COMSTOCK RESOURCES, INC. REPORTS FIRST QUARTER 2022 FINANCIAL AND OPERATING RESULTS
03 Maio 2022 - 05:15PM
Comstock Resources, Inc. ("Comstock" or the "Company") (NYSE: CRK)
today reported financial and operating results for the quarter
ended March 31, 2022.
Highlights of
2022's First Quarter
- Generated free cash flow from
operations of $68 million in the quarter.
- Paid down $85 million of debt in the
quarter.
- Adjusted EBITDAX increased 27% to $333
million.
- Operating cash flow (excluding working
capital changes) increased 44% to $297 million or $1.07 per diluted
share.
- Revenues, after
realized hedging losses, were $408 million, 23% higher than 2021's
first quarter.
- Adjusted net
income to common stockholders was $136 million for the quarter or
$0.51 per diluted share.
- Strong results
from Haynesville drilling program with 15 (12.0 net) operated wells
turned to sales with an average initial production of 29 MMcf per
day.
Financial Results for the Three Months
Ended March 31, 2022
Revenues in the first quarter of 2022 totaled
$407.7 million (inclusive of realized hedging losses of $117.2
million). Net cash provided by operating activities (excluding
changes in working capital) generated in the first quarter was
$296.5 million, and net loss available to common stockholders for
the first quarter of 2022 was $115.7 million or $(0.50) per share.
Net loss in the quarter included a pre-tax $320.3 million
unrealized loss on hedging contracts held for risk management.
Excluding this item and certain other items, adjusted net income
available to common stockholders for the first quarter of 2022 was
$135.8 million, or $0.51 per diluted share.Comstock's production
cost per Mcfe in the first quarter was $0.69 per Mcfe, which was
comprised of $0.28 for gathering and transportation costs, $0.23
for lease operating costs, $0.12 for production and other taxes and
$0.06 for cash general and administrative expenses. Production cost
was $0.67 per Mcfe in the fourth quarter of 2021 and $0.60 in the
first quarter of 2021. Comstock's unhedged operating margin was 85%
in the first quarter of 2022 and 81% after hedging.
First Quarter 2022 Drilling
Results
Comstock drilled 15 (13.1 net) operated
horizontal Haynesville/Bossier shale wells in the first quarter of
2022 which had an average lateral length of 10,186 feet. The
Company also participated in an additional 14 (0.7 net)
non-operated Haynesville shale wells in the first quarter of 2022.
Comstock turned 33 (15.2 net) wells to sales in the first quarter
of 2022 and currently expects to turn an additional 14 (12.7 net)
wells to sales in the second quarter of 2022.
Since its last operational update in February,
Comstock has turned 15 (12.0 net) new operated Haynesville/Bossier
shale wells to sales. These wells had initial daily production
rates that averaged 29 MMcf per day. The completed lateral length
of these wells averaged 10,115 feet.
Other Matters
Comstock has planned a conference call for 10:00
a.m. Central Time on May 4, 2022, to discuss the first quarter of
2022 operational and financial results. Investors wishing to
participate should visit the Company's website at
www.comstockresources.com for a live webcast or dial 844-776-7840
(international dial-in use 661-378-9538) and provide access code
2547726 when prompted. If you are unable to participate in the
original conference call, a web replay will be available
approximately 24 hours following the completion of the call on
Comstock's website at www.comstockresources.com. The web replay
will be available for approximately one week. A replay of the
conference call will be available beginning at 1:00 p.m. CT on May
4, 2022 and will continue until 1:00 p.m. CT on May 11, 2022. To
hear the replay, call 855-859-2056 (404-537-3406 if calling from
outside the US). The conference call access code is 2547726.
This press release may contain
"forward-looking statements" as that term is defined in the Private
Securities Litigation Reform Act of 1995. Such statements are based
on management's current expectations and are subject to a number of
factors and uncertainties which could cause actual results to
differ materially from those described herein. Although the Company
believes the expectations in such statements to be reasonable,
there can be no assurance that such expectations will prove to be
correct. Information concerning the assumptions, uncertainties and
risks that may affect the actual results can be found in the
Company's filings with the Securities and Exchange Commission
("SEC") available on the Company's website or the SEC's website at
sec.gov.
Comstock Resources, Inc. is a leading
independent natural gas producer with operations focused on the
development of the Haynesville shale in North Louisiana
and East Texas. The Company's stock is traded on the New
York Stock Exchange under the symbol CRK.
COMSTOCK RESOURCES,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except per share amounts)
|
Three Months EndedMarch 31, |
|
|
2022 |
|
|
|
2021 |
|
|
|
Revenues: |
|
|
|
Natural gas sales |
$ |
522,957 |
|
|
$ |
323,960 |
|
Oil sales |
|
1,884 |
|
|
|
16,525 |
|
Total oil and gas sales |
|
524,841 |
|
|
|
340,485 |
|
Operating expenses: |
|
|
|
Production and ad valorem taxes |
|
13,820 |
|
|
|
9,652 |
|
Gathering and transportation |
|
32,093 |
|
|
|
29,458 |
|
Lease operating |
|
26,186 |
|
|
|
24,563 |
|
Exploration |
|
1,021 |
|
|
|
— |
|
Depreciation, depletion and amortization |
|
106,728 |
|
|
|
109,128 |
|
General and administrative |
|
8,223 |
|
|
|
8,028 |
|
Gain on sale of assets |
|
(2 |
) |
|
|
(70 |
) |
Total operating expenses |
|
188,069 |
|
|
|
180,759 |
|
Operating income |
|
336,772 |
|
|
|
159,726 |
|
Other income (expenses): |
|
|
|
Loss from derivative financial instruments |
|
(437,493 |
) |
|
|
(21,749 |
) |
Other income |
|
4,166 |
|
|
|
281 |
|
Interest expense |
|
(46,491 |
) |
|
|
(63,811 |
) |
Loss on early retirement of debt |
|
— |
|
|
|
(238,539 |
) |
Total other expenses |
|
(479,818 |
) |
|
|
(323,818 |
) |
Loss before income taxes |
|
(143,046 |
) |
|
|
(164,092 |
) |
Benefit from income taxes |
|
31,622 |
|
|
|
29,967 |
|
Net loss |
|
(111,424 |
) |
|
|
(134,125 |
) |
Preferred stock dividends |
|
(4,315 |
) |
|
|
(4,315 |
) |
Net loss available to common
stockholders |
$ |
(115,739 |
) |
|
$ |
(138,440 |
) |
|
|
|
|
Net loss per share: |
|
|
|
Basic |
$ |
(0.50 |
) |
|
$ |
(0.60 |
) |
Diluted |
$ |
(0.50 |
) |
|
$ |
(0.60 |
) |
Weighted average shares
outstanding: |
|
|
|
Basic |
|
231,976 |
|
|
|
231,377 |
|
Diluted |
|
231,976 |
|
|
|
231,377 |
|
COMSTOCK RESOURCES,
INC.OPERATING RESULTS(In thousands,
except per unit amounts)
|
Three Months EndedMarch 31, |
|
|
|
|
2021 |
|
|
|
2022 |
|
|
Pro Forma (3) |
|
As Reported |
Gas production (MMcf) |
|
114,906 |
|
|
|
111,804 |
|
|
|
113,293 |
|
Oil production (Mbbls) |
|
21 |
|
|
|
17 |
|
|
|
326 |
|
Total production (MMcfe) |
|
115,035 |
|
|
|
111,908 |
|
|
|
115,246 |
|
|
|
|
|
|
|
Natural gas sales |
$ |
522,957 |
|
|
$ |
322,795 |
|
|
$ |
323,960 |
|
Natural gas hedging
settlements (1) |
|
(117,186 |
) |
|
|
(7,490 |
) |
|
|
(7,490 |
) |
Total natural gas including hedging |
|
405,771 |
|
|
|
315,305 |
|
|
|
316,470 |
|
Oil sales |
|
1,884 |
|
|
|
951 |
|
|
|
16,525 |
|
Oil hedging settlements
(1) |
|
— |
|
|
|
— |
|
|
|
(918 |
) |
Total oil including hedging |
|
1,884 |
|
|
|
951 |
|
|
|
15,607 |
|
Total oil and gas sales including hedging |
$ |
407,655 |
|
|
$ |
316,256 |
|
|
$ |
332,077 |
|
|
|
|
|
|
|
Average gas price (per
Mcf) |
$ |
4.55 |
|
|
$ |
2.89 |
|
|
$ |
2.86 |
|
Average gas price including
hedging (per Mcf) |
$ |
3.53 |
|
|
$ |
2.82 |
|
|
$ |
2.79 |
|
Average oil price (per
barrel) |
$ |
89.71 |
|
|
$ |
55.94 |
|
|
$ |
50.69 |
|
Average oil price including
hedging (per barrel) |
$ |
89.71 |
|
|
$ |
55.94 |
|
|
$ |
47.87 |
|
Average price (per Mcfe) |
$ |
4.56 |
|
|
$ |
2.89 |
|
|
$ |
2.95 |
|
Average price including
hedging (per Mcfe) |
$ |
3.54 |
|
|
$ |
2.83 |
|
|
$ |
2.88 |
|
|
|
|
|
|
|
Production and ad valorem
taxes |
$ |
13,820 |
|
|
$ |
8,048 |
|
|
$ |
9,652 |
|
Gathering and
transportation |
|
32,093 |
|
|
|
29,458 |
|
|
|
29,458 |
|
Lease operating |
|
26,186 |
|
|
|
21,059 |
|
|
|
24,563 |
|
Cash general and
administrative (2) |
|
6,728 |
|
|
|
6,338 |
|
|
|
6,338 |
|
Total production costs |
$ |
78,827 |
|
|
$ |
64,903 |
|
|
$ |
70,011 |
|
|
|
|
|
|
|
Production and ad valorem
taxes (per Mcfe) |
$ |
0.12 |
|
|
$ |
0.07 |
|
|
$ |
0.08 |
|
Gathering and transportation
(per Mcfe) |
|
0.28 |
|
|
|
0.26 |
|
|
|
0.26 |
|
Lease operating (per
Mcfe) |
|
0.23 |
|
|
|
0.19 |
|
|
|
0.21 |
|
Cash general and
administrative (per Mcfe) |
|
0.06 |
|
|
|
0.06 |
|
|
|
0.05 |
|
Total production costs (per Mcfe) |
$ |
0.69 |
|
|
$ |
0.58 |
|
|
$ |
0.60 |
|
|
|
|
|
|
|
Unhedged operating margin |
|
85 |
% |
|
|
80 |
% |
|
|
79 |
% |
Hedged operating margin |
|
81 |
% |
|
|
79 |
% |
|
|
79 |
% |
|
|
|
|
|
|
Oil and Gas Capital
Expenditures: |
|
|
|
|
|
Proved property acquisitions |
$ |
274 |
|
|
$ |
— |
|
|
$ |
— |
|
Unproved property acquisitions |
|
3,631 |
|
|
|
5,776 |
|
|
|
5,776 |
|
Total oil and gas properties acquisitions |
$ |
3,905 |
|
|
$ |
5,776 |
|
|
$ |
5,776 |
|
Exploration and Development: |
|
|
|
|
|
Development leasehold |
$ |
4,632 |
|
|
$ |
4,043 |
|
|
$ |
4,056 |
|
Exploratory drilling and completion |
|
11,557 |
|
|
|
— |
|
|
|
— |
|
Development drilling and completion |
|
189,048 |
|
|
|
155,239 |
|
|
|
155,239 |
|
Other development costs |
|
18,612 |
|
|
|
2,389 |
|
|
|
3,452 |
|
Total exploration and development capital expenditures |
$ |
223,849 |
|
|
$ |
161,671 |
|
|
$ |
162,747 |
|
(1) Included in gain (loss) from derivative
financial instruments in operating
results.(2) Excludes stock-based
compensation.(3) Excludes results of the Company's
Bakken shale assets, which were sold in October 2021.
COMSTOCK RESOURCES,
INC.NON-GAAP FINANCIAL MEASURES(In
thousands, except per share amounts)
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
ADJUSTED NET INCOME
AVAILABLE TO COMMON STOCKHOLDERS: |
|
|
|
Net loss available to common stockholders |
$ |
(115,739 |
) |
|
$ |
(138,440 |
) |
Unrealized loss from derivative financial instruments |
|
320,307 |
|
|
|
13,072 |
|
Non-cash interest amortization from adjusting debt assumed in
acquisition to fair value |
|
2,760 |
|
|
|
4,927 |
|
Exploration expense |
|
1,021 |
|
|
|
— |
|
Gain on sale of assets |
|
(2 |
) |
|
|
(70 |
) |
Loss on early retirement of debt |
|
— |
|
|
|
238,539 |
|
Adjustment to provision for income taxes |
|
(72,589 |
) |
|
|
(54,733 |
) |
Adjusted net income available to common stockholders (1) |
$ |
135,758 |
|
|
$ |
63,295 |
|
|
|
|
|
Adjusted net income available to common stockholders per share
(2) |
$ |
0.51 |
|
|
$ |
0.25 |
|
|
|
|
|
Diluted shares outstanding |
|
277,058 |
|
|
|
275,127 |
|
ADJUSTED
EBITDAX: |
|
|
|
Net loss |
$ |
(111,424 |
) |
|
$ |
(134,125 |
) |
Interest expense (3) |
|
46,491 |
|
|
|
64,080 |
|
Income taxes |
|
(31,622 |
) |
|
|
(29,967 |
) |
Depreciation, depletion, and amortization |
|
106,728 |
|
|
|
109,128 |
|
Exploration |
|
1,021 |
|
|
|
— |
|
Unrealized loss from derivative financial instruments |
|
320,307 |
|
|
|
13,072 |
|
Stock-based compensation |
|
1,495 |
|
|
|
1,690 |
|
Loss on early extinguishment of debt |
|
— |
|
|
|
238,539 |
|
Gain on sale of assets |
|
(2 |
) |
|
|
(70 |
) |
Total Adjusted EBITDAX (4) |
$ |
332,994 |
|
|
$ |
262,347 |
|
(1) Adjusted net income available to common
stockholders is presented because of its acceptance by investors
and by Comstock management as an indicator of the Company's
profitability excluding loss on early retirement of debt, non-cash
unrealized gains and losses on derivative financial instruments,
gains and losses on sales of assets and other unusual items.
(2) Adjusted net income available to common
stockholders per share is calculated to include the dilutive
effects of unvested restricted stock pursuant to the two-class
method and performance stock units and preferred stock pursuant to
the treasury stock method.
(3) Includes realized gains or
losses from interest rate derivative financial instruments.
(4) Adjusted EBITDAX is
presented in the earnings release because management believes that
adjusted EBITDAX, which represents Comstock's results from
operations before interest, income taxes, and certain non-cash
items, including loss on early retirement of debt, depreciation,
depletion and amortization and exploration expense, is a common
alternative measure of operating performance used by certain
investors and financial analysts.
COMSTOCK RESOURCES,
INC.NON-GAAP FINANCIAL MEASURES(In
thousands)
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
OPERATING CASH
FLOW (1): |
|
|
|
Net loss |
$ |
(111,424 |
) |
|
$ |
(134,125 |
) |
Reconciling items: |
|
|
|
Unrealized loss from derivative financial instruments |
|
320,307 |
|
|
|
13,072 |
|
Deferred income tax benefit |
|
(24,788 |
) |
|
|
(30,150 |
) |
Depreciation, depletion and amortization |
|
106,728 |
|
|
|
109,128 |
|
Loss on early retirement of debt |
|
— |
|
|
|
238,539 |
|
Amortization of debt discount and issuance costs |
|
4,225 |
|
|
|
8,489 |
|
Stock-based compensation |
|
1,495 |
|
|
|
1,690 |
|
Gain on sale of assets |
|
(2 |
) |
|
|
(70 |
) |
Operating cash flow |
$ |
296,541 |
|
|
$ |
206,573 |
|
(Increase) decrease in accounts receivable |
|
28,125 |
|
|
|
(7,032 |
) |
Decrease in other current assets |
|
1,406 |
|
|
|
4,778 |
|
Decrease in accounts payable and accrued expenses |
|
(42,033 |
) |
|
|
(11,047 |
) |
Net cash provided by operating activities |
$ |
284,039 |
|
|
$ |
193,272 |
|
|
|
|
|
|
Three Months Ended March 31, |
|
|
2022 |
|
|
|
2021 |
|
FREE CASH
FLOW (2): |
|
|
|
Operating cash flow |
$ |
296,541 |
|
|
$ |
206,573 |
|
Less: |
|
|
|
Exploration and development capital expenditures |
|
(223,849 |
) |
|
|
(162,747 |
) |
Preferred dividends |
|
(4,315 |
) |
|
|
(4,315 |
) |
Free cash flow from operations |
$ |
68,377 |
|
|
$ |
39,511 |
|
Acquisitions of oil and gas properties |
|
(3,905 |
) |
|
|
(5,776 |
) |
Free cash flow after acquisition and divestiture activity |
$ |
64,472 |
|
|
$ |
33,735 |
|
|
|
|
|
(1) Operating cash flow is
presented in the earnings release because management believes it to
be useful to investors as a common alternative measure of cash
flows which excludes changes to other working capital accounts.
(2) Free cash flow from
operations and free cash flow after acquisition and divestiture
activity are presented in the earnings release because management
believes them to be useful indicators of the Company's ability to
internally fund acquisitions and debt maturities after exploration
and development capital expenditures, preferred dividend payments,
proved and unproved property acquisitions and proceeds from
divestiture of oil and gas properties.
COMSTOCK RESOURCES,
INC.CONSOLIDATED BALANCE SHEETS(In
thousands)
|
As of |
|
March 31, 2022 |
|
December 31, 2021 |
ASSETS |
|
|
|
Cash and cash equivalents |
$ |
12,137 |
|
|
$ |
30,663 |
|
Accounts receivable |
|
239,613 |
|
|
|
267,738 |
|
Derivative financial
instruments |
|
2,601 |
|
|
|
5,258 |
|
Other current assets |
|
13,671 |
|
|
|
15,077 |
|
Total current assets |
|
268,022 |
|
|
|
318,736 |
|
Property and equipment,
net |
|
4,128,894 |
|
|
|
4,007,146 |
|
Goodwill |
|
335,897 |
|
|
|
335,897 |
|
Derivative financial
instruments |
|
10,008 |
|
|
|
— |
|
Operating lease right-of-use
assets |
|
6,879 |
|
|
|
6,450 |
|
|
$ |
4,749,700 |
|
|
$ |
4,668,229 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
Accounts payable |
$ |
318,736 |
|
|
$ |
314,569 |
|
Accrued costs |
|
103,322 |
|
|
|
135,026 |
|
Operating leases |
|
2,784 |
|
|
|
2,444 |
|
Derivative financial
instruments |
|
513,645 |
|
|
|
181,945 |
|
Total current liabilities |
|
938,487 |
|
|
|
633,984 |
|
Long-term debt |
|
2,534,460 |
|
|
|
2,615,235 |
|
Deferred income taxes |
|
172,629 |
|
|
|
197,417 |
|
Derivative financial
instruments |
|
— |
|
|
|
4,042 |
|
Long-term operating
leases |
|
4,167 |
|
|
|
4,075 |
|
Asset retirement
obligation |
|
26,416 |
|
|
|
25,673 |
|
Other non-current
liabilities |
|
24 |
|
|
|
24 |
|
Total liabilities |
|
3,676,183 |
|
|
|
3,480,450 |
|
Mezzanine Equity: |
|
|
|
Preferred stock |
|
175,000 |
|
|
|
175,000 |
|
Stockholders' Equity: |
|
|
|
Common stock |
|
116,460 |
|
|
|
116,462 |
|
Additional paid-in capital |
|
1,101,838 |
|
|
|
1,100,359 |
|
Accumulated deficit |
|
(319,781 |
) |
|
|
(204,042 |
) |
Total stockholders' equity |
|
898,517 |
|
|
|
1,012,779 |
|
|
$ |
4,749,700 |
|
|
$ |
4,668,229 |
|
Ron Mills
VP - Finance and Investor Relations
Comstock Resources
972-668-8834
rmills@comstockresources.com
Comstock Resources (NYSE:CRK)
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