Riley Permian Reports Fiscal Fourth Quarter and Year End 2021 Financial and Operating Results
Riley Exploration Permian reported a net loss of $65.7 million for fiscal year 2021, despite generating $89.9 million of Adjusted EBITDAX and $26 million of Free Cash Flow. Total production increased by 22% to 3.15 MMBoe year-over-year. In Q4, production rose 35% to 9.6 MBoe per day, with a net income of $15.7 million. Dividends paid totaled $5.5 million, representing 21% of operating cash flow. Future guidance includes projected Q1 2022 oil production of 7.0 to 7.3 MBbls per day and a capital expenditure forecast of $26 to $32 million.
- 22% increase in total production year-over-year to 3.15 MMBoe.
- Q4 production increased by 35% to 9.6 MBoe per day.
- Generated $89.9 million of Adjusted EBITDAX for FY 2021.
- Declared $5.5 million in dividends, 21% of operating cash flow.
- Reported net loss of $65.7 million for FY 2021.
- Increased cash costs per Boe by 2% to $15.38 compared to previous quarter.
OKLAHOMA CITY, Dec. 13, 2021 /PRNewswire/ -- Riley Exploration Permian, Inc. (NYSE American: REPX) ("Riley Permian" or the "Company"), today reported financial and operational results for the fiscal fourth quarter and year ended September 30, 2021.
HIGHLIGHTS FOR THE FISCAL FULL YEAR ENDING SEPTEMBER 30, 2021
- Increased total production by
22% to 3.15 MMBoe for fiscal year 2021, as compared to fiscal year 2020 - Reported net loss of
$65.7 million with income from operations of$59.9 million for the same period - Generated
$89.9 million of Adjusted EBITDAX(1),$86.1 million of operating cash flow from continuing operations and$26.0 million of Free Cash Flow(1) - Invested total cash capital expenditures before acquisitions of
$60.0 million , which corresponds to70% of operating cash flow from continuing operations - Paid
$18.3 million in dividends on common units/shares, which corresponds to21% of operating cash flow from continuing operations or70% of Free Cash Flow(1) - Increased total proved developed reserves by
38% year-over-year to 41.5 MMBoe and increased total proved reserves by27% year-over-year to 72.2 MMBoe
HIGHLIGHTS FOR THE FISCAL FOURTH QUARTER ENDING SEPTEMBER 30, 2021
- Increased production by
35% to 9.6 MBoe per day for the three months ended September 30, 2021, as compared to the same period in 2020, or by5% quarter-over-quarter compared to fiscal third quarter 2021 - Reported net income of
$15.7 million with income from operations of$26.9 million for the same period - Generated
$24.5 million of Adjusted EBITDAX(1),$27.2 million of operating cash flow from continuing operations and$7.2 million of Free Cash Flow(1) - Realized a Cash Margin(1) of
$39.08 per Boe before derivative settlements or$26.41 per Boe after derivative settlements - Declared dividends of
$0.28 per share with a record date of July 23, 2021 for a total of$5.5 million
"Riley Permian completed another strong fiscal year," stated Bobby Riley, Chief Executive Officer and Chairman of the Board of Directors. Mr. Riley continued, "We completed our merger with Tengasco in February, had a successful capital raise in July, began and progressed on our EOR project this fall, and met our operational guidance metrics for the fiscal fourth quarter and the fiscal year. We are proud of the organic growth achieved over the past year and believe our reinvestment for growth is warranted to improve our scale, cost structure and cash flow. At the same time, we achieved this growth while allocating significant cash flow from operations back to shareholders in the form of dividends. Finally, we have continued to progress our efforts in developing CCUS projects, including for permanent storage projects on our property, and we're optimistic in initiating our first project during 2022. We are engaging in constructive discussions and diligence efforts with counterparties from CO2 source hosts, capture equipment providers and regulatory advisors. We are seeking to construct commercial arrangements that provide attractive economic returns in the current regulatory environment, with potential for improvement should regulations change at the federal or state levels."
___________________ |
(1) Non-GAAP financial measure, which is defined and reconciled below. |
Selected Operating and Financial Data | ||||||||||||||||
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Select Financial Data (in thousands): | ||||||||||||||||
Oil and natural gas sales, net | $ | 48,014 | $ | 15,309 | $ | 148,636 | $ | 73,133 | ||||||||
Net income (loss) | $ | 15,654 | $ | (5,084) | $ | (65,666) | $ | 35,144 | ||||||||
Adjusted EBITDAX(1) | $ | 24,505 | $ | 14,257 | $ | 89,938 | $ | 68,387 | ||||||||
Production Data, net: | ||||||||||||||||
Oil (MBbls) | 639 | 497 | 2,340 | 2,060 | ||||||||||||
Natural gas (MMcf) | 807 | 466 | 2,602 | 1,628 | ||||||||||||
Natural gas liquids (MBbls) | 109 | 79 | 380 | 260 | ||||||||||||
Total (MBoe) | 882 | 653 | 3,154 | 2,592 | ||||||||||||
Daily combined volumes (Boe/d) | 9,581 | 7,100 | 8,640 | 7,081 | ||||||||||||
Daily oil volumes (Bbls/d) | 6,940 | 5,400 | 6,411 | 5,630 | ||||||||||||
Average Prices: | ||||||||||||||||
Oil ($ per Bbl) | $ | 68.95 | $ | 30.89 | $ | 58.29 | $ | 36.35 | ||||||||
Natural gas ($ per Mcf)(2) | 2.36 | (0.55) | 2.88 | (0.78) | ||||||||||||
Natural gas liquids ($ per Bbl)(2) | 19.16 | 2.80 | 12.41 | (1.90) | ||||||||||||
Total average price ($ per Boe) | $ | 54.46 | $ | 23.43 | $ | 47.12 | $ | 28.22 | ||||||||
Average Prices, including the effects of derivative | ||||||||||||||||
Oil ($ per Bbl) | $ | 52.30 | $ | 44.48 | $ | 51.47 | $ | 49.41 | ||||||||
Natural gas ($ per Mcf)(2)(4) | 1.69 | (0.55) | 2.75 | (0.78) | ||||||||||||
Natural gas liquids ($ per Bbl)(2)(4) | 19.16 | 2.80 | 12.41 | (1.90) | ||||||||||||
Total average price ($ per Boe) | $ | 41.79 | $ | 33.77 | $ | 41.95 | $ | 38.61 | ||||||||
Cash Costs ($ per Boe)(1) | $ | 15.38 | $ | 13.80 | $ | 14.96 | $ | 14.41 | ||||||||
Cash Margin ($ per Boe)(1) | $ | 39.08 | $ | 9.63 | $ | 32.16 | $ | 13.81 | ||||||||
Cash Margin, including derivative settlements ($ per Boe)(1) | $ | 26.41 | $ | 19.96 | $ | 26.99 | $ | 24.19 | ||||||||
_____________________ | |
(1) | Non-GAAP financial measure, which is defined and reconciled below. |
(2) | The Company's natural gas and NGL sales are presented net of gathering, processing and transportation fees which at times exceed the price received and result in negative average prices. |
(3) | The Company's calculation of the effects of derivative settlements includes gains (losses) on the settlement of its commodity derivative contracts. These gains (losses) are included under other income and expense on the Company's consolidated statement of operations. |
(4) | During the years ended September 30, 2021 and 2020, the Company did not have any NGL derivative contracts in place. During the year ended September 30, 2020, the Company did not have any natural gas derivative contracts in place. |
OPERATIONS UPDATE
Riley Permian increased production by
During the fiscal year 2021, Riley Permian increased total proved developed reserves by
Since October 1, 2021, the Company has continued to progress on its EOR pilot program. The Company has drilled six of six currently planned vertical injection wells and has commenced installation of water and CO2 injection lines. Also, the Company executed two agreements in October 2021, including an agreement with the Cortez Pipeline Company relating to the connection and establishment of a delivery point for CO2 for Riley Permian, as well as an agreement with Kinder Morgan CO2 Company LLC, relating to the purchase and sale of CO2.
FINANCIALS UPDATE
The Company reported net income (loss) of
Fiscal fourth quarter 2021 average realized prices, before derivative settlements were
Riley Permian's total Cash Costs(1) for the fiscal fourth quarter of 2021 were
The Company had
During the fiscal fourth quarter 2021, the Company declared common dividends of
As of December 8, 2021, we had
____________________ |
(1) Non-GAAP financial measure, which is defined and reconciled below. |
FISCAL FIRST QUARTER AND FULL YEAR 2022 OUTLOOK AND GUIDANCE
Based on current market conditions, the Company forecasts fiscal first quarter 2022 accrued capital expenditures before acquisitions to total approximately
Riley Permian forecasts fiscal first quarter 2022 oil production to average 7.0 MBbls per day to 7.3 MBbls per day, with total equivalent production to average 9.5 MBoe per day to 10.0 MBoe per day.
The Company forecasts first fiscal quarter of 2022 LOE of approximately
Based on current market conditions, the Company forecasts full-year fiscal 2022 accrued capital expenditures before acquisitions to total approximately
CONFERENCE CALL
Riley Permian management will host a conference call for investors and analysts on December 14, 2021 at 11:00 a.m. CT to discuss the Company's results. Interested parties are invited to participate by calling:
- U.S./Canada Toll Free, (888) 330-2214
- International, +1 (646) 960-0161
- Conference ID number 5405646
An updated company presentation, which will include certain items to be discussed on the call, will be posted prior to the call on the Company's website (www.rileypermian.com). A replay of the call will be available until December 28, 2021 by calling:
- (800) 770-2030 or (647) 362-9199
- Conference ID number 5405646
About Riley Exploration Permian, Inc.
Riley Permian is a growth-oriented, independent oil and natural gas company focused on the acquisition, exploration, development and production of oil, natural gas and natural gas liquids. For more information please visit www.rileypermian.com.
Investor Contact:
Rick D'Angelo
405-438-0126
IR@rileypermian.com
____________________ |
(1) Non-GAAP financial measure, which is defined above. |
CAUTIONARY STATEMENT FOR THE PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
This press 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. The statements contained in this release that are not historical facts are forward-looking statements that represent management's beliefs and assumptions based on currently available information. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, need for financing, competitive position and potential growth opportunities. Our forward-looking statements do not consider the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believes," "intends," "may," "should," "anticipates," "expects," "could," "plans," "estimates," "projects," "targets" or comparable terminology or by discussions of strategy or trends. Although we believe that the expectations reflected in such forward-looking statements are reasonable, we cannot give any assurances that these expectations will prove to be correct. Such statements by their nature involve risks and uncertainties that could significantly affect expected results, and actual future results could differ materially from those described in such forward-looking statements.
Among the factors that could cause actual future results to differ materially are the risks and uncertainties the Company is exposed to. While it is not possible to identify all factors, we continue to face many risks and uncertainties including, but not limited to: fluctuations in the price we receive for our oil, natural gas, and NGL production, including local market price differentials; the impact of the COVID-19 pandemic, including reduced demand for oil and natural gas, economic slowdown, governmental and societal actions taken in response to the COVID-19 pandemic, and stay-at-home orders or illness that may cause interruptions to our operations; cost and availability of gathering, pipeline, refining, transportation, water, CO2, and other midstream and downstream activities and our ability to sell oil, natural gas, and NGLs, which may be negatively impacted by the COVID-19 pandemic; severe weather and other risks and lead to a lack of any available markets; our ability to successfully complete mergers, acquisitions and divestitures; failure of our enhanced oil recovery project to perform as expected or produce the anticipated benefits; risks relating to our operations, including development drilling and testing results and performance of acquired properties and newly drilled wells; any reduction in our borrowing base from time to time and our ability to repay any excess borrowings as a result of such reduction; the impact of our derivative instruments and hedging activities; continuing compliance with the financial covenants contained in our credit agreement; the loss of certain federal income tax deductions or other changes to the Internal Revenue Code; risks associated with executing our business strategy, including any changes in our strategy; inability to prove up undeveloped acreage and maintaining production on leases; risks associated with concentration of operations in one major geographic area; deviations from our forecasts and budgets, including our capital expenditure budget; the ability of the members of the Organization of Petroleum Exporting Countries ("OPEC") and other oil exporting nations to agree to, adhere to and maintain oil price and production controls; legislative or regulatory changes, including initiatives related to hydraulic fracturing, emissions, and disposal of produced water, which may be negatively impacted by the recent change in Presidential administration or legislatures; the ability to receive drilling and other permits or approvals and rights-of-way in a timely manner (or at all), which may be negatively impacted by the impact of COVID-19 restrictions on regulatory employees who process and approve permits, other approvals and rights-of-way and which may be restricted by new Presidential and Secretarial orders and regulation and legislation; risks related to litigation; and cybersecurity threats, technology system failures and data security issues. Additional factors that could cause results to differ materially from those described above can be found in Riley Permian's Annual Report on Form 10-K for the year ended September 30, 2021 filed with the SEC and available from the Company's website at www.rileypermian.com under the "Investor" tab, and in other documents the Company files with the SEC.
The forward-looking statements in this press release are made as of the date hereof and are based on information available at that time. The Company does not undertake, and expressly disclaims, any duty to update or revise our forward-looking statements based on new information, future events or otherwise.
RILEY EXPLORATION PERMIAN, INC. | ||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||
September 30, 2021 | September 30, 2020 | |||||||
(In thousands, except share amounts) | ||||||||
Assets | ||||||||
Current Assets: | ||||||||
Cash and cash equivalents | $ | 17,067 | $ | 1,660 | ||||
Accounts receivable | 17,473 | 10,128 | ||||||
Accounts receivable - related parties | 456 | 55 | ||||||
Prepaid expenses and other current assets | 1,730 | 1,752 | ||||||
Current derivative assets | — | 18,819 | ||||||
Total current assets | 36,726 | 32,414 | ||||||
Oil and natural gas properties, net (successful efforts) | 345,797 | 310,726 | ||||||
Other property and equipment, net | 3,183 | 1,801 | ||||||
Non-current derivative assets | 106 | 3,102 | ||||||
Other non-current assets, net | 2,419 | 2,949 | ||||||
Total Assets | $ | 388,231 | $ | 350,992 | ||||
Liabilities, Series A Preferred Units, and Members'/Shareholders' Equity | ||||||||
Current Liabilities: | ||||||||
Accounts payable | $ | 12,234 | $ | 4,739 | ||||
Accrued liabilities | 19,355 | 8,688 | ||||||
Revenue payable | 9,008 | 4,432 | ||||||
Income taxes payable | 219 | — | ||||||
Advances from joint interest owners | 214 | 254 | ||||||
Current derivative liabilities | 42,144 | — | ||||||
Other current liabilities | 441 | 450 | ||||||
Total Current Liabilities | 83,615 | 18,563 | ||||||
Non-current derivative liabilities | 8,932 | — | ||||||
Asset retirement obligations | 2,306 | 2,268 | ||||||
Revolving credit facility | 60,000 | 101,000 | ||||||
Deferred tax liabilities | 11,628 | 1,834 | ||||||
Other non-current liabilities | 60 | 418 | ||||||
Total Liabilities | 166,541 | 124,083 | ||||||
Commitments and Contingencies | ||||||||
Series A Preferred Units | — | 60,292 | ||||||
Members' Equity | — | 166,617 | ||||||
Shareholders' Equity: | ||||||||
Preferred stock, | — | — | ||||||
Common stock, | 20 | — | ||||||
Additional paid-in capital | 270,837 | — | ||||||
Accumulated deficit | (49,167) | — | ||||||
Total Shareholders' Equity | 221,690 | — | ||||||
Total Liabilities, Series A Preferred Units, and Members'/Shareholders' | $ | 388,231 | $ | 350,992 | ||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||||||||
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands, except per share/unit amounts) | ||||||||||||||||
Revenues: | ||||||||||||||||
Oil and natural gas sales, net | $ | 48,014 | $ | 15,309 | $ | 148,636 | $ | 73,133 | ||||||||
Contract services - related parties | 600 | 650 | 2,400 | 3,800 | ||||||||||||
Total Revenues | 48,614 | 15,959 | 151,036 | 76,933 | ||||||||||||
Costs and Expenses: | ||||||||||||||||
Lease operating expenses | 5,686 | 5,254 | 21,975 | 20,243 | ||||||||||||
Production and ad valorem taxes | 2,575 | 944 | 8,636 | 4,280 | ||||||||||||
Exploration costs | 884 | 692 | 9,566 | 9,923 | ||||||||||||
Depletion, depreciation, amortization and accretion | 6,692 | 5,459 | 26,015 | 21,479 | ||||||||||||
General and administrative: | ||||||||||||||||
Administrative costs | 4,790 | 2,157 | 13,966 | 10,826 | ||||||||||||
Unit-based compensation expense | — | 313 | 689 | 963 | ||||||||||||
Share-based compensation expense | 751 | — | 6,104 | — | ||||||||||||
Cost of contract services - related parties | 147 | 100 | 477 | 503 | ||||||||||||
Transaction costs | 198 | 1,389 | 3,732 | 1,431 | ||||||||||||
Total Costs and Expenses | 21,723 | 16,308 | 91,160 | 69,648 | ||||||||||||
Income (Loss) From Operations | 26,891 | (349) | 59,876 | 7,285 | ||||||||||||
Other Income (Expense): | ||||||||||||||||
Interest expense | (963) | (1,213) | (4,534) | (5,299) | ||||||||||||
Gain (loss) on derivatives | (14,987) | (3,123) | (89,195) | 33,876 | ||||||||||||
Total Other Income (Expense) | (15,950) | (4,336) | (93,729) | 28,577 | ||||||||||||
Net Income (Loss) from Continuing Operations Before | 10,941 | (4,685) | (33,853) | 35,862 | ||||||||||||
Income tax benefit (expense) | 3,937 | (399) | (13,016) | (718) | ||||||||||||
Net Income (Loss) From Continuing Operations | 14,878 | (5,084) | (46,869) | 35,144 | ||||||||||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||
CONSOLIDATED STATEMENTS OF OPERATIONS - (Continued) | ||||||||||||||||
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands, except per share/unit amounts) | ||||||||||||||||
Discontinued Operations: | ||||||||||||||||
Income (Loss) from discontinued operations | 775 | — | (18,738) | — | ||||||||||||
Income tax benefit (expense) on discontinued operations | 1 | — | (59) | — | ||||||||||||
Income (Loss) on discontinued operations | 776 | — | (18,797) | — | ||||||||||||
Net Income (Loss) | 15,654 | (5,084) | (65,666) | 35,144 | ||||||||||||
Dividends on preferred units | — | (904) | (1,491) | (3,535) | ||||||||||||
Net Income (Loss) Attributable to Common | $ | 15,654 | $ | (5,988) | $ | (67,157) | $ | 31,609 | ||||||||
Net Income (Loss) per Share/Unit from Continuing | ||||||||||||||||
Basic | $ | 0.77 | $ | (0.41) | $ | (3.02) | $ | 2.54 | ||||||||
Diluted | $ | 0.76 | $ | (0.41) | $ | (3.02) | $ | 2.13 | ||||||||
Net Income (Loss) per Share/Unit from Discontinued | ||||||||||||||||
Basic | $ | 0.04 | $ | — | $ | (1.17) | $ | — | ||||||||
Diluted | $ | 0.04 | $ | — | $ | (1.17) | $ | — | ||||||||
Net Income (Loss) per Share/Unit: | ||||||||||||||||
Basic | $ | 0.81 | $ | (0.48) | $ | (4.19) | $ | 2.54 | ||||||||
Diluted | $ | 0.80 | $ | (0.48) | $ | (4.19) | $ | 2.13 | ||||||||
Weighted Average Common Shares/Units | ||||||||||||||||
Basic | 19,434 | 12,468 | 16,021 | 12,457 | ||||||||||||
Diluted | 19,540 | 12,468 | 16,021 | 16,509 | ||||||||||||
______________________ | |
(1) | Amounts for the three months and year ended September 30, 2021 were computed using a retroactive application of the Exchange Ratio and the one-for-twelve reverse stock split that occurred in connection with the Merger. |
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||||||||
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands) | ||||||||||||||||
Cash Flows from Operating Activities: | ||||||||||||||||
Net income (loss) | $ | 15,654 | $ | (5,084) | $ | (65,666) | $ | 35,144 | ||||||||
Adjustments to reconcile net income (loss) to net cash provided | ||||||||||||||||
Loss (income) from discontinued operations | (776) | — | 18,797 | — | ||||||||||||
Oil and gas lease expirations | 732 | 614 | 9,347 | 7,902 | ||||||||||||
Depletion, depreciation, amortization and accretion | 6,692 | 5,321 | 26,015 | 21,341 | ||||||||||||
(Gain) loss on plugging liabilities | — | 138 | — | 138 | ||||||||||||
(Gain) loss on derivatives | 14,987 | 3,123 | 89,195 | (33,876) | ||||||||||||
Settlements on derivative contracts | (11,171) | 6,753 | (16,304) | 26,914 | ||||||||||||
Amortization of deferred financing costs | 170 | 164 | 653 | 648 | ||||||||||||
Unit-based compensation expense | — | 313 | 689 | 963 | ||||||||||||
Share-based compensation expense | 751 | — | 6,104 | — | ||||||||||||
Deferred income tax expense (benefit) | (4,223) | 346 | 12,962 | 665 | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||||
Accounts receivable | (1,800) | (4,128) | (7,345) | 1,515 | ||||||||||||
Accounts receivable – related parties | 1,539 | 290 | (401) | 449 | ||||||||||||
Prepaid expenses and other current assets | 735 | 1,263 | 201 | 839 | ||||||||||||
Other non-current assets | — | 2 | — | 84 | ||||||||||||
Accounts payable and accrued liabilities | 2,229 | 2,800 | 7,445 | 16 | ||||||||||||
Income taxes payable | 286 | — | (54) | — | ||||||||||||
Revenue payable | 1,570 | 1,115 | 4,576 | (84) | ||||||||||||
Advances from joint interest owners | (52) | 11 | (40) | (108) | ||||||||||||
Other liabilities | (77) | — | (101) | — | ||||||||||||
Net Cash Provided By Operating Activities - Continuing | 27,246 | 13,041 | 86,073 | 62,550 | ||||||||||||
Cash Flows from Investing Activities: | ||||||||||||||||
Additions to oil and natural gas properties | (19,746) | (5,955) | (58,329) | (47,183) | ||||||||||||
Acquisitions of oil and natural gas properties | — | 696 | (445) | (4,110) | ||||||||||||
Additions to other property and equipment | (541) | (60) | (1,714) | (228) | ||||||||||||
Tengasco acquired cash | — | — | 860 | — | ||||||||||||
Net Cash Used In Investing Activities - Continuing | (20,287) | (5,319) | (59,628) | (51,521) | ||||||||||||
RILEY EXPLORATION PERMIAN, INC. | ||||||||||||||||
CONSOLIDATED STATEMENTS OF CASH FLOWS – (Continued) | ||||||||||||||||
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands) | ||||||||||||||||
Cash Flows from Financing Activities: | ||||||||||||||||
Deferred financing costs | (4) | (1,183) | (139) | (1,476) | ||||||||||||
Proceeds from revolving credit facility | — | 2,500 | 5,500 | 16,500 | ||||||||||||
Repayment under revolving credit facility | (37,500) | (5,500) | (46,500) | (12,500) | ||||||||||||
Payment of common share/unit dividends | (5,452) | (2,797) | (18,286) | (15,297) | ||||||||||||
Proceeds from issuance of common stock | 50,000 | — | 50,000 | — | ||||||||||||
Public offering costs | (3,316) | — | (3,316) | — | ||||||||||||
Payment of preferred unit dividends | — | — | (1,491) | — | ||||||||||||
Common stock repurchased for tax withholding | (514) | — | (514) | — | ||||||||||||
Purchase of common units under long-term incentive plan | — | — | (191) | (322) | ||||||||||||
Net Cash Provided By (Used in) Financing Activities - | 3,214 | (6,980) | (14,937) | (13,095) | ||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents from | 10,173 | 742 | 11,508 | (2,066) | ||||||||||||
Cash Flows from Discontinued Operations: | ||||||||||||||||
Operating activities | — | — | 7 | — | ||||||||||||
Investing activities | — | — | 3,892 | — | ||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents from | — | — | 3,899 | — | ||||||||||||
Net Increase (Decrease) in Cash and Cash Equivalents | 10,173 | 742 | 15,407 | (2,066) | ||||||||||||
Cash and Cash Equivalents, Beginning of Period | 6,894 | 918 | 1,660 | 3,726 | ||||||||||||
Cash and Cash Equivalents, End of Period | $ | 17,067 | $ | 1,660 | $ | 17,067 | $ | 1,660 | ||||||||
OIL AND NATURAL GAS RESERVES
Netherland, Sewell & Associates, Inc. prepared the estimates of the Company's proved reserves in accordance with the rules and regulations of the Securities and Exchange Commission. The table below presents our total proved reserves as of September 30, 2021.
Total Proved | Total Proved | ||||
Oil (MBbls) | 26,170 | 46,263 | |||
Natural Gas (MMcf) | 46,173 | 76,019 | |||
Natural Gas Liquids (MBbls) | 7,650 | 13,229 | |||
Total Proved Reserves (MBoe) | 41,516 | 72,163 | |||
Estimates of reserves were prepared using an average price equal to the unweighted arithmetic average of hydrocarbon prices received on a field-by-field basis on the first day of each month within the 12-month period ended September 30, 2021 in accordance with SEC guidelines. Reserve estimates do not include any value for probable or possible reserves that may exist, nor do they include any value for undeveloped acreage. The reserve estimates represent our net revenue interest in our properties, all of which are located within the continental United States.
DERIVATIVE CONTRACTS
The following table summarizes the open financial derivative positions as of December 8, 2021, related to oil and natural gas production. Derivative positions in the table for calendar Q4 2021 are as of September 30, 2021.
Weighted Average Price | |||||||||||||||
Calendar Quarter | Notional Volume | Fixed | Put | Call | |||||||||||
($ per unit) | |||||||||||||||
Oil Swaps (Bbl) | |||||||||||||||
Q4 2021 | 558,116 | $ | 51.65 | $ | — | $ | — | ||||||||
Q1 2022 | 345,000 | $ | 57.47 | $ | — | $ | — | ||||||||
Q2 2022 | 345,000 | $ | 57.47 | $ | — | $ | — | ||||||||
Q3 2022 | 270,000 | $ | 56.03 | $ | — | $ | — | ||||||||
Q4 2022 | 270,000 | $ | 56.03 | $ | — | $ | — | ||||||||
Q1 2023 | 225,000 | $ | 53.65 | $ | — | $ | — | ||||||||
Q2 2023 | 195,000 | $ | 53.89 | $ | — | $ | — | ||||||||
Q3 2023 | 150,000 | $ | 52.58 | $ | — | $ | — | ||||||||
Q4 2023 | 150,000 | $ | 52.58 | $ | — | $ | — | ||||||||
Natural Gas Swaps (Mcf) | |||||||||||||||
Q4 2021 | 555,000 | $ | 3.03 | $ | — | $ | — | ||||||||
Q1 2022 | 540,000 | $ | 3.26 | $ | — | $ | — | ||||||||
Q2 2022 | 540,000 | $ | 3.26 | $ | — | $ | — | ||||||||
Q3 2022 | 540,000 | $ | 3.26 | $ | — | $ | — | ||||||||
Q4 2022 | 540,000 | $ | 3.26 | $ | — | $ | — | ||||||||
Oil Collars (Bbl) | |||||||||||||||
Q1 2022 | 90,000 | $ | — | $ | 35.00 | $ | 42.63 | ||||||||
Q2 2022 | 90,000 | $ | — | $ | 35.00 | $ | 42.63 | ||||||||
Q3 2022 | 90,000 | $ | — | $ | 35.00 | $ | 42.63 | ||||||||
Q4 2022 | 90,000 | $ | — | $ | 35.00 | $ | 42.63 | ||||||||
Oil Basis (Bbl) | |||||||||||||||
Q4 2021 | 435,000 | $ | 0.40 | $ | — | $ | — | ||||||||
Q1 2022 | 180,000 | $ | 0.40 | $ | — | $ | — | ||||||||
Q2 2022 | 180,000 | $ | 0.40 | $ | — | $ | — | ||||||||
Q3 2022 | 180,000 | $ | 0.40 | $ | — | $ | — | ||||||||
Q4 2022 | 180,000 | $ | 0.40 | $ | — | $ | — | ||||||||
NON-GAAP MEASURES
The Company presents certain non-GAAP financial measures to supplement its financial statements prepared in accordance with accounting principles generally accepted in the United States ("GAAP"). The non-GAAP financial measures include Adjusted Net Income, Adjusted EBITDAX, Cash G&A, Cash Costs and Cash Margin and Free Cash Flow. A reconciliation of each non-GAAP measure to the most directly comparable GAAP financial measure is presented below.
We believe that these non-GAAP measures presented, in conjunction with our financial and operating results prepared in accordance with GAAP, provide a more complete understanding of the Company's performance. We use these non-GAAP measures to compare our financial and operating performance with that of other companies in the oil and natural gas industry as well as our financial and operating performance for current and historical periods. These non-GAAP measures should not be considered in isolation or as a substitute for GAAP measures, such as net income (loss), operating income (loss), total costs and expenses, general and administrative expenses or net cash provided by operating activities or any other GAAP measure of financial position or results of operations.
As not all companies use the same calculation, our non-GAAP measures may not be comparable to similarly titled measures presented by other companies.
Adjusted Net Income: We define Adjusted Net Income as net income (loss) plus (income) loss on discontinued operations, unrealized (gain) loss on derivative contracts, transaction costs, income tax expense related to our change in tax status and the associated changes in estimated income tax. We believe that Adjusted Net Income is a widely followed measure of operating performance and is one of many metrics used by investors as well as our management team. For example, Adjusted Net Income can be used to assess our operating performance and return on capital in comparison to other independent exploration and production companies without regard to financial or capital structure and to assess the financial performance of our assets and our company without regard to capital structure or historical cost basis. The following table provides a reconciliation of Net Income (Loss) to Adjusted Net Income for the periods indicated:
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||||
(In thousands) | ||||||||||||||||||
Net income (loss) | $ | 15,654 | $ | (5,084) | $ | (65,666) | $ | 35,144 | ||||||||||
Loss (income) on discontinued operations | (776) | — | 18,797 | — | ||||||||||||||
Unrealized loss (gain) on derivatives | 3,816 | 9,876 | 72,891 | (6,962) | ||||||||||||||
Transaction costs and other | 458 | 1,389 | 3,992 | 1,823 | ||||||||||||||
Income tax expense from change in tax status | — | — | 13,581 | — | ||||||||||||||
Tax effect of adjustments(1) | (755) | — | (20,657) | — | ||||||||||||||
Adjusted Net Income | $ | 18,397 | $ | 6,181 | $ | 22,938 | $ | 30,005 | ||||||||||
___________________ | |
(1) | Computed by applying a combined federal and state statutory rate of |
Adjusted EBITDAX: We define Adjusted EBITDAX as net income (loss) adjusted for loss (income) on discontinued operations, exploration expense, depletion, depreciation, amortization and accretion, equity-based compensation expense, interest expense, unrealized (gain) loss on commodity derivative contracts, income taxes, and transaction costs. We believe Adjusted EBITDAX is useful to investors because it provides an effective way to evaluate our operating performance and compare the results of our operations from period to period as well as to other companies in the oil and natural gas industry without regard to our financing methods or capital structure. The following table provides a reconciliation from the GAAP measure of Net income (loss) to Adjusted EBITDAX.
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands) | ||||||||||||||||
Net income (loss) | $ | 15,654 | $ | (5,084) | $ | (65,666) | $ | 35,144 | ||||||||
Loss (income) on discontinued operations | (776) | — | 18,797 | — | ||||||||||||
Exploration expense | 884 | 692 | 9,566 | 9,923 | ||||||||||||
Depletion, depreciation, amortization and accretion | 6,692 | 5,459 | 26,015 | 21,479 | ||||||||||||
Unit-based compensation expense | — | 313 | 689 | 963 | ||||||||||||
Share-based compensation expense | 751 | — | 6,104 | — | ||||||||||||
Interest expense | 963 | 1,213 | 4,534 | 5,299 | ||||||||||||
Unrealized loss (gain) on derivatives | 3,816 | 9,876 | 72,891 | (6,962) | ||||||||||||
Income tax expense (benefit) | (3,937) | 399 | 13,016 | 718 | ||||||||||||
Transaction costs and other | 458 | 1,389 | 3,992 | 1,823 | ||||||||||||
Adjusted EBITDAX | $ | 24,505 | $ | 14,257 | $ | 89,938 | $ | 68,387 | ||||||||
Cash G&A: Cash G&A is defined as general and administrative expense less share-based and unit-based compensation and contract services–related parties revenue plus cost of contract services–related parties. We believe Cash G&A is used by analysts and others in valuation, comparison and investment recommendations of companies in our industry to allow for analysis of cash G&A spend without regard to equity based compensation programs or amounts related to contract services. Administrative costs exclude share-based and unit-based compensation as those expenses are presented separately as components of general and administrative expense on our statement of operations. The following table provides a calculation for Cash G&A for the periods indicated:
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands) | ||||||||||||||||
Administrative costs | $ | 4,790 | $ | 2,157 | $ | 13,966 | $ | 10,826 | ||||||||
Plus: Costs of contract services - related parties | 147 | 100 | 477 | 503 | ||||||||||||
Less: Contract services revenues - related parties | (600) | (650) | (2,400) | (3,800) | ||||||||||||
Total Cash G&A | $ | 4,337 | $ | 1,607 | $ | 12,043 | $ | 7,529 | ||||||||
Cash Costs and Cash Margin per Boe: Cash Costs is a non-GAAP financial measure that we use as an indicator of our total cash-based cost of production and operations. We define "Cash Costs" as lease operating expenses plus production and ad valorem taxes, cash G&A, and interest expense. Management believes that Cash Costs is an important financial measure for use in evaluating the Company's operating and financial performance and for comparison to other companies in the oil and natural gas industry. We believe this is a useful measure for investors in evaluating our results against other oil and natural gas companies. Cash Costs should be considered in addition to, rather than as a substitute for, Total Costs and Expenses. The following table provides a calculation for Cash Costs and Cash Margin for the periods indicated:
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands, except per Boe amounts) | ||||||||||||||||
Cash Costs: | ||||||||||||||||
Lease operating expenses | $ | 5,686 | $ | 5,254 | $ | 21,975 | $ | 20,243 | ||||||||
Production and ad valorem taxes | 2,575 | 944 | 8,636 | 4,280 | ||||||||||||
Cash G&A(1) | 4,337 | 1,607 | 12,043 | 7,529 | ||||||||||||
Interest expense | 963 | 1,213 | 4,534 | 5,299 | ||||||||||||
Total Cash Costs | $ | 13,561 | $ | 9,018 | $ | 47,188 | $ | 37,351 | ||||||||
Total Production (MBoe) | 882 | 653 | 3,154 | 2,592 | ||||||||||||
Cash Margin ($ per Boe): | ||||||||||||||||
Total average realized price ($ per Boe) | $ | 54.46 | $ | 23.43 | $ | 47.12 | $ | 28.22 | ||||||||
Less: | ||||||||||||||||
Lease operating expenses | 6.45 | 8.04 | 6.97 | 7.81 | ||||||||||||
Production and ad valorem taxes | 2.92 | 1.44 | 2.74 | 1.65 | ||||||||||||
Cash G&A(1) | 4.92 | 2.46 | 3.82 | 2.91 | ||||||||||||
Interest expense | 1.09 | 1.86 | 1.44 | 2.04 | ||||||||||||
Total Cash Costs per Boe | 15.38 | 13.80 | 14.96 | 14.41 | ||||||||||||
Cash Margin per Boe | $ | 39.08 | $ | 9.63 | $ | 32.16 | $ | 13.81 | ||||||||
Realized gain (loss) on derivatives ($ per Boe) | (12.67) | 10.34 | (5.17) | 10.39 | ||||||||||||
Cash Margin per Boe, including derivative settlements | $ | 26.41 | $ | 19.96 | $ | 26.99 | $ | 24.19 | ||||||||
______________________ |
(1) A non-GAAP financial measure which is reconciled above. |
Free Cash Flow: Free Cash Flow is a measure that we use as an indicator of our ability to fund our development activities and generate excess cash for other corporate purposes. We define Free Cash Flow as Cash Flow from Continuing Operations, less capital expenditures before acquisitions. Free Cash Flow should be considered in addition to, rather than as a substitute for, net cash provided by operating activities as a measure of our liquidity. The following table provides a reconciliation of Net Cash Provided by Operating Activities - Continuing Operations to Free Cash Flow for the periods indicated:
Three Months Ended September 30, | Year Ended September 30, | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
(In thousands) | ||||||||||||||||
Net Cash Provided by Operating Activities - Continuing | $ | 27,232 | $ | 13,041 | $ | 86,073 | $ | 62,550 | ||||||||
Additions to oil and natural gas properties | (19,447) | (5,955) | (58,329) | (47,183) | ||||||||||||
Additions to other property and equipment | (542) | (60) | (1,714) | (228) | ||||||||||||
Free Cash Flow | $ | 7,243 | $ | 7,026 | $ | 26,030 | $ | 15,139 | ||||||||
View original content to download multimedia:https://www.prnewswire.com/news-releases/riley-permian-reports-fiscal-fourth-quarter-and-year-end-2021-financial-and-operating-results-301443494.html
SOURCE Riley Exploration Permian, Inc.
FAQ
What were Riley Exploration Permian's Q4 earnings results?
What is the production forecast for Q1 2022 for REPX?
How much Free Cash Flow did REPX generate in FY 2021?
What was the total dividend amount declared by REPX in 2021?
What is the capital expenditure guidance for FY 2022 for REPX?
