W&T OFFSHORE, INC. This press release includes non-GAAP financial measures, including Adjusted Net (Loss) Income, Adjusted EBITDA, Free Cash Flow and Net Debt, which are described and reconciled to the most comparable GAAP measures below in the accompanying tables under “Non-GAAP Information.”
Key highlights for the first quarter of 2024 and through the date of this press release include:
- Completed accretive acquisition of six shallow water
Gulf of Mexico (“GOM”) fields inJanuary 2024 (the “Cox acquisition”);- Paid
$77.2 million for the Cox acquisition where W&T acquired and will operate 100% working interests in six fields that are located adjacent to existing W&T operations; - Hired select Cox offshore personnel while completing all required regulatory transfers of operatorship, lease ownership and financial responsibility;
- Integrated accounting, production reporting, cost tracking and other data into existing W&T systems, while integrating and inspecting fields to ensure W&T’s health, safety and environmental standards are implemented; and
- Year-end 2023 proved reserves based on an independent engineering report prepared by
Netherland Sewell and Associates (“NSAI”) of 21.8 million barrels of oil equivalent (“MMBoe”), which is around 17% higher than W&T’s expectation of 18.7 MMBoe at the time of acquisition announcement;
- Paid
- Generated production of 35.1 thousand barrels of oil equivalent per day (“MBoe/d”) (55% liquids) in the first quarter of 2024, an increase of approximately 3% over fourth quarter 2023 and above the midpoint of guidance;
- Three of the Cox fields, Mobile 916,
West Delta 073, andEugene Island 064, were shut-in during the first quarter 2024. As such, Adjusted EBITDA did not reflect the full potential of the Cox acquisition;
- Three of the Cox fields, Mobile 916,
- Reported net loss of
$11.5 million , or$(0.08) per diluted share;- Adjusted Net Loss totaled
$7.6 million , or$(0.05) per share, which excludes the net unrealized gain on outstanding derivative contracts and non-ARO plugging and abandonment (“P&A”) costs;
- Adjusted Net Loss totaled
- Reported Adjusted EBITDA in the first quarter of 2024 of
$49.4 million , an increase of approximately 10% over the fourth quarter of 2023; - Produced net cash from operating activities of
$11.6 million and Free Cash Flow of$32.4 million in the first quarter of 2024, marking the 25th consecutive quarter of positive Free Cash Flow; - Reported cash and cash equivalents of
$94.8 million and Net Debt of$296.4 million atMarch 31, 2024 , which reflects the impact of funding the Cox acquisition using cash on hand; - Continued to maintain a low leverage profile with Net Debt to trailing twelve months (“TTM”) Adjusted EBITDA of 1.6x;
- Adopted a quarterly cash dividend policy in
November 2023 and paid dividends of$0.01 per common share inDecember 2023 andMarch 2024 ;- Declared second quarter of 2024 dividend of
$0.01 per share, which will be payable onMay 31, 2024 to stockholders of record onMay 24, 2024 ;
- Declared second quarter of 2024 dividend of
- Expanded the size of the Board to six members and appointed Mr.
John D. Buchanan to fill the vacancy on the Board effectiveApril 8, 2024 ; and - Scheduled first quarter 2024 earnings conference call for
8:30 am central time onMonday, May 13, 2024 .
“Our strong balance sheet allowed us to close on the Cox acquisition utilizing a portion of our cash on hand, and we remain focused on expanding our healthy cash balance of almost
Production, Prices and Revenue: Production for the first quarter of 2024 was 35.1 MBoe/d compared with 34.1 MBoe/d for the fourth quarter of 2023 and 32.5 MBoe/d for the corresponding period in 2023. The increase in production compared to the fourth quarter of 2023 was primarily driven by the inclusion of the Cox acquisition, which closed in
W&T’s average realized price per Boe before realized derivative settlements was
Revenues for the first quarter of 2024 were
Lease Operating Expense: Lease operating expense (“LOE”), which includes base lease operating expenses, insurance premiums, workovers and facilities maintenance expenses, was
Gathering, Transportation Costs and Production Taxes: Gathering, transportation costs and production taxes totaled
Depreciation, Depletion and Amortization (“DD&A”): DD&A was
Asset Retirement Obligations Accretion: Asset retirement obligations accretion was
General & Administrative Expenses (“G&A”): G&A was
Derivative Gain: In the first quarter of 2024, W&T recorded a net gain of
As of
A summary of the Company’s outstanding derivative positions is provided in the investor presentation posted on W&T’s website.
Interest Expense: Net interest expense in the first quarter of 2024 was
Other Expense: During 2021 and 2022, as a result of the declaration of bankruptcy by a third party that is the indirect successor in title to certain offshore interests that were previously divested by the Company, W&T recorded a contingent loss accrual related to anticipated non-ARO plugging and abandonment costs. During the first quarter of 2024, the Company reassessed its existing obligations and recorded an additional
Income Tax Expense: W&T recognized income tax expense of
Balance Sheet and Liquidity: As of
Capital Expenditures: Capital expenditures on an accrual basis (excluding acquisitions) in the first quarter of 2024 were
Cox Acquisition and Integration
In
- Adds significant proved reserves of 21.8 MMBoe1 (60% liquids) based on an independent engineering report prepared by NSAI;
- Based on the cash consideration paid of
$77.2 million , this equates to a price of$3.54 per Boe of proved reserves; - Field logistics are being examined to see if more cost-effective tie-ins and throughput can be done with existing W&T facilities adjacent to the newly acquired fields; and
- In first quarter 2024 the net production from these six fields acquired was approximately 3.3 MBoe/d, which is approximately 50% below the assets’ potential due to three of the six fields being shut-in. As it has done after prior acquisitions, W&T is inspecting and optimizing operations, and also negotiating midstream services at the newly acquired fields. This required temporarily shutting in Mobile 916,
West Delta 073, andEugene Island 064. W&T will provide additional information on these fields in the future.
OPERATIONS UPDATE
Well Recompletions and Workovers
During the first quarter of 2024, the Company performed three workovers and three recompletions that positively impacted production for the quarter. W&T plans to continue performing these low cost, short payout operations that impact both production and revenue.
Cash Dividend Policy
The Company paid its first quarter 2024 dividend of
The Board of Directors declared a second quarter 2024 dividend of
Addition to W&T’s Board of Directors
In
Second Quarter and Full Year 2024 Production and Expense Guidance
The guidance for the second quarter and full year 2024 in the table below represents the Company’s current expectations. Please refer to the section entitled “Forward-Looking and Cautionary Statements” below for risk factors that could impact guidance.
| Production | Second Quarter 2024 | Full Year 2024 |
| Oil (MBbl) | 1,225 – 1,400 | 5,100 – 5,800 |
| NGLs (MBbl) | 280 – 315 | 1,150 – 1,375 |
| Natural gas (MMcf) | 8,800 – 10,060 | 37,000 – 44,500 |
| Total equivalents (MBoe) | 2,972 – 3,392 | 12,417 – 14,592 |
| Average daily equivalents (MBoe/d) | 32.7 – 37.3 | 33.9 – 39.9 |
| Expenses | Second Quarter 2024 | Full Year 2024 |
| Lease operating expense ($MM) | 83.0 – 92.0 | 295.0 – 332.0 |
| Gathering, transportation & production taxes ($MM) | 8.1 – 8.9 | 34.5 – 39.0 |
| General & administrative – cash ($MM) | 13.7 – 15.1 | 59.0 – 66.5 |
| General & administrative – non-cash ($MM) | 2.9 – 3.3 | 12.5 – 14.0 |
| DD&A ($ per Boe) | 11.4 – 12.9 | |
W&T expects substantially all taxes in 2024 to be deferred.
Conference Call Information
W&T will hold a conference call to discuss its financial and operational results on
About
Forward-Looking and Cautionary Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this release regarding the Company’s financial position, operating and financial performance, business strategy, plans and objectives of management for future operations, projected costs, industry conditions, potential acquisitions, the impact of and integration of acquired assets, and indebtedness are forward-looking statements. When used in this release, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcomes, although not all forward-looking statements contain such identifying words. Items contemplating or making assumptions about actual or potential future production and sales, prices, market size, and trends or operating results also constitute such forward-looking statements.
These forward-looking statements are based on the Company’s current expectations and assumptions about future events and speak only as of the date of this release. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control. Accordingly, you are cautioned not to place undue reliance on these forward-looking statements, as results actually achieved may differ materially from expected results described in these statements. The Company does not undertake, and specifically disclaims, any obligation to update any forward-looking statements to reflect events or circumstances occurring after the date of such statements, unless required by law.
Forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially including, among other things, the regulatory environment, including availability or timing of, and conditions imposed on, obtaining and/or maintaining permits and approvals, including those necessary for drilling and/or development projects; the impact of current, pending and/or future laws and regulations, and of legislative and regulatory changes and other government activities, including those related to permitting, drilling, completion, well stimulation, operation, maintenance or abandonment of wells or facilities, managing energy, water, land, greenhouse gases or other emissions, protection of health, safety and the environment, or transportation, marketing and sale of the Company’s products; inflation levels; global economic trends, geopolitical risks and general economic and industry conditions, such as the global supply chain disruptions and the government interventions into the financial markets and economy in response to inflation levels and world health events; volatility of oil, NGL and natural gas prices; the global energy future, including the factors and trends that are expected to shape it, such as concerns about climate change and other air quality issues, the transition to a low-emission economy and the expected role of different energy sources; supply of and demand for oil, natural gas and NGLs, including due to the actions of foreign producers, importantly including
| Condensed Consolidated Statements of Operations | ||||||||||||
| (In thousands, except per share data) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| Revenues: | ||||||||||||
| Oil | $ | 107,015 | $ | 94,076 | $ | 97,000 | ||||||
| NGLs | 7,469 | 6,851 | 7,795 | |||||||||
| Natural gas | 21,616 | 29,401 | 24,804 | |||||||||
| Other | 4,687 | 2,012 | 2,126 | |||||||||
| Total revenues | 140,787 | 132,340 | 131,725 | |||||||||
| Operating expenses: | ||||||||||||
| Lease operating expenses | 70,830 | 64,643 | 65,186 | |||||||||
| Gathering, transportation and production taxes | 7,540 | 6,620 | 6,136 | |||||||||
| Depreciation, depletion, and amortization | 33,937 | 33,658 | 22,624 | |||||||||
| Asset retirement obligations accretion | 7,969 | 7,377 | 7,510 | |||||||||
| General and administrative expenses | 20,515 | 18,251 | 19,919 | |||||||||
| Total operating expenses | 140,791 | 130,549 | 121,375 | |||||||||
| Operating (loss) income | (4 | ) | 1,791 | 10,350 | ||||||||
| Interest expense, net | 10,072 | 9,729 | 14,713 | |||||||||
| Derivative gain, net | (4,877 | ) | (13,199 | ) | (39,240 | ) | ||||||
| Other expense, net | 5,230 | 3,772 | 233 | |||||||||
| (Loss) income before income taxes | (10,429 | ) | 1,489 | 34,644 | ||||||||
| Income tax expense | 1,045 | 1,932 | 8,639 | |||||||||
| Net (loss) income | $ | (11,474 | ) | $ | (443 | ) | $ | 26,005 | ||||
| Net (loss) income per share: | ||||||||||||
| Basic | $ | (0.08 | ) | $ | — | $ | 0.18 | |||||
| Diluted | (0.08 | ) | — | 0.17 | ||||||||
| Weighted average common shares outstanding | ||||||||||||
| Basic | 146,857 | 146,578 | 146,418 | |||||||||
| Diluted | 146,857 | 146,578 | 148,726 | |||||||||
| Condensed Operating Data | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| Net sales volumes: | ||||||||||||
| Oil (MBbls) | 1,400 | 1,219 | 1,350 | |||||||||
| NGLs (MBbls) | 343 | 329 | 294 | |||||||||
| Natural gas (MMcf) | 8,733 | 9,533 | 7,677 | |||||||||
| Total oil and natural gas (MBoe) (1) | 3,199 | 3,136 | 2,924 | |||||||||
| Average daily equivalent sales (MBoe/d) | 35.1 | 34.1 | 32.5 | |||||||||
| Average realized sales prices (before the impact of derivative settlements): | ||||||||||||
| Oil ($/Bbl) | $ | 76.44 | $ | 77.17 | $ | 71.85 | ||||||
| NGLs ($/Bbl) | 21.78 | 20.82 | 26.51 | |||||||||
| Natural gas ($/Mcf) | 2.48 | 3.08 | 3.23 | |||||||||
| Barrel of oil equivalent ($/Boe) | 42.55 | 41.55 | 44.32 | |||||||||
| Average operating expenses per Boe ($/Boe): | ||||||||||||
| Lease operating expenses | $ | 22.14 | $ | 20.61 | $ | 22.29 | ||||||
| Gathering, transportation and production taxes | 2.36 | 2.11 | 2.10 | |||||||||
| Depreciation, depletion, and amortization | 10.61 | 10.73 | 7.74 | |||||||||
| Asset retirement obligations accretion | 2.49 | 2.35 | 2.57 | |||||||||
| General and administrative expenses | 6.41 | 5.82 | 6.81 | |||||||||
(1) MBoe is determined using the ratio of six Mcf of natural gas to one Bbl of crude oil, condensate or NGLs (totals may not compute due to rounding). The conversion ratio does not assume price equivalency and the price on an equivalent basis for oil, NGLs and natural gas may differ significantly. The realized prices presented above are volume-weighted for production in the respective period.
| Consolidated Balance Sheets | ||||||||
| (In thousands) | ||||||||
| (Unaudited) | ||||||||
| 2024 | 2023 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 94,822 | $ | 173,338 | ||||
| Restricted cash | 4,417 | 4,417 | ||||||
| Receivables: | ||||||||
| Oil and natural gas sales | 66,959 | 52,080 | ||||||
| Joint interest, net | 18,280 | 15,480 | ||||||
| Other | 1,901 | 2,218 | ||||||
| Prepaid expenses and other assets | 21,342 | 17,447 | ||||||
| Total current assets | 207,721 | 264,980 | ||||||
| Oil and natural gas properties and other, net | 825,628 | 749,056 | ||||||
| Restricted deposits for asset retirement obligations | 22,346 | 22,272 | ||||||
| Deferred income taxes | 38,040 | 38,774 | ||||||
| Other assets | 32,740 | 38,923 | ||||||
| Total assets | $ | 1,126,475 | $ | 1,114,005 | ||||
| Liabilities and Shareholders’ Equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 75,966 | $ | 78,857 | ||||
| Accrued liabilities | 15,559 | 31,978 | ||||||
| Undistributed oil and natural gas proceeds | 52,835 | 42,134 | ||||||
| Advances from joint interest partners | 2,864 | 2,962 | ||||||
| Current portion of asset retirement obligation | 37,745 | 31,553 | ||||||
| Current portion of long-term debt, net | 6,987 | 29,368 | ||||||
| Total current liabilities | 191,956 | 216,852 | ||||||
| Asset retirement obligations | 492,066 | 467,262 | ||||||
| Long-term debt, net | 384,241 | 361,236 | ||||||
| Other liabilities | 16,672 | 19,420 | ||||||
| Commitments and contingencies | 20,780 | 18,043 | ||||||
| Shareholders’ equity: | ||||||||
| Preferred stock | — | — | ||||||
| Common stock | 1 | 1 | ||||||
| Additional paid-in capital | 588,563 | 586,014 | ||||||
| Retained deficit | (543,637 | ) | (530,656 | ) | ||||
| (24,167 | ) | (24,167 | ) | |||||
| Total shareholders’ equity | 20,760 | 31,192 | ||||||
| Total liabilities and shareholders’ equity | $ | 1,126,475 | $ | 1,114,005 | ||||
| Condensed Consolidated Statements of Cash Flows | ||||||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| Operating activities: | ||||||||||||
| Net (loss) income | $ | (11,474 | ) | $ | (443 | ) | $ | 26,005 | ||||
| Adjustments to reconcile net (loss) income to net cash provided by operating activities: | ||||||||||||
| Depreciation, depletion, amortization and accretion | 41,906 | 41,035 | 30,134 | |||||||||
| Share-based compensation | 3,032 | 3,124 | 1,922 | |||||||||
| Amortization and write off of debt issuance costs | 1,292 | 1,266 | 3,249 | |||||||||
| Derivative gain, net | (4,877 | ) | (13,199 | ) | (39,240 | ) | ||||||
| Derivative cash settlements, net | 2,599 | (2,809 | ) | (5,328 | ) | |||||||
| Deferred income taxes | 733 | 3,838 | 4,396 | |||||||||
| Changes in operating assets and liabilities: | — | |||||||||||
| Accounts receivable | (17,362 | ) | (2,989 | ) | 17,505 | |||||||
| Prepaid expenses and other current assets | 433 | (28,262 | ) | 31,489 | ||||||||
| Accounts payable, accrued liabilities and other | (852 | ) | 43,155 | (38,055 | ) | |||||||
| Asset retirement obligation settlements | (3,788 | ) | (9,052 | ) | (8,642 | ) | ||||||
| Net cash provided by operating activities | 11,642 | 35,664 | 23,435 | |||||||||
| Investing activities: | ||||||||||||
| Investment in oil and natural gas properties and equipment | (7,080 | ) | (12,139 | ) | (13,158 | ) | ||||||
| Acquisition of property interests | (80,515 | ) | 1,479 | — | ||||||||
| Deposit related to acquisition of property interests | — | 8,850 | — | |||||||||
| Purchases of furniture, fixtures and other | (24 | ) | (347 | ) | (156 | ) | ||||||
| Net cash used in investing activities | (87,619 | ) | (2,157 | ) | (13,314 | ) | ||||||
| Financing activities: | ||||||||||||
| Proceeds from issuance of long-term debt | — | — | 275,000 | |||||||||
| Repayments of long-term debt | (275 | ) | (7,687 | ) | (562,012 | ) | ||||||
| Debt issuance costs | (312 | ) | — | (6,354 | ) | |||||||
| Payment of dividends | (1,469 | ) | (1,466 | ) | — | |||||||
| Other | (483 | ) | (9 | ) | (723 | ) | ||||||
| Net cash used in financing activities | (2,539 | ) | (9,162 | ) | (294,089 | ) | ||||||
| Change in cash, cash equivalents and restricted cash | (78,516 | ) | 24,345 | (283,968 | ) | |||||||
| Cash, cash equivalents and restricted cash, beginning of period | 177,755 | 153,410 | 465,774 | |||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 99,239 | $ | 177,755 | $ | 181,806 | ||||||
Non-GAAP Information
Certain financial information included in W&T’s financial results are not measures of financial performance recognized by accounting principles generally accepted in
We calculate Net Debt as total debt (current and long-term portions), less cash and cash equivalents. Management uses Net Debt to evaluate the Company’s financial position, including its ability to service its debt obligations.
Reconciliation of Net (Loss) Income to Adjusted Net Loss
Adjusted Net Loss adjusts for certain items that the Company believes affect comparability of operating results, including items that are generally non-recurring in nature or whose timing and/or amount cannot be reasonably estimated. These items include unrealized commodity derivative gain, net, allowance for credit losses, write-off of debt issuance costs, non-recurring IT-transition costs, non-ARO plugging and abandonment costs, and other which are then tax effected using the Federal Statutory Rate.
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| (in thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Net (loss) income | $ | (11,474 | ) | $ | (443 | ) | $ | 26,005 | ||||
| Unrealized commodity derivative gain, net | (1,122 | ) | (14,785 | ) | (39,470 | ) | ||||||
| Allowance for credit losses | 84 | 28 | — | |||||||||
| Write-off debt issuance costs | — | — | 2,330 | |||||||||
| Non-recurring costs related to IT services transition | 758 | 413 | 785 | |||||||||
| Non-ARO P&A costs | 5,352 | 4,137 | 6 | |||||||||
| Other | (214 | ) | (240 | ) | 378 | |||||||
| Tax effect of selected items (1) | (1,020 | ) | 2,194 | 7,554 | ||||||||
| Adjusted net loss | $ | (7,636 | ) | $ | (8,696 | ) | $ | (2,412 | ) | |||
| Adjusted net loss per common share: | ||||||||||||
| Basic | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.02 | ) | |||
| Diluted | $ | (0.05 | ) | $ | (0.06 | ) | $ | (0.02 | ) | |||
| Weighted average shares outstanding: | ||||||||||||
| Basic | 146,857 | 146,578 | 146,418 | |||||||||
| Diluted | 146,857 | 146,578 | 146,418 | |||||||||
(1) Selected items were tax effected with the Federal Statutory Rate of 21% for each respective period.
Non-GAAP Information
Adjusted EBITDA/ Free Cash Flow Reconciliations
The Company also presents non-GAAP financial measures of Adjusted EBITDA and Free Cash Flow. The Company defines Adjusted EBITDA as net (loss) income plus net interest expense, income tax expense, depreciation, depletion and amortization, ARO accretion, excluding the unrealized commodity derivative gain, allowance for credit losses, non-cash incentive compensation, non-recurring IT-transition costs, non-ARO plugging and abandonment costs, and other. Company management believes this presentation is relevant and useful because it helps investors understand W&T’s operating performance and makes it easier to compare its results with those of other companies that have different financing, capital and tax structures. Adjusted EBITDA should not be considered in isolation from or as a substitute for net income, as an indication of operating performance or cash flows from operating activities or as a measure of liquidity. Adjusted EBITDA, as W&T calculates it, may not be comparable to Adjusted EBITDA measures reported by other companies. In addition, Adjusted EBITDA does not represent funds available for discretionary use.
The Company defines Free Cash Flow as Adjusted EBITDA (defined above), less capital expenditures, plugging and abandonment costs and net interest expense (all on an accrual basis). For this purpose, the Company’s definition of capital expenditures includes costs incurred related to oil and natural gas properties (such as drilling and infrastructure costs and the lease maintenance costs) and equipment, but excludes acquisition costs of oil and gas properties from third parties that are not included in the Company’s capital expenditures guidance provided to investors. Company management believes that Free Cash Flow is an important financial performance measure for use in evaluating the performance and efficiency of its current operating activities after the impact of accrued capital expenditures, plugging and abandonment costs and net interest expense and without being impacted by items such as changes associated with working capital, which can vary substantially from one period to another. There is no commonly accepted definition of Free Cash Flow within the industry. Accordingly, Free Cash Flow, as defined and calculated by the Company, may not be comparable to Free Cash Flow or other similarly named non-GAAP measures reported by other companies. While the Company includes net interest expense in the calculation of Free Cash Flow, other mandatory debt service requirements of future payments of principal at maturity (if such debt is not refinanced) are excluded from the calculation of Free Cash Flow. These and other non-discretionary expenditures that are not deducted from Free Cash Flow would reduce cash available for other uses.
The following table presents a reconciliation of the Company’s net (loss) income, a GAAP measure, to Adjusted EBITDA and Free Cash Flow, as such terms are defined by the Company:
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| (in thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Net (loss) income | $ | (11,474 | ) | $ | (443 | ) | $ | 26,005 | ||||
| Interest expense, net | 10,072 | 9,729 | 14,713 | |||||||||
| Income tax expense | 1,045 | 1,932 | 8,639 | |||||||||
| Depreciation, depletion and amortization | 33,937 | 33,658 | 22,624 | |||||||||
| Asset retirement obligations accretion | 7,969 | 7,377 | 7,510 | |||||||||
| Unrealized commodity derivative gain, net | (1,122 | ) | (14,785 | ) | (39,470 | ) | ||||||
| Allowance for credit losses | 84 | 28 | — | |||||||||
| Non-cash incentive compensation | 3,032 | 3,124 | 1,922 | |||||||||
| Non-recurring costs related to IT services transition | 758 | 413 | 785 | |||||||||
| Non-ARO P&A costs | 5,352 | 4,137 | 6 | |||||||||
| Other | (214 | ) | (240 | ) | 378 | |||||||
| Adjusted EBITDA | $ | 49,439 | $ | 44,930 | $ | 43,112 | ||||||
| Capital expenditures, accrual basis (1) | $ | (3,156 | ) | $ | (10,319 | ) | $ | (7,367 | ) | |||
| Asset retirement obligation settlements | (3,788 | ) | (9,052 | ) | (8,642 | ) | ||||||
| Interest expense, net | (10,072 | ) | (9,729 | ) | (14,713 | ) | ||||||
| Free Cash Flow | $ | 32,423 | $ | 15,830 | $ | 12,390 | ||||||
(1) A reconciliation of the adjustment used to calculate Free Cash Flow to the Condensed Consolidated Financial Statements is included below:
| Capital expenditures, accrual basis reconciliation | ||||||||||||
| Investment in oil and natural gas properties and equipment | $ | (7,080 | ) | $ | (12,139 | ) | $ | (13,158 | ) | |||
| Less: changes in operating assets and liabilities associated with investing activities | (3,924 | ) | (1,820 | ) | (5,791 | ) | ||||||
| Capital expenditures, accrual basis | $ | (3,156 | ) | $ | (10,319 | ) | $ | (7,367 | ) | |||
The following table presents a reconciliation of cash flow from operating activities, a GAAP measure, to Free Cash Flow, as defined by the Company:
| Three Months Ended | ||||||||||||
| 2024 | 2023 | 2023 | ||||||||||
| (in thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| Net cash provided by operating activities | $ | 11,642 | $ | 35,664 | $ | 23,435 | ||||||
| Allowance for credit losses | 84 | 28 | — | |||||||||
| Amortization of debt items and other items | (1,292 | ) | (1,266 | ) | (3,249 | ) | ||||||
| Non-recurring costs related to IT services transition | 758 | 413 | 785 | |||||||||
| Current tax expense (benefit) (1) | 312 | (1,906 | ) | 4,243 | ||||||||
| Changes in derivatives receivable (1) | 1,156 | 1,223 | 5,098 | |||||||||
| Non-ARO P&A costs | 5,352 | 4,137 | 6 | |||||||||
| Changes in operating assets and liabilities, excluding asset retirement obligation settlements | 17,781 | (11,904 | ) | (10,939 | ) | |||||||
| Capital expenditures, accrual basis | (3,156 | ) | (10,319 | ) | (7,367 | ) | ||||||
| Other | (214 | ) | (240 | ) | 378 | |||||||
| Free Cash Flow | $ | 32,423 | $ | 15,830 | $ | 12,390 | ||||||
(1) A reconciliation of the adjustments used to calculate Free Cash Flow to the Condensed Consolidated Financial Statements is included below:
| Current tax benefit: | ||||||||||||
| Income tax expense | $ | 1,045 | $ | 1,932 | $ | 8,639 | ||||||
| Less: Deferred income taxes | 733 | 3,838 | 4,396 | |||||||||
| Current tax (benefit) expense | $ | 312 | $ | (1,906 | ) | $ | 4,243 | |||||
| Changes in derivatives receivable (payable) | ||||||||||||
| Derivatives receivable, end of period | $ | 1,427 | $ | 271 | $ | 524 | ||||||
| Derivatives (receivable) payable, beginning of period | (271 | ) | 952 | 4,574 | ||||||||
| Change in derivatives receivable | $ | 1,156 | $ | 1,223 | $ | 5,098 | ||||||
| CONTACT: | ||
| Investor Relations Coordinator | Executive VP and CFO | |
| investorrelations@wtoffshore.com | sparasnis@wtoffshore.com | |
| 713-297-8024 | 713-513-8654 |
1 Reserves as of
2024 GlobeNewswire, Inc., source
