
|
Low
|
|
High
|
|
Variance
|
|
|
|
|
|
|
|
|
|
|
Natural Gas
Realized Price vs. NYMEX Henry Hub ($/Mcf)
|
$0.10
|
|
$0.20
|
|
$0.15
|
|
$0.25
|
|
33%
|
Net Marketing
Expense ($/Mcfe)
|
$0.08
|
|
$0.10
|
|
$0.06
|
|
$0.08
|
|
(22%)
|
Cash Production
Expense ($/Mcfe)
|
$2.18
|
|
$2.23
|
|
$2.23
|
|
$2.28
|
|
2%
|
Land Capital
($MM)
|
$45
|
|
$45
|
|
$65
|
|
$70
|
|
50%
|
|
|
|
|
|
|
|
|
|
|
Net impact from
guidance changes (1)
|
($/Mcfe)
|
|
Cash Production
Expense
|
($0.05)
|
|
Net Marketing
Expense
|
$0.02
|
|
Natural Gas Realized
Prices vs. NYMEX Henry Hub
|
$0.05
|
|
Net
Impact
|
$0.02
|
|
|
|
(1)
|
Assumes midpoint
of revised guidance
|
|
Any 2021
projections not discussed in this release are unchanged from
previously stated guidance.
|
Project Canary
Antero has entered into a pilot to certify multiple pads
utilizing Project Canary's TrustWell certification process.
Antero's certification process is set to begin in the fourth
quarter of 2021 and to be completed in the first quarter of
2022. The TrustWell certification also aligns with Antero's
long-term goals to reduce methane leak loss rate by 50% to under
0.025%, reduce GHG intensity by 10% and to achieve Net Zero Scope 1
emissions by 2025.
Debt Reduction
Antero reduced net debt by $158
million during the second quarter utilizing Free Cash Flow
and the $51 million contingency
earnout received from achieving volume thresholds related to the
ORRI transaction. In May, Antero used proceeds from a
$600 million offering of senior notes
due 2030 to redeem all of its senior notes due in 2023.
Following the offering, Antero's nearest maturity is 2025.
Further, as of June 30, 2021, Antero
has an undrawn credit facility. The company plans to continue to
utilize Free Cash Flow to reduce debt, with the near-term goal of
reducing debt to under $2.0
billion.
Second Quarter 2021 Free Cash Flow
During the second quarter, Antero generated $105 million in Free Cash Flow. Free Cash
Flow before Changes in Working Capital was $77 million during the second quarter.
|
|
Three Months
Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Net cash provided by
operating activities
|
|
$
|
115,963
|
|
|
308,541
|
|
Less: Net cash used
in investing activities
|
|
|
(262,927)
|
|
|
(179,903)
|
|
Less: Proceeds from
asset sales
|
|
|
—
|
|
|
(2,351)
|
|
Less: Distributions
to non-controlling interests in Martica
|
|
|
—
|
|
|
(21,329)
|
|
Free Cash
Flow
|
|
$
|
(146,964)
|
|
|
104,958
|
|
Changes in Working
Capital
|
|
|
78,382
|
|
|
(28,077)
|
|
Free Cash Flow
before Changes in Working Capital
|
|
$
|
(68,582)
|
|
|
76,881
|
|
|
|
(1)
|
Working capital
adjustments in 2021 include $21.4 million in changes in current
assets and liabilities and $6.7 million in accounts payable and
accrued liabilities for additions to property and equipment. See
the cash flow statement in this release for details.
|
Second Quarter 2021 Financial Results
Net loss was $523 million, or
$1.70 per diluted share, compared to
a net loss of $463 million, or
$1.73 per diluted share, in the prior
year period. The net loss was driven by a $757 million unrealized commodity derivative fair
value loss primarily as a result of the rise in the natural gas
futures strip prices during the quarter. Adjusted Net Income
(non-GAAP measure) was $42 million,
or $0.13 per diluted share, compared
to Adjusted Net Loss of $99 million,
or $0.37 per diluted share, in the
prior year period.
Adjusted EBITDAX was $319 million,
a 71% increase compared to the prior year quarter, driven by higher
realized natural gas and NGL prices.
Net daily natural gas equivalent production in the second
quarter averaged 3.3 Bcfe/d, including 173,000 Bbl/d of liquids, as
detailed in the table below.
Antero's average realized natural gas price before hedging was
$3.01 per Mcf, representing a 76%
increase compared to the prior year period. Despite
Appalachian Basin differentials that widened significantly during
the quarter, Antero realized an $0.18
per Mcf premium to the average NYMEX Henry Hub price by
capitalizing on its premium firm transportation. Widening
differentials that were experienced by others were driven by
increasing supply and insufficient spare pipeline capacity that
Antero expects to continue into the future.
The following table details the components of average net
production and average realized prices for the three months ended
June 30, 2021:
|
|
Three Months Ended
June 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
Combined
|
|
|
|
|
|
|
|
|
|
|
|
Natural
|
|
|
|
Natural
Gas
|
|
Oil
|
|
C3+
NGLs
|
|
Ethane
|
|
Gas
Equivalent
|
|
|
|
(MMcf/d)
|
|
(Bbl/d)
|
|
(Bbl/d)
|
|
(Bbl/d)
|
|
(MMcfe/d)
|
|
Average Net
Production
|
|
|
2,287
|
|
|
10,330
|
|
|
114,725
|
|
|
47,868
|
|
|
3,324
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Combined
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural
|
|
|
|
Natural
Gas
|
|
Oil
|
|
C3+
NGLs
|
|
Ethane
|
|
Gas
Equivalent
|
|
Average Realized
Prices
|
|
($/Mcf)
|
|
($/Bbl)
|
|
($/Bbl)
|
|
($/Bbl)
|
|
($/Mcfe)
|
|
Average realized
prices before settled derivatives
|
|
$
|
3.01
|
|
$
|
55.22
|
|
$
|
40.32
|
|
$
|
9.97
|
|
$
|
3.78
|
|
NYMEX average
price
|
|
$
|
2.83
|
|
$
|
66.09
|
|
|
|
|
|
|
|
$
|
2.83
|
|
Premium /
(Differential) to NYMEX before settled derivatives
|
|
$
|
0.18
|
|
$
|
(10.87)
|
|
|
|
|
|
|
|
$
|
0.95
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Settled commodity
derivatives
|
|
$
|
(0.10)
|
|
$
|
(3.17)
|
|
$
|
(4.37)
|
|
$
|
—
|
|
$
|
(0.23)
|
|
Average realized
prices after settled derivatives
|
|
$
|
2.91
|
|
$
|
52.05
|
|
$
|
35.95
|
|
$
|
9.97
|
|
$
|
3.55
|
|
Premium/(Differential) to NYMEX after settled
derivatives
|
|
$
|
0.08
|
|
$
|
(14.04)
|
|
|
|
|
|
|
|
$
|
0.72
|
|
Antero's average realized C3+ NGL price before hedging was
$40.32 per barrel, a 159% increase
versus the prior year period. Antero shipped 55% of its total
C3+ NGL net production on Mariner East 2 for export and realized a
$0.07 per gallon premium to Mont
Belvieu pricing on these volumes at Marcus Hook, PA. Antero
sold the remaining 45% of C3+ NGL net production at a $0.10 per gallon discount to Mont Belvieu pricing
at Hopedale, OH. The resulting blended price on 114,725 Bbl/d
of net C3+ NGL production was $40.32
per barrel, which was a $0.01 per
gallon discount to Mont Belvieu pricing. Antero expects to
sell at least 50% of its C3+ NGL production in 2021 at Marcus Hook
for export at a premium to Mont Belvieu. The average realized
price for C3+ NGLs is forecasted to be in the range of $0.00 to a $0.05
per gallon premium relative to Mont Belvieu pricing in 2021,
unchanged from prior guidance.
|
|
Three Months Ended
June 30, 2021
|
|
|
|
|
|
|
|
|
|
|
|
Pricing
Point
|
|
Net C3+
NGL
Production
(Bbl/d)
|
|
%
by
Destination
|
|
Premium
(Discount)
To Mont
Belvieu
($/Gal)
|
Propane / Butane
exported on ME2
|
Marcus Hook,
PA
|
|
63,089
|
|
55%
|
|
$0.07
|
Remaining C3+ NGL
volume
|
Hopedale,
OH
|
|
51,636
|
|
45%
|
|
($0.10)
|
Total C3+
NGLs/Blended Premium
|
|
|
|
114,725
|
|
100%
|
|
($0.01)
|
All-in cash expense, which includes lease operating, gathering,
compression, processing and transportation, production and ad
valorem taxes was $2.30 per Mcfe in
the second quarter, a 9% increase compared to $2.11 per Mcfe average during the second quarter
of 2020. The increase from a year ago was due primarily to an
increase in gathering, processing and transportation expense driven
by higher fuel costs as a result of higher natural gas prices and
$12 million in incentive fee rebates
earned in the second quarter of 2020 that were not earned in the
second quarter of 2021. Transportation expense increased
$0.06 per Mcfe due to increased
utilization on higher tariff pipelines into the Midwest and Gulf
Coast, which in turn led to higher natural gas price
realizations. Lease operating expense was $0.07 per Mcfe in the second quarter, a decrease
of $0.01 per Mcfe from the year ago
period. Production and ad valorem expense increased
$0.05 per Mcfe from the year ago
period due to higher commodity prices.
G&A expense was $0.09 per
Mcfe, flat from the second quarter of 2020. G&A expense
is expected to be in the range of $0.08 to $0.10 per
Mcfe for the remainder of 2021.
Net marketing loss was $0.11 per
Mcfe in the second quarter, compared to a loss of $0.15 per Mcfe reported in the prior year
period. The improvement was due to higher third party
marketing volumes.
Second Quarter 2021 Operating Update
Antero placed 22 horizontal Marcellus wells to sales during the
second quarter with an average lateral length of 11,740 feet. Nine
of the 22 new wells have been on line for at least 60 days and the
average 60-day rate per well was 23.2 MMcfe/d, including
approximately 922 Bbl/d of liquids assuming 25% ethane
recovery.
Antero set a company record for completion stages per day for a
quarter at 9.8 stages per day, a 23% increase from the 8.0 stages
per day average in 2020, as well as a new monthly record at 10.7
stages per day. Antero is currently operating three drilling rigs
and two completion crews.
Second Quarter 2021 Capital Investment
Antero's accrued drilling and completion capital expenditures
for the three months ended June 30,
2021 were $167 million.
In addition to capital invested in drilling and completion costs,
the Company invested $16 million in
land during the second quarter. For a reconciliation of
accrued capital expenditures to cash capital expenditures see the
table in the Non-GAAP Financial Measures section.
Balance Sheet and Liquidity
As of June 30, 2021, Antero's
total debt was $2.4 billion with no
borrowings outstanding under the Company's revolving credit
facility. After deducting letters of credit outstanding, the
Company had approximately $1.9
billion in available liquidity at June 30, 2021. Net debt to trailing twelve
month Adjusted EBITDA ratio (non-GAAP) was 1.7x as of June 30, 2021.
Commodity Derivative Positions
As of June 30, 2021, the Company
has hedged 835 Bcf of natural gas at a weighted average index price
of $2.62 per MMBtu through 2023 with
fixed price swap positions. Antero also has oil and NGL fixed
price swap positions, as detailed in the below table.
Please see Antero's Quarterly Report on Form 10-Q for the
quarter ended June 30, 2021, for more
information on all commodity derivative positions. For detail
on current commodity positions, please see the Hedge Profile
presentations at www.anteroresources.com.
The following tables summarize Antero's natural gas and NGL
hedge position as of June 30,
2021:
Fixed price natural gas positions from July 1, 2021 through December 31, 2023 were as follows:
|
|
Natural
gas
MMBtu/day
|
|
Weighted
average
index
price
|
|
Year ending
December 31, 2021:
|
|
|
|
|
|
|
NYMEX
($/MMBtu)
|
|
2,160,000
|
|
|
$2.77
|
|
Year ending
December 31, 2022:
|
|
|
|
|
|
|
NYMEX
($/MMBtu)
|
|
1,155,486
|
|
|
$2.50
|
|
Year ending
December 31, 2023:
|
|
|
|
|
|
|
NYMEX
($/MMBtu)
|
|
43,000
|
|
|
$2.37
|
|
NGL and oil derivative contract positions from July 1, 2021 through December 31, 2021 were as follows:
|
Derivative
Contract
Type
|
Liquids
Hedges
(Bbl/d)
|
|
|
Weighted
average
index
price
($/Bbl)
|
Third Quarter
2021:
|
|
|
|
|
|
C3+ NGL Composite
Barrel
|
Fixed
swap
|
75,950
|
|
|
$34.47
|
Fourth Quarter
2021:
|
|
|
|
|
|
C3+ NGL Composite
Barrel
|
Fixed
swap
|
15,200
|
|
|
$42.68
|
|
|
|
|
|
|
Year ending
December 31, 2021:
|
|
|
|
|
|
Total NYMEX Crude
Oil
|
|
3,000
|
|
|
$55.16
|
Conference Call
A conference call is scheduled on Thursday, July 29, 2021 at 9:00 am MT to discuss the financial and
operational results. A brief Q&A session for security
analysts will immediately follow the discussion of the
results. To participate in the call, dial in at 877-407-9079
(U.S.), or 201-493-6746 (International) and reference "Antero
Resources." A telephone replay of the call will be available
until Thursday, August 5, 2021 at
9:00 am MT at 877-660-6853 (U.S.) or
201-612-7415 (International) using the conference ID: 13720339.
A simultaneous webcast of the call may be accessed over the
internet at www.anteroresources.com. The webcast will be
archived for replay on the Company's website until Thursday, August 5, 2021 at 9:00 am MT.
Presentation
An updated presentation will be posted to the Company's website
before the conference call. The presentation can be found at
www.anteroresources.com on the homepage. Information on the
Company's website does not constitute a portion of, and is not
incorporated by reference into this press release.
Non-GAAP Financial Measures
Adjusted Net Income (Loss)
Adjusted Net Income (Loss) as set forth in this release
represents net loss, adjusted for certain items. Antero
believes that Adjusted Net Income (Loss) is useful to investors in
evaluating operational trends of the Company and its performance
relative to other oil and gas producing companies. Adjusted
Net Income (Loss) is not a measure of financial performance under
GAAP and should not be considered in isolation or as a substitute
for net loss as an indicator of financial performance. The
following tables reconcile net loss to Adjusted Net Income (Loss)
(in thousands):
|
|
Three Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Net loss attributable
to Antero Resources Corp
|
|
$
|
(463,304)
|
|
|
(523,467)
|
|
Net income (loss) and
comprehensive income (loss) attributable to noncontrolling
interests
|
|
|
236
|
|
|
(10,984)
|
|
Unrealized commodity
derivative losses
|
|
|
481,927
|
|
|
756,998
|
|
Payments for
derivative monetizations
|
|
|
—
|
|
|
4,569
|
|
Amortization of
deferred revenue, VPP
|
|
|
—
|
|
|
(11,279)
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
(2,288)
|
|
Impairment of oil and
gas properties
|
|
|
37,350
|
|
|
9,303
|
|
Equity-based
compensation
|
|
|
7,973
|
|
|
4,249
|
|
(Gain) loss on early
extinguishment of debt
|
|
|
(39,171)
|
|
|
23,065
|
|
Loss on convertible
note equitization
|
|
|
—
|
|
|
11,731
|
|
Equity in earnings of
unconsolidated affiliate
|
|
|
(20,228)
|
|
|
(17,477)
|
|
Contract termination
and rig stacking
|
|
|
11,071
|
|
|
844
|
|
Tax effect of
reconciling items (1)
|
|
|
(115,047)
|
|
|
(187,629)
|
|
|
|
|
(99,193)
|
|
|
57,635
|
|
Martica adjustments
(2)
|
|
|
—
|
|
|
(16,097)
|
|
Adjusted Net Income
(Loss)
|
|
$
|
(99,193)
|
|
|
41,538
|
|
|
|
|
|
|
|
|
|
Fully Diluted Shares
Outstanding
|
|
|
268,386
|
|
|
307,879
|
|
|
|
(1)
|
Deferred taxes
were 24% for 2020 and 2021.
|
(2)
|
Adjustments
reflect noncontrolling interest in Martica not otherwise adjusted
in amounts above.
|
Net Debt
Net Debt is calculated as total debt less cash and cash
equivalents. Management uses Net Debt to evaluate the
Company's financial position, including its ability to service its
debt obligations.
The following table reconciles consolidated total debt to Net
Debt as used in this release (in thousands):
|
|
December
31,
|
|
June 30,
|
|
|
|
2020
|
|
2021
|
|
Bank credit
facility
|
|
$
|
1,017,000
|
|
|
—
|
|
5.125% senior notes
due 2022
|
|
|
660,516
|
|
|
—
|
|
5.625% senior notes
due 2023
|
|
|
574,182
|
|
|
—
|
|
5.000% senior notes
due 2025
|
|
|
590,000
|
|
|
590,000
|
|
8.375% senior notes
due 2026
|
|
|
—
|
|
|
500,000
|
|
7.625% senior notes
due 2029
|
|
|
—
|
|
|
700,000
|
|
5.375% senior notes
due 2030
|
|
|
—
|
|
|
600,000
|
|
4.250% convertible
senior notes due 2026
|
|
|
287,500
|
|
|
81,570
|
|
Net unamortized
discount
|
|
|
(111,886)
|
|
|
(29,782)
|
|
Net unamortized debt
issuance costs
|
|
|
(15,719)
|
|
|
(26,625)
|
|
Consolidated total
debt
|
|
$
|
3,001,593
|
|
|
2,415,163
|
|
Less: cash and cash
equivalents
|
|
|
—
|
|
|
(4,541)
|
|
Net Debt
|
|
$
|
3,001,593
|
|
|
2,410,622
|
|
Free Cash Flow
Free Cash Flow is a measure of financial performance not
calculated under GAAP and should not be considered in isolation or
as a substitute for cash flow from operating, investing, or
financing activities, as an indicator of cash flow, or as a measure
of liquidity. The Company defines Free Cash Flow as net cash
provided by operating activities, less net cash used in investing
activities, which includes drilling and completion capital and
leasehold capital, less proceeds from asset sales and less
distributions to non-controlling interests in Martica.
The Company has not provided projected net cash provided by
operating activities or a reconciliation of Free Cash Flow to
projected net cash provided by operating activities, the most
comparable financial measure calculated in accordance with
GAAP. The Company is unable to project net cash provided by
operating activities for any future period because this metric
includes the impact of changes in operating assets and liabilities
related to the timing of cash receipts and disbursements that may
not relate to the period in which the operating activities
occurred. The Company is unable to project these timing
differences with any reasonable degree of accuracy without
unreasonable efforts.
Free Cash Flow is a useful indicator of the Company's ability to
internally fund its activities and to service or incur additional
debt. There are significant limitations to using Free Cash Flow as
a measure of performance, including the inability to analyze the
effect of certain recurring and non-recurring items that materially
affect the Company's net income, the lack of comparability of
results of operations of different companies and the different
methods of calculating Free Cash Flow reported by different
companies. Free Cash Flow does not represent funds available for
discretionary use because those funds may be required for debt
service, land acquisitions and lease renewals, other capital
expenditures, working capital, income taxes, exploration expenses,
and other commitments and obligations.
Adjusted EBITDAX
Adjusted EBITDAX is a non-GAAP financial measure that we define
as net loss, adjusted for certain items detailed below.
Adjusted EBITDAX as used and defined by us, may not be
comparable to similarly titled measures employed by other companies
and is not a measure of performance calculated in accordance with
GAAP. Adjusted EBITDAX should not be considered in isolation
or as a substitute for operating income or loss, net income or
loss, cash flows provided by operating, investing, and financing
activities, or other income or cash flow statement data prepared in
accordance with GAAP. Adjusted EBITDAX provides no
information regarding our capital structure, borrowings, interest
costs, capital expenditures, working capital movement, or tax
position. Adjusted EBITDAX does not represent funds available
for discretionary use because those funds may be required for debt
service, capital expenditures, working capital, income taxes,
exploration expenses, and other commitments and obligations.
However, our management team believes Adjusted EBITDAX is useful to
an investor in evaluating our financial performance because this
measure:
- is widely used by investors in the oil and natural gas industry
to measure operating performance without regard to items excluded
from the calculation of such term, which may vary substantially
from company to company depending upon accounting methods and the
book value of assets, capital structure and the method by which
assets were acquired, among other factors;
- helps investors to more meaningfully evaluate and compare the
results of our operations from period to period by removing the
effect of our capital and legal structure from our operating
structure;
- is used by our management team for various purposes, including
as a measure of our operating performance, in presentations to our
Board of Directors, and as a basis for strategic planning and
forecasting: and
- is used by our Board of Directors as a performance measure in
determining executive compensation.
There are significant limitations to using Adjusted EBITDAX as a
measure of performance, including the inability to analyze the
effects of certain recurring and non-recurring items that
materially affect our net income or loss, the lack of comparability
of results of operations of different companies, and the different
methods of calculating Adjusted EBITDAX reported by different
companies.
The following table represents a reconciliation of Antero's net
loss, including noncontrolling interest, to Adjusted EBITDAX and a
reconciliation of Antero's Adjusted EBITDAX to net cash provided by
operating activities per our consolidated statements of cash flows,
in each case, for the three months ended June 30, 2020 and 2021. Adjusted EBITDAX
also excludes the noncontrolling interests in Martica and these
adjustments are disclosed in the table below as Martica related
adjustments.
|
|
Three Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Reconciliation of
net loss to Adjusted EBITDAX:
|
|
|
|
|
|
|
|
Net loss and
comprehensive loss attributable to Antero Resources
Corporation
|
|
$
|
(463,304)
|
|
|
(523,467)
|
|
Net income (loss) and
comprehensive income (loss) attributable to noncontrolling
interests
|
|
|
236
|
|
|
(10,984)
|
|
Unrealized commodity
derivative losses
|
|
|
481,927
|
|
|
756,998
|
|
Payments for
derivative monetizations
|
|
|
—
|
|
|
4,569
|
|
Amortization of
deferred revenue, VPP
|
|
|
—
|
|
|
(11,279)
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
(2,288)
|
|
Interest expense,
net
|
|
|
51,811
|
|
|
49,963
|
|
Loss (gain) on early
extinguishment of debt
|
|
|
(39,171)
|
|
|
23,065
|
|
Loss on convertible
note equitization
|
|
|
—
|
|
|
11,731
|
|
Provision for income
tax benefit
|
|
|
(142,404)
|
|
|
(175,966)
|
|
Depletion,
depreciation, amortization, and accretion
|
|
|
215,146
|
|
|
188,661
|
|
Impairment of oil and
gas properties
|
|
|
37,350
|
|
|
9,303
|
|
Exploration
expense
|
|
|
231
|
|
|
5,638
|
|
Equity-based
compensation expense
|
|
|
7,973
|
|
|
4,249
|
|
Equity in earnings of
unconsolidated affiliate
|
|
|
(20,228)
|
|
|
(17,477)
|
|
Dividends from
unconsolidated affiliate
|
|
|
42,755
|
|
|
31,284
|
|
Contract termination
and rig stacking
|
|
|
11,071
|
|
|
844
|
|
Transaction
expense
|
|
|
6,138
|
|
|
185
|
|
|
|
|
189,531
|
|
|
345,029
|
|
Martica related
adjustments (1)
|
|
|
(3,100)
|
|
|
(25,677)
|
|
Adjusted
EBITDAX
|
|
$
|
186,431
|
|
|
319,352
|
|
|
|
|
|
|
|
|
|
Reconciliation of
our Adjusted EBITDAX to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Adjusted
EBITDAX
|
|
$
|
186,431
|
|
|
319,352
|
|
Martica related
adjustments (1)
|
|
|
3,100
|
|
|
25,677
|
|
Interest expense,
net
|
|
|
(51,811)
|
|
|
(49,963)
|
|
Exploration
expense
|
|
|
(231)
|
|
|
(5,638)
|
|
Changes in current
assets and liabilities
|
|
|
(6,310)
|
|
|
21,370
|
|
Transaction
expense
|
|
|
(6,138)
|
|
|
(185)
|
|
Payments for
derivative monetizations
|
|
|
—
|
|
|
(4,569)
|
|
Other items
|
|
|
(9,078)
|
|
|
2,497
|
|
Net cash provided by
operating activities
|
|
$
|
115,963
|
|
|
308,541
|
|
|
|
(1)
|
Adjustments
reflect noncontrolling interests in Martica not otherwise adjusted
in amounts above.
|
|
|
|
|
|
|
Twelve
|
|
|
|
Months
Ended
|
|
|
|
June 30,
|
|
|
|
2021
|
|
Reconciliation of
net loss to Adjusted EBITDAX:
|
|
|
|
|
Net loss and
comprehensive loss attributable to Antero Resources
Corporation
|
|
$
|
(1,004,749)
|
|
Net income and
comprehensive income attributable to noncontrolling
interests
|
|
|
661
|
|
Unrealized commodity
derivative losses
|
|
|
1,538,067
|
|
Payments for
derivative monetizations
|
|
|
(4,438)
|
|
Amortization of
deferred revenue, VPP
|
|
|
(36,936)
|
|
Gain on sale of
assets
|
|
|
(1,909)
|
|
Interest expense,
net
|
|
|
187,665
|
|
Loss on early
extinguishment of debt
|
|
|
10,039
|
|
Loss on convertible
note equitizations
|
|
|
50,777
|
|
Provision for income
tax benefit
|
|
|
(324,005)
|
|
Depletion,
depreciation, amortization, and accretion
|
|
|
832,839
|
|
Impairment of oil and
gas properties
|
|
|
140,565
|
|
Exploration
expense
|
|
|
6,499
|
|
Equity-based
compensation expense
|
|
|
21,906
|
|
Equity in earnings of
unconsolidated affiliate
|
|
|
(81,338)
|
|
Dividends from
unconsolidated affiliates
|
|
|
159,551
|
|
Contract termination
and rig stacking
|
|
|
4,154
|
|
Transaction
expense
|
|
|
3,582
|
|
|
|
|
1,502,930
|
|
Martica related
adjustments (1)
|
|
|
(92,294)
|
|
Adjusted
EBITDAX
|
|
$
|
1,410,636
|
|
|
|
(1)
|
Adjustments
reflect noncontrolling interests in Martica not otherwise adjusted
in amounts above.
|
Drilling and Completion Capital Expenditures
For a reconciliation between cash paid for drilling and
completion capital expenditures and drilling and completion accrued
capital expenditures during the period, please see the capital
expenditures section below (in thousands):
|
|
Three Months
Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Drilling and
completion costs (as reported; cash basis)
|
|
$
|
251,744
|
|
|
168,825
|
|
Change in accrued
capital costs
|
|
|
(71,793)
|
|
|
(2,041)
|
|
Adjusted drilling and
completion costs (accrual basis)
|
|
$
|
179,951
|
|
|
166,784
|
|
Notwithstanding their use for comparative purposes, the
Company's non-GAAP financial measures may not be comparable to
similarly titled measures employed by other companies.
Antero Resources is an independent natural gas and natural
gas liquids company engaged in the acquisition, development and
production of unconventional properties located in the Appalachian
Basin in West Virginia and
Ohio. In conjunction with its
affiliate, Antero Midstream (NYSE: AM), Antero is one of the most
integrated natural gas producers in the U.S. The Company's
website is located at
www.anteroresources.com.
This release includes "forward-looking statements." Such
forward-looking statements are subject to a number of risks and
uncertainties, many of which are not under Antero Resources'
control. All statements, except for statements of historical fact,
made in this release regarding activities, events or developments
Antero Resources expects, believes or anticipates will or may occur
in the future, such as those regarding expected results, future
commodity prices, future production targets, realizing potential
future fee rebates or reductions, including those related to
certain levels of production, future earnings, leverage targets and
debt repayment, future capital spending plans, improved and/or
increasing capital efficiency, estimated realized natural gas, NGL
and oil prices, expected drilling and development plans, projected
well costs and cost savings initiatives, future financial position,
the participation level of our drilling partner and the financial
and production results to be achieved as a result of that drilling
partnership, the other key assumptions underlying our projections,
and future marketing opportunities, are forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. All
forward-looking statements speak only as of the date of this
release. Although Antero Resources believes that the plans,
intentions and expectations reflected in or suggested by the
forward-looking statements are reasonable, there is no assurance
that these plans, intentions or expectations will be achieved.
Therefore, actual outcomes and results could materially differ from
what is expressed, implied or forecast in such statements. Except
as required by law, Antero Resources expressly disclaims any
obligation to and does not intend to publicly update or revise any
forward-looking statements.
Antero Resources cautions you that these forward-looking
statements are subject to all of the risks and uncertainties,
incident to the exploration for and development, production,
gathering and sale of natural gas, NGLs and oil most of which are
difficult to predict and many of which are beyond the Antero
Resources' control. These risks include, but are not limited to,
commodity price volatility, inflation, lack of availability of
drilling and production equipment and services, environmental
risks, drilling and other operating risks, regulatory changes, the
uncertainty inherent in estimating natural gas and oil reserves and
in projecting future rates of production, cash flow and access to
capital, the timing of development expenditures, impacts of world
health event, including the COVID-19 pandemic, cybersecurity risks
and the other risks described under the heading "Item 1A. Risk
Factors" in Antero Resources' Quarterly Report on Form 10-Q for the
quarter ended June 30, 2021.
ANTERO RESOURCES
CORPORATION
|
Condensed
Consolidated Balance Sheets
|
(In thousands, except
per share amounts)
|
|
|
|
|
|
(Unaudited)
|
|
|
December
31,
|
|
June
30,
|
|
|
2020
|
|
2021
|
Assets
|
Current
assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$
|
—
|
|
|
4,541
|
Accounts
receivable
|
|
|
28,457
|
|
|
36,145
|
Accrued
revenue
|
|
|
425,314
|
|
|
493,740
|
Derivative
instruments
|
|
|
105,130
|
|
|
1,056
|
Other current
assets
|
|
|
15,238
|
|
|
14,958
|
Total current
assets
|
|
|
574,139
|
|
|
550,440
|
Property and
equipment:
|
|
|
|
|
|
|
Oil and gas
properties, at cost (successful efforts method):
|
|
|
|
|
|
|
Unproved
properties
|
|
|
1,175,178
|
|
|
1,076,562
|
Proved
properties
|
|
|
12,260,713
|
|
|
12,479,785
|
Gathering systems and
facilities
|
|
|
5,802
|
|
|
5,802
|
Other property and
equipment
|
|
|
74,361
|
|
|
77,231
|
|
|
|
13,516,054
|
|
|
13,639,380
|
Less accumulated
depletion, depreciation, and amortization
|
|
|
(3,869,116)
|
|
|
(4,095,539)
|
Property and
equipment, net
|
|
|
9,646,938
|
|
|
9,543,841
|
Operating leases
right-of-use assets
|
|
|
2,613,603
|
|
|
2,486,044
|
Derivative
instruments
|
|
|
47,293
|
|
|
19,396
|
Investment in
unconsolidated affiliate
|
|
|
255,082
|
|
|
237,668
|
Other
assets
|
|
|
13,790
|
|
|
10,944
|
Total
assets
|
|
$
|
13,150,845
|
|
|
12,848,333
|
|
|
|
|
|
|
|
Liabilities and
Equity
|
Current
liabilities:
|
|
|
|
|
|
|
Accounts
payable
|
|
$
|
26,728
|
|
|
39,612
|
Accounts payable,
related parties
|
|
|
69,860
|
|
|
85,471
|
Accrued
liabilities
|
|
|
343,524
|
|
|
433,050
|
Revenue distributions
payable
|
|
|
198,117
|
|
|
267,926
|
Derivative
instruments
|
|
|
31,242
|
|
|
733,994
|
Short-term lease
liabilities
|
|
|
266,024
|
|
|
269,611
|
Deferred revenue,
VPP
|
|
|
45,257
|
|
|
41,453
|
Other current
liabilities
|
|
|
2,302
|
|
|
11,980
|
Total current
liabilities
|
|
|
983,054
|
|
|
1,883,097
|
Long-term
liabilities:
|
|
|
|
|
|
|
Long-term
debt
|
|
|
3,001,593
|
|
|
2,415,163
|
Deferred income tax
liability
|
|
|
412,252
|
|
|
214,292
|
Derivative
instruments
|
|
|
99,172
|
|
|
204,525
|
Long-term lease
liabilities
|
|
|
2,348,785
|
|
|
2,217,336
|
Deferred revenue,
VPP
|
|
|
156,024
|
|
|
137,322
|
Other
liabilities
|
|
|
59,694
|
|
|
58,184
|
Total
liabilities
|
|
|
7,060,574
|
|
|
7,129,919
|
Commitments and
contingencies (Notes 13 and 14)
|
|
|
|
|
|
|
Equity:
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
|
|
|
Preferred stock, $0.01
par value; authorized - 50,000 shares; none issued
|
|
|
—
|
|
|
—
|
Common stock, $0.01
par value; authorized - 1,000,000 shares; 268,672 shares and
313,527 shares issued and outstanding as of December 31, 2020 and
June 30, 2021, respectively
|
|
|
2,686
|
|
|
3,135
|
Additional paid-in
capital
|
|
|
6,195,497
|
|
|
6,363,774
|
Accumulated
deficit
|
|
|
(430,478)
|
|
|
(969,444)
|
Total stockholders'
equity
|
|
|
5,767,705
|
|
|
5,397,465
|
Noncontrolling
interests
|
|
|
322,566
|
|
|
320,949
|
Total
equity
|
|
|
6,090,271
|
|
|
5,718,414
|
Total liabilities and
equity
|
|
$
|
13,150,845
|
|
|
12,848,333
|
ANTERO RESOURCES
CORPORATION
|
Condensed
Consolidated Statements of Operations and Comprehensive
Loss
|
(Unaudited)
|
(In thousands, except
per share amounts)
|
|
|
|
Three Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Revenue and
other:
|
|
|
|
|
|
|
|
Natural gas
sales
|
|
$
|
367,415
|
|
|
626,520
|
|
Natural gas liquids
sales
|
|
|
212,197
|
|
|
464,381
|
|
Oil sales
|
|
|
8,322
|
|
|
51,906
|
|
Commodity derivative
fair value losses
|
|
|
(168,015)
|
|
|
(831,840)
|
|
Marketing
|
|
|
64,285
|
|
|
165,453
|
|
Amortization of
deferred revenue, VPP
|
|
|
—
|
|
|
11,279
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
2,288
|
|
Other income
(loss)
|
|
|
707
|
|
|
(619)
|
|
Total
revenue
|
|
|
484,911
|
|
|
489,368
|
|
Operating
expenses:
|
|
|
|
|
|
|
|
Lease
operating
|
|
|
24,742
|
|
|
21,645
|
|
Gathering,
compression, processing, and transportation
|
|
|
631,845
|
|
|
641,362
|
|
Production and ad
valorem taxes
|
|
|
19,992
|
|
|
33,694
|
|
Marketing
|
|
|
113,053
|
|
|
198,994
|
|
Exploration
|
|
|
231
|
|
|
5,638
|
|
Impairment of oil and
gas properties
|
|
|
37,350
|
|
|
9,303
|
|
Depletion,
depreciation, and amortization
|
|
|
214,035
|
|
|
187,330
|
|
Accretion of asset
retirement obligations
|
|
|
1,111
|
|
|
1,331
|
|
General and
administrative (including equity-based compensation expense of
$7,973 and $4,249 in 2020 and 2021, respectively)
|
|
|
38,403
|
|
|
32,177
|
|
Contract termination
and rig stacking
|
|
|
11,071
|
|
|
844
|
|
Total operating
expenses
|
|
|
1,091,833
|
|
|
1,132,318
|
|
Operating
loss
|
|
|
(606,922)
|
|
|
(642,950)
|
|
Other income
(expense):
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated affiliate
|
|
|
20,228
|
|
|
17,477
|
|
Transaction
expense
|
|
|
(6,138)
|
|
|
(185)
|
|
Interest expense,
net
|
|
|
(51,811)
|
|
|
(49,963)
|
|
Gain (loss) on early
extinguishment of debt
|
|
|
39,171
|
|
|
(23,065)
|
|
Loss on convertible
note equitization
|
|
|
—
|
|
|
(11,731)
|
|
Total other income
(expense)
|
|
|
1,450
|
|
|
(67,467)
|
|
Loss before income
taxes
|
|
|
(605,472)
|
|
|
(710,417)
|
|
Provision for income
tax benefit
|
|
|
142,404
|
|
|
175,966
|
|
Net loss and
comprehensive loss including noncontrolling interests
|
|
|
(463,068)
|
|
|
(534,451)
|
|
Less: net income
(loss) and comprehensive income (loss) attributable to
noncontrolling interests
|
|
|
236
|
|
|
(10,984)
|
|
Net loss and
comprehensive loss attributable to Antero Resources
Corporation
|
|
$
|
(463,304)
|
|
|
(523,467)
|
|
|
|
|
|
|
|
|
|
Loss per
share—basic
|
|
$
|
(1.73)
|
|
|
(1.70)
|
|
Loss per
share—diluted
|
|
$
|
(1.73)
|
|
|
(1.70)
|
|
|
|
|
|
|
|
|
|
Weighted average
number of shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
|
|
268,386
|
|
|
307,879
|
|
Diluted
|
|
|
268,386
|
|
|
307,879
|
|
ANTERO RESOURCES
CORPORATION
|
Condensed
Consolidated Statements of Cash Flows
|
(Unaudited)
|
(In
thousands)
|
|
|
|
Six Months Ended
June 30,
|
|
|
|
2020
|
|
2021
|
|
Cash flows provided
by (used in) operating activities:
|
|
|
|
|
|
|
|
Net loss including
noncontrolling interests
|
|
$
|
(801,878)
|
|
|
(545,555)
|
|
Adjustments to
reconcile net loss to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depletion,
depreciation, amortization, and accretion
|
|
|
415,927
|
|
|
383,475
|
|
Impairments
|
|
|
737,202
|
|
|
43,365
|
|
Commodity derivative
fair value losses (gains)
|
|
|
(397,818)
|
|
|
1,009,596
|
|
Gains (losses) on
settled commodity derivatives
|
|
|
524,838
|
|
|
(64,951)
|
|
Payments for
derivative monetizations
|
|
|
—
|
|
|
(4,569)
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
(2,288)
|
|
Equity-based
compensation expense
|
|
|
11,302
|
|
|
9,891
|
|
Deferred income tax
benefit
|
|
|
(252,389)
|
|
|
(178,912)
|
|
Equity in (earnings)
loss of unconsolidated affiliate
|
|
|
107,827
|
|
|
(36,171)
|
|
Dividends of earnings
from unconsolidated affiliate
|
|
|
85,511
|
|
|
74,040
|
|
Amortization of
deferred revenue
|
|
|
—
|
|
|
(22,429)
|
|
Amortization of debt
issuance costs, debt discount, debt premium and other
|
|
|
4,433
|
|
|
7,877
|
|
(Gain) loss on early
extinguishment of debt
|
|
|
(119,732)
|
|
|
66,269
|
|
Loss on convertible
note equitizations
|
|
|
—
|
|
|
50,777
|
|
Changes in current
assets and liabilities:
|
|
|
|
|
|
|
|
Accounts
receivable
|
|
|
(27,329)
|
|
|
(7,687)
|
|
Accrued
revenue
|
|
|
63,023
|
|
|
(68,425)
|
|
Other current
assets
|
|
|
789
|
|
|
631
|
|
Accounts payable
including related parties
|
|
|
(21,182)
|
|
|
6,681
|
|
Accrued
liabilities
|
|
|
15,722
|
|
|
64,499
|
|
Revenue distributions
payable
|
|
|
(29,560)
|
|
|
69,809
|
|
Other current
liabilities
|
|
|
(46)
|
|
|
16,349
|
|
Net cash provided by
operating activities
|
|
|
316,640
|
|
|
872,272
|
|
Cash flows provided
by (used in) investing activities:
|
|
|
|
|
|
|
|
Additions to unproved
properties
|
|
|
(21,672)
|
|
|
(29,473)
|
|
Drilling and
completion costs
|
|
|
(552,227)
|
|
|
(273,956)
|
|
Additions to other
property and equipment
|
|
|
(1,234)
|
|
|
(2,320)
|
|
Settlement of water
earnout
|
|
|
125,000
|
|
|
—
|
|
Proceeds from asset
sales
|
|
|
—
|
|
|
2,351
|
|
Change in other
liabilities
|
|
|
—
|
|
|
(77)
|
|
Change in other
assets
|
|
|
525
|
|
|
597
|
|
Net cash used in
investing activities
|
|
|
(449,608)
|
|
|
(302,878)
|
|
Cash flows provided
by (used in) financing activities:
|
|
|
|
|
|
|
|
Repurchases of common
stock
|
|
|
(43,443)
|
|
|
—
|
|
Issuance of senior
notes
|
|
|
—
|
|
|
1,800,000
|
|
Repayment of senior
notes
|
|
|
(496,541)
|
|
|
(1,234,698)
|
|
Borrowings
(repayments) on bank credit facilities, net
|
|
|
374,000
|
|
|
(1,017,000)
|
|
Payment of debt
issuance costs
|
|
|
—
|
|
|
(22,440)
|
|
Sale of noncontrolling
interest
|
|
|
300,000
|
|
|
51,000
|
|
Distributions to
noncontrolling interests in Martica Holdings LLC
|
|
|
—
|
|
|
(46,028)
|
|
Employee tax
withholding for settlement of equity compensation awards
|
|
|
(331)
|
|
|
(9,530)
|
|
Convertible note
equitizations
|
|
|
—
|
|
|
(85,648)
|
|
Other
|
|
|
(717)
|
|
|
(509)
|
|
Net cash provided by
(used in) financing activities
|
|
|
132,968
|
|
|
(564,853)
|
|
Net increase in cash
and cash equivalents
|
|
|
—
|
|
|
4,541
|
|
Cash and cash
equivalents, beginning of period
|
|
|
—
|
|
|
—
|
|
Cash and cash
equivalents, end of period
|
|
$
|
—
|
|
|
4,541
|
|
|
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information:
|
|
|
|
|
|
|
|
Cash paid during the
period for interest
|
|
$
|
101,885
|
|
|
58,126
|
|
Increase (decrease) in
accounts payable and accrued liabilities for additions to property
and equipment
|
|
$
|
(61,305)
|
|
|
42,589
|
|
The following table set forth selected financial data for the
three months ended June 30, 2020 and
2021:
|
|
Three Months
Ended
|
|
Amount of
|
|
|
|
|
|
June 30,
|
|
Increase
|
|
Percent
|
|
(in thousands)
|
|
2020
|
|
2021
|
|
(Decrease)
|
|
Change
|
|
Revenue:
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas
sales
|
|
$
|
367,415
|
|
|
626,520
|
|
|
259,105
|
|
71
|
%
|
Natural gas liquids
sales
|
|
|
212,197
|
|
|
464,381
|
|
|
252,184
|
|
119
|
%
|
Oil sales
|
|
|
8,322
|
|
|
51,906
|
|
|
43,584
|
|
524
|
%
|
Commodity derivative
fair value losses
|
|
|
(168,015)
|
|
|
(831,840)
|
|
|
(663,825)
|
|
395
|
%
|
Marketing
|
|
|
64,285
|
|
|
165,453
|
|
|
101,168
|
|
157
|
%
|
Amortization of
deferred revenue, VPP
|
|
|
—
|
|
|
11,279
|
|
|
11,279
|
|
*
|
|
Gain on sale of
assets
|
|
|
—
|
|
|
2,288
|
|
|
2,288
|
|
*
|
|
Other income
(loss)
|
|
|
707
|
|
|
(619)
|
|
|
(1,326)
|
|
(188)
|
%
|
Total
revenue
|
|
|
484,911
|
|
|
489,368
|
|
|
4,457
|
|
1
|
%
|
Operating
expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease
operating
|
|
|
24,742
|
|
|
21,645
|
|
|
(3,097)
|
|
(13)
|
%
|
Gathering and
compression
|
|
|
202,773
|
|
|
224,073
|
|
|
21,300
|
|
11
|
%
|
Processing
|
|
|
242,592
|
|
|
209,627
|
|
|
(32,965)
|
|
(14)
|
%
|
Transportation
|
|
|
186,480
|
|
|
207,662
|
|
|
21,182
|
|
11
|
%
|
Production and ad
valorem taxes
|
|
|
19,992
|
|
|
33,694
|
|
|
13,702
|
|
69
|
%
|
Marketing
|
|
|
113,053
|
|
|
198,994
|
|
|
85,941
|
|
76
|
%
|
Exploration
|
|
|
231
|
|
|
5,638
|
|
|
5,407
|
|
*
|
|
Impairment of oil and
gas properties
|
|
|
37,350
|
|
|
9,303
|
|
|
(28,047)
|
|
(75)
|
%
|
Depletion,
depreciation, and amortization
|
|
|
214,035
|
|
|
187,330
|
|
|
(26,705)
|
|
(12)
|
%
|
Accretion of asset
retirement obligations
|
|
|
1,111
|
|
|
1,331
|
|
|
220
|
|
20
|
%
|
General and
administrative (excluding equity-based compensation)
|
|
|
30,430
|
|
|
27,928
|
|
|
(2,502)
|
|
(8)
|
%
|
Equity-based
compensation
|
|
|
7,973
|
|
|
4,249
|
|
|
(3,724)
|
|
(47)
|
%
|
Contract termination
and rig stacking
|
|
|
11,071
|
|
|
844
|
|
|
(10,227)
|
|
*
|
|
Total operating
expenses
|
|
|
1,091,833
|
|
|
1,132,318
|
|
|
40,485
|
|
4
|
%
|
Operating
loss
|
|
|
(606,922)
|
|
|
(642,950)
|
|
|
(36,028)
|
|
6
|
%
|
Other earnings
(expenses):
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity in earnings of
unconsolidated affiliate
|
|
|
20,228
|
|
|
17,477
|
|
|
(2,751)
|
|
(14)
|
%
|
Transaction
expense
|
|
|
(6,138)
|
|
|
(185)
|
|
|
5,953
|
|
(97)
|
%
|
Interest expense,
net
|
|
|
(51,811)
|
|
|
(49,963)
|
|
|
1,848
|
|
(4)
|
%
|
Gain (loss) on early
extinguishment of debt
|
|
|
39,171
|
|
|
(23,065)
|
|
|
(62,236)
|
|
(159)
|
%
|
Loss on convertible
note equitization
|
|
|
—
|
|
|
(11,731)
|
|
|
(11,731)
|
|
*
|
|
Total other income
(expense)
|
|
|
1,450
|
|
|
(67,467)
|
|
|
(68,917)
|
|
*
|
|
Loss before income
taxes
|
|
|
(605,472)
|
|
|
(710,417)
|
|
|
(104,945)
|
|
17
|
%
|
Provision for income
tax benefit
|
|
|
142,404
|
|
|
175,966
|
|
|
33,562
|
|
24
|
%
|
Net loss and
comprehensive loss including noncontrolling interests
|
|
|
(463,068)
|
|
|
(534,451)
|
|
|
(71,383)
|
|
15
|
%
|
Less: net income
(loss) and comprehensive income (loss) attributable to
noncontrolling interests
|
|
|
236
|
|
|
(10,984)
|
|
|
(11,220)
|
|
*
|
|
Net loss and
comprehensive loss attributable to Antero Resources
Corporation
|
|
$
|
(463,304)
|
|
|
(523,467)
|
|
|
(60,163)
|
|
13
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted
EBITDAX
|
|
$
|
186,431
|
|
|
319,352
|
|
|
132,921
|
|
71
|
%
|
The following table set forth selected operating data for the
three months ended June, 2020 and 2021:
|
|
Three Months
Ended
|
|
Amount of
|
|
|
|
|
|
June 30,
|
|
Increase
|
|
Percent
|
|
|
|
2020
|
|
2021
|
|
(Decrease)
|
|
Change
|
|
Production data
(1):
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas
(Bcf)
|
|
|
215
|
|
|
208
|
|
|
(7)
|
|
(3)
|
%
|
C2 Ethane
(MBbl)
|
|
|
4,622
|
|
|
4,356
|
|
|
(266)
|
|
(6)
|
%
|
C3+ NGLs
(MBbl)
|
|
|
11,935
|
|
|
10,440
|
|
|
(1,495)
|
|
(13)
|
%
|
Oil (MBbl)
|
|
|
1,004
|
|
|
940
|
|
|
(64)
|
|
(6)
|
%
|
Combined
(Bcfe)
|
|
|
320
|
|
|
303
|
|
|
(17)
|
|
(5)
|
%
|
Daily combined
production (MMcfe/d)
|
|
|
3,521
|
|
|
3,324
|
|
|
(197)
|
|
(6)
|
%
|
Average prices
before effects of derivative settlements
(2):
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas (per
Mcf)
|
|
$
|
1.71
|
|
|
3.01
|
|
|
1.30
|
|
76
|
%
|
C2 Ethane (per
Bbl)
|
|
$
|
5.76
|
|
|
9.97
|
|
|
4.21
|
|
73
|
%
|
C3+ NGLs (per
Bbl)
|
|
$
|
15.55
|
|
|
40.32
|
|
|
24.77
|
|
159
|
%
|
Oil (per
Bbl)
|
|
$
|
8.29
|
|
|
55.22
|
|
|
46.93
|
|
566
|
%
|
Weighted Average
Combined (per Mcfe)
|
|
$
|
1.83
|
|
|
3.78
|
|
|
1.95
|
|
107
|
%
|
Average realized
prices after effects of derivative settlements
(2):
|
|
|
|
|
|
|
|
|
|
|
|
|
Natural gas (per
Mcf)
|
|
$
|
2.79
|
|
|
2.91
|
|
|
0.12
|
|
4
|
%
|
C2 Ethane (per
Bbl)
|
|
$
|
5.66
|
|
|
9.97
|
|
|
4.31
|
|
76
|
%
|
C3+ NGLs (per
Bbl)
|
|
$
|
20.23
|
|
|
35.95
|
|
|
15.72
|
|
78
|
%
|
Oil (per
Bbl)
|
|
$
|
33.47
|
|
|
52.05
|
|
|
18.58
|
|
56
|
%
|
Weighted Average
Combined (per Mcfe)
|
|
$
|
2.81
|
|
|
3.55
|
|
|
0.74
|
|
26
|
%
|
Average costs (per
Mcfe):
|
|
|
|
|
|
|
|
|
|
|
|
|
Lease
operating
|
|
$
|
0.08
|
|
|
0.07
|
|
|
(0.01)
|
|
(13)
|
%
|
Gathering and
compression
|
|
$
|
0.63
|
|
|
0.74
|
|
|
0.11
|
|
17
|
%
|
Processing
|
|
$
|
0.76
|
|
|
0.69
|
|
|
(0.07)
|
|
(9)
|
%
|
Transportation
|
|
$
|
0.58
|
|
|
0.69
|
|
|
0.11
|
|
19
|
%
|
Production
taxes
|
|
$
|
0.06
|
|
|
0.11
|
|
|
0.05
|
|
83
|
%
|
Marketing,
net
|
|
$
|
0.15
|
|
|
0.11
|
|
|
(0.04)
|
|
(27)
|
%
|
Depletion,
depreciation, amortization and accretion
|
|
$
|
0.67
|
|
|
0.62
|
|
|
(0.05)
|
|
(7)
|
%
|
General and
administrative (excluding equity-based compensation)
|
|
$
|
0.09
|
|
|
0.09
|
|
|
—
|
|
—
|
%
|
|
|
(1)
|
Production volumes
exclude volumes related to VPP transaction.
|
(2)
|
Average sales
prices shown in the table reflect both the before and after effects
of the Company's settled commodity derivatives. The
calculation of such after effects includes gains on settlements of
commodity derivatives, which do not qualify for hedge accounting
because the Company does not designate or document them as hedges
for accounting purposes. Oil and NGLs production was
converted at 6 Mcf per Bbl to calculate total Bcfe production and
per Mcfe amounts. This ratio is an estimate of the equivalent
energy content of the products and does not necessarily reflect
their relative economic value.
|
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SOURCE Antero Resources Corporation