DENVER--(BUSINESS WIRE)--May 4, 2022--

Civitas Resources, Inc. (NYSE: CIVI) (the "Company" or "Civitas") today announced its first quarter 2022 financial results, and has posted an updated investor presentation to its website.

Operational and Financial Highlights for the First Quarter 2022

  • Average daily sales volumes of 159.0 thousand barrels of oil equivalent per day (“MBoe/d”), with oil representing 43% of total volumes (includes one month of volumes from the Bison acquisition, which closed March 1, 2022)
  • Total capital expenditures of $234.5 million
  • GAAP net income of $91.6 million for the first quarter 2022
  • Adjusted EBITDAX (1) of $471.8 million for the first quarter 2022
  • Lease operating expenses (“LOE”) of $2.52 per Boe for the first quarter; up 14% from the fourth quarter of 2021, and down 17% from the first quarter of 2021
  • Recurring cash G&A (1) expense, which excludes non-cash and non-recurring expenses, was $24.7 million for the quarter, or $1.73 per Boe, down sequentially from $2.00 per Boe in the fourth quarter of 2021
  • Exited first quarter 2022 with approximately $0.9 billion of liquidity, including an undrawn credit facility and approximately $154.3 million of cash, after giving effect to an aggregate of $12.4 million of undrawn letters of credit

(1)

Non-GAAP financial measure; see attached reconciliation schedules at the end of this release.

Combined Base and Variable Dividend to be Paid in June

The Company's board of directors has elected to pay a dividend of $1.3625/share in the second quarter, which reflects the combination of a variable dividend of $0.9000/share and a base fixed dividend of $0.4625/share. This dividend will be paid on June 29, 2022 to shareholders of record as of June 15, 2022. Additional detail regarding the calculation of the variable dividend can be found in the Company's new investor presentation.

Ben Dell, Chairman of Civitas, commented, “Our first quarter results continue to demonstrate our execution of the new E&P business model. We have successfully integrated Bison, kept a tight control on our costs and delivered significant free cash flow, which we are returning to shareholders. As we welcome our new President and Chief Executive Officer, Chris Doyle, we look forward to continuing the momentum and developing Civitas into a peer group leader on all aspects of the operating model.”

First Quarter 2022 Results

During the first quarter of 2022, the Company reported average daily sales of 159.0 MBoe/d. Product mix for the first quarter was 43% crude oil, 31% natural gas, and 26% natural gas liquids. The table below provides sales volumes, product mix, and average sales prices for the first quarter 2022 and 2021.

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

 

2021

 

 

% Change

Avg. Daily Sales Volumes:

 

 

 

 

 

 

Crude oil (Bbls/d)

 

 

68,039

 

 

 

10,474

 

 

550

%

Natural gas (Mcf/d)

 

 

297,627

 

 

 

35,710

 

 

733

%

Natural gas liquids (Bbls/d)

 

 

41,363

 

 

 

4,424

 

 

835

%

Crude oil equivalent (Boe/d)

 

 

159,007

 

 

 

20,850

 

 

663

%

 

 

 

 

 

 

 

Product Mix

 

 

 

 

 

 

Crude oil

 

 

43

%

 

 

50

%

 

 

Natural gas

 

 

31

%

 

 

29

%

 

 

Natural gas liquids

 

 

26

%

 

 

21

%

 

 

 

 

 

 

 

 

 

Average Sales Prices (before derivatives):

 

 

 

 

Crude oil (per Bbl)

 

$

89.65

 

 

$

52.83

 

 

70

%

Natural gas (per Mcf)

 

$

4.20

 

 

$

3.82

 

 

10

%

Natural gas liquids (per Bbl)

 

$

41.68

 

 

$

27.54

 

 

51

%

Crude oil equivalent (per Boe)

 

$

57.06

 

 

$

38.93

 

 

47

%

Capital expenditures were $234.5 million for the first quarter of 2022. The Company drilled 52 gross (43 net) operated wells, completed 41 gross (37 net) operated wells, and turned to sales 49 gross (44 net) operated wells during the first quarter.

Net crude oil, natural gas, and natural gas liquids revenue for the first quarter of 2022 increased to $817.8 million compared to $510.5 million for the fourth quarter of 2021. The increase was a result of higher crude oil, natural gas, and natural gas liquids realized prices and a significant increase in sales volumes, primarily related the acquisitions that closed on November 1, 2021. Crude oil accounted for approximately 67% of total revenue for the quarter. Differentials for the Company's crude oil production, relative to WTI, averaged approximately negative $5.00 per barrel in the quarter.

LOE for the first quarter of 2022 on a unit basis increased to $2.52 per Boe from $2.22 per Boe in the fourth quarter of 2021.

Rocky Mountain Infrastructure (“RMI”) net effective cost for the first quarter 2022 was $0.31 per Boe, which consists of $0.40 per Boe of midstream operating expense offset by $0.09 per Boe of RMI operating revenue from working interest partners. RMI operating revenue from working interest partners is based on production volumes and the fees are not tied to crude oil or natural gas prices.

The Company's general and administrative ("G&A") expenses were $35.7 million for the first quarter of 2022, which included $8.1 million in non-cash stock-based compensation and $2.9 million of other non-recurring G&A. Recurring cash G&A, which excludes non-recurring and non-cash items, was $24.7 million for the first quarter of 2022. On a per unit basis, the Company's recurring cash G&A decreased 14% sequentially from $2.00 per Boe in the fourth quarter of 2021 to $1.73 per Boe in the first quarter of 2022.

RMI net effective cost and recurring cash G&A are non-GAAP financial measures. Please see Schedule 7 and Schedule 8 at the end of this release for a reconciliation to the most comparable GAAP measure.

2022 Guidance

2022 Company guidance reflects the closing of the Bison acquisition on March 1, 2022. The Company expects an average crude oil price differential of roughly negative $6.00/Bbl relative to WTI during the year. Civitas does not expect to be a cash income taxpayer this year at the commodity prices assumed below.

2022 Guidance

Low

 

High

D&C Capital Expenditures ($MM)

$825

--

$950

Land, Midstream & Other Capital Expenditures ($MM)

$70

--

$90

Total Production (MBoe/d)

156

--

167

Oil Production (MBbl/d)

69

--

75

% Liquids

68%

--

70%

Lease Operating Expenses ($/Boe)

$2.50

--

$2.75

Gathering, Transportation and Processing Expenses ($/Boe)

$3.25

--

$3.50

Midstream Operating Expenses ($/Boe)

$0.50

--

$0.60

Recurring Cash G&A Expenses ($MM)

$70

--

$75

Production Taxes (% of revenue)

8%

--

9%

Note: Guidance is based on $75/Bbl WTI oil and $4.00/MMbtu Henry Hub gas. Guidance is forward-looking information that is subject to considerable change and numerous risks and uncertainties, many of which are beyond the Company’s control. See “Forward-Looking Statements” below.

Conference Call Information

The Company will host a conference call to discuss these results on May 5, 2022 at 8:00 a.m. Mountain Time (10:00 a.m. Eastern Time). A live webcast and replay will be available on the Investor Relations section of the Company’s website at www.civiresources.com. Dial-in information for the conference call is included below.

Type

Phone Number

Passcode

Live participant

888-510-2535

4872770

Replay

800-770-2030

4872770

About Civitas Resources, Inc.

Civitas Resources, Inc. is Colorado’s first carbon neutral oil and gas producer and is focused on developing and producing crude oil, natural gas, and natural gas liquids in Colorado’s Denver-Julesburg Basin. The Company is committed to pursuing compelling economic returns and cash flow while delivering best-in-class cost leadership and capital efficiency. Civitas is dedicated to safety, environmental responsibility, and implementing industry leading practices to create a positive local impact. For more information about Civitas, please visit www.civiresources.com.

Forward-Looking Statements and Cautionary Statements

Certain statements in this press release concerning the credit facility, the results, effects, benefits and synergies of the acquisition of Bison, future opportunities for Civitas, future financial performance and condition, guidance and any other statements regarding Civitas’ future expectations, beliefs, plans, objectives, financial conditions, assumptions or future events or performance that are not historical facts are “forward-looking” statements based on assumptions currently believed to be valid. Forward-looking statements are all statements other than statements of historical facts. The words “anticipate,” “believe,” “ensure,” “expect,” “if,” “intend,” “estimate,” “probable,” “project,” “forecasts,” “predict,” “outlook,” “aim,” “will,” “could,” “should,” “would,” “potential,” “may,” “might,” “anticipate,” “likely” “plan,” “positioned,” “strategy,” and similar expressions or other words of similar meaning, and the negatives thereof, are intended to identify forward-looking statements. The forward-looking statements are intended to be subject to the safe harbor provided by Section 27A of the Securities Act of 1933, as amended, Section 21E of the Securities Exchange Act of 1934, as amended, and the Private Securities Litigation Reform Act of 1995.

These forward-looking statements involve significant risks and uncertainties that could cause actual results to differ materially from those anticipated, including, but not limited to, the ultimate timing, outcome and results of integrating the legacy operations of Civitas; changes in capital markets and the ability of Civitas to finance operations in the manner expected; the effects of commodity prices; the risks of oil and gas activities; and the fact that operating costs and business disruption may be greater than expected. Additionally, risks and uncertainties that could cause actual results to differ materially from those anticipated also include general economic conditions, whether internationally, nationally or in the regional and local market areas in which we do business; the effects of disruption of our operations or excess supply of oil and natural gas due to the COVID-19 pandemic and the actions by certain oil and natural gas producing countries; the scope, duration and severity of the COVID-19 pandemic, including any recurrence, as well as the timing of the economic recovery following the pandemic; ability of our customers to meet their obligations to us; our ability to generate sufficient cash flow from operations, borrowings, or other sources to enable us to fully develop our undeveloped acreage positions; the presence or recoverability of estimated oil and natural gas reserves and the actual future sales volume rates and associated costs; uncertainties associated with estimates of proved oil and gas reserves; the assumptions underlying forecasts, including forecasts of production, well costs, capital expenditures, rates of return, expenses, cash flow and cash flow from purchases and sales of oil and gas; the possibility that the industry may be subject to future local, state, and federal regulatory or legislative actions (including additional taxes and changes in environmental regulation); environmental risks; seasonal weather conditions; drilling and operating risks, including the risks associated with the employment of horizontal drilling and completion techniques; our ability to acquire adequate supplies of water for drilling and completion operations; availability of oilfield equipment, services, and personnel; exploration and development risks; competition in the oil and natural gas industry; our ability to secure adequate processing capacity for natural gas we produce, to secure adequate transportation for oil, natural gas, and natural gas liquids we produce, and to sell the oil, natural gas, and natural gas liquids at market prices; continued hostilities in Ukraine, the Middle East, South America, and other sustained military campaigns or acts of terrorism or sabotage; and other economic, competitive, governmental, legislative, regulatory, geopolitical, and technological factors that may negatively impact our businesses, operations, or pricing. Expectations regarding business outlook, including changes in revenue, pricing, capital expenditures, cash flow generation, strategies for our operations, oil and natural gas market conditions, legal, economic and regulatory conditions, and environmental matters are only forecasts regarding these matters.

Additional information concerning other risk factors is also contained in Civitas’ most recently filed Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other Securities and Exchange Commission (“SEC”) filings. Civitas undertakes no duty to publicly update these statements except as required by law.

Schedule 1: Condensed Consolidated Statements of Operations and Comprehensive Income (Loss)

(in thousands, expect for per share amounts, unaudited)

 

Three Months Ended March 31,

 

 

2022

 

 

 

2021

 

Operating net revenues:

 

 

 

Oil, natural gas, and NGL sales

$

817,810

 

 

$

74,159

 

Operating expenses:

 

 

 

Lease operating expense

 

36,019

 

 

 

5,731

 

Midstream operating expense

 

5,712

 

 

 

3,905

 

Gathering, transportation, and processing

 

50,403

 

 

 

4,967

 

Severance and ad valorem taxes

 

63,304

 

 

 

4,604

 

Exploration

 

528

 

 

 

96

 

Depreciation, depletion, and amortization

 

184,860

 

 

 

18,823

 

Abandonment and impairment of unproved properties

 

17,975

 

 

 

 

Unused commitments

 

776

 

 

 

 

Merger transaction costs

 

20,534

 

 

 

3,295

 

General and administrative (including $8,090 and $1,612, respectively, of stock-based compensation)

 

35,720

 

 

 

9,251

 

Total operating expenses

 

415,831

 

 

 

50,672

 

Other income (expense):

 

 

 

Derivative loss

 

(295,493

)

 

 

(23,419

)

Interest expense

 

(9,066

)

 

 

(419

)

Gain on property transactions, net

 

16,797

 

 

 

 

Other income

 

783

 

 

 

188

 

Total other expense

 

(286,979

)

 

 

(23,650

)

Income (loss) from operations before taxes

 

115,000

 

 

 

(163

)

Income tax benefit (expense)

 

(23,361

)

 

 

44

 

Net income (loss)

$

91,639

 

 

$

(119

)

 

 

 

 

Comprehensive income (loss)

$

91,639

 

 

$

(119

)

 

 

 

 

Net income (loss) per common share:

 

 

 

Basic

$

1.08

 

 

$

(0.01

)

Diluted

$

1.07

 

 

$

(0.01

)

Weighted-average common shares outstanding:

 

 

 

Basic

 

84,840

 

 

 

20,839

 

Diluted

 

85,326

 

 

 

20,839

 

 

Schedule 2: Condensed Consolidated Statements of Cash Flows

(in thousands, unaudited)

Three Months Ended March 31,

 

 

2022

 

 

 

2021

 

Cash flows from operating activities:

 

 

 

Net income (loss)

$

91,639

 

 

$

(119

)

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

 

 

 

Depreciation, depletion, and amortization

 

184,860

 

 

 

18,823

 

Deferred income tax expense (benefit)

 

23,361

 

 

 

(44

)

Abandonment and impairment of unproved properties

 

17,975

 

 

 

 

Stock-based compensation

 

8,090

 

 

 

1,612

 

Amortization of deferred financing costs

 

1,078

 

 

 

93

 

Derivative loss

 

295,493

 

 

 

23,419

 

Derivative cash settlements loss

 

(166,578

)

 

 

(3,791

)

Gain on property transactions, net

 

(16,797

)

 

 

 

Other

 

68

 

 

 

(84

)

Changes in current assets and liabilities:

 

 

 

Accounts receivable, net

 

11,906

 

 

 

(5,718

)

Prepaid expenses and other assets

 

(2,398

)

 

 

106

 

Accounts payable and accrued liabilities

 

88,975

 

 

 

9,073

 

Settlement of asset retirement obligations

 

(5,131

)

 

 

(406

)

Net cash provided by operating activities

 

532,541

 

 

 

42,964

 

Cash flows from investing activities:

 

 

 

Acquisition of oil and natural gas properties

 

(300,087

)

 

 

(180

)

Cash acquired

 

44,310

 

 

 

 

Exploration and development of oil and natural gas properties

 

(260,667

)

 

 

(28,730

)

Additions to other property and equipment

 

(68

)

 

 

(38

)

Other

 

212

 

 

 

 

Net cash used in investing activities

 

(516,300

)

 

 

(28,948

)

Cash flows from financing activities:

 

 

 

Proceeds from exercise of stock options

 

178

 

 

 

15

 

Dividends paid

 

(103,596

)

 

 

 

Payment of employee tax withholdings in exchange for the return of common stock

 

(12,928

)

 

 

 

Deferred financing costs

 

 

 

 

(58

)

Other

 

 

 

 

(21

)

Net cash used in financing activities

 

(116,346

)

 

 

(64

)

Net change in cash, cash equivalents, and restricted cash:

 

(100,105

)

 

 

13,952

 

Cash, cash equivalents, and restricted cash:

 

 

 

Beginning of period

 

254,556

 

 

 

24,845

 

End of period (1)

$

154,451

 

 

$

38,797

 

(1) Includes $0.1 million of restricted cash and consists of funds for road maintenance and repairs that is presented in other noncurrent assets within the accompanying unaudited condensed consolidated balance sheets (“balance sheets”) as of both March 31, 2022 and March 31, 2021.

Schedule 3: Condensed Consolidated Balance Sheets

(in thousands, unaudited)

 

March 31, 2022

 

December 31, 2021

ASSETS

 

 

 

Current assets:

 

 

 

Cash and cash equivalents

$

154,349

 

 

$

254,454

 

Accounts receivable, net:

 

 

 

Oil, natural gas, and NGL sales

 

410,418

 

 

 

362,262

 

Joint interest and other

 

72,888

 

 

 

66,390

 

Prepaid expenses and other

 

21,891

 

 

 

21,052

 

Inventory of oilfield equipment

 

14,557

 

 

 

12,386

 

Derivative assets

 

 

 

 

3,393

 

Total current assets

 

674,103

 

 

 

719,937

 

Property and equipment (successful efforts method):

 

 

 

Proved properties

 

5,983,892

 

 

 

5,457,213

 

Less: accumulated depreciation, depletion, and amortization

 

(608,898

)

 

 

(430,201

)

Total proved properties, net

 

5,374,994

 

 

 

5,027,012

 

Unproved properties

 

671,538

 

 

 

688,895

 

Wells in progress

 

213,153

 

 

 

177,296

 

Other property and equipment, net of accumulated depreciation of $5,403 in 2022 and $4,742 in 2021

 

51,046

 

 

 

51,639

 

Total property and equipment, net

 

6,310,731

 

 

 

5,944,842

 

Right-of-use assets

 

36,054

 

 

 

39,885

 

Deferred income tax assets

 

 

 

 

22,284

 

Other noncurrent assets

 

12,859

 

 

 

14,085

 

Total assets

$

7,033,747

 

 

$

6,741,033

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

Current liabilities:

 

 

 

Accounts payable and accrued expenses

$

296,433

 

 

$

246,188

 

Production taxes payable

 

188,962

 

 

 

144,408

 

Oil and natural gas revenue distribution payable

 

422,854

 

 

 

466,233

 

Lease liability

 

18,588

 

 

 

18,873

 

Derivative liability

 

384,694

 

 

 

219,804

 

Asset retirement obligations

 

24,000

 

 

 

24,000

 

Total current liabilities

 

1,335,531

 

 

 

1,119,506

 

Long-term liabilities:

 

 

 

Senior notes

 

492,123

 

 

 

491,710

 

Lease liability

 

17,920

 

 

 

21,398

 

Ad valorem taxes

 

296,773

 

 

 

232,147

 

Derivative liability

 

46,111

 

 

 

19,959

 

Deferred income tax liabilities

 

5,805

 

 

 

 

Asset retirement obligations

 

201,951

 

 

 

201,315

 

Total liabilities

 

2,396,214

 

 

 

2,086,035

 

Commitments and contingencies

 

 

 

Stockholders’ equity:

 

 

 

Preferred stock, $.01 par value, 25,000,000 shares authorized, none outstanding

 

 

 

 

 

Common stock, $.01 par value, 225,000,000 shares authorized, 84,941,558 and 84,572,846 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively

 

4,916

 

 

 

4,912

 

Additional paid-in capital

 

4,194,444

 

 

 

4,199,108

 

Retained earnings

 

438,173

 

 

 

450,978

 

Total stockholders’ equity

 

4,637,533

 

 

 

4,654,998

 

Total liabilities and stockholders’ equity

$

7,033,747

 

 

$

6,741,033

 

 

Schedule 4: Per unit cash cost margins

(unaudited)

 

Three Months Ended March 31,

 

 

 

2022

 

 

 

2021

 

 

Percent
Change

Crude oil equivalent sales volumes (MBoe)

 

 

14,311

 

 

 

1,876

 

 

663

%

 

 

 

 

 

 

 

Realized price (before derivatives) (1)

 

$

57.06

 

 

$

38.93

 

 

47

%

 

 

 

 

 

 

 

Per unit costs ($/Boe)

 

 

 

 

 

 

Lease operating expense

 

$

2.52

 

 

$

3.05

 

 

(17

) %

RMI net effective cost (1)

 

$

0.31

 

 

$

1.49

 

 

(79

) %

Gathering, transportation, and processing

 

$

3.52

 

 

$

2.65

 

 

33

%

Severance and ad valorem taxes

 

$

4.42

 

 

$

2.45

 

 

80

%

Recurring cash general and administrative (2)

 

$

1.73

 

 

$

4.07

 

 

(57

) %

Interest

 

$

0.63

 

 

$

0.22

 

 

186

%

Total cash costs

 

$

13.13

 

 

$

13.93

 

 

(6

) %

Cash cost margin (before derivatives)

 

$

43.93

 

 

$

25.00

 

 

76

%

Derivative cash settlements

 

$

(11.64

)

 

$

(2.02

)

 

476

%

Cash cost margin (after derivatives)

 

$

32.29

 

 

$

22.98

 

 

41

%

 

 

 

 

 

 

 

Non-cash and non-recurring items

 

 

 

 

 

 

Depreciation, depletion, and amortization

 

$

12.92

 

 

$

10.03

 

 

29

%

Non-cash and non-recurring general and administrative

 

$

0.77

 

 

$

0.86

 

 

(10

) %

 

 

 

 

 

 

 

(1) Crude oil and natural gas sales excludes $1.3 million and $1.1 million of oil transportation and gas gathering revenues from third parties, which do not have associated sales volumes for three months ended March 31, 2022 and 2021, respectively. Alternatively, the aforementioned oil transportation and gas gathering revenues from third parties have been netted against the midstream operating expense to arrive at the RMI net effective cost. See Schedule 8 for a reconciliation from GAAP midstream operating expense to RMI net effective cost.

(2) Recurring cash general and administrative expense excludes stock-based compensation, cash severance costs, and other non-recurring fees. Please see Schedule 7 for a reconciliation from GAAP G&A to recurring cash G&A.

Schedule 5: Adjusted Net Income

(in thousands, except per share amounts, unaudited)

Adjusted net income is a supplemental non-GAAP financial measure that is used by management to present a more comparable, recurring profitability between periods. Management believes adjusted net income provides external users of the Company’s consolidated financial statements such as industry analysts, investors, lenders, and rating agencies with additional information to assist in their analysis of the Company. The Company defines adjusted net income as net income after adjusting for (1) the impact of certain non-cash items and one-time transactions and correspondingly (2) the related tax effect in each period. Adjusted net income is not a measure of net income as determined by GAAP.

The following table presents a reconciliation of the GAAP financial measure of net income to the non-GAAP financial measure of adjusted net income.

 

Three Months Ended March 31,

 

 

2022

 

 

 

2021

 

Net income (loss)

$

91,639

 

 

$

(119

)

Adjustments to net income (loss):

 

 

 

Abandonment and impairment of unproved properties

 

17,975

 

 

 

 

Unused commitments

 

776

 

 

 

 

Stock-based compensation (1)

 

8,090

 

 

 

1,612

 

Non-recurring general and administrative expense (1)

 

2,886

 

 

 

 

Merger transaction costs

 

20,534

 

 

 

3,295

 

Gain loss on property transactions, net

 

(16,797

)

 

 

 

Derivative loss

 

295,493

 

 

 

23,419

 

Derivative cash settlement loss

 

(166,578

)

 

 

(3,791

)

Other

 

68

 

 

 

(84

)

Total adjustments before taxes

 

162,447

 

 

 

24,451

 

Tax effect of adjustments (2)

 

(39,962

)

 

 

(6,015

)

Total adjustments after taxes

 

122,485

 

 

 

18,436

 

 

 

 

 

Adjusted net income

$

214,124

 

 

$

18,317

 

 

 

 

 

Adjusted net income per diluted share

$

2.51

 

 

$

0.88

 

 

 

 

 

Diluted weighted-average common shares outstanding

 

85,326

 

 

 

20,839

 

 

 

 

 

(1) Included as a portion of general and administrative expense in the condensed consolidated statements of operations and comprehensive income (loss).

(2) Estimated using the federal and state effective tax rate of 24.6%.

Schedule 6: Adjusted EBITDAX

(in thousands, unaudited)

Adjusted EBITDAX is a supplemental non-GAAP financial measure that is used by management to provide a metric of the Company's ability to internally generate funds for exploration and development of oil and gas properties. The metric excludes items which are non-recurring in nature. Management believes adjusted EBITDAX provides external users of the Company’s consolidated financial statements such as industry analysts, investors, lenders, and rating agencies with additional information to assist in their analysis of the Company. The Company defines Adjusted EBITDAX as earnings before interest, income taxes, depreciation, depletion, and amortization, impairment, exploration expenses and other similar non-cash and non-recurring charges. Adjusted EBITDAX is not a measure of net income or cash flows as determined by GAAP.

The following table presents a reconciliation of the GAAP financial measure of net income to the non-GAAP financial measure of Adjusted EBITDAX.

 

Three Months Ended March 31,

 

 

2022

 

 

 

2021

 

Net income (loss)

$

91,639

 

 

$

(119

)

Exploration

 

528

 

 

 

96

 

Depreciation, depletion and amortization

 

184,860

 

 

 

18,823

 

Abandonment and impairment of unproved properties

 

17,975

 

 

 

 

Stock-based compensation (1)

 

8,090

 

 

 

1,612

 

Non-recurring general and administrative expense (1)

 

2,886

 

 

 

 

Merger transaction costs

 

20,534

 

 

 

3,295

 

Unused commitments

 

776

 

 

 

 

Gain on property transactions, net

 

(16,797

)

 

 

 

Interest expense

 

9,066

 

 

 

419

 

Derivative loss

 

295,493

 

 

 

23,419

 

Derivative cash settlements loss

 

(166,578

)

 

 

(3,791

)

Income tax (benefit) expense

 

23,361

 

 

 

(44

)

Adjusted EBITDAX

$

471,833

 

 

$

43,710

 

 

 

 

 

(1) Included as a portion of general and administrative expense in the consolidated statement of operations and comprehensive income.

Schedule 7: Recurring Cash G&A

(in thousands, unaudited)

Recurring cash G&A is a supplemental non-GAAP financial measure that is used by management to provide only the cash portion of its G&A expense, which can be used to evaluate cost management and operating efficiency on a comparable basis from period to period. Management believes recurring cash G&A provides external users of the Company’s consolidated financial statements such as industry analysts, investors, lenders, and rating agencies with additional information to assist in their analysis of the Company. The Company defines recurring cash G&A as GAAP general and administrative expense exclusive of the Company's stock-based compensation and one-time charges. The Company refers to recurring cash G&A to provide typical recurring cash G&A costs that are planned for in a given period. Recurring cash G&A is not a fully inclusive measure of general and administrative expense as determined by GAAP.

The following table presents a reconciliation of the GAAP financial measure of general and administrative expense to the non-GAAP financial measure of recurring cash G&A.

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

 

2021

 

General and administrative expense

 

$

35,720

 

 

$

9,251

 

Stock-based compensation

 

 

(8,090

)

 

 

(1,612

)

Non-recurring general and administrative expense

 

 

(2,886

)

 

 

 

Recurring Cash G&A

 

$

24,744

 

 

$

7,639

 

 

Schedule 8: RMI Net Effective Cost

(in thousands, unaudited)

RMI net effective cost is a supplemental non-GAAP financial measure that is used by management to assess only the net cash impact the Company’s wholly owned subsidiary, Rocky Mountain Infrastructure, LLC, has on the Company’s consolidated financials. Management believes the net effective cost provides external users of the Company’s consolidated financial statements, such as industry analysts, investors, lenders, and rating agencies, with additional information to assist in their analysis of the Company. The Company defines the RMI net effective cost as GAAP midstream operating expense less revenue generated from working interest partners utilizing the RMI assets.

The following table presents a reconciliation of the GAAP financial measures of midstream operating expense and RMI working interest partner revenue to the non-GAAP financial measure of RMI net effective cost.

 

 

Three Months Ended March 31,

 

 

 

2022

 

 

 

2021

 

Midstream operating expense

 

$

5,712

 

 

$

3,905

 

RMI working interest partner revenue

 

 

(1,267

)

 

 

(1,109

)

RMI net effective cost

 

$

4,445

 

 

$

2,796

 

 

View source version on businesswire.com:https://www.businesswire.com/news/home/20220504006018/en/

CONTACT: Investor Relations:

John Wren,ir@civiresources.comMedia:

Brian Cain,info@civiresources.com

KEYWORD: UNITED STATES NORTH AMERICA COLORADO

INDUSTRY KEYWORD: OIL/GAS ENERGY

SOURCE: Civitas Resources, Inc.

Copyright Business Wire 2022.

PUB: 05/04/2022 04:30 PM/DISC: 05/04/2022 04:32 PM

http://www.businesswire.com/news/home/20220504006018/en

Copyright Business Wire 2022.