News Release |
PRODUCTION: | |||||||||||
Midland Basin | South Texas | Total | |||||||||
Oil (MBbl / MBbl/d) | 5,088 / 56.5 | 341 / 3.8 | 5,428 / 60.3 | ||||||||
Natural Gas (MMcf / MMcf/d) | 10,560 / 117.3 | 10,981 / 122.0 | 21,542 / 239.4 | ||||||||
NGLs (MBbl / MBbl/d) | 4 / - | 1,026 / 11.4 | 1,030 / 11.4 | ||||||||
Total (MBoe / MBoe/d) | 6,852 / 76.1 | 3,197 / 35.5 | 10,048 / 111.6 | ||||||||
Note: Totals may not calculate due to rounding. |
REALIZED PRICES: | |||||||||||
Midland Basin | South Texas | Total (Pre/Post-hedge) | |||||||||
Oil ($/Bbl) | $56.24 | $57.71 | $56.33 / $45.95 | ||||||||
Natural Gas ($/Mcf) | $5.47 | $2.90 | $4.16 / $2.28 | ||||||||
NGLs ($/Bbl) | nm | $26.94 | $26.93 / $16.14 | ||||||||
Per Boe | $50.21 | $24.76 | $42.11 / $31.37 |
SM ENERGY COMPANY | |||||||||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||||||||
March 31, 2021 | |||||||||||||||||
Production Data | |||||||||||||||||
For the Three Months Ended March 31, | |||||||||||||||||
2021 | 2020 | Percent Change | |||||||||||||||
Realized sales price (before the effects of derivative settlements): | |||||||||||||||||
Oil (per Bbl) | $ | 56.33 | $ | 45.96 | 23 | % | |||||||||||
Gas (per Mcf) | $ | 4.16 | $ | 1.54 | 170 | % | |||||||||||
NGLs (per Bbl) | $ | 26.93 | $ | 13.62 | 98 | % | |||||||||||
Equivalent (per Boe) | $ | 42.11 | $ | 28.64 | 47 | % | |||||||||||
Realized sales price (including the effects of derivative settlements): | |||||||||||||||||
Oil (per Bbl) | $ | 45.95 | $ | 54.40 | (16) | % | |||||||||||
Gas (per Mcf) | $ | 2.28 | $ | 2.09 | 9 | % | |||||||||||
NGLs (per Bbl) | $ | 16.14 | $ | 16.89 | (4) | % | |||||||||||
Equivalent (per Boe) | $ | 31.37 | $ | 34.58 | (9) | % | |||||||||||
Net production volumes: (1) | |||||||||||||||||
Oil (MMBbl) | 5.4 | 6.3 | (14) | % | |||||||||||||
Gas (Bcf) | 21.5 | 26.5 | (19) | % | |||||||||||||
NGLs (MMBbl) | 1.0 | 1.6 | (36) | % | |||||||||||||
MMBoe | 10.0 | 12.4 | (19) | % | |||||||||||||
Average net daily production: (1) | |||||||||||||||||
Oil (MBbls/d) | 60.3 | 69.8 | (14) | % | |||||||||||||
Gas (MMcf/d) | 239.4 | 291.2 | (18) | % | |||||||||||||
NGLs (MBbls/d) | 11.4 | 17.6 | (35) | % | |||||||||||||
MBoe/d | 111.6 | 135.9 | (18) | % | |||||||||||||
Per Boe data: | |||||||||||||||||
Realized price (before the effects of derivative settlements) | $ | 42.11 | $ | 28.64 | 47 | % | |||||||||||
Lease operating expense | 4.64 | 4.75 | (2) | % | |||||||||||||
Transportation costs | 2.94 | 3.11 | (5) | % | |||||||||||||
Production taxes | 1.94 | 1.20 | 62 | % | |||||||||||||
Ad valorem tax expense | 0.52 | 0.60 | (13) | % | |||||||||||||
General and administrative (2) | 2.46 | 2.22 | 11 | % | |||||||||||||
Operating margin (before the effects of derivative settlements) | 29.61 | 16.76 | 77 | % | |||||||||||||
Derivative settlement gain (loss) | (10.74) | 5.94 | (281) | % | |||||||||||||
Operating margin (including the effects of derivative settlements) | $ | 18.87 | $ | 22.70 | (17) | % | |||||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | $ | 16.62 | $ | 18.88 | (12) | % | |||||||||||
(1) Amounts and percentage changes may not calculate due to rounding. | |||||||||||||||||
(2) Includes non-cash stock-based compensation expense per Boe of $0.44 and $0.37 for the three months ended March 31, 2021, and 2020, respectively. |
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2021 | |||||||||||
Condensed Consolidated Balance Sheets | |||||||||||
(in thousands, except share data) | March 31, | December 31, | |||||||||
ASSETS | 2021 | 2020 | |||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | — | $ | 10 | |||||||
Accounts receivable | 199,631 | 162,455 | |||||||||
Derivative assets | 20,859 | 31,203 | |||||||||
Prepaid expenses and other | 9,792 | 10,001 | |||||||||
Total current assets | 230,282 | 203,669 | |||||||||
Property and equipment (successful efforts method): | |||||||||||
Proved oil and gas properties | 8,735,538 | 8,608,522 | |||||||||
Accumulated depletion, depreciation, and amortization | (5,051,876) | (4,886,973) | |||||||||
Unproved oil and gas properties | 705,822 | 714,602 | |||||||||
Wells in progress | 291,146 | 233,498 | |||||||||
Other property and equipment, net of accumulated depreciation of $64,242 and $63,662, respectively | 31,986 | 32,217 | |||||||||
Total property and equipment, net | 4,712,616 | 4,701,866 | |||||||||
Noncurrent assets: | |||||||||||
Derivative assets | 13,567 | 23,150 | |||||||||
Other noncurrent assets | 59,180 | 47,746 | |||||||||
Total noncurrent assets | 72,747 | 70,896 | |||||||||
Total assets | $ | 5,015,645 | $ | 4,976,431 | |||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable and accrued expenses | $ | 394,226 | $ | 371,670 | |||||||
Derivative liabilities | 371,802 | 200,189 | |||||||||
Other current liabilities | 10,591 | 11,880 | |||||||||
Total current liabilities | 776,619 | 583,739 | |||||||||
Noncurrent liabilities: | |||||||||||
Revolving credit facility | 135,000 | 93,000 | |||||||||
Senior Notes, net | 2,125,651 | 2,121,319 | |||||||||
Asset retirement obligations | 84,206 | 83,325 | |||||||||
Derivative liabilities | 67,595 | 22,331 | |||||||||
Other noncurrent liabilities | 56,902 | 56,557 | |||||||||
Total noncurrent liabilities | 2,469,354 | 2,376,532 | |||||||||
Stockholders’ equity: | |||||||||||
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued and outstanding: 114,742,304 shares as of March 31, 2021, and December 31, 2020 | 1,147 | 1,147 | |||||||||
Additional paid-in capital | 1,833,651 | 1,827,914 | |||||||||
Retained earnings (deficit) | (51,719) | 200,697 | |||||||||
Accumulated other comprehensive loss | (13,407) | (13,598) | |||||||||
Total stockholders’ equity | 1,769,672 | 2,016,160 | |||||||||
Total liabilities and stockholders’ equity | $ | 5,015,645 | $ | 4,976,431 |
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2021 | |||||||||||
Condensed Consolidated Statements of Operations | |||||||||||
(in thousands, except per share data) | For the Three Months Ended March 31, | ||||||||||
2021 | 2020 | ||||||||||
Operating revenues and other income: | |||||||||||
Oil, gas, and NGL production revenue | $ | 423,165 | $ | 354,233 | |||||||
Other operating income | 20,681 | 1,501 | |||||||||
Total operating revenues and other income | 443,846 | 355,734 | |||||||||
Operating expenses: | |||||||||||
Oil, gas, and NGL production expense | 100,930 | 119,552 | |||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 166,960 | 233,489 | |||||||||
Exploration (1) | 9,323 | 11,349 | |||||||||
Impairment | 8,750 | 989,763 | |||||||||
General and administrative (1) | 24,714 | 27,447 | |||||||||
Net derivative (gain) loss (2) | 344,689 | (545,340) | |||||||||
Other operating expense, net | (599) | 566 | |||||||||
Total operating expenses | 654,767 | 836,826 | |||||||||
Loss from operations | (210,921) | (481,092) | |||||||||
Interest expense | (39,871) | (41,512) | |||||||||
Gain on extinguishment of debt | — | 12,195 | |||||||||
Other non-operating expense, net | (371) | (494) | |||||||||
Loss before income taxes | (251,163) | (510,903) | |||||||||
Income tax (expense) benefit | (106) | 99,008 | |||||||||
Net loss | $ | (251,269) | $ | (411,895) | |||||||
Basic weighted-average common shares outstanding | 114,759 | 113,009 | |||||||||
Diluted weighted-average common shares outstanding | 114,759 | 113,009 | |||||||||
Basic net loss per common share | $ | (2.19) | $ | (3.64) | |||||||
Diluted net loss per common share | $ | (2.19) | $ | (3.64) | |||||||
Dividends per common share | $ | 0.01 | $ | 0.01 | |||||||
(1) Non-cash stock-based compensation included in: | |||||||||||
Exploration expense | $ | 1,284 | $ | 957 | |||||||
General and administrative expense | 4,453 | 4,604 | |||||||||
Total non-cash stock-based compensation | $ | 5,737 | $ | 5,561 | |||||||
(2) The net derivative (gain) loss line item consists of the following: | |||||||||||
Derivative settlement (gain) loss | $ | 107,885 | $ | (73,437) | |||||||
(Gain) loss on fair value changes | 236,804 | (471,903) | |||||||||
Total net derivative (gain) loss | $ | 344,689 | $ | (545,340) |
SM ENERGY COMPANY | |||||||||||||||||||||||||||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||||||||||||||||||||||||||
March 31, 2021 | |||||||||||||||||||||||||||||||||||
Condensed Consolidated Statements of Stockholders' Equity | |||||||||||||||||||||||||||||||||||
(in thousands, except share data and dividends per share) | |||||||||||||||||||||||||||||||||||
Additional Paid-in Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||||||||||||||||||||
Common Stock | |||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balances, December 31, 2020 | 114,742,304 | $ | 1,147 | $ | 1,827,914 | $ | 200,697 | $ | (13,598) | $ | 2,016,160 | ||||||||||||||||||||||||
Net loss | — | — | — | (251,269) | — | (251,269) | |||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | 191 | 191 | |||||||||||||||||||||||||||||
Cash dividends declared, $0.01 per share | — | — | — | (1,147) | — | (1,147) | |||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | 5,737 | — | — | 5,737 | |||||||||||||||||||||||||||||
Balances, March 31, 2021 | 114,742,304 | $ | 1,147 | $ | 1,833,651 | $ | (51,719) | $ | (13,407) | $ | 1,769,672 | ||||||||||||||||||||||||
Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||||
Common Stock | Retained Earnings | ||||||||||||||||||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||||||||||||||
Balances, December 31, 2019 | 112,987,952 | $ | 1,130 | $ | 1,791,596 | $ | 967,587 | $ | (11,319) | $ | 2,748,994 | ||||||||||||||||||||||||
Net loss | — | — | — | (411,895) | — | (411,895) | |||||||||||||||||||||||||||||
Other comprehensive income | — | — | — | — | 190 | 190 | |||||||||||||||||||||||||||||
Cash dividends declared, $0.01 per share | — | — | — | (1,130) | — | (1,130) | |||||||||||||||||||||||||||||
Issuance of common stock upon vesting of RSUs, net of shares used for tax withholdings | 730 | — | (3) | — | — | (3) | |||||||||||||||||||||||||||||
Stock-based compensation expense | — | — | 5,561 | — | — | 5,561 | |||||||||||||||||||||||||||||
Balances, March 31, 2020 | 112,988,682 | $ | 1,130 | $ | 1,797,154 | $ | 554,562 | $ | (11,129) | $ | 2,341,717 | ||||||||||||||||||||||||
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2021 | |||||||||||
Condensed Consolidated Statements of Cash Flows | |||||||||||
(in thousands) | For the Three Months Ended March 31, | ||||||||||
2021 | 2020 | ||||||||||
Cash flows from operating activities: | |||||||||||
Net loss | $ | (251,269) | $ | (411,895) | |||||||
Adjustments to reconcile net loss to net cash provided by operating activities: | |||||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 166,960 | 233,489 | |||||||||
Impairment | 8,750 | 989,763 | |||||||||
Stock-based compensation expense | 5,737 | 5,561 | |||||||||
Net derivative (gain) loss | 344,689 | (545,340) | |||||||||
Derivative settlement gain (loss) | (107,885) | 73,437 | |||||||||
Amortization of debt discount and deferred financing costs | 4,723 | 3,992 | |||||||||
Gain on extinguishment of debt | — | (12,195) | |||||||||
Deferred income taxes | (52) | (99,347) | |||||||||
Other, net | (14,592) | (816) | |||||||||
Net change in working capital | (51,437) | (18,517) | |||||||||
Net cash provided by operating activities | 105,624 | 218,132 | |||||||||
Cash flows from investing activities: | |||||||||||
Capital expenditures | (147,563) | (139,306) | |||||||||
Other | (71) | — | |||||||||
Net cash used in investing activities | (147,634) | (139,306) | |||||||||
Cash flows from financing activities: | |||||||||||
Proceeds from revolving credit facility | 440,000 | 425,500 | |||||||||
Repayment of revolving credit facility | (398,000) | (476,000) | |||||||||
Cash paid to repurchase Senior Notes | — | (28,318) | |||||||||
Other | — | (3) | |||||||||
Net cash provided by (used in) financing activities | 42,000 | (78,821) | |||||||||
Net change in cash, cash equivalents, and restricted cash | (10) | 5 | |||||||||
Cash, cash equivalents, and restricted cash at beginning of period | 10 | 10 | |||||||||
Cash, cash equivalents, and restricted cash at end of period | $ | — | $ | 15 | |||||||
Supplemental schedule of additional cash flow information and non-cash activities: | |||||||||||
Operating activities: | |||||||||||
Cash paid for interest, net of capitalized interest | $ | (53,449) | $ | (47,469) | |||||||
Investing activities: | |||||||||||
Increase in capital expenditure accruals and other | $ | 37,409 | $ | 16,802 |
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2021 | |||||||||||
Adjusted EBITDAX Reconciliation (1) | |||||||||||
(in thousands) | |||||||||||
Reconciliation of net loss (GAAP) and net cash provided by operating activities (GAAP) to Adjusted EBITDAX (non-GAAP) | For the Three Months Ended March 31, | ||||||||||
2021 | 2020 | ||||||||||
Net loss (GAAP) | $ | (251,269) | $ | (411,895) | |||||||
Interest expense | 39,871 | 41,512 | |||||||||
Income tax expense (benefit) | 106 | (99,008) | |||||||||
Depletion, depreciation, amortization, and asset retirement obligation liability accretion | 166,960 | 233,489 | |||||||||
Exploration (2) | 8,039 | 10,392 | |||||||||
Impairment | 8,750 | 989,763 | |||||||||
Stock-based compensation expense | 5,737 | 5,561 | |||||||||
Net derivative (gain) loss | 344,689 | (545,340) | |||||||||
Derivative settlement gain (loss) | (107,885) | 73,437 | |||||||||
Gain on extinguishment of debt | — | (12,195) | |||||||||
Other, net | (10) | 333 | |||||||||
Adjusted EBITDAX (non-GAAP) | $ | 214,988 | $ | 286,049 | |||||||
Interest expense | (39,871) | (41,512) | |||||||||
Income tax (expense) benefit | (106) | 99,008 | |||||||||
Exploration (2) | (8,039) | (10,392) | |||||||||
Amortization of debt discount and deferred financing costs | 4,723 | 3,992 | |||||||||
Deferred income taxes | (52) | (99,347) | |||||||||
Other, net | (14,582) | (1,149) | |||||||||
Net change in working capital | (51,437) | (18,517) | |||||||||
Net cash provided by operating activities (GAAP) | $ | 105,624 | $ | 218,132 | |||||||
(1) See "Definitions of non-GAAP Measures as Calculated by the Company" above. | |||||||||||
(2) Stock-based compensation expense is a component of the exploration expense and general and administrative expense line items on the accompanying unaudited condensed consolidated statements of operations. Therefore, the exploration line items shown in the reconciliation above will vary from the amount shown on the accompanying unaudited condensed consolidated statements of operations for the component of stock-based compensation expense recorded to exploration expense. |
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2021 | |||||||||||
Adjusted Net Loss Reconciliation (1) | |||||||||||
(in thousands, except per share data) | |||||||||||
Reconciliation of net loss (GAAP) to adjusted net loss (non-GAAP): | For the Three Months Ended March 31, | ||||||||||
2021 | 2020 | ||||||||||
Net loss (GAAP) | $ | (251,269) | $ | (411,895) | |||||||
Net derivative (gain) loss | 344,689 | (545,340) | |||||||||
Derivative settlement gain (loss) | (107,885) | 73,437 | |||||||||
Impairment | 8,750 | 989,763 | |||||||||
Gain on extinguishment of debt | — | (12,195) | |||||||||
Other, net (2) | 17 | 386 | |||||||||
Tax effect of adjustments (3) | (53,289) | (109,813) | |||||||||
Valuation allowance on deferred tax assets | 53,289 | 10,017 | |||||||||
Adjusted net loss (non-GAAP) | $ | (5,698) | $ | (5,640) | |||||||
Diluted net loss per common share (GAAP) | $ | (2.19) | $ | (3.64) | |||||||
Net derivative (gain) loss | 3.00 | (4.83) | |||||||||
Derivative settlement gain (loss) | (0.94) | 0.65 | |||||||||
Impairment | 0.08 | 8.76 | |||||||||
Gain on extinguishment of debt | — | (0.11) | |||||||||
Other, net (2) | — | — | |||||||||
Tax effect of adjustments (3) | (0.46) | (0.97) | |||||||||
Valuation allowance on deferred tax assets | 0.46 | 0.09 | |||||||||
Adjusted net loss per diluted common share (non-GAAP) | $ | (0.05) | $ | (0.05) | |||||||
Basic weighted-average common shares outstanding | 114,759 | 113,009 | |||||||||
Diluted weighted-average common shares outstanding | 114,759 | 113,009 | |||||||||
Note: Amounts may not calculate due to rounding. | |||||||||||
(1) See "Definitions of non-GAAP Measures as Calculated by the Company" above. | |||||||||||
(2) For each of the three months ended March 31, 2021, and 2020, other adjustments related to bad debt expense and impairments of other property. Other adjustments for the three months ended March 31, 2020, also includes impairment of materials inventory. | |||||||||||
(3) The tax effect of adjustments for each of the three months ended March 31, 2021, and 2020, was calculated using a tax rate of 21.7%. This rate approximates the Company's statutory tax rate for the respective periods, as adjusted for ordinary permanent differences. |
SM ENERGY COMPANY | |||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||
March 31, 2021 | |||||
Reconciliation of Total Long-Term Debt to Net Debt (1) | |||||
(in thousands) | |||||
As of March 31, 2021 | |||||
Senior Secured Notes (2) | $ | 512,160 | |||
Senior Unsecured Notes (2) | 1,674,581 | ||||
Revolving credit facility (2) | 135,000 | ||||
Total funded debt | 2,321,741 | ||||
Less: Cash and cash equivalents | — | ||||
Net Debt | $ | 2,321,741 | |||
(1) See "Definitions of non-GAAP Measures as Calculated by the Company" above. | |||||
(2) Amounts are from Note 5 - Long-term Debt in Part I, Item I of the Company's Form 10-Q for the three months ended March 31, 2021. |
Free Cash Flow (1) | |||||||||||
(in thousands) | |||||||||||
For the Three Months Ended March 31, | |||||||||||
2021 | 2020 | ||||||||||
Net cash provided by operating activities (GAAP) | $ | 105,624 | $ | 218,132 | |||||||
Net change in working capital | 51,437 | 18,517 | |||||||||
Cash flow from operations before net change in working capital | $ | 157,061 | $ | 236,649 | |||||||
Capital expenditures (GAAP) | $ | 147,563 | $ | 139,306 | |||||||
Increase in capital expenditure accruals and other | 37,409 | 16,802 | |||||||||
Capital expenditures before accruals and other | $ | 184,972 | $ | 156,108 | |||||||
Free cash flow | $ | (27,911) | $ | 80,541 | |||||||
(1) See "Definitions of non-GAAP Measures as Calculated by the Company" above. |