PITTSBURGH, Sept. 8, 2020 /PRNewswire/ -- CNX Resources
Corporation (NYSE: CNX) ("CNX" or the "company") today announced
the following updates:
CNX continues to execute on its commitment to generate long-term
intrinsic value per share by generating free cash flow (FCF) per
share on a regular basis and reducing its outstanding debt to
further strengthen its balance sheet. The following is an update of
key drivers in that effort.
- 2020 FCF(a) guidance increased to approximately
$350 million from prior guidance of
$300 million
- In August 2020, CNX received
$104 million of federal tax refunds,
which the company expects to use to further pay down its 5.875%
notes due in 2022, leaving a remaining balance of approximately
$250 million, a reduction from
$895 million at year-end 2019.
- CNX expects full year EBITDAX(a) to be modestly
above the high-end of the previously announced range of
$830-$900
million
- Capital expenditures expected near the midpoint of the
previously announced range of $470-$550
million
- Previously curtailed production expected to resume October 1, 2020. The company estimates that
optimizing the temporary curtailments and turning back in-line
(TBIL) timings have resulted in approximately $30 million of net present value (NPV) realized
through the pricing arbitrage
Chief Financial Officer Don Rush
stated, "These positive developments support the company's
continued focus on its unique free cash flow generation plan. Our
previously released 7-year plan highlighted our ability to generate
over $3.3 billion of free cash flow
and creates a non-replicable, best-in-class investment opportunity
as we continue to build long-term intrinsic value, and today's
announcement demonstrates our continued execution of that plan.
While our near-term free cash flow allocation plan will continue to
focus on debt reduction until we achieve a 1.5x leverage ratio, we
are continuously evaluating our future capital allocation options,
including direct shareholder returns in the form of buy backs and
dividends, accelerating future development and/or other strategic
plans that create value for our shareholders. Our
uniquely-positioned company provides the opportunity to create
consistent, robust value for our shareholders year after
year."
(a) CNX is unable to provide a reconciliation of projected
financial results contained in this release, including FCF and
EBITDAX to their respective comparable financial measure calculated
in accordance with GAAP. This is due to our inability to calculate
the comparable GAAP projected metrics, including operating income,
given the unknown effect, timing, and potential significance of
certain income statement items.
About CNX Resources Corporation
CNX Resources Corporation (NYSE: CNX) is one of the largest
independent natural gas exploration, development and production
companies, with operations centered in the major shale formations
of the Appalachian basin. The company deploys an organic growth
strategy focused on responsibly developing its resource base. As of
December 31, 2019, CNX had 8.4
trillion cubic feet equivalent of proved natural gas reserves. The
company is a member of the Standard & Poor's Midcap 400 Index.
Additional information may be found at
www.cnx.com.
Forward-Looking Statements
All statements in this release (and oral statements made
regarding the subjects of this communication), including those that
express a belief, expectation or intention, may be considered
forward-looking statements (as defined in Section 21E of the
Securities Exchange Act of 1934, as amended, and Section 27A of the
Securities Act of 1933, as amended (the "Securities Act")) that
involve risks and uncertainties that could cause actual results to
differ materially from projected results. Without limiting the
generality of the foregoing, forward-looking statements contained
in this communication include statements relying on a number of
assumptions concerning future events and are subject to a number of
uncertainties and factors, many of which are outside the control of
CNX and CNX Midstream Partners LP (the "Partnership"), which could
cause actual results to differ materially from such statements.
Accordingly, investors should not place undue reliance on
forward-looking statements as a prediction of actual results. The
forward-looking statements may include, but are not limited to,
statements regarding: the expected future performance of the
company; the company's anticipated use of tax refund proceeds; and
plans and objectives of management for future operations.
When we use the words "believe," "intend," "expect," "may,"
"should," "anticipate," "could," "estimate," "plan," "predict,"
"project," or their negatives, or other similar expressions, the
statements which include those words are usually forward-looking
statements. When we describe strategy that involves risks or
uncertainties, we are making forward-looking statements.
While CNX and the Partnership believe that the assumptions
concerning future events are reasonable, they caution that there
are inherent difficulties in predicting certain important factors
that could impact the future performance or results of their
businesses. Among the factors that could cause results to differ
materially from those indicated by such forward-looking statements
are: the failure to realize the anticipated costs savings,
synergies and other benefits of the proposed transaction; the
possible diversion of management time on transaction-related
issues; the risk that the requisite approvals to complete the
proposed transaction are not obtained; local, regional and national
economic conditions and the impact they may have on CNX, the
Partnership and their customers; the impact of outbreaks of
communicable diseases such as the novel highly transmissible and
pathogenic coronavirus (COVID-19) on business activity, the
Company's operations and national and global economic conditions,
generally; changes in tax laws that impact master limited
partnerships; conditions in the oil and gas industry, including a
sustained decrease in the level of supply or demand for oil or
natural gas or a sustained decrease in the price of oil or natural
gas; the financial condition of CNX's or the Partnership's
customers; any non-performance by customers of their contractual
obligations; changes in customer, employee or supplier
relationships resulting from the proposed transaction; changes in
safety, health, environmental and other regulations; the results of
any reviews, investigations or other proceedings by government
authorities; and the performance of CNX and the Partnership.
The forward-looking statements in this release speak only as of
the date of this release; we disclaim any obligation to update
these statements. We have based these forward-looking statements on
our current expectations and assumptions about future events. While
our management considers these expectations and assumptions to be
reasonable, they are inherently subject to significant business,
economic, competitive, regulatory and other risks, contingencies
and uncertainties, most of which are difficult to predict and many
of which are beyond our control. These risks, contingencies and
uncertainties relate to, among other matters, the risks and
uncertainties set forth in the "Risk Factors" section of CNX's
Annual Report on Form 10-K for the year ended December 31, 2019, and Quarterly Reports on Form
10-Q for the three month periods ended March
31, 2020 and June 30, 2020,
and the Partnership's Annual Report on Form 10-K for the year ended
December 31, 2019, and Quarterly
Reports on Form 10-Q for the three month periods ended March 31, 2020 and June
30, 2020, in each case, as filed with the Securities and
Exchange Commission (the "SEC"), and any subsequent reports filed
with the SEC.
No Offer or Solicitation
This release is for informational purposes only and shall not
constitute an offer to sell or the solicitation of an offer to buy
any securities pursuant to the proposed transaction or otherwise,
nor shall there be any sale of securities in any jurisdiction in
which the offer, solicitation or sale would be unlawful prior to
the registration or qualification under the securities laws of any
such jurisdiction. No offer of securities shall be made except by
means of a prospectus meeting the requirements of Section 10 of the
Securities Act.
Additional Information and Where You Can Find It
In connection with the proposed transaction, CNX has filed a
registration statement on Form S-4, including a consent
statement/prospectus of CNX and the Partnership, with the SEC and
the SEC declared that registration statement effective on
August 28, 2020. INVESTORS AND
SECURITY HOLDERS OF CNX AND THE PARTNERSHIP ARE ADVISED TO
CAREFULLY READ THE REGISTRATION STATEMENT AND CONSENT
STATEMENT/PROSPECTUS (INCLUDING ALL AMENDMENTS AND SUPPLEMENTS
THERETO) BECAUSE THEY CONTAIN IMPORTANT INFORMATION ABOUT THE
PROPOSED TRANSACTION, THE PARTIES TO THE PROPOSED TRANSACTION AND
THE RISKS ASSOCIATED WITH THE PROPOSED TRANSACTION. The
consent statement/prospectus will have been sent to security
holders of the Partnership in connection with the solicitation of
consents from the Partnership's limited partners. Investors and
security holders may obtain a free copy of the consent
statement/prospectus and other relevant documents filed by CNX and
the Partnership with the SEC from the SEC's website at
www.sec.gov. Security holders and other interested parties
are also be able to obtain, without charge, a copy of the consent
statement/prospectus and other relevant documents from www.cnx.com
under the tab "Investors" and then under the heading "SEC
Filings.
Participants in the Solicitation Relating to the
Merger
CNX, the Partnership and their respective directors, executive
officers and certain other members of management may be deemed to
be participants in the solicitation of consents in respect of the
proposed transaction. Information about these persons is set
forth in CNX's proxy statement relating to its 2020 Annual Meeting
of Stockholders, which was filed with the SEC on March 24, 2020, and the Partnership's Annual
Report on Form 10-K and Form 10-K/A for the year ended December 31, 2019, which were filed with the SEC
on February 10, 2020 and April 27, 2020, respectively, and subsequent
statements of changes in beneficial ownership on file with the
SEC. Security holders and investors may obtain additional
information regarding the interests of such persons, which may be
different than those of the respective companies' security holders
generally, by reading the consent statement/prospectus and other
relevant documents regarding the proposed transaction, which has
been filed with the SEC.
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SOURCE CNX Resources Corporation