Attached files
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| 8-K/A - FORM 8-K AMENDMENT NO.1 - BILL BARRETT CORP | d475251d8ka.htm |
Exhibit 99.2
Bill Barrett Corporation
Unaudited Pro Forma Condensed Consolidated Financial Information
On December 31, 2012, Bill Barrett Corporation (the “Company”) closed on its previously announced sale to an affiliate of Vanguard Natural Resources, LLC (“Buyer”) of certain of the Company’s non-core natural gas assets under the Purchase and Sale Agreement between the Company and Buyer dated October 31, 2012 (the “Agreement”). The assets sold include all Wind River Basin natural gas producing properties, the Company’s Powder River Basin coal bed methane assets and a working interest in its Gibson Gulch-Piceance Basin development property. Total consideration received by the Company was $328.8 million after customary preliminary closing adjustments. The transaction was effective as of October 1, 2012.
The following pro forma condensed consolidated balance sheet information as of September 30, 2012 is based on the historical financial statements of the Company, including certain pro forma adjustments, and has been prepared to illustrate the pro forma effect of the Company’s sale on December 31, 2012 of the Wind River Basin (“WRB”) natural gas producing properties, the Company’s Powder River Basin coalbed methane (“CBM”) assets and a working interest in its Gibson Gulch-Piceance Basin development property on December 31, 2012 as if the sale had occurred on September 30, 2012.
The unaudited pro forma consolidated statements of income for the three and nine months ended September 30, 2012 and the year ended December 31, 2011 are based on the historical financial statements of the Company, including certain pro forma adjustments, and assume that the sale of the assets occurred as of the beginning of the period presented.
The unaudited pro forma condensed consolidated financial information has been prepared based upon available information and management estimates; actual amounts may differ from these estimated amounts. In preparing the pro forma information, the Company eliminated all direct expenses related to the properties, but did not adjust general and administrative expenses or for commodity hedging activity. The unaudited pro forma condensed combined financial information is for informational purposes only and is not intended to represent or be indicative of the results of operations or financial position of the Company or the pro forma effect of closing of the divestiture and should not be taken as indicative of the Company’s future results of operations or financial position. Actual results may differ significantly from those reflected in the unaudited pro forma financial information for a number of reasons, including, but not limited to, differences between the assumptions used to prepare the unaudited pro forma combined financial information and actual results. The pro forma adjustments are described in the Notes to the Unaudited Pro Forma Condensed Consolidated Financial Statements.
The unaudited pro forma condensed consolidated financial information should be read in conjunction with the financial statements and notes and related Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2012 and the Company’s Annual Report on Form 10-K for the year ended December 31, 2011.
Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements
| (1) | Basis of Presentation |
The accompanying unaudited pro forma consolidated financial statements give effect to pro forma adjustments to reflect the sale of the WRB natural gas producing properties, the CBM assets and a working interest in the Gibson Gulch-Piceance Basin development property as if the sale had occurred as of the beginning of the period presented in the pro forma statements of income for the three and nine months ended September 30, 2012 and for the year ended December 31, 2011 and as if the sale had occurred on September 30, 2012 in the pro forma balance sheet.
| (2) | Pro Forma Adjustments |
The unaudited pro forma condensed consolidated statements of income and balance sheet reflect the effect of the following pro forma adjustments:
| (a) | The sale of the oil and gas assets as if the sale had occurred on September 30, 2012. |
| (b) | The effect on stockholders’ equity as a result of adjustment (a). |
| (c) | The assumed paydown of outstanding borrowings under the Company’s bank credit facility with a portion of the net cash proceeds from the divestiture. This $160.0 million represents the outstanding balance on the credit facility as of September 30, 2012. |
| (d) | The difference between the purchase price of $335.0 million (before closing adjustments) and the paydown of the outstanding borrowings under the Company’s bank credit facility as of September 30, 2012 of $160.0 million. |
| (e) | The reversal of interest expense relating to the Company’s credit facility in conjunction with the paydown of the credit facility with proceeds received from the divestiture for the three and nine months ended September 30, 2012 and for the year ended December 31, 2011. |
| (f) | Elimination of sales of natural gas, oil and natural gas related revenues directly related to the assets for the three and nine months ended September 30, 2012 and for the year ended December 31, 2011. |
| (g) | Elimination of direct operating expenses and income taxes related to the assets for the three and nine months ended September 30, 2012 and for the year ended December 31, 2011. |
BILL BARRETT CORPORATION
Unaudited Pro Forma Condensed Consolidated Balance Sheet
September 30, 2012
| Bill Barrett Historical |
Pro Forma Adjustments |
Unaudited Pro Forma Balance Sheet |
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| (In thousands) | ||||||||||||
| Current Assets: |
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| Cash and cash equivalents |
$ | 23,933 | $ | 175,000 | (d) | $ | 198,933 | |||||
| Accounts Receivable |
97,025 | 0 | 97,025 | |||||||||
| Derivative Assets |
32,867 | 0 | 32,867 | |||||||||
| Prepayments and other current assets |
6,763 | 0 | 6,763 | |||||||||
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| Total current assets |
160,588 | 175,000 | 335,588 | |||||||||
| Property and Equipment — At cost, successful efforts method for oil and gas properties: |
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| Proved oil and gas properties |
4,149,790 | (1,094,254 | )(a) | 3,055,536 | ||||||||
| Unproved oil and gas properties, excluded from amortization |
580,912 | (22,869 | )(a) | 558,043 | ||||||||
| Furniture, equipment and other |
44,186 | (416 | )(a) | 43,770 | ||||||||
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| 4,774,888 | (1,117,539 | ) | 3,657,349 | |||||||||
| Accumulated depreciation, depletion, amortization and impairment |
(1,910,047 | ) | 759,821 | (1,150,226 | ) | |||||||
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| Total property and equipment, net |
2,864,841 | (357,718 | )(a) | 2,507,123 | ||||||||
| Deferred financing costs and other noncurrent assets |
35,200 | 0 | 35,200 | |||||||||
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| Total assets |
$ | 3,060,629 | $ | (182,718 | ) | $ | 2,877,911 | |||||
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| Current Liabilities: |
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| Accounts payable and accrued liabilities |
$ | 140,932 | $ | (255 | )(a) | $ | 140,677 | |||||
| Amounts payable to oil and gas property owners |
16,360 | 0 | 16,360 | |||||||||
| Production taxes payable |
46,134 | 0 | 46,134 | |||||||||
| Derivative liabilities |
611 | 0 | 611 | |||||||||
| Deferred income taxes |
6,722 | 0 | 6,722 | |||||||||
| Current portion of long-term debt |
9,003 | 0 | 9,003 | |||||||||
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| Total current liabilities |
219,762 | (255 | ) | 219,507 | ||||||||
| Long-Term debt |
1,318,540 | (160,000 | )(c) | 1,158,540 | ||||||||
| Asset retirement obligation |
71,100 | (30,994 | )(a) | 40,106 | ||||||||
| Deferred income taxes |
271,388 | (3,756 | )(a) | 267,632 | ||||||||
| Derivatives and other noncurrent liabilities |
5,632 | 0 | 5,632 | |||||||||
| Total stockholders’ equity |
1,174,207 | 12,287 | (b) | 1,186,494 | ||||||||
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| Total liabilities |
$ | 3,060,629 | $ | (182,718 | ) | $ | 2,877,911 | |||||
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BILL BARRETT CORPORATION
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the nine months ended September 30, 2012
| Bill Barrett Historical |
Pro Forma Adjustments |
Unaudited Pro Forma Statement of Operations |
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| (in thousands, except share and per share amounts) | ||||||||||||
| Operating and Other Revenues: |
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| Oil and gas production |
$ | 516,556 | $ | (68,467 | )(f) | $ | 448,089 | |||||
| Other |
3,838 | 0 | 3,838 | |||||||||
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| Total operating and other revenues |
520,394 | $ | (68,467 | ) | 451,927 | |||||||
| Operating Expenses: |
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| Lease operating expense |
54,671 | (10,309 | )(g) | 44,362 | ||||||||
| Gathering, transportation and processing expense |
79,939 | (16,733 | )(g) | 63,206 | ||||||||
| Production tax expense |
21,193 | (4,772 | )(g) | 16,421 | ||||||||
| Exploration expense |
8,063 | (298 | )(g) | 7,765 | ||||||||
| Impairment, dry hole costs and abandonment expense |
60,179 | (9,052 | )(g) | 51,127 | ||||||||
| Depreciation, depletion and amortization |
251,417 | (40,753 | )(g) | 210,664 | ||||||||
| General and administrative expense |
51,441 | 0 | 51,441 | |||||||||
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| Total operating expenses |
526,903 | (81,917 | ) | 444,986 | ||||||||
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| Operating Income (Loss) |
(6,509 | ) | 13,450 | 6,941 | ||||||||
| Other Income and Expense: |
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| Interest income and other income (expense) |
128 | 0 | 128 | |||||||||
| Interest expense |
(70,029 | ) | 1,607 | (e) | (68,422 | ) | ||||||
| Commodity derivative gain (loss) |
53,431 | 0 | 53,431 | |||||||||
| Gain on extinguishment of debt |
1,601 | 0 | 1,601 | |||||||||
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| Total other income and expense |
(14,869 | ) | 1,607 | (13,262 | ) | |||||||
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| Income (Loss) before Income Taxes |
(21,378 | ) | 15,057 | (6,321 | ) | |||||||
| Provision for (Benefit from) Income Taxes |
(7,943 | ) | 5,654 | (g) | (2,289 | ) | ||||||
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| Net Income (Loss) |
$ | (13,435 | ) | $ | 9,403 | $ | (4,032 | ) | ||||
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| Net Income Per Common Share, Basic |
$ | (0.28 | ) | $ | (0.09 | ) | ||||||
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| Net Income Per Common Share, Diluted |
$ | (0.28 | ) | $ | (0.09 | ) | ||||||
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| Weighted Average Common Shares Outstanding, Basic |
47,172,656 | 47,172,656 | ||||||||||
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| Weighted Average Common Shares Outstanding, Diluted |
47,172,656 | 47,172,656 | ||||||||||
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BILL BARRETT CORPORATION
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the three months ended September 30, 2012
| Bill Barrett Historical |
Pro Forma Adjustments |
Unaudited Pro Forma Statement of Operations |
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| (in thousands, except share and per share amounts) | ||||||||||||
| Operating and Other Revenues: |
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| Oil and gas production |
$ | 180,024 | $ | (22,797 | )(f) | $ | 157,227 | |||||
| Other |
842 | 0 | 842 | |||||||||
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| Total operating and other revenues |
180,866 | $ | (22,797 | ) | 158,069 | |||||||
| Operating Expenses: |
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| Lease operating expense |
17,003 | (2,897 | )(g) | 14,106 | ||||||||
| Gathering, transportation and processing expense |
26,725 | (5,743 | )(g) | 20,982 | ||||||||
| Production tax expense |
8,094 | (1,861 | )(g) | 6,233 | ||||||||
| Exploration expense |
3,562 | (48 | )(g) | 3,514 | ||||||||
| Impairment, dry hole costs and abandonment expense |
38,540 | (7 | )(g) | 38,533 | ||||||||
| Depreciation, depletion and amortization |
91,392 | (13,842 | )(g) | 77,550 | ||||||||
| General and administrative expense |
17,965 | 0 | 17,965 | |||||||||
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| Total operating expenses |
203,281 | (24,398 | ) | 178,883 | ||||||||
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| Operating Income (Loss) |
(22,415 | ) | 1,601 | (20,814 | ) | |||||||
| Other Income and Expense: |
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| Interest income and other income (expense) |
53 | 0 | 53 | |||||||||
| Interest expense |
(24,527 | ) | 870 | (e) | (23,657 | ) | ||||||
| Commodity derivative gain (loss) |
(38,340 | ) | 0 | (38,340 | ) | |||||||
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| Total other income and expense |
(62,814 | ) | 870 | (61,944 | ) | |||||||
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| Income (Loss) before Income Taxes |
(85,229 | ) | 2,471 | (82,758 | ) | |||||||
| Provision for (Benefit from) Income Taxes |
(32,603 | ) | 928 | (g) | (31,675 | ) | ||||||
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| Net Income (Loss) |
$ | (52,626 | ) | $ | 1,543 | $ | (51,083 | ) | ||||
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| Net Income Per Common Share, Basic |
$ | (1.11 | ) | $ | (1.08 | ) | ||||||
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| Net Income Per Common Share, Diluted |
$ | (1.11 | ) | $ | (1.08 | ) | ||||||
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| Weighted Average Common Shares Outstanding, Basic |
47,230,473 | 47,230,473 | ||||||||||
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| Weighted Average Common Shares Outstanding, Diluted |
47,230,473 | 47,230,473 | ||||||||||
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BILL BARRETT CORPORATION
Unaudited Pro Forma Condensed Consolidated Statements of Operations
For the year ended December 31, 2011
| Bill Barrett Historical |
Pro Forma Adjustment |
Unaudited Pro Forma Statement of Operations |
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| (in thousands, except share and per share amounts) | ||||||||||||
| Operating and Other Revenues: |
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| Oil and gas production |
$ | 780,751 | $ | (139,584 | )(f) | $ | 641,167 | |||||
| Other |
4,873 | 0 | 4,873 | |||||||||
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| Total operating and other revenues |
785,624 | (139,584 | ) | 646,040 | ||||||||
| Operating Expenses: |
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| Lease operating expense |
56,603 | (13,822 | )(g) | 42,781 | ||||||||
| Gathering, transportation and processing expense |
93,423 | (23,453 | )(g) | 69,970 | ||||||||
| Production tax expense |
37,498 | (12,306 | )(g) | 25,192 | ||||||||
| Exploration expense |
3,645 | (395 | )(g) | 3,250 | ||||||||
| Impairment, dry hole costs and abandonment expense |
117,599 | (95,474 | )(g) | 22,125 | ||||||||
| Depreciation, depletion and amortization |
288,421 | (71,812 | )(g) | 216,609 | ||||||||
| General and administrative expense |
66,780 | 0 | 66,780 | |||||||||
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| Total operating expenses |
663,969 | (217,262 | ) | 446,707 | ||||||||
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| Operating Income |
121,655 | 77,678 | 199,333 | |||||||||
| Other Income and Expense: |
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| Interest income and other income (expense) |
(397 | ) | 0 | (397 | ) | |||||||
| Interest expense |
(58,616 | ) | 2,553 | (e) | (56,063 | ) | ||||||
| Commodity derivative gain (loss) |
(14,263 | ) | 0 | (14,263 | ) | |||||||
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| Total other income and expense |
(73,276 | ) | 2,553 | (70,723 | ) | |||||||
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| Income before Income Taxes |
48,379 | 80,231 | 128,610 | |||||||||
| Provision for Income Taxes |
17,672 | 30,111 | (g) | 47,783 | ||||||||
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| Net Income |
$ | 30,707 | $ | 50,120 | $ | 80,827 | ||||||
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| Net Income Per Common Share, Basic |
$ | 0.66 | $ | 1.74 | ||||||||
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| Net Income Per Common Share, Diluted |
$ | 0.65 | $ | 1.71 | ||||||||
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| Weighted Average Common Shares Outstanding, Basic |
46,535,632 | 46,535,632 | ||||||||||
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| Weighted Average Common Shares Outstanding, Diluted |
47,236,663 | 47,236,663 | ||||||||||
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