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 $1,551.7 million for four separate acquisitions of an aggregate of approximately 161,000 net acres in the Company's West Williston and East Nesson project areas. |
(2) | Total E&P capital expenditures include: |
| |
(3) | Non-E&P CapEx include such items as administrative capital and capitalized interest. |
(4) | CapEx (including acquisitions) reflected in the table above differ from the amounts for capital expenditures and acquisition of oil and gas properties shown in the statement of cash flows in the Company's consolidated financial statements because amounts reflected in the table include changes in accrued liabilities from the previous reporting period for capital expenditures, while the amounts presented in the statement of cash flows are presented on a cash basis. In addition, acquisitions reflected in the table include inventory purchased as part of acquisitions, which is included in net cash provided by operating activities in the statement of cash flows in the Company's consolidated financial statements. |
Hedging Activity
As of February 25, 2014, the Company had the following outstanding commodity derivate contracts, all of which are priced off NYMEX West Texas Intermediate crude oil index prices and settle monthly:
Weighted Average Prices ($/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.
