Battalion Oil Corporation Announces Third Quarter 2023 Financial and Operating Results

Rhea-AI Summary

Battalion Oil Corporation (NYSE American: BATL) announced financial and operating results for Q3 2023, highlighting sales volumes, drilling operations, and preferred equity raise. Management comments on drilling operations and acid gas injection project. Results of operations show average daily net production, revenue, and expenses. The company reported a net loss and adjusted EBITDA for the quarter. Liquidity and balance sheet details are also provided.

HOUSTON, Nov. 15, 2023 (GLOBE NEWSWIRE) -- Battalion Oil Corporation (NYSE American: BATL, “Battalion” or the “Company”) today announced financial and operating results for the third quarter of 2023.

Key Highlights

• Generated third quarter 2023 sales volumes of 12,717 barrels of oil equivalent per day (“Boe/d”)
• Continued robust production results from our most recent completed wells
• Recommenced drilling operations in Monument Draw
• Executed a $38.0 million preferred equity raise in September 2023 and obtained commitments for an additional $55.0 million preferred equity in November 2023 to support incremental activity plans
• Continued to explore strategic alternatives
  

Management Comments

The Company has commenced drilling operations on a two-well pad in Monument Draw while preparing additional locations across all three asset areas. Drilling is ahead of plan from both a capital and time perspective and the wells should now be online in early 2024. The previously announced acid gas injection (“AGI”) project is still undergoing workover operations. All workover operations and improvements are expected to be completed and the facility fully online in the first quarter of 2024. With this expected timing, the facility should be operational contemporaneously with placing the two-well pad on production.

The latest Monument Draw well continues to outperform offset wells and has produced over 266,000 Boe in its first 225 days on production while flowing naturally without artificial lift. Monument Draw production showcased a lower forecast decline in the quarter, however downstream shut-ins curtailed production by over 2,500 Boe/d which the Company expects to have back online before the end of the first quarter of 2024, post third-party improvements to infrastructure.

Matt Steele, Chief Executive Officer, commented, “Drilling activity in Monument Draw is underway and ahead of plan on all metrics after the team stood up a new rig and new crews. We look forward to entering 2024 in position to benefit from producing our existing and new wells into the enhanced cost structure associated with AGI coming online.”

Results of Operations

Average daily net production and total operating revenue during the third quarter of 2023 were 12,717 Boe/d (46% oil) and $54.1 million, respectively, as compared to production and revenue of 16,228 Boe/d (50% oil) and $99.1 million, respectively, during the third quarter of 2022. The decrease in revenues in the third quarter of 2023 as compared to the third quarter of 2022 is primarily attributable to an approximate $20.44 decrease in average realized prices (excluding the impact of hedges). Excluding the impact of hedges, Battalion realized 100.3% of the average NYMEX oil price during the third quarter of 2023. Realized hedge losses totaled approximately $6.9 million during the third quarter 2023.

Lease operating and workover expense was $10.13 per Boe in the third quarter of 2023 versus $9.93 per Boe in the third quarter of 2022. The increase in lease operating and workover expense per Boe year-over-year is primarily attributable to a decrease in average daily production as a large portion of our lease operating expenses are fixed costs. Gathering and other expense was $13.26 per Boe in the third quarter of 2023 versus $11.16 per Boe in the third quarter of 2022. The increase was primarily related to midstream disruptions and plant curtailments and an increased percentage of total production requiring H2S treatment, as well as inflationary impacts on costs associated with our own hydrogen sulfide treating plant. General and administrative expense was $2.72 per Boe in the third quarter of 2023 compared to $3.02 per Boe in the third quarter of 2022. The decrease is primarily due to a benefit recognized related to stock-based compensation forfeitures from the departure of certain executives and employees. After adjusting for selected items, Adjusted G&A was $2.64 per Boe in the third quarter of 2023 compared to $2.11 per Boe in the third quarter of 2022.

For the third quarter of 2023, the Company reported a net loss available to common stockholders of $57.7 million and a net loss of $3.50 per share available to common stockholders. After adjusting for selected items, the Company reported an adjusted net loss available to common stockholders for the third quarter of 2023 of $12.0 million, or an adjusted net loss of $0.72 per common share (see Reconciliation for additional information). Adjusted EBITDA during the quarter ended September 30, 2023 was $13.6 million as compared to $24.3 million during the quarter ended September 30, 2022 (see Adjusted EBITDA Reconciliation table for additional information).

Liquidity and Balance Sheet

As of September 30, 2023, the Company had $210.2 million of indebtedness outstanding and no letters of credit outstanding. Subsequent to September 30, 2023, letters of credit outstanding totaled $0.3 million. Total liquidity on September 30, 2023, made up of cash and cash equivalents, was $42.6 million.

In November 2023, the Company obtained a commitment letter from its existing equity stockholders to purchase additional preferred equity securities in an amount up to $55.0 million. For further discussion on our liquidity and balance sheet, as well as recent developments, refer to Management’s Discussion and Analysis and Risk Factors in the Company’s Form 10-Q.

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, 2022, 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

Matthew B. Steele
Chief Executive Officer & Principal Financial Officer
832-541-8334

BATTALION OIL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share amounts)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2023				2022				2023				2022
Operating revenues:
Oil, natural gas and natural gas liquids sales:
Oil		$	43,689			$	70,406			$	144,072			$	206,874
Natural gas			3,668				15,656				8,628				39,296
Natural gas liquids			6,078				12,644				18,893				35,234
Total oil, natural gas and natural gas liquids sales			53,435				98,706				171,593				281,404
Other			671				443				1,927				858
Total operating revenues			54,106				99,149				173,520				282,262
Operating expenses:
Production:
Lease operating			11,152				12,265				34,208				35,698
Workover and other			700				2,559				4,669				4,807
Taxes other than income			3,307				5,613				9,677				15,936
Gathering and other			15,512				16,663				48,857				47,787
General and administrative			3,192				4,498				13,572				14,071
Depletion, depreciation and accretion			13,426				13,615				44,287				36,436
Total operating expenses			47,289				55,213				155,270				154,735
Income from operations			6,817				43,936				18,250				127,527
Other income (expenses):
Net (loss) gain on derivative contracts			(53,687	)			67,634				(29,741	)			(88,134	)
Interest expense and other			(6,929	)			(5,682	)			(24,245	)			(13,202	)
Total other (expenses) income			(60,616	)			61,952				(53,986	)			(101,336	)
(Loss) income before income taxes			(53,799	)			105,888				(35,736	)			26,191
Income tax benefit (provision)			—				—				—				—
Net (loss) income		$	(53,799	)		$	105,888			$	(35,736	)		$	26,191
Series A preferred dividends			(3,863	)			—				(6,352	)			—
Net (loss) income available to common stockholders		$	(57,662	)		$	105,888			$	(42,088	)		$	26,191
Net (loss) income per share of common stock available to common stockholders:
Basic		$	(3.50	)		$	6.48			$	(2.56	)		$	1.60
Diluted		$	(3.50	)		$	6.42			$	(2.56	)		$	1.59
Weighted average common shares outstanding:
Basic			16,457				16,340				16,436				16,327
Diluted			16,457				16,483				16,436				16,496

BATTALION OIL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share and per share amounts)
		September 30, 2023				December 31, 2022
Current assets:
Cash and cash equivalents		$	42,590			$	32,726
Accounts receivable, net			27,177				37,974
Assets from derivative contracts			4,649				16,244
Restricted cash			90				90
Prepaids and other			786				1,131
Total current assets			75,292				88,165
Oil and natural gas properties (full cost method):
Evaluated			736,205				713,585
Unevaluated			62,649				62,621
Gross oil and natural gas properties			798,854				776,206
Less: accumulated depletion			(434,034	)			(390,796	)
Net oil and natural gas properties			364,820				385,410
Other operating property and equipment:
Other operating property and equipment			4,623				4,434
Less: accumulated depreciation			(1,653	)			(1,209	)
Net other operating property and equipment			2,970				3,225
Other noncurrent assets:
Assets from derivative contracts			2,022				5,379
Operating lease right of use assets			889				352
Other assets			10,768				2,827
Total assets		$	456,761			$	485,358
Current liabilities:
Accounts payable and accrued liabilities		$	59,417			$	100,095
Liabilities from derivative contracts			36,363				29,286
Current portion of long-term debt			45,106				35,067
Operating lease liabilities			513				352
Asset retirement obligations			—				225
Total current liabilities			141,399				165,025
Long-term debt, net			153,476				182,676
Other noncurrent liabilities:
Liabilities from derivative contracts			35,089				33,649
Asset retirement obligations			17,202				15,244
Operating lease liabilities			375				—
Deferred income taxes			—				—
Other			1,554				4,136
Commitments and contingencies
Temporary equity:
Series A redeemable convertible preferred stock: 63,000 shares of $0.0001			66,834				—
par value authorized, issued and outstanding as of September 30, 2023
Stockholders' equity:
Common stock: 100,000,000 shares of $0.0001 par value authorized;
16,456,563 and 16,344,815 shares issued and outstanding as of
September 30, 2023 and December 31, 2022, respectively			2				2
Additional paid-in capital			326,511				334,571
Retained earnings (accumulated deficit)			(285,681	)			(249,945	)
Total stockholders' equity			40,832				84,628
Total liabilities, temporary equity and stockholders' equity		$	456,761			$	485,358

BATTALION OIL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2023				2022				2023				2022
Cash flows from operating activities:
Net (loss) income		$	(53,799	)		$	105,888			$	(35,736	)		$	26,191
Adjustments to reconcile net (loss) income to net cash
provided by operating activities:
Depletion, depreciation and accretion			13,426				13,615				44,287				36,436
Stock-based compensation, net			(686	)			683				(1,231	)			1,540
Unrealized loss (gain) on derivative contracts			46,805				(102,112	)			23,469				(23,911	)
Amortization/accretion of financing related costs			1,946				919				5,789				2,726
Reorganization items			—				—				—				(744	)
Accrued settlements on derivative contracts			3,775				(7,159	)			2,846				7,493
Change in fair value of embedded derivative liability			(1,878	)			(448	)			(2,582	)			(3,043	)
Other			91				(32	)			144				(128	)
Cash flows from operations before changes in working capital			9,680				11,354				36,986				46,560
Changes in working capital			(7,264	)			14,127				(25,921	)			7,254
Net cash provided by operating activities			2,416				25,481				11,065				53,814
Cash flows from investing activities:
Oil and natural gas capital expenditures			(4,062	)			(35,621	)			(36,695	)			(86,998	)
Proceeds received from sale of oil and natural gas assets			—				1				1,189				1
Other operating property and equipment capital expenditures			148				(244	)			(136	)			(949	)
Other			(1,453	)			70				(1,464	)			166
Net cash used in operating activities			(5,367	)			(35,794	)			(37,106	)			(87,780	)
Cash flows from financing activities:
Proceeds from borrowings			—				122				—				20,122
Repayments of borrowings			(10,023	)			—				(25,066	)			(85	)
Payment of deferred debt financing costs			—				—				—				(379	)
Proceeds from issuance of preferred stock			37,050				—				61,425				—
Other			—				(25	)			(454	)			(492	)
Net cash provided by financing activities			27,027				97				35,905				19,166
Net increase (decrease) in cash, cash equivalents and restricted cash			24,076				(10,216	)			9,864				(14,800	)
Cash, cash equivalents and restricted cash at beginning of period			18,604				43,775				32,816				48,359
Cash, cash equivalents and restricted cash at end of period		$	42,680			$	33,559			$	42,680			$	33,559

BATTALION OIL CORPORATION SELECTED OPERATING DATA (Unaudited)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2023				2022				2023				2022
Production volumes:
Crude oil (MBbls)			539				753				1,905				2,097
Natural gas (MMcf)			2,054				2,352				6,616				7,022
Natural gas liquids (MBbls)			288				348				917				924
Total (MBoe)			1,170				1,493				3,925				4,191
Average daily production (Boe/d)			12,717				16,228				14,377				15,352
Average prices:
Crude oil (per Bbl)		$	81.06			$	93.50			$	75.63			$	98.65
Natural gas (per Mcf)			1.79				6.66				1.30				5.60
Natural gas liquids (per Bbl)			21.10				36.33				20.60				38.13
Total per Boe			45.67				66.11				43.72				67.14
Cash effect of derivative contracts:
Crude oil (per Bbl)		$	(14.96	)		$	(36.07	)		$	(7.04	)		$	(46.50	)
Natural gas (per Mcf)			0.57				(3.11	)			1.08				(2.07	)
Natural gas liquids (per Bbl)			—				—				—				—
Total per Boe			(5.88	)			(23.09	)			(1.60	)			(26.73	)
Average prices computed after cash effect of settlement of derivative contracts:
Crude oil (per Bbl)		$	66.10			$	57.43			$	68.59			$	52.15
Natural gas (per Mcf)			2.36				3.55				2.38				3.53
Natural gas liquids (per Bbl)			21.10				36.33				20.60				38.13
Total per Boe			39.79				43.02				42.12				40.41
Average cost per Boe:
Production:
Lease operating		$	9.53			$	8.22			$	8.72			$	8.52
Workover and other			0.60				1.71				1.19				1.15
Taxes other than income			2.83				3.76				2.47				3.80
Gathering and other			13.26				11.16				12.45				11.40
General and administrative, as adjusted (1)			2.64				2.11				3.32				2.74
Depletion			11.17				8.97				11.02				8.56
(1) Represents general and administrative costs per Boe, adjusted for items noted in the reconciliation below:
General and administrative:
General and administrative, as reported		$	2.72			$	3.02			$	3.46			$	3.36
Stock-based compensation:
Non-cash			0.59				(0.46	)			0.31				(0.37	)
Non-recurring charges and other:
Cash			(0.67	)			(0.45	)			(0.45	)			(0.25	)
General and administrative, as adjusted(2)		$	2.64			$	2.11			$	3.32			$	2.74
Total operating costs, as reported		$	28.94			$	27.87			$	28.29			$	28.23
Total adjusting items			(0.08	)			(0.91	)			(0.14	)			(0.62	)
Total operating costs, as adjusted(3)		$	28.86			$	26.96			$	28.15			$	27.61

___________________
(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 plan, as well as other cash charges associated with non-recurring charges 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)	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 CORPORATION RECONCILIATION (Unaudited) (In thousands, except per share amounts)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2023				2022				2023				2022
As Reported:
Net (loss) income available to common stockholders - diluted (1)		$	(57,662	)		$	105,888			$	(42,088	)		$	26,191
Impact of Selected Items:
Unrealized loss (gain) on derivatives contracts:
Crude oil		$	46,133			$	(99,848	)		$	16,003			$	(28,886	)
Natural gas			672				(2,264	)			7,466				4,975
Total mark-to-market non-cash charge			46,805				(102,112	)			23,469				(23,911	)
Change in fair value of embedded derivative liability			(1,878	)			(449	)			(2,582	)			(3,043	)
Non-recurring charges			780				670				1,774				1,036
Selected items, before income taxes			45,707				(101,891	)			22,661				(25,918	)
Income tax effect of selected items			—				—				—				—
Selected items, net of tax			45,707				(101,891	)			22,661				(25,918	)
Net (loss) income available to common stockholders, as adjusted (2)		$	(11,955	)		$	3,997			$	(19,427	)		$	273
Diluted net (loss) income per common share, as reported		$	(3.50	)		$	6.42			$	(2.56	)		$	1.59
Impact of selected items			2.77				(6.18	)			1.38				(1.57	)
Diluted net (loss) income per common share, excluding selected items (2)(3)		$	(0.73	)		$	0.24			$	(1.18	)		$	0.02
Net cash (used in) provided by operating activities		$	2,416			$	25,481			$	11,065			$	53,814
Changes in working capital			7,264				(14,127	)			25,921				(7,254	)
Cash flows from operations before changes in working capital			9,680				11,354				36,986				46,560
Cash components of selected items			(2,995	)			7,829				(1,406	)			(5,713	)
Income tax effect of selected items			—				—				—				—
Cash flows from operations before changes in working capital, adjusted for selected items (1)		$	6,685			$	19,183			$	35,580			$	40,847

___________________
(1)	Amount reflects net (loss) income available to common stockholders on a diluted basis for earnings per share purposes as calculated using the two-class method of computing earnings per share which is further described in Note 12, Earnings Per Share in our Form 10-Q for the quarter ended September 30, 2023.
(2)	Net (loss) income 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.
(3)	The impact of selected items for the three and nine months ended September 30, 2023 were calculated based upon weighted average diluted shares of 16.5 million and 16.4 million shares, respectively, due to the net (loss) income available to common stockholders, excluding selected items. The impact of selected items for the three and nine months ended September 30, 2022 were calculated based upon weighted average diluted shares of 16.5 million shares, respectively, due to the net (loss) income available to common stockholders, excluding selected items.

BATTALION OIL CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands)
		Three Months Ended								Nine Months Ended
		September 30,								September 30,
		2023				2022				2023				2022
Net (loss) income, as reported		$	(53,799	)		$	105,888			$	(35,736	)		$	26,191
Impact of adjusting items:
Interest expense			9,219				6,232				27,594				16,347
Depletion, depreciation and accretion			13,426				13,615				44,287				36,436
Stock-based compensation			(686	)			683				(1,231	)			1,540
Interest income			(293	)			(141	)			(718	)			(142	)
Unrealized loss (gain) on derivatives contracts			46,805				(102,112	)			23,469				(23,911	)
Change in fair value of embedded derivative liability			(1,878	)			(449	)			(2,582	)			(3,043	)
Non-recurring charges and other			831				597				1,460				867
Adjusted EBITDA(1)		$	13,625			$	24,313			$	56,543			$	54,285

___________________

(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 CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands)
		Three Months				Three Months				Three Months				Three Months
		Ended				Ended				Ended				Ended
		September 30, 2023				June 30, 2023				March 31, 2023				December 31, 2022
Net (loss) income, as reported		$	(53,799	)		$	(4,748	)			22,811				(7,652	)
Impact of adjusting items:
Interest expense			9,219				9,366				9,009				9,378
Depletion, depreciation and accretion			13,426				14,713				16,148				15,479
Stock-based compensation			(686	)			(772	)			227				670
Interest income			(293	)			(234	)			(191	)			(227	)
Unrealized loss (gain) on derivatives contracts			46,805				(2,332	)			(21,004	)			3,655
Change in fair value of embedded derivative liability			(1,878	)			358				(1,062	)			1,224
Non-recurring charges (credits) and other			831				477				152				194
Adjusted EBITDA(1)		$	13,625			$	16,828			$	26,090			$	22,721
Adjusted LTM EBITDA(1)		$	79,264

___________________

(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 CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands)
		Three Months				Three Months				Three Months				Three Months
		Ended				Ended				Ended				Ended
		September 30, 2022				June 30, 2022				March 31, 2022				December 31, 2021
Net income (loss), as reported		$	105,888				13,047				(92,744	)			25,935
Impact of adjusting items:
Interest expense			6,232				5,394				4,721				3,215
Depletion, depreciation and accretion			13,615				12,601				10,220				12,679
Stock-based compensation			683				473				384				450
Interest income			(141	)			(1	)			-				(1	)
Loss (gain) on extinguishment of debt			—				—				—				122
Unrealized loss (gain) on derivatives contracts			(102,112	)			(12,837	)			91,038				(21,332	)
Change in fair value of embedded derivative liability			(449	)			(562	)			(2,032	)			—
Non-recurring charges (credits) and other			597				53				217				(718	)
Adjusted EBITDA(1)		$	24,313			$	18,168			$	11,804			$	20,350
Adjusted LTM EBITDA(1)		$	74,635

___________________

(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.

FAQ

What are the key highlights of Battalion Oil Corporation's Q3 2023 financial and operating results?

Battalion Oil Corporation reported sales volumes, robust production results, recommenced drilling operations, and obtained commitments for preferred equity raise to support incremental activity plans.

What are the management comments regarding drilling operations and the acid gas injection project?

The company has commenced drilling operations in Monument Draw and is ahead of plan from both a capital and time perspective. The acid gas injection project is still undergoing workover operations and is expected to be fully online in the first quarter of 2024.

What are the results of operations for Battalion Oil Corporation in Q3 2023?

The company reported average daily net production, total operating revenue, lease operating and workover expense, gathering and other expense, and general and administrative expense. They also reported a net loss and adjusted EBITDA for the quarter.

What are the liquidity and balance sheet details for Battalion Oil Corporation as of September 30, 2023?

As of September 30, 2023, the company had $210.2 million of indebtedness outstanding and no letters of credit outstanding. Total liquidity was $42.6 million. In November 2023, the Company obtained a commitment letter for additional preferred equity securities in an amount up to $55.0 million.