OKLAHOMA CITY, Nov. 4, 2020 /PRNewswire/ – SandRidge Energy, Inc. (the "Company" or "SandRidge") (NYSE: SD) today announced financial and operational results for the quarter ended September 30, 2020.
Results and highlights during the quarter:
- Decreased net debt1 by $44.7 million to $0.8 million compared to $45.5 million at the end of the prior quarter
- Generated Adjusted EBITDA of $15.4 million compared to $8.8 million in the prior quarter
- Produced 22.3 MBoepd compared to 23.6 MBoepd in the prior quarter
- Incurred a net loss of $48.7 million, or $1.36 per share, driven largely by lower commodity prices and a non-cash ceiling test write down. Adjusted net income was $5.4 million, or $0.15 per share
- Decreased G&A by $1.8 million to $2.5 million, or $1.22 per boe from $4.3 million, or $2.01 per boe in the prior quarter and decreased Adjusted G&A by $1.5 million to $2.3 million, or $1.11 per boe from $3.7 million, or 1.74 per boe in the prior quarter
- Decreased LOE by $0.6 million to $8.1 million, or $3.94 per boe from $8.7 million, or $4.04 per boe in the prior quarter
- Closed on the sale of the company headquarters for net proceeds of $35.4 million
- Closed on the acquisition of the overriding royalty interests held by SandRidge Mississippian Royalty Trust II for a net purchase price of $3.3 million
- Continued streak without a recordable Health, Safety and Environmental ("HS&E") incident for 25 months as of the end of the quarter
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1 Net debt is defined as total debt less unrestricted cash |
Financial Results
For the quarter, the Company reported a net loss of $48.7 million, or $1.36 per share, and net cash provided by operating activities of $27.4 million. After adjusting for certain items, the Company's adjusted net income amounted to $5.4 million, or $0.15 per share, operating cash flow totaled $12.7 million and adjusted EBITDA was $15.4 million for the quarter. The Company defines and reconciles adjusted net income, adjusted EBITDA and other non-GAAP financial measures to the most directly comparable GAAP measure in supporting tables at the conclusion of this press release.
Operational Results and Activity
Production totaled 2,048 MBoe (23.6 MBoepd, 22% oil, 32% NGLs and 46% natural gas) for the quarter.
Mid-Continent Assets in Oklahoma and Kansas
Production in the Mississippian totaled 1,719 MBoe (18.7 MBoepd, 12% oil) and 126 MBoe (1.4 MBoepd, 31% oil) in the Northwest STACK during the quarter.
North Park Basin Assets in Colorado
Net production for North Park Basin totaled 203 MBoe (2.2 MBoepd, 100% oil) during the quarter.
Building Sale
On August 31, 2020, the Company closed on the previously announced sale of its corporate headquarters building located in Oklahoma City, OK for net proceeds of approximately $35.4 million.
ORRI Acquisition
On September 10, 2020, the Company acquired all of the overriding royalty interests of SandRidge Mississippian Royalty Trust II for a gross purchase price of $5.25 million (net purchase price of $3.28 million, given the Company's prior 37.6% ownership of the Trust).
2020 Capital Expenditures and Operational Guidance
The Company reaffirms its 2020 capital expenditures and operational guidance previously published on May 18, 2020.
Liquidity and Capital Structure
As of September 30, 2020, the Company's total liquidity was $69.9 million, based on $11.2 million of cash, excluding restricted cash and $58.7 million available under its credit facility. The Company currently has $12.0 million drawn under its $75.0 million facility and $4.3 million in outstanding letters of credit.
Given the net proceeds from the third quarter sale of our corporate headquarters for $35.4 million as well as several initiatives from prior quarters expected to optimize free cash flow, including personnel and non-personnel cost reductions and entering into commodity derivative contracts for natural gas, we were able to alleviate prior conditions that gave rise to substantial doubt about our ability to continue as a going concern.
Conference Call Information
The Company will host a conference call to discuss these results on Thursday, November 5, 2020 at 10:00 am CT. The conference call can be accessed by registering online at http://www.directeventreg.com/registration/event/2188429 at which time registrants will receive dial-in information as well as a passcode and registrant ID. At the time of the call, participants will dial in using the numbers in the confirmation email and enter their passcode and ID, upon which they will enter the conference call.
A live audio webcast of the conference call will also be available via SandRidge's website, www.sandridgeenergy.com, under Investor Relations/Presentation & Events. The webcast will be archived for replay on the Company's website for 30 days.
Operational and Financial Statistics
Information regarding the Company's production, pricing, costs and earnings is presented below:
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||||||||
2020 | 2019 | 2020 | 2019 | ||||||||||||
Production - Total | |||||||||||||||
Oil (MBbl) | 454 | 835 | 1,656 | 2,668 | |||||||||||
NGL (MBbl) | 646 | 629 | 2,096 | 2,335 | |||||||||||
Natural Gas (MMcf) | 5,686 | 8,318 | 18,078 | 25,414 | |||||||||||
Oil equivalent (MBoe) | 2,048 | 2,850 | 6,765 | 9,239 | |||||||||||
Daily production (MBoed) | 22.3 | 31.0 | 24.7 | 33.8 | |||||||||||
Average price per unit | |||||||||||||||
Realized oil price per barrel - as reported | $ | 37.60 | $ | 52.78 | $ | 34.59 | $ | 53.54 | |||||||
Realized impact of derivatives per barrel | — | 0.75 | 6.00 | 0.23 | |||||||||||
Net realized price per barrel | $ | 37.60 | $ | 53.53 | $ | 40.59 | $ | 53.77 | |||||||
Realized NGL price per barrel - as reported | $ | 7.71 | $ | 10.11 | $ | 5.97 | $ | 12.37 | |||||||
Realized impact of derivatives per barrel | — | — | — | — | |||||||||||
Net realized price per barrel | $ | 7.71 | $ | 10.11 | $ | 5.97 | $ | 12.37 | |||||||
Realized natural gas price per Mcf - as reported | $ | 0.97 | $ | 0.93 | $ | 0.79 | $ | 1.37 | |||||||
Realized impact of derivatives per Mcf | 0.10 | — | 0.07 | 0.20 | |||||||||||
Net realized price per Mcf | $ | 1.07 | $ | 0.93 | $ | 0.86 | $ | 1.57 | |||||||
Realized price per Boe - as reported | $ | 13.45 | $ | 20.42 | $ | 12.44 | $ | 22.34 | |||||||
Net realized price per Boe - including impact of derivatives | $ | 13.76 | $ | 20.64 | $ | 14.09 | $ | 22.96 | |||||||
Average cost per Boe | |||||||||||||||
Lease operating | $ | 3.94 | $ | 8.37 | $ | 4.79 | $ | 7.76 | |||||||
Production, ad valorem, and other taxes | $ | 1.14 | $ | 1.52 | $ | 1.09 | $ | 1.66 | |||||||
Depletion (1) | $ | 3.67 | $ | 13.64 | $ | 6.76 | $ | 12.42 | |||||||
Loss per share | |||||||||||||||
Loss per share applicable to common stockholders | |||||||||||||||
Basic | $ | (1.36) | $ | (5.12) | $ | (7.78) | $ | (5.66) | |||||||
Diluted | $ | (1.36) | $ | (5.12) | $ | (7.78) | $ | (5.66) | |||||||
Adjusted net income (loss) per share available to common stockholders | |||||||||||||||
Basic | $ | 0.15 | $ | (0.49) | $ | (0.26) | $ | (0.74) | |||||||
Diluted | $ | 0.15 | $ | (0.49) | $ | (0.26) | $ | (0.74) | |||||||
Weighted average number of shares outstanding (in thousands) | |||||||||||||||
Basic | 35,783 | 35,491 | 35,649 | 35,390 | |||||||||||
Diluted | 35,783 | 35,491 | 35,649 | 35,390 | |||||||||||
(1) Includes accretion of asset retirement obligation. | |||||||||||||||
Capital Expenditures
The table below presents actual results of the Company's capital expenditures for the three and nine months ended September 30, 2020.
Three Months Ended | Nine Months Ended | ||||||
September 30, 2020 | September 30, 2020 | ||||||
(In thousands) | (In thousands) | ||||||
Drilling, completion and capital workovers | $ | 876 | $ | 3,306 | |||
Other capital expenditures | 399 | 896 | |||||
Total Capital Expenditures | $ | 1,275 | $ | 4,202 | |||
(excluding acquisitions and plugging and abandonment) | |||||||
Derivative Contracts
The table below sets forth the Company's open derivative contracts as of September 30, 2020.
Notional (MMBtu) | Weighted Average Fixed Price per Unit | |||||
Natural Gas Price Swaps: October 2020 | 1,240,000 | $ | 2.14 | |||
Natural Gas Price Swaps: November 2020 - December 2020 | 2,135,000 | $ | 2.54 | |||
Natural Gas Price Swaps: January 2021 - December 2021 | 10,950,000 | $ | 2.61 | |||
Capitalization
The Company's capital structure as of September 30, 2020 and December 31, 2019 is presented below:
September 30, 2020 | December 31, 2019 | ||||||
(In thousands) | |||||||
Cash, cash equivalents and restricted cash | $ | 12,641 | $ | 5,968 | |||
Credit facility | $ | 12,000 | $ | 57,500 | |||
Total debt | 12,000 | 57,500 | |||||
Stockholders' equity | |||||||
Common stock | 36 | 36 | |||||
Warrants | 88,520 | 88,520 | |||||
Additional paid-in capital | 1,061,961 | 1,059,253 | |||||
Accumulated deficit | (1,022,555) | (745,357) | |||||
Total SandRidge Energy, Inc. stockholders' equity | 127,962 | 402,452 | |||||
Total capitalization | $ | 139,962 | $ | 459,952 | |||