Attached files
| file | filename |
|---|---|
| 8-K - FORM 8-K - PETROHAWK ENERGY CORP | d8k.htm |
| EX-10.2 - ASSIGNMENT OF AGREEMENT OF SALE AND PURCHASE - PETROHAWK ENERGY CORP | dex102.htm |
Exhibit 99.1
Petrohawk Energy Corporation
Unaudited Pro Forma Consolidated Balance Sheet
(In thousands)
| September 30, 2009 | ||||||||||||
| Historical | Adjustments | Pro Forma | ||||||||||
| Current assets: |
||||||||||||
| Cash |
$ | 1,692 | $ | — | $ | 1,692 | ||||||
| Marketable securities |
150,028 | — | 150,028 | |||||||||
| Accounts receivable |
181,915 | — | 181,915 | |||||||||
| Receivables from derivative contracts |
150,346 | — | 150,346 | |||||||||
| Prepaids and other |
42,079 | — | 42,079 | |||||||||
| Total current assets |
526,060 | — | 526,060 | |||||||||
| Oil and natural gas properties (full cost method): |
||||||||||||
| Evaluated |
5,947,489 | (383,822 | )(1) | 5,563,667 | ||||||||
| Unevaluated |
2,332,134 | (1,748 | )(2) | 2,330,386 | ||||||||
| Gross oil and natural gas properties |
8,279,623 | (385,570 | ) | 7,894,053 | ||||||||
| Less—accumulated depletion |
(4,122,596 | ) | — | (4,122,596 | ) | |||||||
| Net oil and natural gas properties |
4,157,027 | (385,570 | ) | 3,771,457 | ||||||||
| Other operating property and equipment: |
||||||||||||
| Gas gathering system and equipment |
448,596 | — | 448,596 | |||||||||
| Other operating assets |
24,301 | — | 24,301 | |||||||||
| Gross other operating property and equipment |
472,897 | — | 472,897 | |||||||||
| Less—accumulated depreciation |
(21,347 | ) | — | (21,347 | ) | |||||||
| Net other operating property and equipment |
451,550 | — | 451,550 | |||||||||
| Other noncurrent assets: |
||||||||||||
| Goodwill |
932,802 | — | 932,802 | |||||||||
| Other intangible assets |
103,266 | — | 103,266 | |||||||||
| Deferred income taxes |
173,037 | — | 173,037 | |||||||||
| Debt issuance costs, net of amortization |
36,586 | — | 36,586 | |||||||||
| Receivables from derivative contracts |
24,589 | — | 24,589 | |||||||||
| Restricted cash |
— | 338,400 | (3) | 338,400 | ||||||||
| Other |
2,551 | 2,551 | ||||||||||
| Total assets |
$ | 6,407,468 | $ | (47,170 | ) | $ | 6,360,298 | |||||
| Current liabilities: |
||||||||||||
| Accounts payable and accrued liabilities |
$ | 610,496 | $ | (37,600 | )(1) | $ | 572,896 | |||||
| Deferred income taxes |
42,976 | — | 42,976 | |||||||||
| Liabilities from derivative contracts |
363 | — | 363 | |||||||||
| Long-term debt |
39,821 | — | 39,821 | |||||||||
| Total current liabilities |
693,656 | (37,600 | ) | 656,056 | ||||||||
| Long-term debt |
2,394,270 | — | 2,394,270 | |||||||||
| Other noncurrent liabilities: |
||||||||||||
| Liabilities from derivative contracts |
1,237 | — | 1,237 | |||||||||
| Asset retirement obligations |
31,660 | (9,570 | )(4) | 22,090 | ||||||||
| Other |
4,235 | — | 4,235 | |||||||||
| Commitments and contingencies |
||||||||||||
| Stockholders' equity: |
||||||||||||
| Common stock |
301 | — | 301 | |||||||||
| Additional paid-in capital |
4,594,885 | — | 4,594,885 | |||||||||
| Accumulated deficit |
(1,312,776 | ) | — | (1,312,776 | ) | |||||||
| Total stockholders’ equity |
3,282,410 | — | 3,282,410 | |||||||||
| Total liabilities and stockholders’ equity |
$ | 6,407,468 | $ | (47,170 | ) | $ | 6,360,298 | |||||
See accompanying notes to the unaudited pro forma consolidated financial statements.
Petrohawk Energy Corporation
Unaudited Pro Forma Consolidated Statement of Operations
(In thousands, except per share amounts)
| Nine Months Ended September 30, 2009 | ||||||||||||
| Petrohawk Historical |
Adjustments | Petrohawk Pro Forma |
||||||||||
| Operating revenues: |
||||||||||||
| Oil and natural gas |
$ | 512,528 | $ | (46,392 | )(5) | $ | 466,136 | |||||
| Marketing |
216,165 | — | 216,165 | |||||||||
| Total operating revenues |
728,693 | (46,392 | ) | 682,301 | ||||||||
| Operating expenses: |
||||||||||||
| Marketing |
211,722 | — | 211,722 | |||||||||
| Production: |
||||||||||||
| Lease operating |
55,903 | (12,348 | )(5) | 43,555 | ||||||||
| Workover and other |
1,793 | (501 | )(5) | 1,292 | ||||||||
| Taxes other than income |
39,921 | (2,782 | )(5) | 37,139 | ||||||||
| Gathering, transportation and other |
65,870 | (1,114 | )(5) | 64,756 | ||||||||
| General and administrative |
68,181 | — | 68,181 | |||||||||
| Depletion, depreciation and amortization |
290,383 | (26,930 | )(6) | 263,106 | ||||||||
| (347 | )(4) | |||||||||||
| Full cost ceiling impairment |
1,732,486 | (180,580 | )(7) | 1,551,906 | ||||||||
| Total operating expenses |
2,466,259 | (224,602 | ) | 2,241,657 | ||||||||
| (Loss) income from operations |
(1,737,566 | ) | 178,210 | (1,559,356 | ) | |||||||
| Other income: |
||||||||||||
| Net gain on derivative contracts |
196,360 | — | 196,360 | |||||||||
| Interest expense and other |
(170,929 | ) | — | (170,929 | ) | |||||||
| Total other income |
25,431 | — | 25,431 | |||||||||
| (Loss) income before income taxes |
(1,712,135 | ) | 178,210 | (1,533,925 | ) | |||||||
| Income tax benefit (provision) |
650,201 | (67,677 | )(8) | 582,524 | ||||||||
| Net (loss) income available to common stockholders |
$ | (1,061,934 | ) | $ | 110,533 | $ | (951,401 | ) | ||||
| Net loss per share of common stock: |
||||||||||||
| Basic |
$ | (3.88 | ) | $ | (3.48 | ) | ||||||
| Diluted |
$ | (3.88 | ) | $ | (3.48 | ) | ||||||
| Weighted average shares outstanding: |
||||||||||||
| Basic |
273,477 | 273,477 | ||||||||||
| Diluted |
273,477 | 273,477 | ||||||||||
See accompanying notes to the unaudited pro forma consolidated financial statements.
Petrohawk Energy Corporation
Unaudited Pro Forma Consolidated Statement of Operations
(In thousands, except per share amounts)
| Year Ended December 31, 2008 | ||||||||||||
| Petrohawk Historical |
Adjustments | Petrohawk Pro Forma |
||||||||||
| Operating revenues: |
||||||||||||
| Oil and natural gas |
$ | 1,031,657 | $ | (140,313 | )(5) | $ | 891,344 | |||||
| Marketing |
63,553 | — | 63,553 | |||||||||
| Total operating revenues |
1,095,210 | (140,313 | ) | 954,897 | ||||||||
| Operating expenses: |
||||||||||||
| Marketing |
58,581 | — | 58,581 | |||||||||
| Production: |
||||||||||||
| Lease operating |
52,477 | (18,687 | )(5) | 33,790 | ||||||||
| Workover and other |
5,624 | (2,897 | )(5) | 2,727 | ||||||||
| Taxes other than income |
47,104 | (12,091 | )(5) | 35,013 | ||||||||
| Gathering, transportation and other |
47,309 | (1,783 | )(5) | 45,526 | ||||||||
| General and administrative |
74,810 | — | 74,810 | |||||||||
| Depletion, depreciation and amortization |
396,556 | (8,248 | )(6) | 387,872 | ||||||||
| (436 | )(4) | |||||||||||
| Full cost ceiling impairment |
950,799 | (104,947 | )(7) | 845,852 | ||||||||
| Total operating expenses |
1,633,260 | (149,089 | ) | 1,484,171 | ||||||||
| (Loss) income from operations |
(538,050 | ) | 8,776 | (529,274 | ) | |||||||
| Other income: |
||||||||||||
| Net gain on derivative contracts |
156,870 | — | 156,870 | |||||||||
| Interest expense and other |
(151,825 | ) | — | (151,825 | ) | |||||||
| Total other income |
5,045 | — | 5,045 | |||||||||
| (Loss) income before income taxes |
(533,005 | ) | 8,776 | (524,229 | ) | |||||||
| Income tax benefit (provision) |
144,953 | (2,387 | )(8) | 142,566 | ||||||||
| Net (loss) income available to common stockholders |
$ | (388,052 | ) | $ | 6,389 | $ | (381,663 | ) | ||||
| Net loss per share of common stock: |
||||||||||||
| Basic |
$ | (1.77 | ) | $ | (1.74 | ) | ||||||
| Diluted |
$ | (1.77 | ) | $ | (1.74 | ) | ||||||
| Weighted average shares outstanding: |
||||||||||||
| Basic |
218,993 | 218,993 | ||||||||||
| Diluted |
218,993 | 218,993 | ||||||||||
See accompanying notes to the unaudited pro forma consolidated financial statements.
Petrohawk Energy Corporation
Notes to Unaudited Pro Forma Consolidated Financial Statements
Note 1 – Basis of Presentation
The unaudited pro forma financial information is presented to illustrate the effect of Petrohawk’s October 30, 2009 sale of its Permian Basin properties on its historical financial position and operating results. The unaudited pro forma balance sheet as of September 30, 2009 is based on the historical statements of Petrohawk as of September 30, 2009 after giving effect to the transaction as if it had occurred on September 30, 2009. The unaudited pro forma statements of operations for the nine months ended September 30, 2009 and the fiscal year ended December 31, 2008 are based on the historical financial statements of Petrohawk for such periods after giving effect to the transaction as if it had occurred on January 1, 2008. The unaudited pro forma financial information should be read in conjunction with Petrohawk’s historical consolidated financial statements and notes thereto contained in Petrohawk’s 2008 Annual Report on Form 10-K, as amended, filed on April 30, 2009, and Petrohawk’s Form 10-Q for the quarter ended September 30, 2009, filed on November 4, 2009.
The preparation of the unaudited pro forma consolidated financial information is based on financial statements prepared in accordance with accounting principles generally accepted in the United States of America. These principles require the use of estimates that affect the reported amounts of assets, liabilities, revenues and expenses. Actual results could differ from those estimates.
The unaudited pro forma consolidated financial information is provided for illustrative purposes only and does not purport to represent what the actual results of operations or the financial position of the company would have been had the transactions occurred on the respective dates assumed, nor is it necessarily indicative of the Company’s future operating results or financial position. However, the pro forma adjustments reflected in the accompanying unaudited pro forma consolidated financial information reflect estimates and assumptions that the company’s management believes to be reasonable.
Note 2 – Pro Forma Adjustments
The unaudited pro forma consolidated balance sheet at September 30, 2009 reflects the following adjustments:
| (1) | Adjustment to reduce the full cost pool for the sale of the Company’s Permian Basin assets, $37.6 million had already been received by the Company as of September 30, 2009 as a deposit; |
| (2) | Adjustment to reduce unevaluated oil and natural gas properties associated with the Company’s Permian Basin assets; |
| (3) | Reflects the $338.4 million received directly by a qualified intermediary to facilitate like-kind exchange transactions; and |
| (4) | Reflects the elimination of asset retirement obligations associated with the Permian Basin assets that were sold. |
The unaudited pro forma consolidated statements of operations for the year ended December 31, 2008 and for the nine months ended September 30, 2009 reflect the following adjustments:
| (5) | Reflects the elimination of oil and gas revenues and operating expenses associated with the Permian Basin assets that were sold; |
| (6) | To adjust historical depletion expense associated with oil and natural gas properties as if the sale of the Permian Basin assets had occurred on January 1, 2008. Depletion expense is calculated using the unit of production method under full cost accounting; |
| (7) | Reflects the elimination of a portion of the Company’s full cost ceiling impairments associated with the Permian Basin assets that were sold; and |
| (8) | Adjustment to record income tax expense on the unaudited pro forma consolidated results of operations based on the Company’s historical effective tax rates of 27.2% for the year ended December 31, 2008, and 38.0% for the nine months ended September 30, 2009. |
Petrohawk will incur approximately $0.5 million in transaction costs. This amount consists of costs associated with employee severance payments. These costs are directly attributable to the transaction and have been excluded from the pro forma financial statements as they represent material nonrecurring charges.