Attached files
| file | filename |
|---|---|
| EX-99.1 - EX-99.1 - ENERGEN CORP | d356856dex991.htm |
| EX-99.2 - EX-99.2 - ENERGEN CORP | d356856dex992.htm |
| 8-K - 8-K - ENERGEN CORP | d356856d8k.htm |
Exhibit 99.3
Non-GAAP Financial Measures
Adjusted Net Income is a Non-GAAP financial measure (GAAP refers to generally accepted accounting principles) which excludes the effects of certain non-cash mark-to-market derivative financial instruments. Adjusted income from continuing operations further excludes impairment losses, certain pension and pension settlement expenses and losses associated with a current period reduction in force and held for sale assets including the San Juan divestment (completed in the first quarter of 2015). Energen believes that excluding the impact of these items is more useful to analysts and investors in comparing the results of operations and operational trends between reporting periods and relative to other oil and gas producing companies.
| Three Months Ended 3/31/2016 | ||||||||
| Energen Net Income ($ in millions except per share data) |
Net Income | Per Diluted Share |
||||||
| Net Income (Loss) All Operations (GAAP) |
(203.1 | ) | (2.34 | ) | ||||
| Non-cash mark-to-market losses (net of $0.1 tax) |
0.2 | 0.00 | ||||||
| Asset impairment, other (net of $78.5 tax) |
141.5 | 1.63 | ||||||
| Pension settlement expenses (net of $1.2 tax) |
2.2 | 0.02 | ||||||
| Loss associated with reduction in force / held for sale properties (net of $2.1 tax) |
3.7 | 0.04 | ||||||
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|
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| Adjusted Income from Continuing Operations (Non-GAAP) |
(55.5 | ) | (0.64 | ) | ||||
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| Three Months Ended 3/31/2015 | ||||||||
| Energen Net Income ($ in millions except per share data) |
Net Income | Per Diluted Share |
||||||
| Net Income (Loss) All Operations (GAAP) |
(15.4 | ) | (0.21 | ) | ||||
| Non-cash mark-to-market losses (net of $21.3 tax) |
38.4 | 0.53 | ||||||
| Asset impairment, other (net of $2.4 tax) |
4.2 | 0.06 | ||||||
| Pension and pension settlement expenses (net of $1.1 tax) |
2.0 | 0.03 | ||||||
| Income associated with held for sale properties (net of $13.4 tax) |
(22.3 | ) | (0.31 | ) | ||||
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|
|||||
| Adjusted Income from Continuing Operations (Non-GAAP) |
6.8 | 0.09 | ||||||
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|
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Note: Amounts may not sum due to rounding
Non-GAAP Financial Measures
Earnings before interest, taxes, depreciation, depletion, amortization and exploration expenses (EBITDAX) is a Non-GAAP financial measure (GAAP refers to generally accepted accounting principles). Adjusted EBITDAX from continuing operations further excludes losses associated with a current period reduction in force and held for sale assets including the San Juan divestment (completed in the first quarter of 2015), impairment losses, certain non-cash mark-to-market derivative financial instruments and certain pension and pension settlement expenses. Energen believes these measures allow analysts and investors to understand the financial performance of the company from core business operations, without including the effects of capital structure, tax rates and depreciation. Further, this measure is useful in comparing the company and other oil and gas producing companies.
| Reconciliation To GAAP Information | Three Months Ended 3/31 | |||||||
| ($ in millions) |
2016 | 2015 | ||||||
| Energen Net Income (Loss) (GAAP) |
(203.1 | ) | (15.4 | ) | ||||
| (Income) Loss associated with reduction in force / held for sale properties, net of tax |
3.7 | (22.3 | ) | |||||
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|
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| Adjusted Net Income from Continuing Operations (Non-GAAP) |
(199.4 | ) | (37.7 | ) | ||||
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|
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| Interest expense |
9.8 | 11.8 | ||||||
| Income tax expense (benefit) * |
(106.3 | ) | (22.1 | ) | ||||
| Depreciation, depletion and amortization * |
114.8 | 120.6 | ||||||
| Accretion expense * |
1.5 | 1.4 | ||||||
| Exploration expense * |
0.2 | 0.7 | ||||||
| Adjustment for asset impairment |
220.0 | 6.6 | ||||||
| Adjustment for mark-to-market losses * |
0.3 | 59.7 | ||||||
| Adjustment for pension and pension settlement expenses |
3.3 | 3.1 | ||||||
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| Energen Adjusted EBITDAX from Continuing Operations (Non-GAAP) |
44.2 | 143.9 | ||||||
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|
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Note: Amounts may not sum due to rounding
| * | Amount adjusted to exclude held for sale assets in either current or prior period. See reconciliation to GAAP Information for the Three Months Ended 3/31/2016 and 3/31/2015. |
2
Non-GAAP Financial Measures
The consolidated statement of income excluding certain divestments is a Non-GAAP financial measure (GAAP refers to generally accepted accounting principles). Energen believes excluding information associated with a reduction in force and held for sale assets including the divestment of assets held in the San Juan Basin (completed in the first quarter of 2015) provides analysts and investors useful information to understand the financial performance of the company from ongoing business operations. Further, this information is useful in comparing the company and other oil and gas producing companies operating primarily in the Permian Basin.
| Energen Net Income (Loss) Excluding RIF* and Held for Sale Assets Reconciliation to GAAP Information |
Three Months Ended March 31, 2016 |
|||||||||||||||||||||
| (in thousands except per share and production data) | GAAP | $/BOE | RIF* / Held for Sale | Non-GAAP | $/BOE | |||||||||||||||||
| Revenues |
||||||||||||||||||||||
| Oil, natural gas liquids and natural gas sales |
$ | 122,764 | $ | 10,117 | $ | 112,647 | ||||||||||||||||
| Gain (loss) on derivative instruments |
5,455 | $ | — | 5,455 | ||||||||||||||||||
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| Total Revenues |
128,219 | 10,117 | 118,102 | |||||||||||||||||||
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| Operating Costs and Expenses |
||||||||||||||||||||||
| Oil, natural gas liquids and natural gas production |
47,727 | $ | 8.55 | 5,780 | 41,947 | $ | 8.51 | |||||||||||||||
| Production and ad valorem taxes |
11,170 | $ | 2.00 | 1,246 | 9,924 | $ | 2.01 | |||||||||||||||
| O&G Depreciation, depletion and amortization |
118,020 | $ | 21.15 | 4,575 | 113,445 | $ | 23.02 | |||||||||||||||
| FF&E Depreciation, depletion and amortization |
1,342 | $ | 0.24 | — | 1,342 | $ | 0.27 | |||||||||||||||
| Asset impairment |
220,025 | — | 220,025 | |||||||||||||||||||
| Exploration |
242 | 59 | 183 | |||||||||||||||||||
| General and administrative † |
29,525 | $ | 5.29 | £ | 3,884 | 25,641 | $ | 5.20 | ||||||||||||||
| Accretion of discount on asset retirement obligations |
1,757 | 239 | 1,518 | |||||||||||||||||||
| (Gain) loss on sale of assets and other |
222 | 142 | 80 | |||||||||||||||||||
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| Total costs and expenses |
430,030 | 15,925 | 414,105 | |||||||||||||||||||
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| Operating Income (Loss) |
(301,811 | ) | (5,808 | ) | (296,003 | ) | ||||||||||||||||
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| Other Income/(Expense) |
||||||||||||||||||||||
| Interest Expense |
(9,833 | ) | — | (9,833 | ) | |||||||||||||||||
| Other income |
95 | — | 95 | |||||||||||||||||||
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| Total other expense |
(9,738 | ) | — | (9,738 | ) | |||||||||||||||||
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| Loss Before Income Taxes |
(311,549 | ) | (5,808 | ) | (305,741 | ) | ||||||||||||||||
| Income tax expense (benefit) |
(108,433 | ) | (2,091 | ) | (106,342 | ) | ||||||||||||||||
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| Net Income (Loss) |
$ | (203,116 | ) | $ | (3,717 | ) | $ | (199,399 | ) | |||||||||||||
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| Diluted Earnings Per Average Common Share |
$ | (2.34 | ) | $ | (0.04 | ) | $ | (2.30 | ) | |||||||||||||
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| Basic earning Per Average Common Share |
$ | (2.34 | ) | $ | (0.04 | ) | $ | (2.30 | ) | |||||||||||||
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| Oil |
3,386 | 247 | 3,139 | |||||||||||||||||||
| NGL |
953 | 159 | 794 | |||||||||||||||||||
| Natural Gas |
1,241 | 246 | 995 | |||||||||||||||||||
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| Total Production (mboe) |
5,580 | 652 | 4,928 | |||||||||||||||||||
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| Total Production (boepd) |
61,319 | 7,165 | 54,154 | |||||||||||||||||||
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Note: Amounts may not sum due to rounding
| * | Reduction in Force |
| † | General and administrative includes $3,343 or $0.68 per BOE of pension settlement expense |
| £ | Adjustment includes $4,101 of expense related to a reduction in force |
3
Non-GAAP Financial Measures
The consolidated statement of income excluding certain divestments is a Non-GAAP financial measure (GAAP refers to generally accepted accounting principles). Energen believes excluding information associated with held for sale assets including the divestment of assets held in the San Juan Basin (completed in the first quarter of 2015) provides analysts and investors useful information to understand the financial performance of the company from ongoing business operations. Further, this information is useful in comparing the company and other oil and gas producing companies operating primarily in the Permian Basin.
| Energen Net Income (Loss) Excluding Held for Sale Assets Reconciliation to GAAP Information |
Three Months Ended March 31, 2015 |
|||||||||||||||||||||
| (in thousands except per share and production data) | GAAP | $/BOE | Held for Sale | Non-GAAP | $/BOE | |||||||||||||||||
| Revenues |
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| Oil, natural gas liquids and natural gas sales |
$ | 187,822 | $ | 33,716 | $ | 154,106 | ||||||||||||||||
| Gain (loss) on derivative instruments |
34,036 | $ | 8,369 | 25,667 | ||||||||||||||||||
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| Total Revenues |
221,858 | 42,085 | 179,773 | |||||||||||||||||||
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| Operating Costs and Expenses |
||||||||||||||||||||||
| Oil, natural gas liquids and natural gas production |
67,754 | $ | 10.74 | 17,052 | 50,702 | $ | 11.54 | |||||||||||||||
| Production and ad valorem taxes |
19,065 | $ | 3.02 | 3,498 | 15,567 | $ | 3.54 | |||||||||||||||
| O&G Depreciation, depletion and amortization |
132,839 | $ | 21.06 | 13,638 | 119,201 | $ | 27.13 | |||||||||||||||
| FF&E Depreciation, depletion and amortization |
1,542 | $ | 0.24 | 153 | 1,389 | $ | 0.32 | |||||||||||||||
| Asset impairment |
6,583 | — | 6,583 | |||||||||||||||||||
| Exploration |
763 | 60 | 703 | |||||||||||||||||||
| General and administrative † |
32,055 | $ | 5.08 | (702 | ) | 32,757 | $ | 7.45 | ||||||||||||||
| Accretion of discount on asset retirement obligations |
2,010 | 587 | 1,423 | |||||||||||||||||||
| (Gain) loss on sale of assets and other |
(28,344 | ) | (27,919 | ) | (425 | ) | ||||||||||||||||
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| Total costs and expenses |
234,267 | 6,367 | 227,900 | |||||||||||||||||||
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| Operating Income (Loss) |
(12,409 | ) | 35,718 | (48,127 | ) | |||||||||||||||||
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| Other Income/(Expense) |
||||||||||||||||||||||
| Interest Expense |
(11,758 | ) | — | (11,758 | ) | |||||||||||||||||
| Other income |
46 | — | 46 | |||||||||||||||||||
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| Total other expense |
(11,712 | ) | — | (11,712 | ) | |||||||||||||||||
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| Loss Before Income Taxes |
(24,121 | ) | 35,718 | (59,839 | ) | |||||||||||||||||
| Income tax expense (benefit) |
(8,701 | ) | 13,420 | (22,121 | ) | |||||||||||||||||
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| Net Income (Loss) |
$ | (15,420 | ) | $ | 22,298 | $ | (37,718 | ) | ||||||||||||||
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| Diluted Earnings Per Average Common Share |
$ | (0.21 | ) | $ | 0.31 | $ | (0.52 | ) | ||||||||||||||
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| Basic earning Per Average Common Share |
$ | (0.21 | ) | $ | 0.31 | $ | (0.52 | ) | ||||||||||||||
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| Oil |
3,235 | 98 | 3,137 | |||||||||||||||||||
| NGL |
861 | 273 | 588 | |||||||||||||||||||
| Natural Gas |
2,213 | 1,544 | 669 | |||||||||||||||||||
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| Total Production (mboe) |
6,309 | 1,915 | 4,394 | |||||||||||||||||||
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| Total Production (boepd) |
70,100 | 21,278 | 48,822 | |||||||||||||||||||
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Note: Amounts may not sum due to rounding
| † | General and administrative includes $3,050 or $0.69 per BOE of pension and pension settlement expense |
4