Matador Resources Company (NYSE: MTDR) (“Matador” or the
“Company”), today updated its full year 2017 guidance estimates in
advance of its 2017 Analyst Day presentation in Dallas, Texas.
2017 Updated Guidance
Matador today announced an update to its full year 2017 guidance
estimates, which were initially provided on February 22, 2017.
These updated guidance estimates primarily reflect the Company’s
decision to drill and complete a five-well operated program in the
Eagle Ford shale in South Texas, with economic returns expected to
be comparable to Matador’s Delaware Basin wells, in order to
maintain the leasehold associated with this drilling program and to
enhance the value of its Eagle Ford asset. Capital expenditures
associated with this five-well operated program are anticipated to
be approximately $30 million, or about 6% of the Company’s 2017
estimated capital expenditures. At March 23, 2017, Matador has
begun drilling this five-well Eagle Ford program and anticipates
that all five wells will be completed and placed on production late
in the second quarter of 2017. In all other material respects,
Matador’s 2017 capital investment plans remain the same as
previously disclosed on February 22, 2017.
With the exception of drilling these five Eagle Ford wells,
Matador’s updated guidance estimates include four drilling rigs
operating in the Delaware Basin in the first quarter of 2017, with
a fifth drilling rig added in the Delaware Basin in the second
quarter of 2017. In 2017, Matador expects to direct 93% of its
estimated capital expenditures to drilling and completion and
midstream activities in the Delaware Basin.
Updated full year 2017 guidance estimates are as follows.
(1) Oil production of 6.9 to 7.2 million barrels, an increase of
38% at the midpoint of 2017 guidance, as compared to 5.1 million
barrels produced in 2016;
(2) Natural gas production of 33.0 to 35.0 billion cubic feet,
an increase of 11% at the midpoint of 2017 guidance, as compared to
30.5 billion cubic feet produced in 2016;
(3) Total oil equivalent production of 12.4 to 13.0 million BOE,
an increase of 25% at the midpoint of 2017 guidance, as compared to
10.2 million BOE produced in 2016;
(4) Drilling and completions capital expenditures (including
equipping wells for production) of $400 to $420 million, including
estimated capital expenditures associated with non-operated well
opportunities;
(5) Midstream capital expenditures of $56 to $64 million, which
represents Matador’s 51% share of an estimated capital expenditure
budget of $110 to $125 million for the recently announced San Mateo
Midstream, LLC joint venture (“San Mateo”); and
(6) Adjusted EBITDA, a non-GAAP financial measure, of $255 to
$275 million, an increase of 68% at the midpoint of 2017 guidance,
as compared to 2016 Adjusted EBITDA. Adjusted EBITDA guidance is
based on estimated average realized prices of $51.72 per barrel for
oil (West Texas Intermediate average oil price of $54.22 per barrel
for oil, less $2.50 per barrel of estimated price differentials,
using the forward strip for oil prices as of late February 2017)
and $3.11 per thousand cubic feet for natural gas (NYMEX Henry Hub
average natural gas price using the forward strip for natural gas
prices as of late February 2017 and assuming regional price
differentials and uplifts from natural gas processing roughly
offset). These 2017 estimates reflect Matador’s reduced ownership
in its Delaware Basin midstream assets from 100% to 51% upon the
formation of San Mateo, as announced on February 17, 2017. In
addition, at these oil and natural gas prices, Matador estimates a
realized loss on derivatives of about $11 million in 2017.
2017 Analyst Day Details
Management plans to provide its detailed 2017 operational plan,
capital budget and forecasts, and to provide an update on its
ongoing operations and continued improvements in drilling,
completion and production techniques, primarily in the Delaware
Basin, at the Company’s Analyst Day scheduled to be held on
Thursday, March 23, 2017 beginning at 9:00 a.m. Central Daylight
Time. The Analyst Day meeting will be held in the Pegasus I, II and
III meeting rooms at the Tower Club, Dallas, located on the 48th
floor of Thanksgiving Tower, 1601 Elm Street, Dallas, Texas 75201.
The presentation will conclude with a question and answer session
for those in attendance. Individuals who are unable to attend in
person can participate in the live conference call or via virtual
webcast. A continental breakfast will be provided beginning at 8:00
a.m. Central Daylight Time; following the presentation, lunch will
be provided.
To access the Analyst Day conference call in a listen-only mode,
domestic participants should dial (855) 875-8781 and international
participants should dial (720) 634-2925. The participant passcode
is 57940638. To access the virtual webcast, participants should use
the following link: http://edge.media-server.com/m/p/endibbxh. All
details can be accessed through the Company’s website at
www.matadorresources.com on the Presentations & Webcasts page
under the Investors tab.
A replay of the Analyst Day conference call will be made
available through April 30, 2017 via webcast. A link to the replay
webcast will be available through the Company’s website at
www.matadorresources.com on the Presentations & Webcasts page
under the Investors tab.
A copy of the Company’s Analyst Day presentation will be
available prior to the event through the Company’s website at
www.matadorresources.com on the Presentations & Webcasts page
under the Investors tab.
About Matador Resources Company
Matador is an independent energy company engaged in the
exploration, development, production and acquisition of oil and
natural gas resources in the United States, with an emphasis on oil
and natural gas shale and other unconventional plays. Its current
operations are focused primarily on the oil and liquids-rich
portion of the Wolfcamp and Bone Spring plays in the Delaware Basin
in Southeast New Mexico and West Texas. Matador also operates in
the Eagle Ford shale play in South Texas and the Haynesville shale
and Cotton Valley plays in Northwest Louisiana and East Texas.
Additionally, Matador conducts midstream operations, primarily
through its midstream joint venture, San Mateo Midstream, LLC, in
support of its exploration, development and production operations
and provides natural gas processing, natural gas, oil and salt
water gathering services and salt water disposal services to third
parties on a limited basis.
For more information, visit Matador Resources Company at
www.matadorresources.com.
Forward-Looking Statements
This press release includes “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. “Forward-looking statements” are statements related to
future, not past, events. Forward-looking statements are based on
current expectations and include any statement that does not
directly relate to a current or historical fact. In this context,
forward-looking statements often address expected future business
and financial performance, and often contain words such as “could,”
“believe,” “would,” “anticipate,” “intend,” “estimate,” “expect,”
“may,” “should,” “continue,” “plan,” “predict,” “potential,”
“project,” “hypothetical,” “forecasted” and similar expressions
that are intended to identify forward-looking statements, although
not all forward-looking statements contain such identifying words.
Actual results and future events could differ materially from those
anticipated in such statements, and such forward-looking statements
may not prove to be accurate. These forward-looking statements
involve certain risks and uncertainties, including, but not limited
to, the following risks related to financial and operational
performance: general economic conditions; the Company’s ability to
execute its business plan, including whether its drilling program
is successful; the ability of the Company’s midstream joint venture
to expand the Black River cryogenic processing plant, the timing of
such expansion and the operating results thereof; the timing and
operating results of the buildout by the Company’s midstream joint
venture of oil, natural gas and water gathering systems and the
drilling of any additional salt water disposal wells; changes in
oil, natural gas and natural gas liquids prices and the demand for
oil, natural gas and natural gas liquids; its ability to replace
reserves and efficiently develop current reserves; costs of
operations; delays and other difficulties related to producing oil,
natural gas and natural gas liquids; its ability to make
acquisitions on economically acceptable terms; its ability to
integrate acquisitions; availability of sufficient capital to
execute its business plan, including from future cash flows,
increases in its borrowing base and otherwise; weather and
environmental conditions; and other important factors which could
cause actual results to differ materially from those anticipated or
implied in the forward-looking statements. For further discussions
of risks and uncertainties, you should refer to Matador’s filings
with the Securities and Exchange Commission (“SEC”),
including the “Risk Factors” section of Matador’s most recent
Annual Report on Form 10-K and any subsequent Quarterly Reports on
Form 10-Q. Matador undertakes no obligation and does not intend to
update these forward-looking statements to reflect events or
circumstances occurring after the date of this letter, except as
required by law, including the securities laws of the United
States and the rules and regulations of the SEC. You are
cautioned not to place undue reliance on these forward-looking
statements, which speak only as of the date of this letter. All
forward-looking statements are qualified in their entirety by this
cautionary statement.
Adjusted EBITDA
This press release references the non-GAAP financial measure of
Adjusted EBITDA. Adjusted EBITDA is a supplemental non-GAAP
financial measure that is used by management and external users of
the Company’s consolidated financial statements, such as industry
analysts, investors, lenders and rating agencies. “GAAP” means
Generally Accepted Accounting Principles in the United States of
America. The Company believes Adjusted EBITDA helps it evaluate its
operating performance and compare its results of operations from
period to period without regard to its financing methods or capital
structure. The Company defines Adjusted EBITDA as earnings before
interest expense, income taxes, depletion, depreciation and
amortization, accretion of asset retirement obligations, property
impairments, unrealized derivative gains and losses, certain other
non-cash items and non-cash stock-based compensation expense, and
net gain or loss on asset sales and inventory impairment. Adjusted
EBITDA is not a measure of net income (loss) or net cash provided
by operating activities as determined by GAAP.
Adjusted EBITDA should not be considered an alternative to, or
more meaningful than, net income (loss) or net cash provided by
operating activities as determined in accordance with GAAP or as an
indicator of the Company’s operating performance or liquidity.
Certain items excluded from Adjusted EBITDA are significant
components of understanding and assessing a company’s financial
performance, such as a company’s cost of capital and tax structure.
Adjusted EBITDA may not be comparable to similarly titled measures
of another company because all companies may not calculate Adjusted
EBITDA in the same manner. Where references are pro forma,
forward-looking, preliminary or prospective in nature, and not
based on historical fact, as in this press release, the Company
does not provide a reconciliation. The Company could not provide
such reconciliation without undue hardship because such Adjusted
EBITDA numbers are estimations, approximations and/or ranges. In
addition, it would be difficult for the Company to present a
detailed reconciliation on account of many unknown variables for
the reconciling items, including future income taxes, full-cost
ceiling impairments, unrealized gains or losses on derivatives and
gains or losses on asset sales and inventory impairments. For the
same reasons, the Company is unable to address the probable
significance of the unavailable information, which could be
material to future results.
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version on businesswire.com: http://www.businesswire.com/news/home/20170323005441/en/
Matador Resources CompanyMac Schmitz, 972-371-5225Investor
Relationsinvestors@matadorresources.com
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