Exhibit 99.2
Year ended December 31, 2022
Supplemental Information of Gulfport Energy
Production Volumes by Asset Area : Quarter ended, December 31, 2022
Production Volumes
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Natural gas (Mcf/day) | ||||||||
| Utica | 702,041 | 805,141 | ||||||
| SCOOP | 232,722 | 172,203 | ||||||
| Other | — | 67 | ||||||
| Total | 934,763 | 977,411 | ||||||
| Oil and condensate (Bbl/day) | ||||||||
| Utica | 612 | 890 | ||||||
| SCOOP | 4,347 | 3,496 | ||||||
| Other | — | 52 | ||||||
| Total | 4,959 | 4,438 | ||||||
| NGL (Bbl/day) | ||||||||
| Utica | 2,937 | 2,288 | ||||||
| SCOOP | 11,584 | 8,518 | ||||||
| Other | — | 2 | ||||||
| Total | 14,520 | 10,808 | ||||||
| Combined (Mcfe/day) | ||||||||
| Utica | 723,332 | 824,211 | ||||||
| SCOOP | 328,303 | 244,286 | ||||||
| Other | 2 | 391 | ||||||
| Total | 1,051,637 | 1,068,888 | ||||||
| Totals may not sum or recalculate due to rounding. | ||||||||
Page 2
Production Volumes by Asset Area : Year ended, December 31, 2022
Production Volumes
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Natural gas (Mcf/day) | ||||||||||||
| Utica | 674,308 | 732,044 | 780,791 | |||||||||
| SCOOP | 208,881 | 183,000 | 126,294 | |||||||||
| Other | 5 | 50 | 63 | |||||||||
| Total | 883,195 | 915,094 | 907,148 | |||||||||
| Oil and condensate (Bbl/day) | ||||||||||||
| Utica | 669 | 963 | 1,336 | |||||||||
| SCOOP | 3,743 | 4,091 | 2,508 | |||||||||
| Other | 1 | 67 | 35 | |||||||||
| Total | 4,412 | 5,121 | 3,879 | |||||||||
| NGL (Bbl/day) | ||||||||||||
| Utica | 2,424 | 2,467 | 2,638 | |||||||||
| SCOOP | 9,857 | 9,190 | 6,200 | |||||||||
| Other | 1 | 1 | 3 | |||||||||
| Total | 12,281 | 11,658 | 8,841 | |||||||||
| Combined (Mcfe/day) | ||||||||||||
| Utica | 692,864 | 752,623 | 804,633 | |||||||||
| SCOOP | 290,477 | 262,686 | 178,545 | |||||||||
| Other | 13 | 455 | 288 | |||||||||
| Total | 983,354 | 1,015,764 | 983,466 | |||||||||
Totals may not sum or recalculate due to rounding.
Page 3
Production and Pricing : Quarter ended, December 31, 2022
The following table summarizes production and related pricing for the quarter ended December 31, 2022, as compared to such data for the quarter ended December 31, 2021:
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Natural gas sales | ||||||||
| Natural gas production volumes (MMcf) | 85,998 | 89,922 | ||||||
| Natural gas production volumes (MMcf) per day | 935 | 977 | ||||||
| Total sales | $ | 468,554 | $ | 492,862 | ||||
| Average price without the impact of derivatives ($/Mcf) | $ | 5.45 | $ | 5.48 | ||||
| Impact from settled derivatives ($/Mcf) | $ | (2.88 | ) | $ | (2.35 | ) | ||
| Average price, including settled derivatives ($/Mcf) | $ | 2.57 | $ | 3.13 | ||||
| Oil and condensate sales | ||||||||
| Oil and condensate production volumes (MBbl) | 456 | 408 | ||||||
| Oil and condensate production volumes (MBbl) per day | 5 | 4 | ||||||
| Total sales | $ | 36,146 | $ | 30,481 | ||||
| Average price without the impact of derivatives ($/Bbl) | $ | 79.27 | $ | 74.71 | ||||
| Impact from settled derivatives ($/Bbl) | $ | (16.89 | ) | $ | (13.18 | ) | ||
| Average price, including settled derivatives ($/Bbl) | $ | 62.38 | $ | 61.53 | ||||
| NGL sales | ||||||||
| NGL production volumes (MBbl) | 1,336 | 994 | ||||||
| NGL production volumes (MBbl) per day | 15 | 11 | ||||||
| Total sales | $ | 41,222 | $ | 43,911 | ||||
| Average price without the impact of derivatives ($/Bbl) | $ | 30.85 | $ | 44.18 | ||||
| Impact from settled derivatives ($/Bbl) | $ | 0.92 | $ | (7.02 | ) | |||
| Average price, including settled derivatives ($/Bbl) | $ | 31.77 | $ | 37.16 | ||||
| Natural gas, oil and condensate and NGL sales | ||||||||
| Natural gas equivalents (MMcfe) | 96,751 | 98,338 | ||||||
| Natural gas equivalents (MMcfe) per day | 1,052 | 1,069 | ||||||
| Total sales | $ | 545,922 | $ | 567,254 | ||||
| Average price without the impact of derivatives ($/Mcfe) | $ | 5.64 | $ | 5.77 | ||||
| Impact from settled derivatives ($/Mcfe) | $ | (2.63 | ) | $ | (2.27 | ) | ||
| Average price, including settled derivatives ($/Mcfe) | $ | 3.01 | $ | 3.50 | ||||
| Production Costs: | ||||||||
| Average lease operating expenses ($/Mcfe) | $ | 0.18 | $ | 0.14 | ||||
| Average taxes other than income ($/Mcfe) | $ | 0.15 | $ | 0.14 | ||||
| Average transportation, gathering, processing and compression ($/Mcfe) | $ | 0.99 | $ | 0.88 | ||||
| Total lease operating expenses, midstream costs and taxes other than income ($/Mcfe) | $ | 1.32 | $ | 1.16 | ||||
Page 4
Production and Pricing : Year ended, December 31, 2022
The following table summarizes production and related pricing for the year ended December 31, 2022, as compared to such data for the year ended December 31, 2021:
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Natural gas sales | ||||||||||||
| Natural gas production volumes (MMcf) | 322,366 | 208,641 | 124,279 | |||||||||
| Natural gas production volumes (MMcf) per day | 883 | 915 | 907 | |||||||||
| Total sales | $ | 1,998,452 | $ | 906,096 | $ | 344,390 | ||||||
| Average price without the impact of derivatives ($/Mcf) | $ | 6.20 | $ | 4.34 | $ | 2.77 | ||||||
| Impact from settled derivatives ($/Mcf) | $ | (3.11 | ) | $ | (1.44 | ) | $ | (0.03 | ) | |||
| Average price, including settled derivatives ($/Mcf) | $ | 3.09 | $ | 2.90 | $ | 2.74 | ||||||
| Oil and condensate sales | ||||||||||||
| Oil and condensate production volumes (MBbl) | 1,610 | 1,167 | 531 | |||||||||
| Oil and condensate production volumes (MBbl) per day | 4 | 5 | 4 | |||||||||
| Total sales | $ | 147,444 | $ | 81,347 | $ | 29,106 | ||||||
| Average price without the impact of derivatives ($/Bbl) | $ | 91.58 | $ | 69.71 | $ | 54.81 | ||||||
| Impact from settled derivatives ($/Bbl) | $ | (24.32 | ) | $ | (8.33 | ) | $ | — | ||||
| Average price, including settled derivatives ($/Bbl) | $ | 67.26 | $ | 61.38 | $ | 54.81 | ||||||
| NGL sales | ||||||||||||
| NGL production volumes (MBbl) | 4,483 | 2,658 | 1,211 | |||||||||
| NGL production volumes (MBbl) per day | 12 | 12 | 9 | |||||||||
| Total sales | $ | 184,963 | $ | 105,141 | $ | 36,780 | ||||||
| Average price without the impact of derivatives ($/Bbl) | $ | 41.26 | $ | 39.56 | $ | 30.37 | ||||||
| Impact from settled derivatives ($/Bbl) | $ | (2.80 | ) | $ | (4.88 | ) | $ | — | ||||
| Average price, including settled derivatives ($/Bbl) | $ | 38.46 | $ | 34.68 | $ | 30.37 | ||||||
| Natural gas, oil and condensate and NGL sales | ||||||||||||
| Natural gas equivalents (MMcfe) | 358,924 | 231,594 | 134,735 | |||||||||
| Natural gas equivalents (MMcfe) per day | 983 | 1,016 | 983 | |||||||||
| Total sales | $ | 2,330,859 | $ | 1,092,584 | $ | 410,276 | ||||||
| Average price without the impact of derivatives ($/Mcfe) | $ | 6.49 | $ | 4.72 | $ | 3.05 | ||||||
| Impact from settled derivatives ($/Mcfe) | $ | (2.94 | ) | $ | (1.39 | ) | $ | (0.02 | ) | |||
| Average price, including settled derivatives ($/Mcfe) | $ | 3.55 | $ | 3.33 | $ | 3.03 | ||||||
| Production Costs: | ||||||||||||
| Average lease operating expenses ($/Mcfe) | $ | 0.18 | $ | 0.14 | $ | 0.14 | ||||||
| Average taxes other than income ($/Mcfe) | $ | 0.17 | $ | 0.13 | $ | 0.09 | ||||||
| Average transportation, gathering, processing and compression ($/Mcfe) | $ | 1.00 | $ | 0.92 | $ | 1.20 | ||||||
| Total lease operating expenses, midstream costs and taxes other than income ($/Mcfe) | $ | 1.34 | $ | 1.19 | $ | 1.43 | ||||||
Totals may not sum or recalculate due to rounding.
Page 5
Consolidated Statements of Income: Quarter ended, December 31, 2022
(In thousands, except per share data)
(Unaudited)
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| REVENUES: | ||||||||
| Natural gas sales | $ | 468,554 | $ | 492,862 | ||||
| Oil and condensate sales | 36,146 | 30,481 | ||||||
| Natural gas liquid sales | 41,222 | 43,911 | ||||||
| Net gain on natural gas, oil and NGL derivatives | 436,570 | 205,315 | ||||||
| Total revenues | 982,492 | 772,569 | ||||||
| OPERATING EXPENSES: | ||||||||
| Lease operating expenses | 17,544 | 14,192 | ||||||
| Taxes other than income | 14,460 | 13,343 | ||||||
| Transportation, gathering, processing and compression | 95,468 | 86,202 | ||||||
| Depreciation, depletion and amortization | 78,456 | 65,978 | ||||||
| General and administrative expenses | 11,176 | 11,256 | ||||||
| Accretion expense | 689 | 500 | ||||||
| Total operating expenses | 217,793 | 191,471 | ||||||
| INCOME FROM OPERATIONS | 764,699 | 581,098 | ||||||
| OTHER EXPENSE: | ||||||||
| Interest expense | 16,094 | 15,608 | ||||||
| Loss on debt extinguishment | — | 3,040 | ||||||
| Other, net | 37 | 5,070 | ||||||
| Total other expense | 16,131 | 23,718 | ||||||
| INCOME BEFORE INCOME TAXES | 748,568 | 557,380 | ||||||
| Income tax benefit | — | (689 | ) | |||||
| NET INCOME | $ | 748,568 | $ | 558,069 | ||||
| Dividends on Preferred Stock | (1,308 | ) | (1,447 | ) | ||||
| Participating securities - Preferred Stock | (121,659 | ) | (93,064 | ) | ||||
| NET INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 625,601 | $ | 463,558 | ||||
| NET INCOME PER COMMON SHARE: | ||||||||
| Basic | $ | 32.57 | $ | 22.50 | ||||
| Diluted | $ | 32.35 | $ | 22.40 | ||||
| Weighted average common shares outstanding—Basic | 19,208 | 20,599 | ||||||
| Weighted average common shares outstanding—Diluted | 19,366 | 20,715 | ||||||
Page 6
Consolidated Statements of Income: Year ended, December 31, 2022
(In thousands, except per share data)
(Unaudited)
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| REVENUES: | ||||||||||||
| Natural gas sales | $ | 1,998,452 | $ | 906,096 | $ | 344,390 | ||||||
| Oil and condensate sales | 147,444 | 81,347 | 29,106 | |||||||||
| Natural gas liquid sales | 184,963 | 105,141 | 36,780 | |||||||||
| Net loss on natural gas, oil and NGL derivatives | (999,747 | ) | (556,819 | ) | (137,239 | ) | ||||||
| Total revenues | 1,331,112 | 535,765 | 273,037 | |||||||||
| OPERATING EXPENSES: | ||||||||||||
| Lease operating expenses | 64,790 | 32,172 | 19,524 | |||||||||
| Taxes other than income | 60,139 | 30,243 | 12,349 | |||||||||
| Transportation, gathering, processing and compression | 357,246 | 212,013 | 161,086 | |||||||||
| Depreciation, depletion and amortization | 267,761 | 160,913 | 62,764 | |||||||||
| Impairment of oil and natural gas properties | — | 117,813 | — | |||||||||
| Impairment of other property and equipment | — | — | 14,568 | |||||||||
| General and administrative expenses | 35,304 | 34,465 | 19,175 | |||||||||
| Restructuring and liability management expenses | — | 2,858 | — | |||||||||
| Accretion expense | 2,746 | 1,214 | 1,229 | |||||||||
| Total operating expenses | 787,986 | 591,691 | 290,695 | |||||||||
| INCOME (LOSS) FROM OPERATIONS | 543,126 | (55,926 | ) | (17,658 | ) | |||||||
| OTHER EXPENSE (INCOME): | ||||||||||||
| Interest expense | 59,773 | 40,853 | 4,159 | |||||||||
| Loss on debt extinguishment | — | 3,040 | — | |||||||||
| Loss from equity method investments, net | — | — | 342 | |||||||||
| Reorganization items, net | — | — | (266,898 | ) | ||||||||
| Other, net | (11,348 | ) | 13,049 | 1,713 | ||||||||
| Total other expense | 48,425 | 56,942 | (260,684 | ) | ||||||||
| INCOME (LOSS) BEFORE INCOME TAXES | 494,701 | (112,868 | ) | 243,026 | ||||||||
| Income tax benefit | — | (39 | ) | (7,968 | ) | |||||||
| NET INCOME (LOSS) | $ | 494,701 | $ | (112,829 | ) | $ | 250,994 | |||||
| Dividends on Preferred Stock | (5,444 | ) | (4,573 | ) | — | |||||||
| Participating securities - Preferred Stock | (76,401 | ) | — | — | ||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ | 412,856 | $ | (117,402 | ) | $ | 250,994 | |||||
| NET INCOME (LOSS) PER COMMON SHARE: | ||||||||||||
| Basic | $ | 20.45 | $ | (5.71 | ) | $ | 1.56 | |||||
| Diluted | $ | 20.32 | $ | (5.71 | ) | $ | 1.56 | |||||
| Weighted average common shares outstanding—Basic | 20,185 | 20,545 | 160,834 | |||||||||
| Weighted average common shares outstanding—Diluted | 20,347 | 20,545 | 160,834 | |||||||||
Page 7
(In thousands, except share data)
| Successor | ||||||||
| December 31, 2022 | December 31, 2021 | |||||||
| (Unaudited) | ||||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 7,259 | $ | 3,260 | ||||
| Accounts receivable—oil, natural gas, and natural gas liquids sales | 278,404 | 232,854 | ||||||
| Accounts receivable—joint interest and other | 21,478 | 20,383 | ||||||
| Prepaid expenses and other current assets | 7,621 | 12,359 | ||||||
| Short-term derivative instruments | 87,508 | 4,695 | ||||||
| Total current assets | 402,270 | 273,551 | ||||||
| Property and equipment: | ||||||||
| Oil and natural gas properties, full-cost method | ||||||||
| Proved oil and natural gas properties | 2,418,666 | 1,917,833 | ||||||
| Unproved properties | 178,472 | 211,007 | ||||||
| Other property and equipment | 6,363 | 5,329 | ||||||
| Total property and equipment | 2,603,501 | 2,134,169 | ||||||
| Less: accumulated depletion, depreciation, amortization and impairment | (545,771 | ) | (278,341 | ) | ||||
| Total property and equipment, net | 2,057,730 | 1,855,828 | ||||||
| Other assets: | ||||||||
| Long-term derivative instruments | 26,525 | 18,664 | ||||||
| Operating lease assets | 26,713 | 322 | ||||||
| Other assets | 21,241 | 19,867 | ||||||
| Total other assets | 74,479 | 38,853 | ||||||
| Total assets | $ | 2,534,479 | $ | 2,168,232 | ||||
Page 8
Consolidated Balance Sheets
(In thousands, except share data)
| Successor | ||||||||
| December 31, 2022 | December 31, 2021 | |||||||
| (Unaudited) | ||||||||
| Liabilities, Mezzanine Equity and Stockholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 437,384 | $ | 394,011 | ||||
| Short-term derivative instruments | 343,522 | 240,735 | ||||||
| Current portion of operating lease liabilities | 12,414 | 182 | ||||||
| Total current liabilities | 793,320 | 634,928 | ||||||
| Non-current liabilities: | ||||||||
| Long-term derivative instruments | 118,404 | 184,580 | ||||||
| Asset retirement obligation | 33,171 | 28,264 | ||||||
| Non-current operating lease liabilities | 14,299 | 140 | ||||||
| Long-term debt, net of current maturities | 694,155 | 712,946 | ||||||
| Total non-current liabilities | 860,029 | 925,930 | ||||||
| Total liabilities | $ | 1,653,349 | $ | 1,560,858 | ||||
| Commitments and contingencies | ||||||||
| Mezzanine Equity: | ||||||||
| Preferred Stock - $0.0001 par value, 110.0 thousand shares authorized, 52.3 thousand issued and outstanding at December 31, 2022, and 57.9 thousand issued and outstanding at December 31, 2021 | 52,295 | 57,896 | ||||||
| Stockholders’ equity: | ||||||||
| Common Stock - $0.0001 par value, 42.0 million shares authorized, 19.1 million issued and outstanding at December 31, 2022, and 20.6 million issued and outstanding at December 31, 2021 | 2 | 2 | ||||||
| Additional paid-in capital | 449,243 | 692,521 | ||||||
| Common Stock held in reserve, 62 thousand shares at December 31, 2022, and 938 thousand shares at December 31, 2021 | (1,996 | ) | (30,216 | ) | ||||
| Retained earnings (accumulated deficit) | 381,872 | (112,829 | ) | |||||
| Treasury stock, at cost - 3.9 thousand shares at December 31, 2022, and no shares at December 31, 2021 | (286 | ) | — | |||||
| Total stockholders’ equity | $ | 828,835 | $ | 549,478 | ||||
| Total liabilities, mezzanine equity and stockholders’ equity | $ | 2,534,479 | $ | 2,168,232 | ||||
Page 9
Consolidated Statement of Cash Flows: Quarter ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 748,568 | $ | 558,069 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depletion, depreciation and amortization | 78,456 | 65,978 | ||||||
| Loss on debt extinguishment | — | 3,040 | ||||||
| Net gain on derivative instruments | (436,570 | ) | (205,315 | ) | ||||
| Net cash payments on settled derivative instruments | (254,394 | ) | (223,283 | ) | ||||
| Other, net | 2,948 | 1,643 | ||||||
| Changes in operating assets and liabilities, net | 48,987 | (71,784 | ) | |||||
| Net cash provided by operating activities | $ | 187,995 | $ | 128,348 | ||||
| Cash flows from investing activities: | ||||||||
| Additions to oil and natural gas properties | $ | (128,786 | ) | $ | (87,807 | ) | ||
| Proceeds from sale of oil and natural gas properties | 150 | 3,739 | ||||||
| Other, net | (339 | ) | 107 | |||||
| Net cash used in investing activities | $ | (128,975 | ) | $ | (83,961 | ) | ||
| Cash flows from financing activities: | ||||||||
| Principal payments on Credit Facility | $ | (570,000 | ) | $ | (477,000 | ) | ||
| Borrowings on Credit Facility | 536,000 | 641,000 | ||||||
| Borrowings on exit credit facility | — | 99,422 | ||||||
| Principal payments on exit credit facility | — | (300,028 | ) | |||||
| Debt issuance costs and loan commitment fees | (23 | ) | (7,558 | ) | ||||
| Dividends on preferred stock | (1,308 | ) | (1,448 | ) | ||||
| Repurchase of common stock under Repurchase Program | (24,691 | ) | — | |||||
| Other, net | (26 | ) | — | |||||
| Net cash used in financing activities | $ | (60,048 | ) | $ | (45,612 | ) | ||
| Net decrease in cash, cash equivalents and restricted cash | $ | (1,028 | ) | $ | (1,225 | ) | ||
| Cash, cash equivalents and restricted cash at beginning of period | $ | 8,287 | $ | 4,485 | ||||
| Cash, cash equivalents and restricted cash at end of period | $ | 7,259 | $ | 3,260 | ||||
Page 10
Consolidated Statement of Cash Flows: Year ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Cash flows from operating activities: | ||||||||||||
| Net income (loss) | $ | 494,701 | $ | (112,829 | ) | $ | 250,994 | |||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||
| Depletion, depreciation and amortization | 267,761 | 160,913 | 62,764 | |||||||||
| Impairment of oil and natural gas properties | — | 117,813 | — | |||||||||
| Impairment of other property and equipment | — | — | 14,568 | |||||||||
| Loss from equity investments | — | — | 342 | |||||||||
| Loss on debt extinguishment | — | 3,040 | — | |||||||||
| Net loss on derivative instruments | 999,747 | 556,819 | 137,239 | |||||||||
| Net cash payments on settled derivative instruments | (1,053,810 | ) | (322,857 | ) | (3,361 | ) | ||||||
| Non-cash reorganization items, net | — | — | (446,012 | ) | ||||||||
| Other, net | 11,251 | 3,130 | 1,727 | |||||||||
| Changes in operating assets and liabilities, net | 19,427 | (113,044 | ) | 153,894 | ||||||||
| Net cash provided by operating activities | $ | 739,077 | $ | 292,985 | $ | 172,155 | ||||||
| Cash flows from investing activities: | ||||||||||||
| Additions to oil and natural gas properties | $ | (460,780 | ) | $ | (207,113 | ) | $ | (102,330 | ) | |||
| Proceeds from sale of oil and natural gas properties | 3,360 | 4,339 | 15 | |||||||||
| Other, net | (875 | ) | 2,669 | 4,484 | ||||||||
| Net cash used in investing activities | $ | (458,295 | ) | $ | (200,105 | ) | $ | (97,831 | ) | |||
| Cash flows from financing activities: | ||||||||||||
| Principal payments on Pre-Petition Revolving Credit Facility | $ | — | $ | — | $ | (318,961 | ) | |||||
| Borrowings on Pre-Petition Revolving Credit Facility | — | — | 26,050 | |||||||||
| Borrowings on Exit Credit Facility | — | 406,277 | 302,751 | |||||||||
| Principal payments on Exit Credit Facility | — | (709,028 | ) | — | ||||||||
| Principal payments on DIP credit facility | — | — | (157,500 | ) | ||||||||
| Principal payments on Credit Facility | (2,082,000 | ) | (477,000 | ) | — | |||||||
| Borrowings on Credit Facility | 2,063,000 | 641,000 | — | |||||||||
| Debt issuance costs and loan commitment fees | (234 | ) | (8,783 | ) | (7,100 | ) | ||||||
| Dividends on Preferred Stock | (5,444 | ) | (1,503 | ) | — | |||||||
| Proceeds from issuance of Preferred Stock | — | — | 50,000 | |||||||||
| Repurchase of Common Stock under Repurchase Program | (250,482 | ) | — | — | ||||||||
| Other, net | (1,623 | ) | — | (8 | ) | |||||||
| Net cash used in in financing activities | $ | (276,783 | ) | $ | (149,037 | ) | $ | (104,768 | ) | |||
| Net increase (decrease) in cash, cash equivalents and restricted cash | $ | 3,999 | $ | (56,157 | ) | $ | (30,444 | ) | ||||
| Cash, cash equivalents and restricted cash at beginning of period | $ | 3,260 | $ | 59,417 | $ | 89,861 | ||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 7,259 | $ | 3,260 | $ | 59,417 | ||||||
Page 11
Gulfport’s 2023 guidance assumes commodity strip prices as of February 13, 2023, adjusted for applicable commodity and location differentials, and no property acquisitions or divestitures.
| Year Ending | ||||||||
| December 31, 2023 | ||||||||
| Low | High | |||||||
| Production | ||||||||
| Average daily gas equivalent (MMcfepd) | 1,000 | 1,040 | ||||||
| % Gas | ~90% | |||||||
| Realizations (before hedges) | ||||||||
| Natural gas (differential to NYMEX settled price) ($/Mcf) | $ | (0.20 | ) | $ | (0.35 | ) | ||
| NGL (% of WTI) | 40 | % | 45 | % | ||||
| Oil (differential to NYMEX WTI) ($/Bbl) | $ | (3.00 | ) | $ | (4.00 | ) | ||
| Operating costs | ||||||||
| Lease operating expense ($/Mcfe) | $ | 0.16 | $ | 0.18 | ||||
| Taxes other than income ($/Mcfe) | $ | 0.10 | $ | 0.12 | ||||
| Transportation, gathering, processing and compression ($/Mcfe) | $ | 0.95 | $ | 0.99 | ||||
| Recurring cash general and administrative(1,2) ($/Mcfe) | $ | 0.11 | $ | 0.13 | ||||
| Total | ||||||||
| (in millions) | ||||||||
| Capital expenditures (incurred) | ||||||||
| D&C | $ | 375 | $ | 400 | ||||
| Leasehold and land | $ | 50 | $ | 75 | ||||
| Total | $ | 425 | $ | 475 | ||||
| (1) | Recurring cash G&A includes capitalization. It excludes non-cash stock compensation and expenses related to the continued administration of our prior Chapter 11 filing. |
| (2) | This is a non-GAAP measure. Reconciliations of these non-GAAP measures and other disclosures are included in these supplemental financial tables. |
Page 12
The below details Gulfport’s hedging positions as of February 28, 2023.
| 1Q2023 | 2Q2023 | 3Q2023 | 4Q2023 | Full Year 2023 | Full Year 2024 | Full Year 2025 | ||||||||||||||||||||||
| Natural Gas Contract Summary (NYMEX): | ||||||||||||||||||||||||||||
| Fixed Price Swaps | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 260 | 180 | 200 | 280 | 230 | 205 | — | |||||||||||||||||||||
| Weighted Average Price ($/MMBtu) | $ | 4.66 | $ | 3.98 | $ | 3.93 | $ | 4.36 | $ | 4.28 | $ | 4.34 | $ | — | ||||||||||||||
| Fixed Price Collars | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 285 | 285 | 285 | 285 | 285 | 150 | — | |||||||||||||||||||||
| Weighted Average Floor Price ($/MMBtu) | $ | 2.93 | $ | 2.93 | $ | 2.93 | $ | 2.93 | $ | 2.93 | $ | 3.47 | $ | — | ||||||||||||||
| Weighted Average Ceiling Price ($/MMBtu) | $ | 4.78 | $ | 4.78 | $ | 4.78 | $ | 4.78 | $ | 4.78 | $ | 5.71 | $ | — | ||||||||||||||
| Fixed Price Calls Sold | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 408 | 408 | 408 | 408 | 408 | 202 | 193 | |||||||||||||||||||||
| Weighted Average Price ($/MMBtu) | $ | 3.01 | $ | 3.21 | $ | 3.21 | $ | 3.21 | $ | 3.16 | $ | 3.33 | $ | 5.80 | ||||||||||||||
| Rex Zone 3 Basis | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 87 | 130 | 130 | 130 | 119 | — | — | |||||||||||||||||||||
| Differential ($/MMBtu) | $ | (0.22 | ) | $ | (0.22 | ) | $ | (0.22 | ) | $ | (0.22 | ) | $ | (0.22 | ) | $ | — | $ | — | |||||||||
| Tetco M2 Basis | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 64 | 120 | 140 | 140 | 116 | 10 | — | |||||||||||||||||||||
| Differential ($/MMBtu) | $ | (0.93 | ) | $ | (0.89 | ) | $ | (0.91 | ) | $ | (0.91 | ) | $ | (0.91 | ) | $ | (1.03 | ) | $ | — | ||||||||
| NGPL TX OK Basis | ||||||||||||||||||||||||||||
| Volume (BBtupd) | 40 | 70 | 70 | 70 | 63 | — | — | |||||||||||||||||||||
| Differential ($/MMBtu) | $ | (0.37 | ) | $ | (0.36 | ) | $ | (0.36 | ) | $ | (0.36 | ) | $ | (0.36 | ) | $ | — | $ | — | |||||||||
| Oil Contract Summary (WTI): | ||||||||||||||||||||||||||||
| Fixed Price Swaps | ||||||||||||||||||||||||||||
| Volume (Bblpd) | 3,000 | 3,000 | 3,000 | 3,000 | 3,000 | — | — | |||||||||||||||||||||
| Weighted Average Price ($/Bbl) | $ | 74.47 | $ | 74.47 | $ | 74.47 | $ | 74.47 | $ | 74.47 | $ | — | $ | — | ||||||||||||||
| NGL Contract Summary: | ||||||||||||||||||||||||||||
| C3 Propane Fixed Price Swaps | ||||||||||||||||||||||||||||
| Volume (Bblpd) | 3,000 | 3,000 | 3,000 | 3,000 | 3,000 | — | — | |||||||||||||||||||||
| Weighted Average Price ($/Bbl) | $ | 38.07 | $ | 38.07 | $ | 38.07 | $ | 38.07 | $ | 38.07 | $ | — | $ | — | ||||||||||||||
Page 13
Gulfport’s management uses certain non-GAAP financial measures for planning, forecasting and evaluating business and financial performance, and believes that they are useful tool to assess Gulfport’s operating results. Although these are not measures of performance calculated in accordance with generally accepted accounting principles (GAAP), management believes that these financial measures are useful to an investor in evaluating Gulfport because (i) analysts utilize these metrics when evaluating company performance and have requested this information as of a recent practicable date, (ii) these metrics are widely used to evaluate a company’s operating performance, and (iii) we want to provide updated information to investors. Investors should not view these metrics as a substitute for measures of performance that are calculated in accordance with GAAP. In addition, because all companies do not calculate these measures identically, these measures may not be comparable to similarly titled measures of other companies.
These non-GAAP financial measures include adjusted net income, adjusted EBITDA, adjusted free cash flow, and recurring general and administrative expense. A reconciliation of each financial measure to its most directly comparable GAAP financial measure is included in the tables below. These non-GAAP measure should be considered in addition to, but not instead of, the financial statements prepared in accordance with GAAP.
Page 14
Adjusted net income is a non-GAAP financial measure equal to income (loss) before income taxes less reorganization items, non-cash derivative loss (gain), impairments of oil and gas properties, contractual charges on midstream disputes, non-recurring general and administrative expenses comprised of expenses related to the continued administration of our prior Chapter 11 filing, restructuring and liability management expenses, stock-based compensation expenses, loss on debt extinguishment, loss from equity method investments and other items which include items related to our Chapter 11 filing and other non-material expenses.
Adjusted EBITDA is a non-GAAP financial measure equal to net income (loss), the most directly comparable GAAP financial measure, plus interest expense, income tax, depreciation, depletion and amortization, and impairment of oil and gas properties, property and equipment, accretion. reorganization items, non-cash derivative loss (gain), contractual charges on midstream disputes, non-recurring general and administrative expenses comprised of expenses related to the continued administration of our prior Chapter 11 filing, restructuring and liability management expenses, stock-based compensation, loss (gain) on debt extinguishment, loss from equity method investments and other items which include items related to our Chapter 11 filing and other non-material expenses.
Adjusted free cash flow is a non-GAAP measure defined as adjusted EBITDA plus certain non-cash items that are included in net cash provided by (used in) operating activities but excluded from adjusted EBITDA less interest expense, capital expenses incurred and capital expenditures incurred. Gulfport includes a adjusted free cash flow estimate for 2023. We are unable, however, to provide a quantitative reconciliation of the forward-looking non-GAAP measure to its most directly comparable forward-looking GAAP measure because management cannot reliably quantify certain of the necessary components of such forward-looking GAAP measure. Accordingly, Gulfport is relying on the exception provided by Item 10(e)(1)(i) (B) of Regulation S-K to exclude such reconciliation. Items excluded in net cash provided by (used in) operating activities to arrive at adjusted free cash flow include interest expense, income taxes, capitalized expenses as well as one-time items or items whose timing or amount cannot be reasonably estimated.
Recurring general and administrative expense is a non-GAAP financial measure equal to general and administrative expense (GAAP) plus capitalized general and administrative expense, less non-recurring general and administrative expenses comprised of expenses related to the continued administration of our prior Chapter 11 filing. Gulfport includes a recurring general and administrative expense estimate for 2023. We are unable, however, to provide a quantitative reconciliation of the forward-looking non-GAAP measure to its most directly comparable forward-looking GAAP measure because management cannot reliably quantify certain of the necessary components of such forward-looking GAAP measure. Accordingly, Gulfport is relying on the exception provided by Item 10(e)(1)(i) (B) of Regulation S-K to exclude such reconciliation. Items excluded in general and administrative expense to arrive at recurring general and administrative expense include capitalized expenses as well as one-time items or items whose timing or amount cannot be reasonably estimated. The non-GAAP measure recurring general and administrative expenses allows investors to compare Gulfport’s total general and administrative expenses, including capitalization, to peer companies that account for their oil and gas operations using the successful efforts method.
Page 15
Adjusted Net Income: Quarter ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Pre-Tax Net Income (GAAP) | $ | 748,568 | $ | 557,380 | ||||
| Adjustments: | ||||||||
| Non-cash derivative gain | (690,964 | ) | (428,598 | ) | ||||
| Non-recurring general and administrative expense | 1,479 | 4,758 | ||||||
| Stock-based compensation expense | 1,566 | 1,145 | ||||||
| Loss on debt extinguishment | — | 3,040 | ||||||
| Other, net(1) | 37 | 5,070 | ||||||
| Adjusted Net Income (Non-GAAP) | $ | 60,686 | $ | 142,795 | ||||
| (1) | For the three months ended December 31, 2021, “Other, net” included approximately $5.8 million expense related to increases in our legal contingency reserve. |
Page 16
Adjusted Net Income: Year ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Pre-Tax Net Income (Loss) (GAAP) | $ | 494,701 | $ | (112,868 | ) | $ | 243,026 | |||||
| Adjustments: | ||||||||||||
| Reorganization items, net | — | — | (266,898 | ) | ||||||||
| Non-cash derivative (gain) loss | (54,063 | ) | 233,962 | 133,878 | ||||||||
| Impairments | — | 117,813 | — | |||||||||
| Contractual charges on midstream disputes | — | — | 30,351 | |||||||||
| Non-recurring general and administrative expense | 3,152 | 18,357 | 8,923 | |||||||||
| Restructuring and liability management expenses | — | 2,858 | — | |||||||||
| Stock-based compensation expense | 5,723 | 2,044 | 1,165 | |||||||||
| Loss on debt extinguishment | — | 3,040 | — | |||||||||
| Loss from equity method investments | — | — | 342 | |||||||||
| Other, net(1)(2) | (11,348 | ) | 13,049 | 2,044 | ||||||||
| Adjusted Net Income (Non-GAAP) | $ | 438,165 | $ | 278,255 | $ | 152,831 | ||||||
| (1) | For the year ended December 31, 2022, “Other, net” included $11.5 million related to our initial claim distribution from our Chapter 11 Plan of Reorganization. The distribution is more fully described in Note 19 of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. |
| (2) | For the period from May 18, 2021 through December 31, 2021, “Other, net” included approximately $9.9 million expense related to increases in our legal contingency reserve. |
Page 17
Adjusted EBITDA: Quarter ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Net Income (GAAP) | $ | 748,568 | $ | 558,069 | ||||
| Adjustments: | ||||||||
| Interest expense | 16,094 | 15,608 | ||||||
| Income tax benefit | — | (689 | ) | |||||
| DD&A and accretion | 79,145 | 66,478 | ||||||
| Non-cash derivative gain | (690,964 | ) | (428,598 | ) | ||||
| Non-recurring general and administrative expenses | 1,479 | 4,758 | ||||||
| Stock-based compensation expense | 1,566 | 1,145 | ||||||
| Loss on debt extinguishment | — | 3,040 | ||||||
| Other, net(1) | 37 | 5,070 | ||||||
| Adjusted EBITDA (Non-GAAP) | $ | 155,925 | $ | 224,881 | ||||
| (1) | For the three months ended December 31, 2021, “Other, net” included approximately $5.8 million expense related to increases in our legal contingency reserve. |
Page 18
Adjusted EBITDA: Year ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Net Income (Loss) (GAAP) | $ | 494,701 | $ | (112,829 | ) | $ | 250,994 | |||||
| Adjustments: | ||||||||||||
| Interest expense | 59,773 | 40,853 | 4,159 | |||||||||
| Income tax benefit | — | (39 | ) | (7,968 | ) | |||||||
| DD&A, impairment, and accretion | 270,507 | 279,940 | 78,561 | |||||||||
| Reorganization items, net | — | — | (266,898 | ) | ||||||||
| Non-cash derivative (gain) loss | (54,063 | ) | 233,962 | 133,878 | ||||||||
| Contractual charges on midstream disputes | — | — | 30,351 | |||||||||
| Non-recurring general and administrative expenses | 3,152 | 18,357 | 8,923 | |||||||||
| Restructuring and liability management expenses | — | 2,858 | — | |||||||||
| Stock-based compensation expense | 5,723 | 2,044 | 1,165 | |||||||||
| Loss on debt extinguishment | — | 3,040 | — | |||||||||
| Loss from equity method investments | — | — | 342 | |||||||||
| Other, net(1)(2) | (11,348 | ) | 13,049 | 2,044 | ||||||||
| Adjusted EBITDA (Non-GAAP) | $ | 768,445 | $ | 481,235 | $ | 235,551 | ||||||
| (1) | For the year ended December 31, 2022, “Other, net” included $11.5 million related to our initial claim distribution from our Chapter 11 Plan of Reorganization. The distribution is more fully described in Note 19 of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. |
| (2) | For the period from May 18, 2021 through December 31, 2021, “Other, net” included approximately $9.9 million expense related to increases in our legal contingency reserve. |
Page 19
Adjusted Free Cash Flow: Quarter ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | ||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||
| Net cash provided by operating activity (GAAP) | $ | 187,995 | $ | 128,348 | ||||
| Adjustments: | ||||||||
| Interest expense | 16,094 | 15,608 | ||||||
| Current income tax benefit | — | (689 | ) | |||||
| Non-recurring general and administrative expenses | 1,479 | 4,758 | ||||||
| Other, net(1) | (656 | ) | 5,072 | |||||
| Changes in operating assets and liabilities: | ||||||||
| (Decrease) increase in accounts receivable - oil, natural gas, and natural gas liquids sales | (39,124 | ) | 46,913 | |||||
| (Decrease) increase in accounts receivable - joint interest and other | (13,852 | ) | 10,714 | |||||
| Decrease in accounts payable and accrued liabilities | 5,769 | 24,009 | ||||||
| Decrease in prepaid expenses | (1,802 | ) | (6,328 | ) | ||||
| Increase (decrease) in other assets | 22 | (3,524 | ) | |||||
| Total changes in operating assets and liabilities | $ | (48,987 | ) | $ | 71,784 | |||
| Adjusted EBITDA (Non-GAAP) | $ | 155,925 | $ | 224,881 | ||||
| Interest expense | (16,094 | ) | (15,608 | ) | ||||
| Capitalized expenses incurred(2) | (4,722 | ) | (3,937 | ) | ||||
| Capital expenditures incurred(3) | (101,918 | ) | (71,458 | ) | ||||
| Adjusted free cash flow (Non-GAAP) | $ | 33,191 | $ | 133,878 | ||||
| (1) | For the three months ended December 31, 2021, “Other, net” included approximately $5.8 million expense related to increases in our legal contingency reserve. |
| (2) | Includes cash capitalized general and administrative expense and incurred capitalized interest expenses. |
| (3) | Incurred capital expenditures and cash capital expenditures may vary from period to period due to the cash payment cycle. |
Page 20
Adjusted Free Cash Flow: Year ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | Predecessor | |||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||
| Net cash provided by operating activity (GAAP) | $ | 739,077 | $ | 292,985 | $ | 172,155 | ||||||
| Adjustments: | ||||||||||||
| Interest expense | 59,773 | 40,853 | 4,159 | |||||||||
| Current income tax benefit | — | (39 | ) | (7,968 | ) | |||||||
| Cash reorganization items, net | — | — | 179,114 | |||||||||
| Non-recurring general and administrative expenses | 3,152 | 18,357 | 8,923 | |||||||||
| Restructuring and liability management expenses | — | 2,858 | — | |||||||||
| Contractual charges on midstream disputes | — | — | 30,351 | |||||||||
| Other, net(1)(2) | (14,130 | ) | 13,176 | 2,711 | ||||||||
| Changes in operating assets and liabilities: | ||||||||||||
| Increase in accounts receivable - oil, natural gas, and natural gas liquids sales | 45,550 | 52,143 | 60,832 | |||||||||
| Increase in accounts receivable - joint interest and other | 1,095 | 5,178 | 3,005 | |||||||||
| (Increase) decrease in accounts payable and accrued liabilities | (59,879 | ) | 72,912 | (79,193 | ) | |||||||
| Decrease in prepaid expenses | (4,863 | ) | (13,559 | ) | (135,471 | ) | ||||||
| Decrease in other assets | (1,330 | ) | (3,630 | ) | (3,067 | ) | ||||||
| Total changes in operating assets and liabilities | (19,427 | ) | 113,044 | (153,894 | ) | |||||||
| Adjusted EBITDA (Non-GAAP) | $ | 768,445 | $ | 481,234 | $ | 235,551 | ||||||
| Interest expense | (59,773 | ) | (40,853 | ) | (4,159 | ) | ||||||
| Capitalized expenses incurred(3) | (17,208 | ) | (9,820 | ) | (8,020 | ) | ||||||
| Capital expenditures incurred(4) | (450,879 | ) | (184,488 | ) | (108,408 | ) | ||||||
| Adjusted free cash flow (Non-GAAP) | $ | 240,585 | $ | 246,073 | $ | 114,964 | ||||||
| (1) | For the year ended December 31, 2022, “Other, net” included $11.5 million related to our initial claim distribution from our Chapter 11 Plan of Reorganization. The distribution is more fully described in Note 19 of our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. |
| (2) | For the period from May 18, 2021 through December 31, 2021, “Other, net” included approximately $9.9 million expense related to increases in our legal contingency reserve. |
| (3) | Includes cash capitalized general and administrative expense and incurred capitalized interest expenses. |
| (4) | Incurred capital expenditures and cash capital expenditures may vary from period to period due to the cash payment cycle. |
Page 21
Recurring General and Administrative Expenses:
Quarter ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | ||||||||||||||||||||||||
| Three Months Ended December 31, 2022 | Three Months Ended December 31, 2021 | |||||||||||||||||||||||
| Cash | Non-Cash | Total | Cash | Non-Cash | Total | |||||||||||||||||||
| General and administrative expense (GAAP) | $ | 9,611 | $ | 1,565 | $ | 11,176 | $ | 10,111 | $ | 1,145 | $ | 11,256 | ||||||||||||
| Capitalized general and administrative expense | 4,722 | 807 | 5,529 | 3,856 | 617 | 4,473 | ||||||||||||||||||
| Non-recurring general and administrative expense | (1,479 | ) | — | (1,479 | ) | (4,758 | ) | — | (4,758 | ) | ||||||||||||||
| Recurring general and administrative before capitalization (Non-GAAP) | $ | 12,854 | $ | 2,372 | $ | 15,226 | $ | 9,209 | $ | 1,762 | $ | 10,971 | ||||||||||||
Page 22
Recurring General and Administrative Expenses:
Year ended, December 31, 2022
(In thousands)
(Unaudited)
| Successor | Predecessor | |||||||||||||||||||||||||||||||||||
| Year Ended December 31, 2022 | Period from May 18, 2021 through December 31, 2021 | Period from January 1, 2021 through May 17, 2021 | ||||||||||||||||||||||||||||||||||
| Cash | Non-Cash | Total | Cash | Non-Cash | Total | Cash | Non-Cash | Total | ||||||||||||||||||||||||||||
| General and administrative expense (GAAP) | $ | 29,582 | $ | 5,722 | $ | 35,304 | $ | 32,421 | $ | 2,044 | $ | 34,465 | $ | 18,002 | $ | 1,173 | $ | 19,175 | ||||||||||||||||||
| Capitalized general and administrative expense | 17,208 | 2,949 | 20,157 | 9,623 | 1,101 | 10,724 | 7,097 | 922 | 8,019 | |||||||||||||||||||||||||||
| Non-recurring general and administrative expense | (3,152 | ) | — | (3,152 | ) | (18,357 | ) | — | (18,357 | ) | (8,923 | ) | — | (8,923 | ) | |||||||||||||||||||||
| Recurring general and administrative before capitalization (Non-GAAP) | $ | 43,638 | $ | 8,671 | $ | 52,309 | $ | 23,687 | $ | 3,145 | $ | 26,832 | $ | 16,176 | $ | 2,095 | $ | 18,271 | ||||||||||||||||||
Page 23