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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2022
OR
TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF SECURITIES EXCHANGE ACT OF 1934
For the transition period from                    to                                    
Commission File Number 001-19514
Gulfport Energy Corporation
(Exact Name of Registrant As Specified in Its Charter)
Delaware86-3684669
(State or Other Jurisdiction of Incorporation or Organization)(IRS Employer Identification Number)
713 Market Drive
Oklahoma City,Oklahoma73114
(Address of Principal Executive Offices)(Zip Code)
(405) 252-4600
(Registrant Telephone Number, Including Area Code)
3001 Quail Springs Parkway
Oklahoma City, Oklahoma 73114
(Former Address)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, $0.0001 par value per shareGPORThe New York Stock Exchange
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
    Yes  ý     No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (Section 232.405 of this chapter) during the preceding 12 months (or such shorter period that the registrant was required to submit such files).     Yes  ý    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large Accelerated filer   ý     Accelerated filer   ¨       Non-accelerated filer  ¨   
Smaller reporting company   Emerging growth company  
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  ý
Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by a court.
 Yes  ý    No  ¨
As of July 28, 2022, 19,693,894 shares of the registrant’s common stock were outstanding.


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GULFPORT ENERGY CORPORATION
TABLE OF CONTENTS
 
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DEFINITIONS
Unless the context otherwise indicates, references to “us,” “we,” “our,” “ours,” “Gulfport,” the “Company” and “Registrant” refer to Gulfport Energy Corporation and its consolidated subsidiaries. All monetary values, other than per unit and per share amounts, are stated in thousands of U.S. dollars unless otherwise specified. In addition, the following are other abbreviations and definitions of certain terms used within this Quarterly Report on Form 10-Q:
1145 Indenture. Agreement dated May 17, 2021 between the Company, UMB Bank, National Association, as trustee, and the guarantors party thereto, under section 1145 of the Bankruptcy Code for our 8.000% Senior Notes due 2026.
2026 Senior Notes. 8.000% Senior Notes due 2026.
4(a)(2) Indenture. Certain eligible holders have made an election entitling such holders to receive senior notes issued pursuant to an indenture, dated as of May 17, 2021, by and among the Company, UMB Bank, National Association, as trustee, and the guarantors party thereto, under Section 4(a)(2) of the Securities Act of 1933, as amended (the “Securities Act”) as opposed to its share of the up to $550 million aggregate principal amount of our Senior Notes due 2026. The 4(a)(2) Indenture’s terms are substantially similar to the terms of the 1145 Indenture. The primary differences between the terms of the 4(a)(2) Indenture and the terms of the 1145 Indenture are that (i) affiliates of the Issuer holding 4(a)(2) Notes are permitted to vote in determining whether the holders of the required principal amount of indenture securities have concurred in any direction or consent under the 4(a)(2) Indenture, while affiliates of the Issuer holding 1145 Notes will not be permitted to vote on such matters under the 1145 Indenture, (ii) the covenants of the 1145 Indenture (other than the payment covenant) require that the Issuer comply with the covenants of the 4(a)(2) Indenture, as amended, and (iii) the 1145 Indenture requires that the 1145 Securities be redeemed pro rata with the 4(a)(2) Securities and that the 1145 Indenture be satisfied and discharged if the 4(a)(2) Indenture is satisfied and discharged.
ASC. Accounting Standards Codification.
Bankruptcy Code. Chapter 11 of Title 11 of the United States Code.
Bbl. One stock tank barrel, or 42 U.S. gallons liquid volume, used herein in reference to crude oil or other liquid hydrocarbons.
Btu. British thermal unit, which represents the amount of energy needed to heat one pound of water by one degree Fahrenheit and can be used to describe the energy content of fuels.
Chapter 11 Cases. Voluntary petitions filed on November 13, 2020 by Gulfport Energy Corporation, Gator Marine, Inc., Gator Marine Ivanhoe, Inc., Grizzly Holdings, Inc., Gulfport Appalachia, LLC, Gulfport Midcon, LLC, Gulfport Midstream Holdings, LLC, Jaguar Resources LLC, Mule Sky LLC, Puma Resources, Inc. and Westhawk Minerals LLC.
CODI. Cancellation of indebtedness income.
Completion. The process of treating a drilled well followed by the installation of permanent equipment for the production of natural gas, oil and NGL.
Credit Facility. The Third Amended and Restated Credit Agreement with JPMorgan Chase Bank, N.A. as administrative agent and various lender parties, providing for a new money senior secured reserve-based revolving credit facility effective as of October 14, 2021.
Current Successor Quarter. Period from April 1, 2022 through June 30, 2022.
Current Successor YTD Period. Period from January 1, 2022 through June 30, 2022.
DD&A. Depreciation, depletion and amortization.
Disputed Claims Reserve. Reserve used to settle any pending claims of unsecured creditors that were in dispute as of the effective date of the Plan.
Emergence Date. May 17, 2021.
GAAP. Accounting principles generally accepted in the United States of America.
Gross Acres or Gross Wells. Refers to the total acres or wells in which a working interest is owned.
Guarantors. All existing consolidated subsidiaries that guarantee the Company's revolving credit facility or certain other debt.
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Incentive Plan. Gulfport Energy Corporation Stock Incentive Plan effective on the Emergence Date.
Indentures. Collectively, the 1145 Indenture and the 4(a)(2) Indenture governing the 2026 Senior Notes.
IRC. The Internal Revenue Code of 1986, as amended.
LIBOR. London Interbank Offered Rate.
LOE. Lease operating expenses.
MBbl. One thousand barrels of crude oil, condensate or natural gas liquids.
Mcf. One thousand cubic feet of natural gas.
Mcfe. One thousand cubic feet of natural gas equivalent.
MMBtu. One million British thermal units.
MMcf. One million cubic feet of natural gas.
MMcfe. One million cubic feet of natural gas equivalent.
Natural Gas Liquids (NGL). Hydrocarbons in natural gas that are separated from the gas as liquids through the process of absorption, condensation, adsorption or other methods in gas processing or cycling plants. Natural gas liquids primarily include ethane, propane, butane, isobutene, pentane, hexane and natural gasoline.
NYMEX. New York Mercantile Exchange.
Plan. The Amended Joint Chapter 11 Plan of Reorganization of Gulfport Energy Corporation and Its Debtor Subsidiaries.
Prior Combined Quarter. Period from April 1, 2021 through June 30, 2021.
Prior Combined YTD Period. Period from January 1, 2021 through June 30, 2021.
Prior Predecessor Quarter. Period from April 1, 2021 through May 17, 2021.
Prior Predecessor YTD Period. Period from January 1, 2021 through May 17, 2021.
Prior Successor Period. Period from May 18, 2021 through June 30, 2021.
Repurchase Program. A stock repurchase program to acquire up to $200 million of Gulfport's outstanding common stock. It is authorized to extend through December 31, 2022, and may be suspended from time to time, modified, extended or discontinued by the board of directors at any time.
SCOOP. Refers to the South Central Oklahoma Oil Province, a term used to describe a defined area that encompasses many of the top hydrocarbon producing counties in Oklahoma within the Anadarko basin. The SCOOP play mainly targets the Devonian to Mississippian aged Woodford, Sycamore and Springer formations. Our acreage is primarily in Garvin, Grady and Stephens Counties.
SEC. The United States Securities and Exchange Commission.
Section 382. Internal Revenue Code Section 382.
SOFR. Secured Overnight Financing Rate.
Utica. Refers to the Utica Play that includes the hydrocarbon bearing rock formations commonly referred to as the Utica formation located in the Appalachian Basin of the United States and Canada. Our acreage is located primarily in Belmont, Harrison, Jefferson and Monroe Counties in eastern Ohio.
Working Interest (WI). The operating interest which gives the owner the right to drill, produce and conduct operating activities on the property and a share of production.
WTI. Refers to West Texas Intermediate.
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Cautionary Note Regarding Forward-Looking Statements
This Form 10-Q may include forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. These statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. In some cases, you can identify forward looking statements by terms such as “may,” “will,” “should,” “could,” “would,” “expects,” “plans,” “anticipates,” “intends,” “believes,” “estimates,” “projects,” “predicts,” “potential” and similar expressions intended to identify forward-looking statements. All statements, other than statements of historical facts, included in this Form 10-Q that address activities, events or developments that we expect or anticipate will or may occur in the future, including the expected impact of the novel coronavirus disease (COVID-19) pandemic and the war in Ukraine on our business, our industry and the global economy, estimated future net revenues from oil and gas reserves and the present value thereof, future capital expenditures (including the amount and nature thereof), share repurchases, business strategy and measures to implement strategy, competitive strength, goals, expansion and growth of our business and operations, plans, references to future success, reference to intentions as to future matters and other such matters are forward-looking statements.
These forward-looking statements are largely based on our expectations and beliefs concerning future events, which reflect estimates and assumptions made by our management. These estimates and assumptions reflect our best judgment based on currently known market conditions and other factors relating to our operations and business environment, all of which are difficult to predict and many of which are beyond our control.
Although we believe our estimates and assumptions to be reasonable, they are inherently uncertain and involve a number of risks and uncertainties that are beyond our control. In addition, management's assumptions about future events may prove to be inaccurate. Management cautions all readers that the forward-looking statements contained in this Form 10-Q are not guarantees of future performance, and we cannot assure any reader that those statements will be realized or the forward-looking events and circumstances will occur. Actual results may differ materially from those anticipated or implied in the forward-looking statements due to the factors listed in Item 1A. “Risk Factors” and Item 7. “Management's Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2021 and elsewhere in this Form 10-Q. All forward-looking statements speak only as of the date of this Form 10-Q.
All forward-looking statements, expressed or implied, included in this Quarterly Report are expressly qualified in their entirety by this cautionary statement. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that we or persons acting on our behalf may issue.
Except as otherwise required by applicable law, we disclaim any duty to update any forward-looking statements, all of which are expressly qualified by the statements in this section, to reflect events or circumstances after the date of this Quarterly Report.
We may use the Investors section of our website (www.gulfportenergy.com) to communicate with investors. It is possible that the financial and other information posted there could be deemed to be material information. The information on our website is not part of this Quarterly Report on Form 10-Q.


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GULFPORT ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS
(In thousands)
Successor
June 30, 2022December 31, 2021
Assets(Unaudited)
Current assets:
Cash and cash equivalents$6,581 $3,260 
Accounts receivable—oil and natural gas sales316,897 232,854 
Accounts receivable—joint interest and other24,494 20,383 
Prepaid expenses and other current assets9,249 12,359 
Short-term derivative instruments24,487 4,695 
Total current assets381,708 273,551 
Property and equipment:
Oil and natural gas properties, full-cost method
Proved oil and natural gas properties2,145,712 1,917,833 
Unproved properties198,229 211,007 
Other property and equipment5,673 5,329 
Total property and equipment2,349,614 2,134,169 
Less: accumulated depletion, depreciation and amortization(403,065)(278,341)
Total property and equipment, net1,946,549 1,855,828 
Other assets:
Long-term derivative instruments26,394 18,664 
Operating lease assets225 322 
Other assets19,785 19,867 
Total other assets46,404 38,853 
Total assets$2,374,661 $2,168,232 
Liabilities, Mezzanine Equity and Stockholders’ Equity
Current liabilities:
Accounts payable and accrued liabilities$453,088 $394,011 
Short-term derivative instruments674,404 240,735 
Current portion of operating lease liabilities164 182 
Total current liabilities1,127,656 634,928 
Non-current liabilities:
Long-term derivative instruments306,389 184,580 
Asset retirement obligation29,663 28,264 
Non-current operating lease liabilities60 140 
Long-term debt673,048 712,946 
Total non-current liabilities1,009,160 925,930 
Total liabilities$2,136,816 $1,560,858 
Commitments and contingencies (Note 7)
Mezzanine Equity:
Preferred stock - $0.0001 par value, 110.0 thousand shares authorized, 53.2 thousand issued and outstanding at June 30, 2022, and 57.9 thousand issued and outstanding at December 31, 2021
53,172 57,896 
Stockholders’ Equity:
Common stock - $0.0001 par value, 42.0 million shares authorized, 20.1 million issued and outstanding at June 30, 2022, and 20.6 million issued and outstanding at December 31, 2021
2 2 
Additional paid-in capital542,700 692,521 
Common stock held in reserve, 62 thousand shares at June 30, 2022, and 938 thousand shares at December 31, 2021
(1,996)(30,216)
Accumulated deficit(348,224)(112,829)
Treasury stock, at cost - 94.3 thousand at June 30, 2022, and no shares at December 31, 2021
(7,809) 
Total stockholders’ equity $184,673 $549,478 
Total liabilities, mezzanine equity and stockholders’ equity $2,374,661 $2,168,232 

See accompanying notes to consolidated financial statements.
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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
(Unaudited) 
SuccessorPredecessor
Three Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from April 1, 2021 through May 17, 2021
REVENUES:
Natural gas sales$539,090 $111,718 $109,069 
Oil and condensate sales45,009 17,587 10,867 
Natural gas liquid sales54,106 16,077 13,004 
Net loss on natural gas, oil and NGL derivatives(172,871)(139,658)(107,261)
Total revenues465,334 5,724 25,679 
OPERATING EXPENSES:
Lease operating expenses14,239 4,116 6,871 
Taxes other than income16,682 5,056 3,645 
Transportation, gathering, processing and compression87,752 41,376 55,219 
Depreciation, depletion and amortization62,602 32,362 21,617 
Impairment of oil and natural gas properties 117,813  
General and administrative expenses8,271 6,518 6,418 
Accretion expense692 226 424 
Total operating expenses190,238 207,467 94,194 
INCOME (LOSS) FROM OPERATIONS275,096 (201,743)(68,515)
OTHER EXPENSE (INCOME):
Interest expense14,234 8,894 898 
Reorganization items, net  (305,619)
Other, net4,282 (1,051)1,960 
Total other expense (income)18,516 7,843 (302,761)
INCOME (LOSS) BEFORE INCOME TAXES256,580 (209,586)234,246 
Income tax benefit  (7,968)
NET INCOME (LOSS)$256,580 $(209,586)$242,214 
Dividends on preferred stock$(1,380)$(1,031)$ 
Participating securities - preferred stock$(39,590)$ $ 
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON STOCKHOLDERS$215,610 $(210,617)$242,214 
NET INCOME (LOSS) PER COMMON SHARE:
Basic$10.42 $(10.36)$1.51 
Diluted$10.34 $(10.36)$1.51 
Weighted average common shares outstanding—Basic20,684 20,321 $160,887 
Weighted average common shares outstanding—Diluted20,877 20,321 160,887 
 
See accompanying notes to consolidated financial statements.
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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
(Unaudited) 
SuccessorPredecessor
Six Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from January 1, 2021 through May 17, 2021
REVENUES:
Natural gas sales$944,302 $111,718 $344,390 
Oil and condensate sales75,248 17,587 29,106 
Natural gas liquid sales99,390 16,077 36,780 
Net loss on natural gas, oil and NGL derivatives(961,422)(139,658)(137,239)
Total revenues157,518 5,724 273,037 
OPERATING EXPENSES:
Lease operating expenses31,883 4,116 19,524 
Taxes other than income29,150 5,056 12,349 
Transportation, gathering, processing and compression172,544 41,376 161,086 
Depreciation, depletion and amortization124,886 32,362 62,764 
Impairment of oil and natural gas properties 117,813  
Impairment of other property and equipment  14,568 
General and administrative expenses15,376 6,518 19,175 
Accretion expense1,384 226 1,229 
Total operating expenses375,223 207,467 290,695 
LOSS FROM OPERATIONS(217,705)(201,743)(17,658)
OTHER EXPENSE (INCOME):
Interest expense28,218 8,894 4,159 
Loss from equity method investments, net  342 
Reorganization items, net  (266,898)
Other, net(10,528)(1,051)1,713 
Total other expense (income)17,690 7,843 (260,684)
(LOSS) INCOME BEFORE INCOME TAXES(235,395)(209,586)243,026 
Income tax benefit  (7,968)
NET (LOSS) INCOME$(235,395)$(209,586)$250,994 
Dividends on preferred stock$(2,828)$(1,031)$ 
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS$(238,223)$(210,617)$250,994 
NET (LOSS) INCOME PER COMMON SHARE:
Basic$(11.36)$(10.36)$1.56 
Diluted$(11.36)$(10.36)$1.56 
Weighted average common shares outstanding—Basic20,961 20,321 160,834 
Weighted average common shares outstanding—Diluted20,961 20,321 160,834 

 See accompanying notes to consolidated financial statements.
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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(In thousands)
(Unaudited)

SuccessorPredecessor
Three Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from April 1, 2021 through May 17, 2021
Net income (loss)$256,580 $(209,586)$242,214 
Other comprehensive income   
Comprehensive income (loss)$256,580 $(209,586)$242,214 
SuccessorPredecessor
Six Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from January 1, 2021 through May 17, 2021
Net (loss) income$(235,395)$(209,586)$250,994 
Foreign currency translation adjustment  2,570 
Other comprehensive income  2,570 
Comprehensive (loss) income$(235,395)$(209,586)$253,564 
See accompanying notes to consolidated financial statements.

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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT)
(In thousands)
(Unaudited)
Common Stock Held in ReserveTreasury StockPaid-in
Capital
Accumulated Other
Comprehensive (Loss) Income
Retained Earnings (Accumulated
Deficit)
Total Stockholders’
Equity (Deficit)
Common Stock
SharesAmountSharesAmount
Balance at January 1, 2021 (Predecessor)160,762 $1,607  $ $ $4,213,752 $(43,000)$(4,472,859)$(300,500)
Net income— — — — — — — 8,780 8,780 
Other comprehensive income— — — — — — 2,570 — 2,570 
Stock compensation— — — — — 1,419 — — 1,419 
Shares repurchased(86)(1)— — — (7)— — (8)
Issuance of restricted stock203 3 — — — (2)— — 1 
Balance at March 31, 2021 (Predecessor)160,879 $1,609  $ $ $4,215,162 $(40,430)$(4,464,079)$(287,738)
Net income— — — — — — — 242,214 242,214 
Issuance of restricted stock25 — — — — — — — — 
Shares repurchased(10)— — — — — — — — 
Stock compensation— — — — — 5,095 — — 5,095 
Accumulated other comprehensive income extinguishment— — — — — — 40,430 — 40,430 
Cancellation of predecessor equity(160,894)(1,609)— — — (4,220,256)— 4,221,865  
Issuance of common stock21,525 2 — — — 693,773 — — 693,775 
Shares of common stock held in reserve— — (1,679)(54,109)— — — — (54,109)
Balance at May 17, 2021 (Predecessor)21,525 $2 (1,679)$(54,109)$ $693,774 $ $ $639,667 
Balance at May 18, 2021 (Successor)21,525 $2 (1,679)$(54,109)$ $693,774 $ $ $639,667 
Net loss— — — — — — — (209,586)(209,586)
Release of common stock held in reserve— — 741 23,893 — — — — 23,893 
Conversion of preferred stock10 — — — — 147 — — 147 
Dividends on preferred stock— — — — — (1,031)— — (1,031)
Balance at June 30, 2021 (Successor)21,535 $2 (938)$(30,216)$ $692,890 $ $(209,586)$453,090 


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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY (DEFICIT) CONTINUED
(In thousands)
(Unaudited)
Common Stock Held in ReserveTreasury StockPaid-in
Capital
Accumulated Other
Comprehensive (Loss) Income
Retained Earnings (Accumulated
Deficit)
Total Stockholders’
Equity (Deficit)
Common Stock
SharesAmountSharesAmount
Balance at January 1, 2022 (Successor)21,537 $2 (938)$(30,216)$ $692,521 $ $(112,829)$549,478 
Net loss— — — — — — — (491,975)(491,975)
Conversion of preferred stock1 — — — — 18 — — 18 
Stock compensation— — — — — 1,755 — — 1,755 
Repurchase of common stock under Repurchase Program(378)— — — (5,318)(30,194)— — (35,512)
Issuance of common stock held in reserve— — 876 28,220 — — — — 28,220 
Issuance of restricted stock, net of shares withheld for income taxes2 — — — — (80)— — (80)
Dividends on preferred stock— — — — — (1,447)— — (1,447)
Balance at March 31, 2022 (Successor)21,162 $2 (62)$(1,996)$(5,318)$662,573 $ $(604,804)$50,457 
Net income— — — — — — — 256,580 256,580 
Conversion of preferred stock342 — — — — 4,706 — — 4,706 
Stock compensation— — — — — 2,145 — — 2,145 
Issuance of restricted stock, net of shares withheld for income taxes8 — — — — (325)— — (325)
Repurchase of common stock under Repurchase Program(1,382)— — — (2,491)(125,019)— — (127,510)
Dividends on preferred stock— — — — — (1,380)— — (1,380)
Balance at June 30, 2022 (Successor)20,130 $2 (62)$(1,996)$(7,809)$542,700 $ $(348,224)$184,673 

 See accompanying notes to consolidated financial statements.

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GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)

SuccessorPredecessor
Six Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from January 1, 2021 through May 17, 2021
Cash flows from operating activities:
Net (loss) income$(235,395)$(209,586)$250,994 
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depletion, depreciation and amortization124,886 32,362 62,764 
Impairment of oil and natural gas properties 117,813  
Impairment of other property and equipment  14,568 
Loss from equity investments  342 
Net loss on derivative instruments961,422 139,658 137,239 
Net cash payments on settled derivative instruments(433,466)(6,689)(3,361)
Non-cash reorganization items, net  (446,012)
Other, net5,071 (397)1,727 
Changes in operating assets and liabilities, net(39,318)(34,796)153,894 
Net cash provided by operating activities383,200 38,365 172,155 
Cash flows from investing activities:
Additions to oil and natural gas properties(181,787)(40,424)(102,330)
Proceeds from sale of oil and natural gas properties580 225 15 
Other, net(58)(77)4,484 
Net cash used in investing activities(181,265)(40,276)(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 
Principal payments on Credit Facility(836,000)  
Borrowings on Credit Facility796,000   
Borrowings on exit credit facility 113,249 302,751 
Principal payments on exit credit facility (131,000) 
Principal payments on DIP credit facility  (157,500)
Debt issuance costs and loan commitment fees(169)(1,206)(7,100)
Dividends on preferred stock(2,828)  
Proceeds from issuance of preferred stock  50,000 
Repurchase of common stock under Repurchase Program(155,212)  
Other, net(405)(25)(8)
Net cash used in financing activities(198,614)(18,982)(104,768)
Net increase (decrease) in cash, cash equivalents and restricted cash3,321 (20,893)(30,444)
Cash, cash equivalents and restricted cash at beginning of period3,260 59,417 89,861 
Cash, cash equivalents and restricted cash at end of period$6,581 $38,524 $59,417 
 
See accompanying notes to consolidated financial statements.
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GULFPORT ENERGY CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1.BASIS OF PRESENTATION
Description of Company
Gulfport Energy Corporation (the "Company" or "Gulfport") is an independent natural gas-weighted exploration and production company focused on the production of natural gas, crude oil and NGL in the United States. The Company's principal properties are located in eastern Ohio targeting the Utica and in central Oklahoma targeting the SCOOP Woodford and SCOOP Springer formations. Gulfport filed for voluntary reorganization under Chapter 11 of the Bankruptcy Code on November 13, 2020, and subsequently operated as a debtor-in-possession, in accordance with applicable provisions of the Bankruptcy Code, until its emergence on May 17, 2021. The Company refers to the post-emergence reorganized organization in the condensed financial statements and footnotes as the "Successor" for periods subsequent to May 17, 2021, and the pre-emergence organization as "Predecessor" for periods on or prior to May 17, 2021.
Basis of Presentation
The accompanying unaudited condensed consolidated financial statements of Gulfport were prepared in accordance with GAAP and the rules and regulations of the SEC.
This Quarterly Report on Form 10-Q (this “Form 10-Q”) relates to the financial position and periods as of and for the three months ended June 30, 2022 ("Current Successor Quarter"), as of and for the six months ended June 30, 2022 ("Current Successor YTD Period"), May 18, 2021 through June 30, 2021 (“Prior Successor Period”), April 1, 2021 through May 17, 2021 ("Prior Predecessor Quarter"), and January 1, 2021 through May 17, 2021 (“Prior Predecessor YTD Period”). The Company's annual report on Form 10-K for the year ended December 31, 2021 (“2021 Form 10-K”) should be read in conjunction with this Form 10-Q. The accompanying unaudited consolidated financial statements reflect all normal recurring adjustments which, in the opinion of management, are necessary for a fair statement of our condensed consolidated financial statements and accompanying notes and include the accounts of our wholly-owned subsidiaries. Intercompany accounts and balances have been eliminated. The accompanying consolidated financial statements have been prepared assuming the Company will continue as a going concern.
Voluntary Reorganization Under Chapter 11 of the Bankruptcy Code
In connection with the Company's emergence from bankruptcy and in accordance with ASC 852, the Company qualified for and applied fresh start accounting on the Emergence date. For further information on the Company’s reorganization value and the resulting fresh start adjustments made on the Emergence Date, refer to the “Fresh Start Accounting” footnote in the notes to the consolidated financial statements in Item 8 of the Company’s 2021 Form 10-K.
Accounts Payable and Accrued Liabilities
Accounts payable and accrued liabilities consisted of the following at June 30, 2022 and December 31, 2021 (in thousands):
Successor
June 30, 2022December 31, 2021
Accounts payable and other accrued liabilities$195,202 $143,938 
Revenue payable and suspense216,890 180,857 
Accrued contract rejection damages and shares held in reserve40,996 69,216 
Total accounts payable and accrued liabilities$453,088 $394,011 
Reorganization Items, Net
In the Prior Predecessor Quarter and Prior Predecessor YTD period, the Company incurred significant expenses related to its Chapter 11 filing. The amount of these items, which were incurred in reorganization items, net within the Company's
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accompanying consolidated statements of operations, significantly affected the Company's statements of operations. The Company also incurred adjustments for allowable claims related to its legal proceedings and executory contracts approved for rejection by the Bankruptcy Court.
The following table summarizes the components in reorganization items, net included in the Company's consolidated statements of operations for the Current Successor YTD Period, Prior Successor Period, Prior Predecessor Quarter, and Prior Predecessor YTD Period (in thousands):
SuccessorPredecessor
Six Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from April 1, 2021 through May 17, 2021Period from January 1, 2021 through May 17, 2021
Legal and professional advisory fees$ $ $(40,782)$(81,565)
Net gain on liabilities subject to compromise  571,032 575,182 
Fresh start adjustments, net  (160,756)(160,756)
Elimination of predecessor accumulated other comprehensive income  (40,430)(40,430)
Debt issuance costs  (3,150)(3,150)
Other items, net  (20,295)(22,383)
Reorganization items, net$ $ $305,619 $266,898 
Other, net
Other, net included in the Company's consolidated statements of operations for the Current Successor YTD period included $11.5 million related to the TC claim distribution received as discussed in Note 7.
Supplemental Cash Flow and Non-Cash Information (in thousands)
SuccessorPredecessor
Six Months Ended June 30, 2022Period from May 18, 2021 through June 30, 2021Period from January 1, 2021 through May 17, 2021
Supplemental disclosure of cash flow information:
Cash paid for reorganization items, net$ $15,369 $87,199 
Interest payments$26,386 $