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[STK] NYSE:OAS
[IN] UTI OIL GAS
[SU] ERN
TO BUSINESS EDITORS:
Oasis Petroleum Inc. Announces Quarter and Year Ending December 31,
2013 Earnings
HOUSTON, Feb. 25, 2014 /PRNewswire/ -- Oasis Petroleum Inc. (NYSE:
OAS) ("Oasis" or the "Company") today announced financial results for
the quarter and year ended December 31, 2013.
Financial Highlights in 2013:
-- Increased revenue by 66% to $1,142.0 million in 2013, up from
$686.7 million in the prior year.
-- Grew Adjusted EBITDA by 60% to $821.9 million in 2013, up from
$512.3 million in the prior year. 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.
-- Increased net income by 49% to $228.0 million in 2013, up from
$153.4 million in the prior year.
Financial Update
The Company's revenues are detailed in the following table:
Quarter Ended: Year Ended:
12/31/2013 9/30/2013 12/31/2013 12/31/2012
Revenues ($ in thousands)
Oil $ 295,903 $ 273,663 $ 1,028,089 $ 641,925
Bulk oil sale - - 5,777 1,521
Natural gas 18,064 13,289 50,546 27,045
Well services (OWS) 17,579 17,090 51,845 16,177
Midstream (OMS) 2,069 1,456 5,742 -
Total revenues $ 333,615 $ 305,498 $ 1,141,999 $ 686,668
Total revenues for the fourth quarter of 2013 increased by 9% compared
to the third quarter of 2013, primarily due to higher production as a
result of the Company's well completions and its acquisition of
certain properties in its West Williston project area in the fourth
quarter of 2013.
The Company's operating expenses are detailed in the following table:
Quarter Ended: Year Ended:
12/31/2013 9/30/2013 12/31/2013 12/31/2012
Operating expenses ($ in thousands):
Lease operating expenses $ 35,048 $ 21,831 $ 94,634 $ 54,924
Well services (OWS) 10,228 9,929 29,259 11,774
Midstream (OMS) 608 390 1,454 -
Marketing, transportation and gathering expenses(1) 5,286 5,173 18,777 8,566
Bulk oil purchase - - 5,776 1,383
Non-cash valuation charge 782 515 1,371 (692)
Select operating expenses $ 51,952 $ 37,838 $ 151,271 $ 75,955
Operating expenses ($ per Boe):
Lease operating expenses $ 9.05 $ 7.18 $ 7.65 $ 6.68
Marketing, transportation and gathering expenses(1) 1.36 1.70 1.52 1.04
(1) Excludes bulk oil purchase and non-cash valuation charges.
The sequential quarter-over-quarter increase in lease operating
expenses per barrel of oil equivalent ("Boe") was primarily due to
additional workover costs, which include costs to protect producing
wells from wells that are being completed, coupled with higher cost
structures on wells acquired by the Company in the fourth quarter of
2013.
Marketing, transportation and gathering expenses, excluding non-cash
valuation charges, was $5.3 million. The 20% sequential
quarter-over-quarter decrease per Boe was primarily due to wells
acquired in the fourth quarter of 2013 that were not connected to
third-party infrastructure.
Production taxes for the fourth quarter of 2013 totaled $30.2 million,
or 9.6% of oil and gas revenues, compared to 9.4% of oil and gas
revenues for the third quarter of 2013. The sequential
quarter-over-quarter increase in production taxes as a percentage of
oil and gas revenues was due to the acquisition of wells in North
Dakota, which imposes a higher production tax rate compared to
Montana, which has lower incentivized production tax rates on certain
new wells.
Depreciation, depletion and amortization for the fourth quarter of
2013 totaled $26.14 per Boe, compared to $23.91 per Boe in the third
quarter of 2013. The increase per Boe was primarily due to costs
related to the acquisition of certain properties in the Company's West
Williston project area.
General and administrative ("G&A") expenses for the fourth quarter of
2013 totaled $28.1 million compared to $16.7 million in the third
quarter of 2013. This increase was primarily due to the impact of the
Company's organizational growth on employee compensation, additional
end-of-year compensation expenses and acquisition-related costs. These
increases were coupled with lower Oasis Well Services ("OWS") activity
due to inclement weather at the end of the fourth quarter of 2013,
which caused OWS G&A expenses to be $3.0 million higher in the fourth
quarter of 2013 as compared to the third quarter of 2013.
The Company's derivative activities are detailed in the following
table:
Quarter Ended: Year Ended:
12/31/2013 9/30/2013 12/31/2013 12/31/2012
Derivative activities(1) ($ in thousands)
Derivative settlements $ (2,998) $ (8,067) $ (8,133) $ 6,545
Change in fair value of derivative instruments 9,404 (31,750) (27,299) 27,619
Net gain (loss) on derivative instruments $ 6,406 $ (39,817) $ (35,432) $ 34,164
(1) The Company's derivative instruments do not qualify for and were not designated as hedging instruments for accounting purposes.
Adjusted EBITDA for the fourth quarter of 2013 was $225.4 million, an
increase of $61.9 million, or 38%, over the fourth quarter of 2012 of
$163.5 million. Adjusted EBITDA for the full year 2013 was $821.9
million, an increase of $309.6 million, or 60%, over the full year
2012 of $512.3 million.
The Company reported net income of $54.5 million in the fourth quarter
of 2013 compared to $42.6 million in the fourth quarter of 2012. For
the full year 2013, Oasis reported net income of $228.0 million
compared to $153.4 million for the full year 2012. Excluding certain
non-cash items and their tax effect in the fourth quarters of 2013 and
2012, Adjusted Net Income (non-GAAP) was $49.7 million, or $0.52 per
diluted share, and $45.2 million, or $0.49 per diluted share,
respectively. Excluding certain non-cash items and their tax effect
for the years ending December 31, 2013 and 2012, Adjusted Net Income
(non-GAAP) was $247.0 million, or $2.64 per diluted share, and $138.4
million, or $1.50 per diluted share, respectively. 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
Oasis' capital expenditures ("CapEx") were $1,699.6 million for the
fourth quarter of 2013 and $2,506.3 million for the year ending
December 31, 2013.
The following table depicts the Company's CapEx for exploration and
production ("E&P") by project area, acquisitions and non-E&P:
2013
1Q 2Q 3Q 4Q FY
CapEx ($ in thousands)
E&P CapEx
West Williston $ 136,370 $ 80,385 $ 135,363 $ 145,503 $ 497,621
East Nesson 82,429 92,576 97,881 105,654 378,540
Sanish 19,943 5,577 9,964 5,083 40,567
Acquisitions(1) - 5,554 127,660 1,430,197 1,563,411
Total E&P CapEx(2) $ 238,742 $ 184,092 $ 370,868 $ 1,686,437 $ 2,480,139
OWS 302 2,559 3,399 8,957 15,217
Other Non E&P(3) 1,303 2,340 3,107 4,192 10,942
Total Company CapEx(4) $ 240,347 $ 188,991 $ 377,374 $ 1,699,586 $ 2,506,298
(1) Reflects all acquisitions in 2013, including $1,551.7 million for four separate acquisitions of an aggregate of approximately 161,000 net acres in the Company's West Williston and East Nesson project areas.
(2) Total E&P capital expenditures include:
$855.8 million of drilling and completion (including production-related equipment) CapEx for operated and non-operated wells, including savings from services provided by OWS and Oasis Midstream Services ("OMS"); $26.5 million for maintaining and expanding the Company's leasehold position; $22.3 million for constructing infrastructure to support production in the Company's core project areas, primarily related to salt water disposal systems; $10.2 million for field facilities; and $1.9 million for micro-seismic work, purchase of seismic data and other test work.
(3) Non-E&P CapEx include such items as administrative capital and capitalized interest.
(4) CapEx (including acquisitions) reflected in the table above differ from the amounts for capital expenditures and acquisition of oil and gas properties shown in the statement of cash flows in the Company's consolidated financial statements because amounts reflected in the table include changes in accrued liabilities from the previous reporting period for capital expenditures, while the amounts presented in the statement of cash flows are presented on a cash basis. In addition, acquisitions reflected in the table include inventory purchased as part of acquisitions, which is included in net cash provided by operating activities in the statement of cash flows in the Company's consolidated financial statements.
Hedging Activity
As of February 25, 2014, the Company had the following outstanding
commodity derivate contracts, all of which are priced off NYMEX West
Texas Intermediate crude oil index prices and settle monthly:
Weighted Average Prices ($/Bbl)
Current Hedged Volumes Term Sub-Floor Floor Ceiling Swaps BOPD Total Barrels
2014
Full Year
Swaps January - December $ 93.07 3,500 1,277,500
Swaps with sub-floor January - December $ 70.00 $ 92.60 6,000 2,190,000
Two-way collars January - December $ 90.00 $ 101.13 3,500 1,277,500
Three-way collars January - December $ 70.59 $ 90.59 $ 105.25 8,500 3,102,500
First Half
Swaps January - June $ 99.42 4,000 724,000
Three-way collars January - June $ 70.00 $ 90.00 $ 103.98 2,000 362,000
Partial Year
Swaps March - December $ 96.49 4,000 1,224,000
Total 2014 hedges (weighted average) $ 70.32 $ 90.38 $ 104.04 $ 94.50 27,829 10,157,500
Remaining 1H14 Hedges (Mar-Jun) 31,500
Average 2H14 Hedges 25,500
2015
Full Year
Swaps January - December $ 88.80 2,000 730,000
First Half
Swaps January - June $ 90.03 4,000 724,000
Total 2015 hedges (weighted average) $ 89.41 3,984 1,454,000
Total 1H15 Hedges 6,000
Total 2H15 Hedges 2,000
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, derivatives
activities, 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 changes in oil and natural
gas prices, 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. Matt Ultis, (281) 404-9600
Oasis Petroleum Inc. Financial Statements OASIS PETROLEUM INC. CONSOLIDATED BALANCE SHEET
December 31,
2013 2012
(In thousands, except share data)
ASSETS
Current assets
Cash and cash equivalents $ 91,901 $ 213,447
Short-term investments - 25,891
Accounts receivable - oil and gas revenues 175,653 110,341
Accounts receivable - joint interest partners 139,459 99,194
Inventory 20,652 20,707
Prepaid expenses 10,191 1,770
Advances to joint interest partners 760 1,985
Derivative instruments 2,264 19,016
Deferred income taxes 6,335 -
Other current assets 391 335
Total current assets 447,606 492,686
Property, plant and equipment
Oil and gas properties (successful efforts method) 4,528,958 2,348,128
Other property and equipment 188,468 49,732
Less: accumulated depreciation, depletion, amortization and impairment (637,676) (391,260)
Total property, plant and equipment, net 4,079,750 2,006,600
Assets held for sale 137,066 -
Derivative instruments 1,333 4,981
Deferred costs and other assets 46,169 24,527
Total assets $ 4,711,924 $ 2,528,794
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $ 8,920 $ 12,491
Advances from joint interest partners 12,829 21,176
Revenues and production taxes payable 146,741 71,553
Accrued liabilities 241,830 189,863
Accrued interest payable 47,910 30,096
Derivative instruments 8,188 1,048
Deferred income taxes - 4,558
Total current liabilities 466,418 330,785
Long-term debt 2,535,570 1,200,000
Asset retirement obligations 35,918 22,956
Derivative instruments 139 380
Deferred income taxes 323,147 177,671
Other liabilities 2,183 1,997
Total liabilities 3,363,375 1,733,789
Commitments and contingencies
Stockholders' equity
Common stock, $0.01 par value; 300,000,000 shares authorized; 100,866,589 shares and 93,432,712 shares issued at December 31, 2013 and 2012, respectively 996 925
Treasury stock, at cost; 167,155 shares and 129,414 shares at December 31, 2013 and 2012, respectively (5,362) (3,796)
Additional paid-in-capital 985,023 657,943
Retained earnings 367,892 139,933
Total stockholders' equity 1,348,549 795,005
Total liabilities and stockholders' equity $ 4,711,924 $ 2,528,794
OASIS PETROLEUM INC. CONSOLIDATED STATEMENT OF OPERATIONS
Three Months Ended December 31, Year Ended December 31,
2013 2012 2013 2012
(In thousands, except per share data)
Revenues
Oil and gas revenues $ 313,967 $ 208,634 $ 1,084,412 $ 670,491
Well services and midstream revenues 19,648 5,693 57,587 16,177
Total revenues 333,615 214,327 1,141,999 686,668
Expenses
Lease operating expenses 35,048 16,945 94,634 54,924
Well services and midstream operating expenses 10,836 4,670 30,713 11,774
Marketing, transportation and gathering expenses 6,068 1,974 25,924 9,257
Production taxes 30,228 19,546 100,537 62,965
Depreciation, depletion and amortization 101,276 65,951 307,055 206,734
Exploration expenses (452) 79 2,260 3,250
Impairment of oil and gas properties 406 974 1,168 3,581
General and administrative expenses 28,072 17,568 75,310 57,190
Total expenses 211,482 127,707 637,601 409,675
Operating income 122,133 86,620 504,398 276,993
Other income (expense)
Net gain (loss) on derivative instruments 6,406 596 (35,432) 34,164
Interest expense, net of capitalized interest (41,736) (21,191) (107,165) (70,143)
Other income (expense) 119 2,339 1,216 4,860
Total other income (expense) (35,211) (18,256) (141,381) (31,119)
Income before income taxes 86,922 68,364 363,017 245,874
Income tax expense 32,432 25,774 135,058 92,486
Net income $ 54,490 $ 42,590 $ 227,959 $ 153,388
Earnings per share:
Basic $ 0.58 $ 0.46 $ 2.45 $ 1.66
Diluted 0.57 0.46 2.44 1.66
Weighted average shares outstanding:
Basic 94,228 92,226 92,867 92,180
Diluted 94,821 92,509 93,411 92,513
OASIS PETROLEUM INC. SELECTED FINANCIAL AND OPERATIONAL STATS
Three Months Ended December 31, Year Ended December 31,
2013 2012 2013 2012
Operating results ($ in thousands):
Revenues
Oil $ 295,903 $ 199,761 $ 1,033,866 $ 643,446
Natural gas 18,064 8,873 50,546 27,045
Well services and midstream 19,648 5,693 57,587 16,177
Total revenues $ 333,615 $ 214,327 $ 1,141,999 $ 686,668
Production data:
Oil (MBbls) 3,446 2,301 11,133 7,533
Natural gas (MMcf) 2,567 1,406 7,450 4,146
Oil equivalents (MBoe) 3,874 2,535 12,375 8,224
Average daily production (Boe/d) 42,106 27,556 33,904 22,469
Average sales prices:
Oil, without derivative settlements (per Bbl)(1) $ 85.87 $ 86.82 $ 92.34 $ 85.22
Oil, with derivative settlements (per Bbl)(1)(2) 85.00 88.45 91.61 86.09
Natural gas (per Mcf)(3) 7.04 6.31 6.78 6.52
Costs and expenses (per Boe of production):
Lease operating expenses(4) $ 9.05 $ 6.68 $ 7.65 $ 6.68
Marketing, transportation and gathering expenses(5) 1.36 1.03 1.52 1.04
Production taxes 7.80 7.71 8.12 7.66
Depreciation, depletion and amortization 26.14 26.01 24.81 25.14
General and administrative expenses 7.25 6.93 6.09 6.95
(1) For the years ended December 31, 2013 and 2012, average sales prices for oil are calculated using total oil revenues, excluding bulk oil sales of $5.8 million and $1.5 million, respectively, divided by oil production.
(2) Realized prices include 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 year ended December 31, 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 year ended December 31, 2013.
(5) Excludes bulk oil purchase and non-cash valuation charges.
OASIS PETROLEUM INC. CONSOLIDATED STATEMENT OF CASH FLOWS
Year Ended December 31,
2013 2012
(In thousands)
Cash flows from operating activities:
Net income $ 227,959 $ 153,388
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization 307,055 206,734
Impairment of oil and gas properties 1,168 3,581
Deferred income taxes 134,583 92,479
Derivative instruments 35,432 (34,164)
Stock-based compensation expenses 11,982 10,333
Debt discount amortization and other 4,248 2,810
Working capital and other changes:
Change in accounts receivable (107,473) (90,103)
Change in inventory (13,941) (29,313)
Change in prepaid expenses (8,191) 346
Change in other current assets (56) 156
Change in other assets (3,248) (95)
Change in accounts payable and accrued liabilities 107,451 76,706
Change in other current liabilities - (472)
Change in other liabilities 887 -
Net cash provided by operating activities 697,856 392,386
Cash flows from investing activities:
Capital expenditures (893,524) (1,051,365)
Acquisition of oil and gas properties (1,560,072) -
Derivative settlements (8,133) 6,545
Purchases of short-term investments - (126,213)
Redemptions of short-term investments 25,000 120,316
Advances from joint interest partners (8,347) 12,112
Net cash used in investing activities (2,445,076) (1,038,605)
Cash flows from financing activities:
Proceeds from issuance of senior notes 1,000,000 400,000
Proceeds from revolving credit facility 600,000 -
Principal payments on revolving credit facility (264,430) -
Debt issuance costs (22,910) (8,012)
Proceeds from sale of common stock 314,580 -
Purchases of treasury stock (1,566) (3,194)
Net cash provided by financing activities 1,625,674 388,794
Decrease in cash and cash equivalents (121,546) (257,425)
Cash and cash equivalents:
Beginning of period 213,447 470,872
End of period $ 91,901 $ 213,447
Supplemental cash flow information:
Cash paid for interest, net of capitalized interest $ 85,596 $ 53,488
Cash paid for taxes 750 107
Supplemental non-cash transactions:
Change in accrued capital expenditures $ 34,354 $ 59,878
Change in asset retirement obligations 13,201 10,230
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 December 31, Year Ended December 31,
2013 2012 2013 2012
(In thousands)
Adjusted EBITDA reconciliation to Net Income:
Net income $ 54,490 $ 42,590 $ 227,959 $ 153,388
Change in fair value of derivative instruments (9,404) 3,165 27,299 (27,619)
Interest expense, net of capitalized interest 41,736 21,191 107,165 70,143
Depreciation, depletion and amortization 101,276 65,951 307,055 206,734
Impairment of oil and gas properties 406 974 1,168 3,581
Exploration expenses (452) 79 2,260 3,250
Stock-based compensation expenses 3,571 3,706 11,982 10,333
Income tax expense 32,432 25,774 135,058 92,486
Other non-cash adjustments 1,321 54 1,910 (2)
Adjusted EBITDA $ 225,376 $ 163,484 $ 821,856 $ 512,294
Adjusted EBITDA reconciliation to Net Cash Provided by Operating Activities:
Net cash provided by operating activities $ 161,175 $ 110,258 $ 697,856 $ 392,386
Derivative settlements (2,998) 3,761 (8,133) 6,545
Interest expense, net of capitalized interest 41,736 21,191 107,165 70,143
Exploration expenses (452) 79 2,260 3,250
Debt discount amortization and other (1,555) (772) (4,248) (2,810)
Current tax expense 93 (57) 475 7
Changes in working capital 26,056 28,970 24,571 42,775
Other non-cash adjustments 1,321 54 1,910 (2)
Adjusted EBITDA $ 225,376 $ 163,484 $ 821,856 $ 512,294
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 non-cash items,
including changes in fair value of 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 the GAAP financial
measure of net income to the non-GAAP financial measure of Adjusted
Net Income for the periods presented.
Adjusted Net Income Reconciliation
Three Months Ended December 31, Year Ended December 31,
2013 2012 2013 2012
(In thousands, except per share data)
Net income $ 54,490 $ 42,590 $ 227,959 $ 153,388
Change in fair value of derivative instruments (9,404) 3,165 27,299 (27,619)
Impairment of oil and gas properties 406 974 1,168 3,581
Other non-cash adjustments 1,321 54 1,910 (2)
Tax impact(1) 2,864 (1,581) (11,302) 9,043
Adjusted Net Income $ 49,677 $ 45,202 $ 247,034 $ 138,391
Adjusted earnings per share:
Basic $ 0.53 $ 0.49 $ 2.66 $ 1.50
Diluted 0.52 0.49 2.64 1.50
Weighted average shares outstanding:
Basic 94,228 92,226 92,867 92,180
Diluted 94,821 92,509 93,411 92,513
Effective tax rate 37.3% 37.7% 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.
-0- 02/25/2014
/Web Site: http://www.oasispetroleum.com
(NYSE:OAS) /
CO: Oasis Petroleum Inc.
ST: Texas
IN: UTI OIL GAS
SU: ERN
PRN
-- LA71719 --
0000 02/25/2014 22:00:00 EDT http://www.prnewswire.com
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