Oasis Petroleum Inc. Announces Quarter Ending September 30, 2013 Earnings

HOUSTON, Nov. 6, 2013 /PRNewswire/ -- Oasis Petroleum Inc. (NYSE: OAS) ("Oasis" or the "Company") today announced financial results for the quarter ended September 30, 2013.

Highlights for the third quarter of 2013 include:

  • Increased average daily production to 33,064 barrels of oil equivalent per day ("Boepd"), a 36% increase over the third quarter of 2012 and a 10% increase over the second quarter of 2013.
  • Increased revenue to $305.5 million in the third quarter of 2013, an increase of $120.8 million over the third quarter of 2012 and a sequential increase of $50.9 million over the second quarter of 2013.
  • Completed and placed on production 38 gross (27.7 net) operated wells in the third quarter of 2013.
  • Managed capital expenditures to $679.5 million year-to-date ending September 30, 2013, excluding expenditures associated with acquisitions.
  • Grew Adjusted EBITDA to $219.6 million, an increase of $80.4 million over the third quarter of 2012 and a sequential increase of $34.1 million over the second quarter of 2013. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income and net cash provided by operating activities, see "Non-GAAP Financial Measures" below.

Recent highlights include:

  • Increased position in Williston Basin to approximately 492,000 net acres and 399 drilling spacing units through four separate acquisitions that closed on or before October 1, 2013.
  • Grew inventory by 42%, up to 2,874 gross operated locations in the heart of the Williston Basin through acquisitions.
  • Increased operated rig count to 14, including two rigs added in our acquisitions, to accelerate production growth.
  • Ordered equipment to build our second Oasis Well Services ("OWS") frac fleet that will begin operations in 2014.
  • Successful production results from wells producing out of the 2nd and 3rd benches of the Three Forks.
  • Decreased well cost to $7.5 million, including the savings from OWS.

"Oasis grew production in line with our expectations during the third quarter of 2013, as we executed on our plan to complete additional wells on pads," said Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer.  "We completed 38 gross operated wells with an average working interest of 73%.  Through pad drilling and continued operational efficiencies, we drove down operated well costs on the wells completed in the third quarter of 2013 to approximately $8.0 million, excluding the impact of OWS.  OWS reduced capital expenditures for the Company by $13.2 million in the third quarter of 2013, which equates to approximately $0.5 million per net operated well completed.  So overall, capital efficiency continues to improve." 

Mr. Nusz added, "Including production from our recent acquisitions, we expect production to range between 42,000 Boepd to 46,000 Boepd in the fourth quarter of 2013.  Given our further confidence in the growing resource potential in the Williston Basin, we have increased our current rig count to 14, including the two rigs we picked up in our acquisition in West Williston.  With the continued growth in our project inventory, we expect to add another two rigs during 2014 which will further accelerate production growth.  With the growth in rig count and continuous improvements in drilling efficiency, we expect to spud approximately 210 gross operated wells in 2014.  In order to support our additional activity, we have decided to add a second frac fleet to OWS.  We expect to spend approximately $20 million for the equipment in 2014 and to begin work in the late second quarter of 2014.  We intend to provide more specifics on our 2014 program in late January 2014."

"We currently have 13 of our 22 planned infill spacing tests online, many of which are in early stages of production," said Taylor L. Reid, Oasis' Chief Operating Officer.  "Initial results are encouraging, although we will continue to monitor future production to better assess the impact of communication between wells.  We expect to have numerous blocks that will be drilled with four to six wells per horizon drilling into the Middle Bakken and first bench of the Three Forks in our 2014 development program.  Additionally, our drilling program will be relatively balanced between the Middle Bakken and Three Forks wells in 2014, including numerous wells targeting the lower benches of the Three Forks." 

Operational and Financial Update

Average daily production by project area is listed in the following table:



Quarter Ended:



9/30/2013


6/30/2013


9/30/2012

Average daily production (Boepd)







West Williston


19,259


18,257


16,605

East Nesson


11,043


9,312


5,336

Sanish


2,762


2,602


2,316

Total


33,064


30,171


24,257








Percent Oil


89.3%


90.6%


93.0%

The following table describes the Company's producing Bakken and Three Forks wells by project area in the Williston Basin as of September 30, 2013:


Bakken/Three Forks Producing Wells


West Williston


East Nesson


Sanish


Total Williston Basin


Gross

Net


Gross

Net


Gross

Net


Gross

Net

Producing on or before 6/30/13:(1)











    Operated

185

148.5


92

76.9


--

--


277

225.4

    Non-Operated

55

4.6


95

7.0


290

22.6


440

34.2

Production started in Q3 2013:












    Operated

16

11.9


22

15.8


--

--


38

27.7

    Non-Operated

3

0.0


5

0.3


20

1.6


28

1.9

Total Producing Wells on 9/30/13:












    Operated

201

160.4


114

92.7


--

--


315

253.1

    Non-Operated

58

4.6


100

7.3


310

24.2


468

36.1













(1)

 Well counts include changes that occurred in the current reporting period for wells producing on or before June 30, 2013.

Additionally, the Company also has a backlog of gross operated wells waiting on completion ("WOC") and wells that were drilling as of September 30, 2013, as shown below:


Gross Operated Wells


WOC


Drilling

  West Williston

22


4

  East Nesson

15


5

Total

37


9





The Company's average price per barrel of oil, without derivative settlements, was $100.75 in the third quarter of 2013, compared to $83.71 in the third quarter of 2012 and $91.15 in the second quarter of 2013. The Company's average price differential compared to NYMEX West Texas Intermediate ("WTI") crude oil index prices was 5% in the third quarter of 2013, compared to 9% in the third quarter of 2012 and 3% in the second quarter of 2013. As the premium at coastal markets contracted each month during the third quarter of 2013, the Company's price differentials relative to WTI increased.

The Company's revenues are detailed in the following table:



Quarter Ended:



9/30/2013


6/30/2013


9/30/2012

Revenues  ($ in thousands):







    Oil (excluding bulk oil purchase)


$      273,663


$        226,848


$        173,752

   Bulk oil purchase


-


5,777


-

    Natural gas 


13,289


9,217


4,996

   Well services (OWS)


17,090


11,461


5,963

   Midstream (OMS)


1,456


1,279


-

      Total revenues 


$    305,498


$      254,582


$      184,711

 

The Company's operating expenses are detailed in the following table:










Quarter Ended:



9/30/2013


6/30/2013


9/30/2012

Operating expenses  ($ in thousands):







Lease operating expenses (LOE)


$         21,831


$         18,266


$         16,134

Well services (OWS)


9,929


6,420


5,420

Midstream (OMS)


390


224


-

Marketing, transportation and gathering expenses (1)


5,173


4,977


2,744

  Bulk oil purchase cost


-


5,777


-

  Non-cash valuation charge


515


25


-

     Total operating expenses


$       37,838


$       35,689


$       24,298















Operating expenses  ($ per Boe):







Lease operating expenses (LOE)


$             7.18


$             6.65


$             7.23

Marketing, transportation and gathering expenses (1)


$             1.70


$             1.82


$             1.23

(1)

Excludes bulk oil purchase and non-cash valuation charge.

The sequential quarter-over-quarter increase in lease operating expenses ("LOE") per barrel of oil equivalent ("BOE") was primarily due to additional workover costs, which includes costs to protect producing wells from wells that are being completed.

The increase in marketing, transportation and gathering expenses from the second quarter of 2013 to the third quarter of 2013 is due to higher operated volumes flowing through third party oil gathering pipelines in the third quarter of 2013. As of September 30, 2013, the Company was flowing approximately 85% of its gross operated oil production through these gathering systems. While transporting volumes through third party oil gathering pipelines increases marketing, transportation and gathering expenses, it improves oil price realizations by reducing transportation costs included in our oil price differential for sales at the wellhead.

Production taxes as a percentage of oil and gas revenues were 9.4% in the third quarter of 2013, 9.2% in the third quarter of 2012 and 9.1% in the second quarter of 2013. The Company's production tax rate increased in the third quarter of 2013 compared to the third quarter of 2012, primarily as a result of adding less Montana wells, which are subject to the lower incentivized production tax rates.

Depreciation, depletion and amortization expenses ("DD&A") totaled $72.7 million in the third quarter of 2013, $57.7 million in the third quarter of 2012 and $66.8 million in the second quarter of 2013. DD&A was $23.91 per Boe in the third quarter of 2013, $25.85 per Boe in the third quarter of 2012 and $24.33 per Boe in the second quarter of 2013.

General and administrative ("G&A") expenses totaled $16.7 million in the third quarter of 2013, $13.9 million in the third quarter of 2012 and $16.7 million in the second quarter of 2013. G&A expenses were $5.50 per Boe in the third quarter of 2013, $6.22 per Boe in the third quarter of 2012 and $6.07 per Boe in the second quarter of 2013. Amortization of stock-based compensation, which is included in the aggregate G&A expenses, was $3.0 million, or $1.00 per Boe, in the third quarter of 2013 as compared to $2.7 million, or $1.22 per Boe, in the third quarter of 2012 and $3.1 million, or $1.12 per Boe, in the second quarter of 2013.

The Company's derivative activities are detailed in the following table: 










Quarter Ended:



9/30/2013


6/30/2013


6/30/2012

Derivative activities(1)($ in thousands) 







Derivative settlements


$         (8,067)


$          1,246


$          5,249

Non-cash change in unrealized gain (loss) on derivative instruments

(31,750)


11,345


(27,690)

 Net gain (loss) on derivative instruments


$     (39,817)


$      12,591


$     (22,441)








(1)

The Company's derivative instruments do not qualify for and were not designated as hedging instruments for accounting purposes.

The Company recorded non-cash charges for the impairment of oil and natural gas properties of $56,000 in the third quarter of 2013 related to unproved property leases that expired or have been forecasted to expire under current drilling plans, as compared to $36,000 in the third quarter of 2012 and $0.2 million in the second quarter of 2013.

Interest expense increased $1.9 million to $22.9 million for the third quarter of 2013 compared to the third quarter of 2012 and increased $1.5 million compared to the second quarter of 2013. The $1.9 million increase from the third quarter of 2012 was the result of additional interest expense from the Company's issuance of 6.875% senior unsecured notes in September 2013. Capitalized interest totaled $1.4 million for the third quarter of 2013 and $0.9 million for the third quarter of 2012 and $1.1 million in the second quarter of 2013.

Income tax expense was $33.7 million for the three months ended September 30, 2013, resulting in an effective tax rate of 38.2%. The Company's income tax expense for the three months ended September 30, 2012 was recorded at 38.5% of pre-tax net income. The Company's effective tax rate is expected to continue to closely approximate the statutory rate applicable to the U.S. and the blended rate for each of the states in which the Company conducts business.

Adjusted EBITDA for the third quarter of 2013 was $219.6 million, an increase of $80.4 million, or 58%, over the third quarter of 2012 of $139.2 million, and an 18% increase from the second quarter of 2013 of $185.5 million. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income and net cash provided by operating activities, see "Non-GAAP Financial Measures" below.

For the third quarter of 2013, the Company reported net income of $54.5 million, or $0.59 per diluted share, as compared to net income of $18.3 million, or $0.20 per diluted share, for the third quarter of 2012. The Company's third quarter 2013 results were impacted by several non-cash items, including a $31.8 million mark-to-market loss on derivative instruments. Excluding these items and their tax effect, the third quarter 2013 Adjusted Net Income (non-GAAP) was $74.5 million, or $0.80 per diluted share. Excluding similar non-cash items and their tax effect, Adjusted Net Income (non-GAAP) for the third quarter of 2012 was $35.4 million, or $0.38 per diluted share. For a definition of Adjusted Net Income and a reconciliation of net income to Adjusted Net Income, see "Non-GAAP Financial Measures" below.

Capital Expenditures

The following table depicts the Company's exploration and production ("E&P") capital expenditures ("CapEx") by project area and total CapEx by category:












1Q 2013


2Q 2013


3Q 2013


YTD 2013

CapEx  ($ in thousands):









E&P CapEx by Project Area









  West Williston


$      136,370


$          85,939


$        135,363


$        357,672

  East Nesson


82,429


92,576


98,288


273,293

  Sanish


19,943


5,577


9,964


35,484

  Acquisitions (1)


-


-


127,253


127,253

Total E&P CapEx (2)


238,742


184,092


370,868


793,702

  OWS


302


2,559


3,399


6,260

  Other Non E&P (3)


1,303


2,340


3,107


6,750

   Total Company CapEx (4)


$    240,347


$      188,991


$      377,374


$      806,712



















(1)

Includes East Nesson acquisitions, which closed in September 2013, and the deposit for the West Williston acquisition, which closed in October 2013.

(2)

Total E&P CapEx include $15.7 million for OMS, primarily related to pipelines and salt water disposal wells.

(3)

Non-E&P CapEx include such items as administrative capital and capitalized interest.

(4)

CapEx reflected in the table above differ from the amounts shown in the statement of cash flows in the Company's condensed consolidated financial statements because amounts reflected in the table above include accrued liabilities for capital expenditures, while the amounts presented in the statement of cash flows are presented on a cash basis.

Liquidity

On September 30, 2013, Oasis had total cash and cash equivalents of $125.4 million and restricted cash of $986.2 million. The restricted cash resulted from the net aggregate proceeds of the 6.875% senior unsecured notes issued in September 2013, which was held in escrow as of September 30, 2013 pending the closing of the West Williston acquisition. On September 3, 2013, the Company entered into an amendment to its revolving credit facility agreement (the "Amendment") and completed its semi-annual redetermination of the Company's borrowing base. Pursuant to the Amendment, the Company's borrowing base increased from $1,250 million to $1,500 million. As of September 30, 2013, the Company had $160.0 million drawn on the revolver and $5.2 million of outstanding letters of credit issued under its revolving credit facility, resulting in an unused borrowing base capacity of $1,334.8 million.  Following the close of the West Williston acquisition, the Company had $600.0 million drawn under the revolver. Pro forma cash and cash equivalents as of September 30, 30, 2013, after giving effect to the West Williston acquisition and borrowing under the revolver, was $145.2 million.

Hedging Activity

The Company has not modified its commodity derivative contracts since its October 1, 2013 press release, which included its current hedging position.

Conference Call Information

Investors, analysts and other interested parties are invited to listen to the conference call:

Date:

Thursday, November 7, 2013

Time:

11:00 a.m. Central Time

Dial-in:

877-621-0256

Intl. Dial in:

706-634-0151

Conference ID:

87563083

Website:

www.oasispetroleum.com

A recording of the conference call will be available beginning at 3:00 p.m. Central Time on the day of the call and will be available until Thursday, November 14, 2013 by dialing:

Replay dial-in:

855-859-2056

Intl. replay:

404-537-3406

Conference ID:

87563083

The conference call will also be available for replay at www.oasispetroleum.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including the Company's drilling program, production, derivative instruments, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Company based on management's experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, changes in oil and natural gas prices, weather and environmental conditions, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Company's ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Company's business and other important factors that could cause actual results to differ materially from those projected as described in the Company's reports filed with the SEC.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About Oasis Petroleum Inc.

Oasis is an independent exploration and production company focused on the acquisition and development of unconventional oil and natural gas resources, primarily operating in the Williston Basin. For more information, please visit the Company's website at www.oasispetroleum.com.

Contact:

Oasis Petroleum Inc.
Richard Robuck, (281) 404-9600
Director – Finance


 

Oasis Petroleum Inc.

Condensed Consolidated Balance Sheet

(Unaudited)

 


9/30/2013


12/31/2012


(In thousands, except share data)

ASSETS




Current assets




Cash and cash equivalents

$               125,440


$               213,447

Restricted cash

986,210


-

Short-term investments

-


25,891

Accounts receivable — oil and gas revenues

155,068


110,341

Accounts receivable — joint interest partners

120,058


99,194

Inventory

18,358


20,707

Prepaid expenses

7,440


1,770

Advances to joint interest partners

1,170


1,985

Derivative instruments

374


19,016

Deferred income taxes

8,683


-

Other current assets

473


335

  Total current assets

1,423,274


492,686

Property, plant and equipment




Oil and gas properties (successful efforts method)

3,044,515


2,348,128

Other property and equipment

157,926


49,732

Less: accumulated depreciation, depletion, amortization and impairment

(589,173)


(391,260)

  Total property, plant and equipment, net

2,613,268


2,006,600

Derivative instruments

3,405


4,981

Deferred costs and other assets

43,436


24,527

  Total assets

$            4,083,383


$            2,528,794

LIABILITIES AND STOCKHOLDERS' EQUITY




Current liabilities




Accounts payable

$                 39,468


$                 12,491

Advances from joint interest partners

13,211


21,176

Revenues and production taxes payable

133,083


71,553

Accrued liabilities

198,493


189,863

Accrued interest payable

22,873


30,096

Derivative instruments

17,060


1,048

Deferred income taxes

-


4,558

  Total current liabilities

424,188


330,785

Long-term debt

2,360,000


1,200,000

Asset retirement obligations

26,999


22,956

Derivative instruments

852


380

Deferred income taxes

293,156


177,671

Other liabilities

2,310


1,997

  Total liabilities

3,107,505


1,733,789

Commitments and contingencies




Stockholders' equity




Common stock, $0.01 par value; 300,000,000 shares authorized; 93,854,867 issued and 93,690,494 outstanding at September 30, 2013; 93,432,712 issued and 93,303,298 outstanding at December 31, 2012

926


925

Treasury stock, at cost; 164,373 and 129,414 shares at September 30, 2013 and December 31, 2012, respectively

(5,220)


(3,796)

Additional paid-in-capital

666,770


657,943

Retained earnings

313,402


139,933

  Total stockholders' equity

975,878


795,005

  Total liabilities and stockholders' equity

$            4,083,383


$            2,528,794






Oasis Petroleum Inc.

Condensed Consolidated Statement of Operations

(Unaudited)

 


Three Months Ended September 30,


Nine Months Ended September 30,


2013


2012


2013


2012


(In thousands, except per share data)

Revenues 








Oil and gas revenues

$                    286,952


$                    178,748


$                    770,445


$                    461,857

Well services and midstream revenues

18,546


5,963


37,939


10,484

  Total revenues 

305,498


184,711


808,384


472,341









Expenses








Lease operating expenses

21,831


16,134


59,586


37,979

Well services and midstream operating expenses

10,319


5,420


19,877


7,104

Marketing, transportation and gathering expenses

5,688


2,744


19,856


7,283

Production taxes 

26,823


16,433


70,309


43,419

Depreciation, depletion and amortization 

72,728


57,684


205,779


140,783

Exploration expenses 

463


336


2,712


3,171

Impairment of oil and gas properties 

56


36


762


2,607

General and administrative expenses 

16,728


13,886


47,238


39,622

  Total expenses 

154,636


112,673


426,119


281,968

Operating income 

150,862


72,038


382,265


190,373

Other income (expense)








Net gain (loss) on derivative instruments 

(39,817)


(22,441)


(41,838)


33,568

Interest expense, net of capitalized interest

(22,854)


(20,979)


(65,429)


(48,952)

Other income  

23


1,147


1,097


2,521

  Total other income (expense) 

(62,648)


(42,273)


(106,170)


(12,863)

Income before income taxes 

88,214


29,765


276,095


177,510

Income tax expense

33,715


11,451


102,626


66,712









Net income  

$                    54,499


$                    18,314


$                  173,469


$                  110,798









Earnings per share:








Basic 

$                          0.59


$                          0.20


$                          1.88


$                          1.20

Diluted

$                          0.59


$                          0.20


$                          1.87


$                          1.20









Weighted average shares outstanding:








Basic

92,449


92,186


92,408


92,164

Diluted

92,836


92,416


92,838


92,343









 

Oasis Petroleum Inc.

Selected Financial and Operational Statistics

(Unaudited)

 



Three Months Ended September 30,


Nine Months Ended September 30,



2013


2012


2013


2012

Operating results ($ in thousands):






Revenues








   Oil 

$            273,663


$               173,752


$            737,963


$            443,686

   Natural gas 

13,289


4,996


32,482


18,171

  Well services and midstream 

18,546


5,963


37,939


10,484

    Total revenues 

305,498


184,711


808,384


472,341










Production data:








Oil (MBbls) 

2,716


2,076


7,687


5,232

Natural gas (MMcf) 

1,954


937


4,883


2,740

Oil equivalents (MBoe) 

3,042


2,232


8,501


5,688

Average daily production (Boe/d) 

33,064


24,257


31,140


20,761










Average sales prices:








Oil, without derivative settlements (per Bbl) (1)

$              100.75


$                   83.71


$                95.24


$                84.52

Oil, with derivative settlements (per Bbl)(1)(2)

97.78


86.24


94.58


85.05

Natural gas (per Mcf) (3)

6.80


5.33


6.65


6.63










Costs and expenses (per Boe of production):








Lease operating expenses(4)

$                  7.18


$                     7.23


$                  7.01


$                  6.68

Marketing, transportation and gathering expenses (5)

1.70


1.23


1.59


1.04

Production taxes 

8.82


7.36


8.27


7.63

Depreciation, depletion and amortization 

23.91


25.85


24.21


24.75

General and administrative expenses 

5.50


6.22


5.56


6.97










 


(1)

Average sales prices for oil are calculated using total oil revenues, excluding bulk oil sales, divided by oil production. Bulk oil sales totaled $5.8 million for the nine months ended September 30, 2013 and $1.5 million for the nine months ended September 30, 2012.

(2)

Realized prices include realized gains or losses on cash settlements for commodity derivatives, which do not qualify for and were not designated as hedging instruments for accounting purposes.

(3)

Natural gas prices include the value for natural gas and natural gas liquids.

(4)

For the three and nine months ended September 30, 2012, lease operating expenses include midstream income and operating expenses, which are included in well services and midstream revenues and well services and midstream operating expenses, respectively, for the three and nine months ended September 30, 2013.

(5)

Excludes bulk oil purchase and non-cash valuation charge.

Oasis Petroleum Inc.

Condensed Consolidated Statement of Cash Flows

(Unaudited)

 


Nine Months Ended September 30,


2013


2012


(In thousands)

Cash flows from operating activities:




Net income

$             173,469


$             110,798

Adjustments to reconcile net income to net cash provided by operating activities:







Depreciation, depletion and amortization 

205,779


140,783

Impairment of oil and gas properties 

762


2,607

Deferred income taxes 

102,244


66,648

Derivative instruments 

41,838


(33,568)

Stock-based compensation expenses 

8,411


6,627

Debt discount amortization and other 

2,693


2,038

Working capital and other changes:




Change in accounts receivable 

(67,487)


(69,163)

Change in inventory 

(8,820)


(26,790)

Change in prepaid expenses 

(5,175)


(2,009)

Change in other current assets 

(138)


413

Change in other assets

(63)


(119)

Change in accounts payable and accrued liabilities 

82,246


79,079

Change in other current liabilities 

-


4,784

Change in other liabilities 

922


-

  Net cash provided by operating activities 

536,681


282,128

Cash flows from investing activities:




Capital expenditures 

(654,175)


(777,516)

Acquisition of oiil and gas properties

(133,061)


-

Restricted cash

(986,210)


-

Derivative settlements 

(5,135)


2,784

Purchases of short-term investments

-


(126,213)

Redemptions of short-term investments 

25,000


19,994

Advances from joint interest partners 

(7,965)


17,508

  Net cash used in investing activities 

(1,761,546)


(863,443)

Cash flows from financing activities:




Proceeds from credit facility

160,000


-

Proceeds from issuance of senior notes

1,000,000


400,000

Purchases of treasury stock

(1,424)


(1,299)

Debt issuance costs 

(21,718)


(7,955)

  Net cash provided by financing activities 

1,136,858


390,746

Decrease in cash and cash equivalents 

(88,007)


(190,569)

Cash and cash equivalents:




Beginning of period 

213,447


470,872

End of period 

$             125,440


$             280,303





Supplemental non-cash transactions:




Change in accrued capital expenditures 

$               10,530


$               71,572

Change in asset retirement obligations 

4,173


7,774

 

Non-GAAP Financial Measures

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. The Company defines Adjusted EBITDA as earnings before interest expense, income taxes, depreciation, depletion, amortization, exploration expenses and other similar non-cash charges. Adjusted EBITDA is not a measure of net income or cash flows as determined by United States generally accepted accounting principles, or GAAP.

The following tables present a reconciliation of the non-GAAP financial measure of Adjusted EBITDA to the GAAP financial measures of net income and net cash provided by operating activities, respectively.

 

Adjusted EBITDA Reconciliations










Three Months Ended September 30,


Nine Months Ended September 30,


2013


2012


2013


2012









Adjusted EBITDA reconciliation to Net Income ($ in thousands): 





Net income

$              54,499


$               18,314


$          173,469


$                  110,798

Net (gain) loss on derivative instruments

39,817


22,441


41,838


(33,568)

Derivative settlements

(8,067)


5,249


(5,135)


2,784

Interest expense

22,854


20,979


65,429


48,952

Depreciation, depletion and amortization

72,728


57,684


205,779


140,783

Impairment of oil and gas properties

56


36


762


2,607

Exploration expenses

463


336


2,712


3,171

Stock-based compensation expenses

3,040


2,729


8,411


6,627

Income tax expense 

33,715


11,451


102,626


66,712

Other non-cash adjustments 

515


-


589


-

Adjusted EBITDA

$          219,620


$          139,219


$        596,480


$                348,866









Adjusted EBITDA reconciliation to Net Cash Provided by Operating Activities ($ in thousands):






Net cash provided by operating activities

$            178,874


$             110,268


$          536,681


$                  282,128

Derivative settlements

(8,067)


5,249


(5,135)


2,784

Interest expense

22,854


20,979


65,429


48,952

Exploration expenses

463


336


2,712


3,171

Debt discount amortization and other

(940)


(773)


(2,693)


(2,038)

Current tax expense

(555)


(36)


382


64

Changes in working capital

26,476


3,196


(1,485)


13,805

Other non-cash adjustments 

515


-


589


-

Adjusted EBITDA

$          219,620


$          139,219


$        596,480


$                348,866









Adjusted Net Income 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. The Company defines Adjusted Net Income as net income after adjusting first for (1) the impact of certain non-cash items, including changes in unrealized gains and losses on derivative instruments, impairment of oil and gas properties, and other similar non-cash charges, and then (2) the non-cash items' impact on taxes based on the Company's effective tax rates in the same period. Adjusted Net Income is not a measure of net income as determined by GAAP.

The following table provides a reconciliation of net income (GAAP) to Adjusted Net Income (non-GAAP):

Adjusted Net Income Reconciliation








Three Months Ended September 30,


Nine Months Ended September 30,


2013


2012


2013


2012


(In thousands, except per share amounts)







Net income 

$                        54,499


$                   18,314


$             173,469


$             110,798

Net (gain) loss on derivative instruments

39,817


22,441


41,838


(33,568)

Derivative settlements

(8,067)


5,249


(5,135)


2,784

Impairment of oil and gas properties

56


36


762


2,607

Other non-cash adjustments 

515



589


Tax impact (1)

(12,329)


(10,667)


(14,237)


10,590









Adjusted Net Income

$                      74,491


$                 35,373


$          197,286


$             93,211









Adjusted earnings per share:








Basic

$                            0.81


$                       0.38


$                   2.13


$                   1.01

Diluted

$                            0.80


$                       0.38


$                   2.13


$                   1.01









Weighted average shares outstanding:








Basic

92,449


92,186


92,408


92,164

Diluted

92,836


92,416


92,838


92,343









Effective Tax Rate

38.2%


38.5%


37.2%


37.6%









 

(1)

 The tax impact is computed utilizing the Company's effective tax rate on the adjustments for certain non-cash items.

SOURCE Oasis Petroleum Inc.



RELATED LINKS
http://www.oasispetroleum.com

More by this Source

Best of Content We Love 2014 


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.