Capital expenditures totaled $27.9 million in the quarter, of which a majority was spent on drilling and completion costs, versus $16.9 million in the prior year period, of which a majority was also spent on drilling and completion costs. The Company conducted drilling and completion operations on 12 gross (4.5 net) wells in the quarter and added 4 gross (2.2 net) wells to production. The Company had 8 gross (2.3 net) wells in the drilling or completion process at the end of the quarter.
BALANCE SHEET
The Company exited the quarter with $5.5 million of cash, $90.4 million outstanding under the Company's credit facility, and total principal debt outstanding, including the credit facility and second lien notes, of $122.9 million.
CRUDE OIL AND NATURAL GAS DERIVATIVES
The Company had a loss of $77.4 million on its derivatives not designated as hedges in the quarter, which was comprised of a loss of $12.5 million on cash settlements and a $64.9 million loss representing the change of the fair value of our open natural gas and oil derivative contracts. The Company had a loss of $11.1 million on its derivatives not designated as hedges in the prior year period, which was comprised of a $12.7 million loss representing the change of the fair value of our open natural gas and oil derivative contracts, offset by a gain of $1.6 million on cash settlements.
OTHER INFORMATION
Certain statements in this news release regarding future expectations and plans for future activities may be regarded as "forward looking statements" within the meaning of the Securities Litigation Reform Act. They are subject to various risks, such as financial market conditions, changes in commodities prices and costs of drilling and completion, operating hazards, drilling risks, and the inherent uncertainties in interpreting engineering data relating to underground accumulations of oil and gas, as well as other risks discussed in detail in the Company's Annual Report on Form 10-K for the year ended December 31, 2020 and other subsequent filings with the Securities and Exchange Commission. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.
Unless otherwise stated, oil production volumes include condensate.
NON-US GAAP INFORMATION
In this press release, the Company refers to several non-US GAAP financial measures, including Adjusted EBITDA, DCF, Return on Invested Capital ("ROIC"), cash margin, oil and natural gas revenues adjusted for cash settled derivatives, adjusted net income, adjusted operating income (loss), G&A expense payable in cash and interest payable in cash. Management believes Adjusted EBITDA, DCF and ROIC are good financial indicators of the Company's performance and ability to internally generate operating funds. Adjusted EBITDA and adjusted net income should not be considered an alternative to net income (loss) applicable to common stock, as defined by US GAAP. DCF should not be considered an alternative to net cash provided by operating activities, as defined by US GAAP. Oil and natural gas revenues adjusted for cash settled derivatives should not be considered an alternative for oil and natural gas revenues, as defined by US GAAP. Adjusted operating income (loss) should not be considered an alternative to operating income (loss), as defined by US GAAP. G&A expense payable in cash should not be considered an alternative to general and administrative expense, as defined by US GAAP. Interest payable in cash should not be considered an alternative to interest expense, as defined by US GAAP. Management believes that all of these non-US GAAP financial measures provide useful information to investors because they are monitored and used by Company management and widely used by professional research analysts in the valuation and investment recommendations of companies within the oil and gas exploration and production industry.
Goodrich Petroleum is an independent oil and natural gas exploration and production company listed on the NYSE American under the symbol "GDP".
GOODRICH PETROLEUM CORPORATION
SELECTED INCOME AND PRODUCTION DATA
(In thousands, except per share amounts)
Unaudited
Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended
September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020
Volumes
Natural gas (MMcf) 15,108 11,346 40,113 35,937
Oil and condensate (MBbls) 26 33 89 106
Mmcfe - Total 15,265 11,543 40,646 36,576
Mcfe per day 165,925 125,462 148,885 133,487
Reconciliation of Oil and
natural gas revenues
adjusted for cash settled
derivatives (non-US GAAP)
Three Months Ended Three Months Ended Nine Months Ended Nine Months Ended
September 30, 2021 September 30, 2020 September 30, 2021 September 30, 2020
Oil and natural gas
revenues (US GAAP) $ 58,733 $ 21,463 $ 128,708 $ 64,917
Net cash received (paid)
for settlement of
derivative instruments (12,498) 1,597 (14,515) 14,905
Oil and natural gas
revenues adjusted for cash
settled derivatives $ 46,235 $ 23,060 $ 114,193 $ 79,822
Oil and natural gas
revenues $ 58,733 $ 21,463 $ 128,708 $ 64,917
Other - 3 - 9
$ 58,733 $ 21,466 $ 128,708 $ 64,926
Operating Expenses
Lease operating expense
(LOE excluding workovers -
$3,016, $2,524, $8,622 and
$8,064, respectively) 3,277 2,831 10,429 9,384
Production and other taxes 1,291 591 2,756 2,361
Transportation and
processing 4,811 4,336 13,457 14,586
Depreciation, depletion and
amortization 13,389 10,341 35,671 35,484
General and administrative
(payable in cash - $3,822,
$2,878, $10,126 and
$9,828, respectively) 4,329 3,891 11,302 13,327
Impairment of oil and
natural gas properties - 3,040 - 17,170
Other 4 (11) (183) (13)
Operating income (loss) 31,632 (3,553) 55,276 (27,373)
Other income (expense)
Interest expense (payable
in cash - $884, $1,001,
$2,612 and $3,149,
respectively) (2,232) (1,733) (6,255) (5,410)
Interest income and other - 5 - 147
Gain (loss) on commodity
derivatives not designated
as hedges (77,369) (11,079) (103,111) (3,629)
Loss on early
extinguishment of debt - - (935) -
(79,601) (12,807) (110,301) (8,892)
Loss before income taxes (47,969) (16,360) (55,025) (36,265)
Income tax expense - - - -
Net loss $ (47,969) $ (16,360) $ (55,025) $ (36,265)
Discretionary cash flow
(see non-US GAAP
reconciliation) (1) $ 32,291 $ 11,790 $ 75,434 $ 41,687
Adjusted EBITDA (see
calculation and non-US
GAAP reconciliation) (2) $ 33,217 $ 12,731 $ 77,885 $ 44,581
Weighted average common
shares outstanding -
basic 13,641 12,618 13,481 12,564
Weighted average common
shares outstanding -
diluted (3) 13,641 12,618 13,481 12,564
Net loss per share
Net loss per share - basic $ (3.52) $ (1.30) $ (4.08) $ (2.89)
Net loss per share -
diluted $ (3.52) $ (1.30) $ (4.08) $ (2.89)
(1) Discretionary cash flow is defined as net cash provided by operating activities before changes in operating assets and
liabilities. Management believes that the non-US GAAP measure of discretionary cash flow is useful as an indicator of an
oil and natural gas exploration and production company's ability to internally fund exploration and development activities
and to service or incur additional debt. The company has also included this information because changes in operating assets
and liabilities relate to the timing of cash receipts and disbursements which the company may not control and may not
relate to the period in which the operating activities occurred. Operating cash flow should not be considered in isolation
or as a substitute for net cash provided by operating activities prepared in accordance with US GAAP.