Unit Corporation Reports First Quarter Results

May 09, 2024 at 09:15 AM EDT

On May 9, 2024, Unit Corporation (OTCQX: UNTC) (Company) filed unaudited condensed consolidated financial statements for the three months ended March 31, 2024 with OTC Markets Group Inc. (OTC). The Company’s current, quarterly, and annual reports may be accessed on the OTC’s website at https://www.otcmarkets.com/stock/UNTC/disclosure, as well as the Company’s website at https://unitcorp.com/investor-relations/otc-sec-filings/.

First Quarter Results

Net income for the three months ended March 31, 2024 was $16.1 million, or $1.61 per diluted share, compared to $134.7 million, or $13.75 per diluted share, for the three months ended March 31, 2023. Total revenues for the three months ended March 31, 2024 were $67.2 million, compared to $93.9 million for the three months ended March 31, 2023.

“After completing the previously announced sale of certain non-core oil and gas assets in the Texas Panhandle, we are pleased to be focused on developing and optimizing production in our core properties,” said Phil Frohlich, Chief Executive Officer. “In addition, we continue to work diligently towards a cost structure that remains appropriate for our core assets while ensuring that we have the resources available to maximize value.”

Operational highlights for the oil and natural gas and contract drilling segments during the three months ended March 31, 2024 and 2023 include:

	Three Months Ended March 31,
	2024	2023	% Change
Oil and Natural Gas:
Avg. oil price ($/Bbl)	$75.28	$65.96	14%
Avg. oil price excl. derivatives ($/Bbl)	$75.28	$73.94	2%
Avg. NGLs price ($/Bbl)	$20.74	$21.37	(3)%
Avg. NGLs price excl. derivatives ($/Bbl)	$20.74	$21.37	(3)%
Avg. natural gas price ($/Mcf)	$1.79	$4.04	(56)%
Avg. natural gas price excl. derivatives ($/Mcf)	$1.79	$3.11	(42)%
Oil production (MBbls)	187	300	(38)%
NGL production (MBbls)	298	419	(29)%
Natural gas production (MMcf)	3,501	5,369	(35)%
Total production (MBOE)	1,069	1,614	(34)%

Contract Drilling:
BOSS rigs available (end of the period)	14	14	—%
Average BOSS rigs in use	13.7	13.8	(1)%
BOSS rigs average dayrate ($/day)	$30,891	$30,845	—%

Common Stock Dividends

The table below presents information about the dividends paid during the periods indicated:

	Type	Dividend per share		Total Amount		Record Date	Payment Date
*2023*				(In thousands)
First quarter	Special	$	10.00	$	96,179	January 20, 2023	January 31, 2023
*2024*
First quarter	Quarterly	$	1.25	$	12,269	March 18, 2024	March 28, 2024

The declaration and payment of any future dividend, whether fixed, special, or variable, will remain at the full discretion of the Company’s Board of Directors and will depend upon the Company’s financial position, results of operations, cash flows, capital requirements, business conditions, future expectations, the requirements of applicable law, and other factors that the Company’s Board of Directors finds relevant at the time of considering any potential dividend declaration. Future dividends are expected to be funded by cash on the Company's balance sheet.

The Company recently posted its preliminary 2024 Form 8937 (Report of Organizational Actions Affecting Basis of Securities) which can be found on its website at https://unitcorp.com/investor-relations/tax-reporting/.

About Unit Corporation

Unit Corporation is a Tulsa-based, publicly held energy company engaged through its wholly-owned subsidiaries in oil and gas production and contract drilling. For more information about Unit Corporation, visit its website at http://www.unitcorp.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. All statements, other than statements of historical facts, included in this release that address activities, events, or developments that the Company expects, believes, or anticipates will or may occur are forward-looking statements. Several risks and uncertainties could cause actual results to differ materially from these statements, including changes in commodity prices, the productive capabilities of the Company’s wells, future demand for oil and natural gas, future drilling rig utilization and dayrates, projected rate of the Company’s oil and natural gas production, the amount available to the Company for borrowings, its anticipated borrowing needs under its credit agreements, the number of wells to be drilled by the Company’s oil and natural gas segment, the potential productive capability of its prospective plays, and other factors described occasionally in the Company’s publicly available OTC and SEC reports. The Company assumes no obligation to update publicly such forward-looking statements, whether because of new information, future events, or otherwise.

Unit Corporation
Selected Financial Highlights

	Three Months Ended March 31,
		2024			2023
	(In thousands except per share amounts)
Revenues:
Oil and natural gas	$	26,572		$	48,026
Contract drilling		40,632			45,903
Total revenues		67,204			93,929
Expenses:
Operating costs:
Oil and natural gas		11,979			17,164
Contract drilling		25,725			26,872
Total operating costs		37,704			44,036
Depreciation, depletion, and amortization		3,901			3,891
General and administrative		4,978			5,090
(Gain) loss on disposition of assets		65			(3,753	)
Total operating expenses		46,648			49,264
Income from operations		20,556			44,665
Other income (expense):
Interest income		954			1,757
Interest expense		(30	)		(39	)
Gain (loss) on derivatives, net		—			13,595
Reorganization items, net		(22	)		(81	)
Other, net		(377	)		107
Total other income (expense)		525			15,339
Income before income taxes		21,081			60,004
Income tax expense (benefit), net:
Current		75			190
Deferred		4,902			(74,836	)
Total income tax expense (benefit), net		4,977			(74,646	)
Net income		16,104			134,650
Net income per common share:
Basic	$	1.64		$	13.93
Diluted	$	1.61		$	13.75

Unit Corporation Selected Financial Highlights - Continued

	March 31, 2024		December 31, 2023
Balance Sheet Data:	(In thousands)
Cash and cash equivalents	$	65,599	$	60,779
Current assets	$	115,528	$	118,296
Total assets	$	314,383	$	322,720
Current liabilities	$	30,021	$	42,399
Long-term debt	$	—	$	—
Other long-term liabilities	$	22,796	$	22,803
Total shareholders’ equity	$	258,360	$	254,126