Battalion Oil Corporation (NYSE American: BATL, “Battalion” or the
“Company”) today announced results of operations for the first
quarter 2021.
Highlights
- Completed four DUCs and spud two
new wells in Monument Draw during the quarter
- Improved average completion costs
from $575/lateral ft in 2020 down to $395/lateral ft in Q1
2021
- Production from recent completions
outperforming expectations
- On track to deliver on 2021
production guidance despite operational shut-ins due to Winter
Storm Uri
Management Comments
Richard Little, the Company’s CEO, commented,
“Battalion delivered a strong first quarter despite the operational
disruption caused by Winter Storm Uri and the ongoing challenges
faced as a result of the COVID-19 pandemic. Our operations team did
a great job keeping us up and running during a historically long
cold snap. Their efforts keeping production up combined with strong
realized pricing allowed us to outperform our Adjusted EBITDA
targets for the first quarter.”
“The team continued their exceptional work as we
brought four wells online and spud two additional wells during the
quarter. Our focus on capital discipline and operational efficiency
allowed us to realize historically low drilling and completion
costs despite price increases in the service market. These new
wells are performing above expectations, and it is just one of the
many reasons we’re optimistic about hitting our production targets
for 2021 despite the production shut-ins caused by the winter
storms.”
“Our commitment to capital efficiency, prudent
liquidity management, and operational excellence has left us well
positioned to execute on our 2021 plan. We are eager to return to
growth and are well positioned to take advantage of the
opportunities the market offers us regardless of whether those
opportunities come through M&A or the drill bit.”
Results of Operations
Average daily net production and total operating
revenue during the first quarter 2021 were 14,333 barrels of oil
equivalent per day (“Boepd”) (56% oil) and $55.5 million,
respectively, as compared to production and revenue of 18,791 Boepd
(55% oil) and $47.4 million, respectively, during the first quarter
2020. The decrease in total production year-over-year was primarily
due to production declines in our non-core areas, including the
divestiture of properties that produced ~800 Boepd, offset by
increased production at Monument Draw as a result of our capital
program. Also contributing to the decrease in total production is
the temporary shut-in of production in February 2021 as a result of
inclement weather during Winter Storm Uri. Despite the reduction in
operating volumes, operating revenue increased year-over-year due
to high realized natural gas prices during the quarter. As a result
of high daily market prices experienced during the winter storm,
Battalion was able to realize quarterly gas prices of $4.26 per
Million cubic feet (“Mcf”) during the first quarter 2021 as
compared to $1.16 per Mcf during the fourth quarter 2020.
Excluding the impact of hedges, Battalion
realized 99% of the average NYMEX oil price during the first
quarter of 2021. Realized hedge losses totaled approximately $9.7
million during the first quarter 2021.
Lease operating and workover expense was $7.77
per Boe in the first quarter of 2021 and $8.07 per Boe in the first
quarter of 2020. Adjusted G&A was $3.24 per Boe in the first
quarter of 2021 compared to $1.50 per Boe in the first quarter of
2020 (see Selected Operating Data table for additional
information).
The Company reported a net loss to common
stockholders for the first quarter of 2021 of $33.4 million and a
net loss per basic and diluted share of $2.06. After adjusting for
selected items, the Company reported net income to common
stockholders for the first quarter of $2.7 million, or $0.17 per
basic and diluted share (see Selected Item Review and
Reconciliation for additional information). Adjusted EBITDA during
the quarter ended March 31, 2021 was $15.3 million as compared to
$8.8 million during the quarter ended December 31, 2020 (see
Adjusted EBITDA Reconciliation table for additional
information).
Liquidity and Balance Sheet
As of March 31, 2021, Battalion had $155.0
million of borrowings and $2.5 million of outstanding letters of
credit issued under the Senior Revolving Credit Facility resulting
in unused borrowing capacity of $32.5 million based on a borrowing
base of $190.0 million. Total liquidity at March 31, 2021,
inclusive of $1.7 million of cash and cash equivalents, was $34.2
million.
In May 2021, the Company entered into the Fourth
Amendment to its Senior Secured Revolving Credit Agreement which,
among other things, reduces the borrowing base to $185.0 million
effective June 1, 2021 and further reduces the borrowing base to
$175.0 million effective September 1, 2021.
Operations Update
During the first quarter of 2021, the Company
completed and brought on production four drilled but uncompleted
wells and spud two additional new wells in Monument Draw. The
Company began completing the two new drill wells in May 2021.
Conference Call Information
Battalion Oil Corporation has scheduled a
conference call for Tuesday, May 18, 2021, at 11:00 a.m. EDT (10:00
a.m. CDT). To participate in the conference call, dial +1
720-452-9102 or 800-437-2398 (toll free) a few minutes before the
call begins and reference Battalion Oil Corporation confirmation
code 5906562. The conference call recording will also be posted to
Battalion’s website: www.battalionoil.com.
Forward Looking Statements
This release contains forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. Statements that are not strictly historical statements
constitute forward-looking statements. Forward-looking statements
include, among others, statements about anticipated production,
liquidity, capital spending, drilling and completion plans, and
forward guidance. Forward-looking statements may often, but not
always, be identified by the use of such words such as "expects",
"believes", "intends", "anticipates", "plans", "estimates",
“projects”, "potential", "possible", or "probable" or statements
that certain actions, events or results "may", "will", "should", or
"could" be taken, occur or be achieved. Forward-looking statements
are based on current beliefs and expectations and involve certain
assumptions or estimates that involve various risks and
uncertainties that could cause actual results to differ materially
from those reflected in the statements. These risks include, but
are not limited to, those set forth in the Company's Annual Report
on Form 10-K for the fiscal year ended December 31, 2020 and other
filings submitted by the Company to the U.S. Securities and
Exchange Commission (“SEC”), copies of which may be obtained from
the SEC's website at www.sec.gov or through the Company's website
at www.battalionoil.com. Readers should not place undue reliance on
any such forward-looking statements, which are made only as of the
date hereof. The Company has no duty, and assumes no obligation, to
update forward-looking statements as a result of new information,
future events or changes in the Company's expectations.
About Battalion
Battalion Oil Corporation is an independent
energy company engaged in the acquisition, production, exploration
and development of onshore oil and natural gas properties in the
United States.
Contact
Chris LangManager, Finance (832) 538-0551
BATTALION OIL
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS (Unaudited)(In thousands, except per
share amounts)
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
|
2020 |
|
Operating
revenues: |
|
|
|
|
|
|
Oil, natural gas and natural gas liquids sales: |
|
|
|
|
|
|
Oil |
|
$ |
41,270 |
|
|
$ |
41,917 |
|
Natural gas |
|
|
9,087 |
|
|
|
354 |
|
Natural gas liquids |
|
|
4,909 |
|
|
|
4,753 |
|
Total oil, natural gas and natural gas liquids sales |
|
|
55,266 |
|
|
|
47,024 |
|
Other |
|
|
252 |
|
|
|
375 |
|
Total operating revenues |
|
|
55,518 |
|
|
|
47,399 |
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
Lease operating |
|
|
9,467 |
|
|
|
12,489 |
|
Workover and other |
|
|
560 |
|
|
|
1,323 |
|
Taxes other than income |
|
|
3,192 |
|
|
|
2,915 |
|
Gathering and other |
|
|
13,171 |
|
|
|
10,547 |
|
Restructuring |
|
|
— |
|
|
|
418 |
|
General and administrative |
|
|
4,827 |
|
|
|
3,856 |
|
Depletion, depreciation and accretion |
|
|
10,595 |
|
|
|
18,030 |
|
Total operating expenses |
|
|
41,812 |
|
|
|
49,578 |
|
Income (loss) from
operations |
|
|
13,706 |
|
|
|
(2,179 |
) |
|
|
|
|
|
|
|
Other income
(expenses): |
|
|
|
|
|
|
Net gain (loss) on derivative contracts |
|
|
(45,711 |
) |
|
|
118,299 |
|
Interest expense and other |
|
|
(1,370 |
) |
|
|
(1,629 |
) |
Total other income (expenses) |
|
|
(47,081 |
) |
|
|
116,670 |
|
Income (loss) before income taxes |
|
|
(33,375 |
) |
|
|
114,491 |
|
Income tax benefit (provision) |
|
|
— |
|
|
|
— |
|
Net income
(loss) |
|
$ |
(33,375 |
) |
|
$ |
114,491 |
|
|
|
|
|
|
|
|
Net income (loss) per
share of common stock: |
|
|
|
|
|
|
Basic |
|
$ |
(2.06 |
) |
|
$ |
7.07 |
|
Diluted |
|
$ |
(2.06 |
) |
|
$ |
7.07 |
|
Weighted average
common shares outstanding: |
|
|
|
|
|
|
Basic |
|
|
16,232 |
|
|
|
16,204 |
|
Diluted |
|
|
16,232 |
|
|
|
16,204 |
|
|
|
BATTALION OIL
CORPORATIONCONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)(In thousands, except share and per
share amounts)
|
|
|
|
|
|
|
|
|
March 31, 2021 |
|
December 31, 2020 |
Current
assets: |
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
1,671 |
|
|
$ |
4,295 |
|
Accounts receivable, net |
|
|
39,534 |
|
|
|
32,242 |
|
Assets from derivative contracts |
|
|
672 |
|
|
|
8,559 |
|
Prepaids and other |
|
|
2,591 |
|
|
|
2,740 |
|
Total current assets |
|
|
44,468 |
|
|
|
47,836 |
|
Oil and natural gas
properties (full cost method): |
|
|
|
|
|
|
Evaluated |
|
|
530,499 |
|
|
|
509,274 |
|
Unevaluated |
|
|
75,880 |
|
|
|
75,494 |
|
Gross oil and natural gas properties |
|
|
606,379 |
|
|
|
584,768 |
|
Less - accumulated depletion |
|
|
(305,505 |
) |
|
|
(295,163 |
) |
Net oil and natural gas properties |
|
|
300,874 |
|
|
|
289,605 |
|
Other operating
property and equipment: |
|
|
|
|
|
|
Other operating property and equipment |
|
|
3,524 |
|
|
|
3,535 |
|
Less - accumulated depreciation |
|
|
(1,257 |
) |
|
|
(1,149 |
) |
Net other operating property and equipment |
|
|
2,267 |
|
|
|
2,386 |
|
Other noncurrent
assets: |
|
|
|
|
|
|
Assets from derivative contracts |
|
|
828 |
|
|
|
4,009 |
|
Operating lease right of use assets |
|
|
195 |
|
|
|
310 |
|
Other assets |
|
|
1,967 |
|
|
|
2,351 |
|
Total
assets |
|
$ |
350,599 |
|
|
$ |
346,497 |
|
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
74,073 |
|
|
$ |
58,928 |
|
Liabilities from derivative contracts |
|
|
42,371 |
|
|
|
22,125 |
|
Current portion of long-term debt |
|
|
2,123 |
|
|
|
1,720 |
|
Operating lease liabilities |
|
|
195 |
|
|
|
403 |
|
Total current liabilities |
|
|
118,762 |
|
|
|
83,176 |
|
Long-term
debt |
|
|
155,086 |
|
|
|
158,489 |
|
Other noncurrent
liabilities: |
|
|
|
|
|
|
Liabilities from derivative contracts |
|
|
9,029 |
|
|
|
4,291 |
|
Asset retirement obligations |
|
|
10,711 |
|
|
|
10,583 |
|
Commitments and
contingencies |
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
|
|
|
Common stock: 100,000,000
shares of $0.0001 par value authorized; 16,267,157 and 16,203,979
shares issued and outstanding as of March 31, 2021 and December 31,
2020, respectively |
|
|
2 |
|
|
|
2 |
|
Additional paid-in
capital |
|
|
330,551 |
|
|
|
330,123 |
|
Retained earnings (accumulated
deficit) |
|
|
(273,542 |
) |
|
|
(240,167 |
) |
Total stockholders' equity |
|
|
57,011 |
|
|
|
89,958 |
|
Total liabilities and
stockholders' equity |
|
$ |
350,599 |
|
|
$ |
346,497 |
|
|
|
BATTALION OIL
CORPORATIONCONDENSED CONSOLIDATED STATEMENTS OF
CASH FLOWS (Unaudited)(In thousands)
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
|
2020 |
|
Cash flows from
operating activities: |
|
|
|
|
|
|
Net income (loss) |
|
$ |
(33,375 |
) |
|
$ |
114,491 |
|
Adjustments to reconcile net
income (loss) to net cash provided by (used in) operating
activities: |
|
|
|
|
|
|
Depletion, depreciation and accretion |
|
|
10,595 |
|
|
|
18,030 |
|
Stock-based compensation, net |
|
|
594 |
|
|
|
387 |
|
Unrealized loss (gain) on derivative contracts |
|
|
36,052 |
|
|
|
(112,378 |
) |
Reorganization items, net |
|
|
— |
|
|
|
(4,984 |
) |
Accrued settlements on derivative contracts |
|
|
4,568 |
|
|
|
(4,923 |
) |
Other income (expense) |
|
|
(117 |
) |
|
|
7 |
|
Cash flows from operations
before changes in working capital |
|
|
18,317 |
|
|
|
10,630 |
|
Changes in working
capital |
|
|
(4,959 |
) |
|
|
1,713 |
|
Net cash provided by (used in)
operating activities |
|
|
13,358 |
|
|
|
12,343 |
|
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
|
Oil and natural gas capital expenditures |
|
|
(13,792 |
) |
|
|
(48,157 |
) |
Proceeds received from sale of oil and natural gas properties |
|
|
1,076 |
|
|
|
— |
|
Funds held in escrow and other |
|
|
(3 |
) |
|
|
509 |
|
Net cash provided by (used in)
investing activities |
|
|
(12,719 |
) |
|
|
(47,648 |
) |
|
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
|
|
Proceeds from borrowings |
|
|
16,000 |
|
|
|
51,000 |
|
Repayments of borrowings |
|
|
(19,000 |
) |
|
|
(25,000 |
) |
Equity issuance costs and other |
|
|
(263 |
) |
|
|
(32 |
) |
Net cash provided by (used in)
financing activities |
|
|
(3,263 |
) |
|
|
25,968 |
|
|
|
|
|
|
|
|
Net increase
(decrease) in cash and cash equivalents |
|
|
(2,624 |
) |
|
|
(9,337 |
) |
|
|
|
|
|
|
|
Cash and cash equivalents at
beginning of period |
|
|
4,295 |
|
|
|
10,275 |
|
Cash and cash equivalents at
end of period |
|
$ |
1,671 |
|
|
$ |
938 |
|
|
|
BATTALION OIL
CORPORATIONSELECTED OPERATING DATA
(Unaudited)
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
|
2020 |
|
Production volumes: |
|
|
|
|
|
|
Crude oil (MBbls) |
|
|
719 |
|
|
|
937 |
|
Natural gas (MMcf) |
|
|
2,133 |
|
|
|
2,539 |
|
Natural gas liquids (MBbls) |
|
|
215 |
|
|
|
350 |
|
Total (MBoe) |
|
|
1,290 |
|
|
|
1,710 |
|
Average daily production (Boe/d) |
|
|
14,333 |
|
|
|
18,791 |
|
|
|
|
|
|
|
|
Average prices: |
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
57.40 |
|
|
$ |
44.74 |
|
Natural gas (per Mcf) |
|
|
4.26 |
|
|
|
0.14 |
|
Natural gas liquids (per Bbl) |
|
|
22.83 |
|
|
|
13.58 |
|
Total per Boe |
|
|
42.84 |
|
|
|
27.50 |
|
|
|
|
|
|
|
|
Cash effect of derivative contracts: |
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
(13.17 |
) |
|
$ |
5.47 |
|
Natural gas (per Mcf) |
|
|
(0.09 |
) |
|
|
0.32 |
|
Natural gas liquids (per Bbl) |
|
|
— |
|
|
|
— |
|
Total per Boe |
|
|
(7.49 |
) |
|
|
3.46 |
|
|
|
|
|
|
|
|
Average prices computed after cash effect of settlement of
derivative contracts: |
|
|
|
|
|
|
Crude oil (per Bbl) |
|
$ |
44.23 |
|
|
$ |
50.21 |
|
Natural gas (per Mcf) |
|
|
4.17 |
|
|
|
0.46 |
|
Natural gas liquids (per Bbl) |
|
|
22.83 |
|
|
|
13.58 |
|
Total per Boe |
|
|
35.35 |
|
|
|
30.96 |
|
|
|
|
|
|
|
|
Average cost per Boe: |
|
|
|
|
|
|
Production: |
|
|
|
|
|
|
Lease operating |
|
$ |
7.34 |
|
|
$ |
7.30 |
|
Workover and other |
|
|
0.43 |
|
|
|
0.77 |
|
Taxes other than income |
|
|
2.47 |
|
|
|
1.70 |
|
Gathering and other, as adjusted (1) |
|
|
10.21 |
|
|
|
6.18 |
|
Restructuring |
|
|
— |
|
|
|
0.24 |
|
General and administrative, as adjusted (1) |
|
|
3.24 |
|
|
|
1.50 |
|
Depletion |
|
|
8.02 |
|
|
|
10.29 |
|
|
|
|
|
|
|
|
(1) Represents
gathering and other and general and administrative costs per Boe,
adjusted for items noted in the reconciliation below: |
|
|
|
|
|
|
|
General and
administrative: |
|
|
|
|
|
|
General and administrative, as reported |
|
$ |
3.74 |
|
|
$ |
2.26 |
|
Stock-based compensation: |
|
|
|
|
|
|
Non-cash |
|
|
(0.46 |
) |
|
|
(0.23 |
) |
Transaction costs and other: |
|
|
|
|
|
|
Cash |
|
|
(0.04 |
) |
|
|
(0.53 |
) |
General and administrative, as adjusted(2) |
|
$ |
3.24 |
|
|
$ |
1.50 |
|
|
|
|
|
|
|
|
Gathering and other, as
reported |
|
|
10.21 |
|
|
|
6.17 |
|
Rig termination and stacking charges and other |
|
|
— |
|
|
|
0.01 |
|
Gathering and other, as
adjusted(3) |
|
$ |
10.21 |
|
|
$ |
6.18 |
|
|
|
|
|
|
|
|
Total operating costs, as
reported |
|
|
24.19 |
|
|
|
18.20 |
|
Total adjusting items |
|
|
(0.50 |
) |
|
|
(0.75 |
) |
Total operating costs, as
adjusted(4) |
|
$ |
23.69 |
|
|
$ |
17.45 |
|
___________________________(2) General and
administrative, as adjusted, is a non-GAAP measure that excludes
non-cash stock-based compensation charges relating to equity awards
under our incentive stock plans, as well as other cash charges
associated with transaction costs and other. The Company believes
that it is useful to understand the effects that these charges have
on general and administrative expenses and total operating costs
and that exclusion of such charges is useful for comparison to
prior periods. (3) Gathering and other, as adjusted, is a
non-GAAP measure that excludes rig termination and stacking charges
and other costs. The Company believes that it is useful to
understand the effects that these charges have on gathering and
other expense and total operating costs and that exclusion of such
charges is useful for comparative
purposes. (4) Represents lease operating expense,
workover and other expense, taxes other than income, gathering and
other expense and general and administrative costs per Boe,
adjusted for items noted in the reconciliation above.
BATTALION OIL
CORPORATIONSELECTED ITEM REVIEW AND RECONCILIATION
(Unaudited)(In thousands, except per share
amounts)
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
|
2020 |
|
As
Reported: |
|
|
|
|
|
|
Net income (loss), as reported |
|
$ |
(33,375 |
) |
|
$ |
114,491 |
|
|
|
|
|
|
|
|
Impact of Selected
Items: |
|
|
|
|
|
|
Unrealized loss (gain) on
derivatives contracts: |
|
|
|
|
|
|
Crude oil |
|
$ |
34,811 |
|
|
$ |
(111,834 |
) |
Natural gas |
|
|
1,241 |
|
|
|
(544 |
) |
Natural gas liquids |
|
|
— |
|
|
|
— |
|
Total mark-to-market non-cash charge |
|
|
36,052 |
|
|
|
(112,378 |
) |
Restructuring |
|
|
— |
|
|
|
418 |
|
Transaction costs, rig
termination and stacking charges and other |
|
|
52 |
|
|
|
906 |
|
Selected items, before income
taxes |
|
|
36,104 |
|
|
|
(111,054 |
) |
Income tax effect of selected
items |
|
|
— |
|
|
|
— |
|
Selected items, net of
tax |
|
|
36,104 |
|
|
|
(111,054 |
) |
|
|
|
|
|
|
|
As
Adjusted: |
|
|
|
|
|
|
Net income (loss), excluding
selected items (1) |
|
$ |
2,729 |
|
|
$ |
3,437 |
|
|
|
|
|
|
|
|
Basic net income (loss) per
common share, as reported |
|
$ |
(2.06 |
) |
|
$ |
7.07 |
|
Impact of selected items |
|
|
2.23 |
|
|
|
(6.86 |
) |
Basic net income (loss) per
common share, excluding selected items (1) |
|
$ |
0.17 |
|
|
$ |
0.21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted net income (loss) per
common share, as reported |
|
$ |
(2.06 |
) |
|
$ |
7.07 |
|
Impact of selected items |
|
|
2.23 |
|
|
|
(6.86 |
) |
Diluted net income (loss) per
common share, excluding selected items (1)(2) |
|
$ |
0.17 |
|
|
$ |
0.21 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash provided by (used in)
operating activities |
|
$ |
13,358 |
|
|
$ |
12,343 |
|
Changes in working
capital |
|
|
4,959 |
|
|
|
(1,713 |
) |
Cash flows from operations
before changes in working capital |
|
|
18,317 |
|
|
|
10,630 |
|
Cash components of selected
items |
|
|
(4,516 |
) |
|
|
11,231 |
|
Income tax effect of selected
items |
|
|
— |
|
|
|
— |
|
Cash flows from operations
before changes in working capital, adjusted for selected items
(1) |
|
$ |
13,801 |
|
|
$ |
21,861 |
|
____________________________(1) Net income
(loss) and earnings per share excluding selected items and cash
flows from operations before changes in working capital adjusted
for selected items are non-GAAP measures presented based on
management's belief that they will enable a user of the financial
information to understand the impact of these items on reported
results. These financial measures are not measures of financial
performance under GAAP and should not be considered as an
alternative to net income, earnings per share and cash flows from
operations, as defined by GAAP. These financial measures may not be
comparable to similarly named non-GAAP financial measures that
other companies may use and may not be useful in comparing the
performance of those companies to Battalion's
performance. (2) The impact of selected items for the
three months ended March 31, 2021 and 2020 were calculated based
upon weighted average diluted shares of 16.4 million and 16.2
million, respectively, due to the net income (loss) available to
common stockholders, excluding selected items.
BATTALION OIL
CORPORATIONADJUSTED EBITDA RECONCILIATION
(Unaudited)(In thousands)
|
|
|
|
|
|
|
|
|
Three Months Ended |
|
|
March 31, |
|
|
2021 |
|
|
2020 |
|
|
|
|
|
|
|
|
Net income (loss), as reported |
|
$ |
(33,375 |
) |
|
$ |
114,491 |
|
Impact of adjusting
items: |
|
|
|
|
|
|
Interest expense |
|
|
1,496 |
|
|
|
1,714 |
|
Depletion, depreciation and accretion |
|
|
10,595 |
|
|
|
18,030 |
|
Stock-based compensation |
|
|
594 |
|
|
|
387 |
|
Interest income |
|
|
(125 |
) |
|
|
(97 |
) |
Restructuring |
|
|
— |
|
|
|
418 |
|
(Gain) loss on sale of other assets |
|
|
(4 |
) |
|
|
— |
|
Unrealized loss (gain) on derivatives contracts |
|
|
36,052 |
|
|
|
(112,378 |
) |
Transaction costs, rig termination and stacking charges and
other |
|
|
52 |
|
|
|
906 |
|
Adjusted EBITDA(1) |
|
$ |
15,285 |
|
|
$ |
23,471 |
|
__________________________(1) Adjusted
EBITDA is a non-GAAP measure, which is presented based on
management's belief that it will enable a user of the financial
information to understand the impact of these items on reported
results. This financial measure is not a measure of financial
performance under GAAP and should not be considered as an
alternative to GAAP measures, including net income (loss). This
financial measure may not be comparable to similarly named non-GAAP
financial measures that other companies may use and may not be
useful in comparing the performance of those companies to
Battalion's performance.
BATTALION OIL
CORPORATIONADJUSTED EBITDA RECONCILIATION
(Unaudited)(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months |
|
Three Months |
|
Three Months |
|
Three Months |
|
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
|
|
|
March 31, 2021 |
|
December 31, 2020 |
|
September 30, 2020 |
|
June 30. 2020 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss), as reported |
|
$ |
(33,375 |
) |
|
$ |
(63,757 |
) |
|
$ |
(153,125 |
) |
|
$ |
(127,316 |
) |
|
Impact of adjusting
items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
1,496 |
|
|
|
1,853 |
|
|
|
1,964 |
|
|
|
1,842 |
|
|
Depletion, depreciation and accretion |
|
|
10,595 |
|
|
|
13,886 |
|
|
|
15,755 |
|
|
|
14,382 |
|
|
Full cost ceiling impairment |
|
|
— |
|
|
|
26,702 |
|
|
|
128,336 |
|
|
|
60,107 |
|
|
Stock-based compensation |
|
|
594 |
|
|
|
785 |
|
|
|
620 |
|
|
|
786 |
|
|
Interest income |
|
|
(125 |
) |
|
|
(171 |
) |
|
|
(273 |
) |
|
|
(232 |
) |
|
Restructuring |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
2,162 |
|
|
(Gain) loss on sale of other assets |
|
|
(4 |
) |
|
|
— |
|
|
|
— |
|
|
|
52 |
|
|
Unrealized loss (gain) on derivatives contracts |
|
|
36,052 |
|
|
|
30,172 |
|
|
|
21,128 |
|
|
|
67,221 |
|
|
Other(1) |
|
|
52 |
|
|
|
(658 |
) |
|
|
210 |
|
|
|
4,211 |
|
|
Adjusted EBITDA(2)(3) |
|
$ |
15,285 |
|
|
$ |
8,812 |
|
|
$ |
14,615 |
|
|
$ |
23,215 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted LTM EBITDA(2)(3) |
|
$ |
61,927 |
|
|
|
|
|
|
|
|
|
|
|
_________________________(1) Other adjustments
to net income (loss), as reported include rig termination and
stacking charges, transaction costs, and other non-recurring
professional fees and costs. (2) Adjusted EBITDA is a non-GAAP
measure, which is presented based on management's belief that it
will enable a user of the financial information to understand the
impact of these items on reported results. This financial measure
is not a measure of financial performance under GAAP and should not
be considered as an alternative to GAAP measures, including net
income (loss). This financial measure may not be comparable to
similarly named non-GAAP financial measures that other companies
may use and may not be useful in comparing the performance of those
companies to Battalion's performance. (3) Adjusted EBITDA for
the three months ended September 30, 2020 and June 30, 2020,
includes approximately $6.6 million and $16.4 million of net
proceeds, respectively, from hedge monetizations that occurred
during the periods.
BATTALION OIL
CORPORATIONADJUSTED EBITDA RECONCILIATION
(Unaudited)(In thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months |
|
Three Months |
|
Three Months |
|
Three Months |
|
|
|
Ended |
|
Ended |
|
Ended |
|
Ended |
|
|
|
March 31, 2020 |
|
December 31, 2019(1) |
|
September 30, 2019 |
|
June 30. 2019 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss), as reported |
|
$ |
114,491 |
|
|
$ |
(125,826 |
) |
|
$ |
(63,284 |
) |
|
$ |
(640,844 |
) |
|
Impact of adjusting
items: |
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest expense |
|
|
1,714 |
|
|
|
1,430 |
|
|
|
9,911 |
|
|
|
14,382 |
|
|
Depletion, depreciation and accretion |
|
|
18,030 |
|
|
|
19,996 |
|
|
|
20,512 |
|
|
|
40,425 |
|
|
Full cost ceiling impairment |
|
|
— |
|
|
|
— |
|
|
|
45,568 |
|
|
|
664,383 |
|
|
Income tax provision (benefit) |
|
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(50,306 |
) |
|
Stock-based compensation |
|
|
387 |
|
|
|
— |
|
|
|
(2,278 |
) |
|
|
1,025 |
|
|
Interest income |
|
|
(97 |
) |
|
|
(128 |
) |
|
|
(13 |
) |
|
|
(17 |
) |
|
Reorganization items, net |
|
|
— |
|
|
|
118,664 |
|
|
|
1,758 |
|
|
|
— |
|
|
Restructuring |
|
|
418 |
|
|
|
1,175 |
|
|
|
3,223 |
|
|
|
654 |
|
|
(Gain) loss on sale of other assets |
|
|
— |
|
|
|
(6 |
) |
|
|
2 |
|
|
|
— |
|
|
(Gain) loss on sale of Water Assets |
|
|
— |
|
|
|
(506 |
) |
|
|
(164 |
) |
|
|
2,897 |
|
|
Unrealized loss (gain) on derivatives contracts |
|
|
(112,378 |
) |
|
|
18,681 |
|
|
|
(11,571 |
) |
|
|
(10,764 |
) |
|
Other(2) |
|
|
906 |
|
|
|
(901 |
) |
|
|
15,276 |
|
|
|
3,678 |
|
|
Adjusted EBITDA(3)(4) |
|
$ |
23,471 |
|
|
$ |
32,579 |
|
|
$ |
18,940 |
|
|
$ |
25,513 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted LTM
EBITDA(1)(3)(4) |
|
$ |
100,503 |
|
|
|
|
|
|
|
|
|
|
|
__________________________(1) For
illustrative purposes, the Company has combined the Successor and
Predecessor results to derive combined results for Adjusted EBITDA
for the three months ended December 31, 2019 and the Adjusted LTM
EBITDA as of March 31, 2020. The combination was
generated by addition of comparable financial statement line items.
However, because of various adjustments to the consolidated
financial statements in connection with the application of
fresh-start reporting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
are not comparable to those of the Predecessor. The Company
believes that subject to consideration of the impact of fresh-start
reporting, combining the results of the Predecessor and Successor
provides meaningful information about Adjusted LTM EBITDA that
assists a reader in understanding the Company’s financial results
for the applicable periods. (2) Other adjustments to net
income (loss), as reported includes rig termination and stacking
charges, prepetition reorganization costs, and other non-recurring
professional fees and costs. (3) Adjusted EBITDA is a non-GAAP
measure, which is presented based on management's belief that it
will enable a user of the financial information to understand the
impact of these items on reported results. This financial measure
is not a measure of financial performance under GAAP and should not
be considered as an alternative to GAAP measures, including net
income (loss). This financial measure may not be comparable to
similarly named non-GAAP financial measures that other companies
may use and may not be useful in comparing the performance of those
companies to Battalion's performance. (4) Adjusted EBITDA for
the three months ended June 30, 2019 includes approximately $4.1
million of net proceeds from hedge monetizations that occurred
during the period.
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