HOUSTON, March 1, 2018 /PRNewswire/ -- Goodrich
Petroleum Corporation (NYSE American: GDP) (the "Company") today
announced an asset sale, operational update and fourth quarter and
year-end 2017 financial results.
East Texas Asset Sale Enhances Liquidity
The Company announced that it has closed on the sale of certain
production, facilities, infrastructure and a portion of its acreage
in the Angelina River Trend to BP America Production Company.
The Company will use a portion of the proceeds from the sale to
pay off its revolver with plans to accelerate development of its
North Louisiana Haynesville asset in the second half of 2018.
Operations Update
The Company also announced that two additional Haynesville wells have been completed as
follows:
- The Wurtsbaugh 25&24-14N-16W 2H (55% WI) well in DeSoto
Parish, Louisiana has achieved a
24-hour peak rate to date of approximately 25,000 Mcfe per day from
a producing lateral length of 7,249 feet;
- The Wurtsbaugh 25&24-14N-16W 3H (55% WI) well in DeSoto
Parish, Louisiana has achieved a
24-hour peak rate to date of approximately 30,000 Mcfe per day from
a producing lateral length of 7,465 feet.
With the completion of these wells, the Company is currently
producing approximately 60,000 Mcfe per day and expects to commence
fracking operations on its next two wells, the Cason-Dickson 14&23 No. 1 & 2 (92% WI)
wells in early March.
Reserve Growth of 41% at Finding and Development Cost of
$0.28/Mcfe
As previously reported, the Company announced that its proved
oil and natural gas reserves as of December
31, 2017 increased by 41% to 428 billion cubic feet
equivalent ("Bcfe") versus 303 Bcfe at year-end 2016. PV10 for
year-end 2017 proved reserves was $264.2
million. Oil and natural gas prices used to determine
proved reserves were $51.34 per
barrel of oil and $2.98 per MMBtu of
natural gas, pursuant to Securities and Exchange Commission ("SEC")
guidelines. Natural gas reserves comprised 97% of the total.
The Company had reserve additions and positive revisions of 138
Bcfe from drilling and completion capital expenditures of
$38.7 million, for an organic finding
and development cost of $0.28 per
Mcfe. When taking into account the costs incurred in 2017
associated with wells of new developed reserves from probable,
proved undeveloped conversions and workovers, the developed finding
and development cost was $0.87 per
Mcfe.
THE COMPANY HAS POSTED A NEW PRESENTATION ON ITS WEBSITE
WHICH WILL BE REVIEWED ON THE EARNINGS CONFERENCE CALL.
INVESTORS CAN ACCESS THE SLIDES AT:
http://goodrichpetroleum.investorroom.com/events-and-presentations
FINANCIAL RESULTS
Cash Flow
Adjusted EBITDA was $4.4 million in the quarter and
discretionary cash flow ("DCF"), defined as net cash provided by
operating activities before changes in working capital, was
$4.0 million in the quarter. Adjusted
EBITDA was negatively impacted by production shut-ins in the
quarter while offset frac operations were being
conducted. Adjusted EBITDA for the year was $18.5 million.
(See accompanying tables at the end of this press release that
reconcile Adjusted EBITDA and DCF, each of which are non-US GAAP
financial measures, to their most directly comparable US GAAP
financial measure.)
Net Income (Loss)
Net loss was $1.8 million in the
quarter, or ($0.17) per basic and
fully diluted share versus net income of $0.7 million in the prior quarter, or
$0.07 per basic and $0.05 per fully diluted share. Net loss for the
year was $8.0 million, or
$0.80 per basic and fully diluted
share.
Production
Production for the quarter totaled 2.9 Bcfe, with average daily
production of approximately 31,200 Mcfe per day (86% natural gas).
Production was affected by shut-ins during the month of December of
an estimated 3,000 Mcfe per day as offset frac operations were
conducted. Production for the year totaled 12.2 Bcfe, with average
daily production of approximately 33,300 Mcfe per day (85% natural
gas).
Revenues
Revenues for the quarter totaled $11.1
million, with 63% of oil and gas revenue attributable to
natural gas. The average realized price was $3.78 per Mcfe ($2.79 per Mcf of natural gas and $58.40 per barrel of oil) or $3.84 per Mcfe when including cash settled
derivatives ($2.89 per Mcf of natural
gas and $57.14 per barrel of
oil). Revenues for the year totaled $46.2 million.
Operating Expenses
Lease operating expense ("LOE") was $2.7
million in the quarter, or $0.93 per Mcfe, versus $2.2 million, or $0.60 per Mcfe in the prior quarter. LOE
for the quarter included $0.4
million, or $0.13 per Mcfe,
for workovers. Lease operating expense excluding
workovers was $2.3 million, or
$0.80 per Mcfe, versus $2.0 million, or $0.55 per Mcfe in the prior quarter. LOE for the
year was $12.1 million, or
$1.00 per Mcfe.
Production and other taxes were $0.1
million in the quarter, or $0.04 per Mcfe, versus an overall negligible
credit in the prior quarter due to refunds for both severance and
ad valorem taxes. Production and other taxes for the year totaled
$1.2 million, or $0.10 per Mcfe. Haynesville wells drilled in
North Louisiana have severance tax
abatement until the earlier of payout or two years, and therefore
the Company's production and other taxes per unit of production is
expected to remain low in the near term as new Haynesville wells are added.
Transportation and processing expense was $1.6 million in the quarter or $0.54 per Mcfe, versus $1.6 million, or $0.44 per Mcfe in the prior quarter.
Transportation and processing expense for the year was $6.2 million, or $0.51 per Mcfe.
Depreciation, depletion and amortization ("DD&A") expense
was $3.2 million in the quarter, or
$1.13 per Mcfe, versus $3.5 million, or $0.96 per Mcfe in the prior quarter.
DD&A expense for the year was $12.1
million, or $1.00 per
Mcfe.
General and Administrative ("G&A") expense was $4.7 million in the quarter, which includes
$1.5 million of stock based
compensation, the accrual of $0.9
million for potential performance bonuses and $0.1 million in non-cash amortization of office
rent. G&A payable in cash for the quarter was $2.3 million, or $0.80 per Mcfe. G&A for the prior quarter was
$3.7 million, of which $2.0 million, or $0.56 per Mcfe was cash G&A. G&A expense
for the year was $16.7 million and
G&A payable in cash was $9.2
million for the year.
(See accompanying tables at the end of this press release that
reconcile general and administrative expense payable in cash to
general and administrative expense.)
Operating Income (Loss)
Operating income (loss), defined as revenues minus operating
expenses, totaled ($1.2) million in
the quarter versus $2.2 million in
the prior quarter. Operating income (loss) for the year was
($2.2) million.
Interest Expense
Interest expense totaled $2.7
million in the quarter, which includes cash interest of
$0.3 million incurred on the
Company's revolver and non-cash interest of $2.4 million incurred on the Company's second
lien notes, which includes $1.5
million paid in-kind interest and $0.9 million amortization of debt discount.
Interest expense for the year was $9.7
million.
(See accompanying tables at the end of this press release that
reconcile interest payable in cash to interest expense.)
Capital Expenditures
Capital expenditures, including non-cash accruals, totaled
$16.0 million and $41.8 million in the quarter and year ending
December 31, 2017, respectively, with
the majority of the expenditures being spent on drilling and
completion costs for the Company's recent Haynesville operated wells. Net cash
used in investing activities was $7.0
million and $28.2 million in
the quarter and for the year, respectively. The Company is
maintaining its capital expenditure guidance for the year of
$65 – 75 million, and plans to
accelerate development of its core, North Louisiana Haynesville
asset in second half of 2018. (See accompanying tables
at the end of this press release that reconcile capital
expenditures to net cash used in investing activities.)
Balance Sheet
The Company exited the quarter with $26.0
million of cash and $63.7
million of total principal amount of debt, for net debt of
$37.7 million.
Crude Oil and Natural Gas Derivatives
The Company had a gain of $1.4
million on its derivatives not designated as hedges in the
quarter, representing a $1.2 million
change in fair value of our natural gas derivative contracts and a
$0.2 million realized gain on
derivative settlements.
OTHER INFORMATION
In this press release, the Company refers to several non-US GAAP
financial measures, including Adjusted EBITDA and DCF.
Management believes Adjusted EBITDA and DCF are good financial
indicators of the Company's performance and ability to internally
generate operating funds. DCF should not be considered an
alternative to net cash provided by operating activities, as
defined by US GAAP. Adjusted EBITDA should not be
considered an alternative to net income (loss), as defined by US
GAAP. Management believes that these non-US GAAP financial
measures provide useful information to investors because they are
monitored and used by Company management and widely used by
professional research analysts in the valuation and investment
recommendations of companies within the oil and gas exploration and
production industry.
Initial production rates are subject to decline over time and
should not be regarded as reflective of sustained production
levels. In particular, production from horizontal drilling in
shale oil and natural gas resource plays and tight natural gas
plays that are stimulated with extensive pressure fracturing are
typically characterized by significant early declines in production
rates.
Unless otherwise stated, oil production volumes include
condensate.
Certain statements in this news release regarding future
expectations and plans for future activities may be regarded as
"forward looking statements" within the meaning of the Securities
Litigation Reform Act. They are subject to various risks,
such as financial market conditions, changes in commodities prices
and costs of drilling and completion, operating hazards, drilling
risks, and the inherent uncertainties in interpreting engineering
data relating to underground accumulations of oil and gas, as well
as other risks discussed in detail in the Company's Annual Report
on Form 10-K for the year ended December 31,
2017 and other subsequent filings with the Securities and
Exchange Commission. Although the Company believes that the
expectations reflected in such forward looking statements are
reasonable, it can give no assurance that such expectations will
prove to be correct.
Goodrich Petroleum is an independent oil and natural gas
exploration and production company listed on the NYSE American
under the symbol "GDP".
GOODRICH PETROLEUM
CORPORATION
|
SELECTED INCOME AND
PRODUCTION DATA
|
(In thousands, except
per share amounts)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
Volumes
|
|
|
|
|
Natural gas
(MMcf)
|
2,461
|
|
10,323
|
|
Oil and condensate
(MBbls)
|
68
|
|
304
|
|
Mmcfe -
Total
|
2,867
|
|
12,150
|
|
|
|
|
|
|
Mcfe per
day
|
31,162
|
|
33,288
|
|
|
|
|
|
Oil and natural gas
revenues
|
$
10,830
|
|
$
45,320
|
Other
|
226
|
|
833
|
|
|
$
11,056
|
|
$
46,153
|
|
|
|
|
|
Operating
Expenses
|
|
|
|
|
Lease operating
expense (LOE excluding workovers - $2,317 and $8,700,
respectively)
|
2,680
|
|
12,125
|
|
Production and other
taxes
|
115
|
|
1,183
|
|
Transportation and
processing
|
1,554
|
|
6,222
|
|
Depreciation,
depletion and amortization
|
3,232
|
|
12,125
|
|
General and
administrative (payable in cash - $2,299 and $9,237,
respectively)
|
4,712
|
|
16,696
|
|
Other
|
-
|
|
(43)
|
Operating
loss
|
(1,237)
|
|
(2,155)
|
|
|
|
|
|
Other income
(expense)
|
|
|
|
|
Interest expense
(payable in cash - $342 and $1,225, respectively)
|
(2,657)
|
|
(9,725)
|
|
Interest income and
other
|
(35)
|
|
1,236
|
|
Gain on derivatives
not designated as hedges
|
1,359
|
|
1,552
|
|
|
(1,333)
|
|
(6,937)
|
|
|
|
|
|
Reorganization items,
net
|
(185)
|
|
118
|
|
|
|
|
|
Loss before income
taxes
|
(2,755)
|
|
(8,974)
|
Income tax
benefit
|
978
|
|
978
|
Net loss
|
$
(1,777)
|
|
$
(7,996)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Discretionary cash
flow (see non-US GAAP reconciliation) (1)
|
$
4,014
|
|
$
17,140
|
|
|
|
|
|
|
Adjusted EBITDA (see
calculation and non-US GAAP reconciliation) (2)
|
$
4,419
|
|
$
18,502
|
|
|
|
|
|
Weighted average
common shares outstanding - basic
|
10,599
|
|
9,975
|
Weighted average
common shares outstanding - diluted (3)
|
10,599
|
|
9,975
|
|
|
|
|
|
Loss per
share
|
|
|
|
|
Net loss -
basic
|
$
(0.17)
|
|
$
(0.80)
|
|
Net loss -
diluted
|
$
(0.17)
|
|
$
(0.80)
|
|
(1) Discretionary
cash flow is defined as net cash provided by operating activities
before changes in operating assets and liabilities. Management
believes that the non-US GAAP measure of discretionary cash flow is
useful as an indicator of an oil and natural gas exploration and
production company's ability to internally fund exploration and
development activities and to service or incur additional debt. The
company has also included this information because changes in
operating assets and liabilities relate to the timing of cash
receipts and disbursements which the company may not control and
may not relate to the period in which the operating activities
occurred. Operating cash flow should not be considered in isolation
or as a substitute for net cash provided by operating activities
prepared in accordance with US GAAP.
|
|
(2) Subsequent to
entering into the 2017 Senior Credit Facility on 10-17-2017,
Adjusted EBITDA became defined by our 2017 Senior Credit Facility
as earnings before interest expense, income and similar taxes,
DD&A, share based compensation expense and impairment of oil
and natural gas properties. In calculating adjusted EBITDA, gains
on reorganization, gains/losses on commodity derivatives not
designated as hedges and net cash received or paid in settlement of
derivative instruments are also excluded. Other excluded items
include interest income and other, gain on sale of assets, and any
extraordinary non-cash gains or losses.
|
|
(3) Fully diluted
shares excludes approximately 4.6 million potentially dilutive
instruments that were anti-dilutive for the three and twelve months
ended December 31, 2017.
|
GOODRICH PETROLEUM
CORPORATION
|
Per Unit Sales Prices
and Costs
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
|
|
|
|
|
Average sales price
per unit:
|
|
|
|
|
Oil (per
Bbl)
|
|
|
|
|
Including net cash received
from/paid to settle oil derivatives
|
$
57.14
|
|
$
50.61
|
|
Excluding net cash received
from/paid to settle oil derivatives
|
$
58.40
|
|
$
50.90
|
|
Natural gas (per
Mcf)
|
|
|
|
|
Including net cash received
from/paid to settle natural gas derivatives
|
$
2.89
|
|
$
2.94
|
|
Excluding net cash received
from/paid to settle natural gas derivatives
|
$
2.79
|
|
$
2.89
|
|
Oil and natural gas
(per Mcfe)
|
|
|
|
|
Including net cash received
from/paid to settle oil and natural gas derivatives
|
$
3.84
|
|
$
3.77
|
|
Excluding net cash received
from/paid to settle oil and natural gas derivatives
|
$
3.78
|
|
$
3.73
|
|
|
|
|
|
|
|
|
|
|
Costs Per
Mcfe
|
|
|
|
|
Lease operating
expense ($0.80 and $0.72 Per Mcfe excluding Workovers,
respectively)
|
$
0.93
|
|
$
1.00
|
|
Production and other
taxes
|
$
0.04
|
|
$
0.10
|
|
Transportation and
processing
|
$
0.54
|
|
$
0.51
|
|
Depreciation,
depletion and amortization
|
$
1.13
|
|
$
1.00
|
|
General and
administrative (payable in cash - $0.80 and $0.76,
respectively)
|
$
1.64
|
|
$
1.37
|
|
Other
|
$
-
|
|
$
-
|
|
|
$
4.29
|
|
$
3.98
|
|
|
Note: Amounts on a
per Mcfe basis may not total due to rounding.
|
GOODRICH PETROLEUM
CORPORATION
|
Selected Cash Flow
Data (In Thousands):
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
discretionary cash flow and net cash provided by operating
activities (unaudited)
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
December 31,
2017
|
|
December 31,
2017
|
|
|
|
|
Net cash provided by
operating activities (US GAAP)
|
2,493
|
|
18,306
|
Net changes in
working capital
|
(1,521)
|
|
1,166
|
Discretionary cash
flow
|
$
4,014
|
|
$
17,140
|
|
|
|
|
|
Supplemental
Balance Sheet Data (unaudited)
|
|
|
|
|
|
As of
|
|
|
|
|
December 31,
2017
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents (including restricted cash)
|
$
25,992
|
|
|
|
|
|
|
|
|
Long-term debt,
net
|
$
55,725
|
|
|
|
Unamortized debt
discount and issuance cost
|
8,013
|
|
|
|
Total principal
amount of debt
|
$
63,738
|
|
|
|
|
|
|
|
Reconciliation of
Net income (loss) to Adjusted EBITDA (under 2017 Senior Credit
Agreement)
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
|
|
|
|
|
|
Net loss (US
GAAP)
|
$
(1,777)
|
|
$
(7,996)
|
|
Depreciation,
depletion and amortization ("DD&A")
|
3,232
|
|
12,125
|
|
Income tax
benefit
|
(978)
|
|
(978)
|
|
Stock compensation
expense
|
2,265
|
|
6,863
|
|
Interest
expense
|
2,657
|
|
9,725
|
|
Gain on derivatives
not designated as hedges
|
(1,359)
|
|
(1,552)
|
|
Net cash received in
settlement of derivative instruments
|
158
|
|
471
|
|
Other excluded items
**
|
222
|
|
(156)
|
|
Adjusted EBITDA
(2)
|
$
4,419
|
|
$
18,502
|
|
|
|
|
|
** Other
excluded items include interest income and other, reorganization
items, net gain on sale of assets and other expense.
|
|
|
|
|
|
Other Information
and Reconciliations
|
|
|
|
|
|
|
|
|
|
Derivative
Activity
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
|
Change in fair value
of derivatives not designated as hedges
|
$
1,201
|
|
$
1,081
|
|
Net cash received in
settlement of derivative instruments
|
158
|
|
471
|
|
Net gain on
derivatives not designated as hedges
|
$
1,359
|
|
$
1,552
|
|
|
|
|
|
Reconciliation of
interest payable in cash to interest expense
(unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
|
|
|
|
|
|
Interest expense
(GAAP)
|
$
2,657
|
|
$
9,725
|
|
Amortization of debt
discount and paid-in-kind interest
|
(2,315)
|
|
(8,500)
|
|
Interest payable in
cash
|
$
342
|
|
$
1,225
|
GOODRICH PETROLEUM
CORPORATION
|
Other Information and
reconciliations continued (In Thousands):
|
|
|
|
|
|
Reconciliation of
capital expenditures (unaudited)
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
December 31,
2017
|
|
December 31,
2017
|
Net cash used in
investing activities (US GAAP)
|
$
(6,965)
|
|
$
(28,200)
|
Cash calls
utilized
|
-
|
|
(415)
|
Inventory
utilized
|
(882)
|
|
(1,854)
|
Cash proceeds from
sale of assets
|
(100)
|
|
(563)
|
Capitalized asset
retirement obligation
|
(110)
|
|
(203)
|
Cost incurred in
prior period and paid in current period
|
3,268
|
|
648
|
Capital accrual at
December 31, 2017
|
(11,206)
|
|
(11,206)
|
Total capital
expenditures
|
$
(15,995)
|
|
$
(41,793)
|
|
|
|
|
|
|
Reconciliation of
drilling and completion capital expenditures used in finding and
development cost per Mcfe calculations (unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
Total capital
expenditures (per above)
|
$
(15,995)
|
|
$
(41,793)
|
Capitalized internal
costs
|
798
|
|
3,103
|
Drilling and
completion capital expenditures
|
$
(15,197)
|
|
$
(38,690)
|
|
|
|
|
|
|
|
|
|
|
Reconciliation of
general & administrative expense payable in cash to general
and administrative expense (unaudited)
|
|
|
|
|
|
|
|
Three Months
Ended
|
|
Year Ended
|
|
|
December 31,
2017
|
|
December 31,
2017
|
General &
administrative expense (GAAP)
|
$
4,712
|
|
$
16,696
|
Share based
compensation
|
(1,489)
|
|
(4,458)
|
Bonus share based
compensation
|
(775)
|
|
(2,405)
|
Non-cash rent
expense
|
(149)
|
|
(596)
|
General &
administrative expense payable in cash
|
$
2,299
|
|
$
9,237
|
|
Oil and natural gas
production (Mfce)
|
2,867
|
|
12,150
|
|
General and
administrative expense payable in cash per Mcfe
|
$
0.80
|
|
$
0.76
|
View original
content:http://www.prnewswire.com/news-releases/goodrich-petroleum-announces-east-texas-asset-sale-operational-update-and-fourth-quarter-and-year-end-2017-financial-results-and-operational-update-300606392.html
SOURCE Goodrich Petroleum Corporation