Whiting Petroleum Reports Fourth Quarter and Full Year 2020 Financial and Operating Results

Rhea-AI Summary

Whiting Petroleum Corporation (NYSE: WLL) reported fourth quarter and full year 2020 financial results with revenue of $212 million and $732 million, respectively. The company's net loss was $1.2 million, or $0.03 per diluted share, down from a loss of $147 million in Q4 2019. Adjusted EBITDAX was $120 million for the quarter, a decrease from $241 million the previous year. The company emerged from bankruptcy on September 1, 2020, applying fresh start accounting, which has impacted comparability of financials.

Positive

• Adjusted net income for Q4 2020 was $56 million, or $1.46 per share.
• Reduced general and administrative expenses helped offset revenue declines.

Negative

• Fourth quarter revenue decreased by $168 million compared to Q4 2019.
• Total production dropped to 8,441 MBOE from 11,315 MBOE year-over-year.
• Adjusted EBITDAX fell from $979 million in 2019 to $382 million in 2020.

Whiting Petroleum Corporation (NYSE: WLL) (“Whiting” or the “Company”) today announced fourth quarter and full year 2020 results.

Fourth Quarter and Full-Year 2020 Highlights

• Revenue was $212 million and $732 million for the quarter and year ending December 31, 2020, respectively
• Net loss was $1.2 million or $0.03 per diluted share for the quarter ending December 31, 2020
• Adjusted EBITDAX was $120 million and $382 million for the quarter and year ending December 31, 2020, respectively (see further discussion regarding the calculation of adjusted EBITDAX in "About Non-GAAP Financial Measures" below)

On September 1, 2020 (the “Emergence Date”) the Company emerged from voluntary bankruptcy under Chapter 11 of the Bankruptcy Code. Beginning on the Emergence Date, the Company applied fresh start accounting, which resulted in a new basis of accounting, and became a new entity for financial reporting purposes. As a result of the application of fresh start accounting and the effects of the implementation of the Company’s chapter 11 plan of reorganization, the consolidated financial statements after September 1, 2020 are not comparable with the consolidated financial statements on or prior to that date. References to “Successor” refer to the Whiting entity after emergence from bankruptcy on the Emergence Date. References to “Predecessor” refer to the Whiting entity prior to emergence from bankruptcy. References to “Successor Period” refer to the period from September 1, 2020 through December 31, 2020. References to “Current Predecessor YTD Period” refer to the period from January 1, 2020 through August 31, 2020.

Although GAAP requires that the Company report on results for the Successor Period and Current Predecessor YTD Period separately, our operating results are discussed below for the year ended December 31, 2020 by combining the results of the applicable Predecessor and Successor periods in order to provide the most meaningful comparison of our current results to prior periods.

Revenue for the fourth quarter of 2020 decreased $168 million to $212 million when comparing to the fourth quarter of 2019. A decrease in total production, which was primarily due to reduced development activity during 2020, accounted for approximately $114 million of the change in revenue. Lower commodity prices realized accounted for the remaining $54 million decrease in revenue between periods.

Net loss for the fourth quarter of 2020 was $1.2 million, or $0.03 per share, as compared to a net loss of $147 million, or $1.62 per share, for the fourth quarter of 2019. Adjusted net income for the fourth quarter of 2020 was $56 million or $1.46 per share. Adjusted net income and adjusted net income per share that exclude the effect of certain items are non-GAAP financial measures. Adjusted net income and adjusted net income per share represent net income (loss) and diluted net income (loss) per share, respectively, as determined under U.S. GAAP excluding the effects of non-cash gains and losses on derivative instruments, property impairments, gains and losses on asset sales and gains and losses on extinguishment of debt as applicable.

Adjusted EBITDAX for the fourth quarter of 2020 was $120 million compared to $241 million for the fourth quarter of 2019. Adjusted EBITDAX for the full-year of 2020 was $382 million compared to $979 million for the full-year of 2019. The Company’s revenues and EBITDAX for 2020 were similarly affected by lower production volumes due to reduced development activity during the year in response to the prevailing commodity price environment. This depressed commodity price environment also directly affected the Company’s results with lower prices received for its products. These effects were partially offset by reduced general and administrative expenses and DD&A primarily due to cost control measures implemented by the Company and its reorganization under bankruptcy. Select operating statistics are presented in the following tables:

Selected Operating and Financial Statistics

		Successor					Predecessor
		Three Months Ended December 31, 2020					Three Months Ended December 31, 2019
Selected operating statistics:
Production
Oil (MBbl)			5,110					7,376
NGLs (MBbl)			1,546					1,886
Natural gas (MMcf)			10,709					12,316
Total production (MBOE)			8,441					11,315
Average prices
Oil (per Bbl):
Price received		$	37.89				$	48.67
Effect of crude oil hedging (1)			(0.55	)				1.36
Realized price (2)		$	37.34				$	50.03
Weighted average NYMEX price (per Bbl) (3)		$	42.59				$	56.93
NGLs (per Bbl):
Realized price		$	6.88				$	8.79
Natural gas (per Mcf):
Price received		$	0.75				$	0.41
Effect of natural gas hedging (4)			(0.20	)				-
Realized price		$	0.55				$	0.41
Weighted average NYMEX price (per MMBtu) (3)		$	2.51				$	2.44
Selected operating metrics
Sales price, net of hedging ($ per BOE)		$	24.56				$	34.53
Lease operating ($ per BOE)			6.57					6.37
Transportation, gathering, compression and other ($ per BOE)			0.72					0.91
Depreciation, depletion and amortization ($ per BOE)			6.80

FAQ

What were Whiting Petroleum's Q4 2020 financial results?

Whiting Petroleum reported Q4 2020 revenue of $212 million, a net loss of $1.2 million, and adjusted EBITDAX of $120 million.

How did Whiting Petroleum perform in 2020 compared to 2019?

In 2020, Whiting's revenue was $732 million, down from $1.2 billion in 2019, and adjusted EBITDAX fell to $382 million from $979 million.

When did Whiting Petroleum emerge from bankruptcy?

Whiting Petroleum emerged from bankruptcy on September 1, 2020.

What impact did fresh start accounting have on Whiting Petroleum?

Fresh start accounting led to a new basis of accounting, affecting the comparability of financial results before and after September 1, 2020.

What were the production figures for Whiting Petroleum in Q4 2020?

Whiting Petroleum produced 8,441 MBOE in Q4 2020, a decrease from 11,315 MBOE in Q4 2019.