Yahoo Finance Range Announces Fourth Quarter 2021 Results, 2022 Guidance, Reinstatement of Dividend and Authorization of $500 Million Share Repurchase Program
FORT WORTH, Texas, Feb. 22, 2022 (GLOBE NEWSWIRE) -- RANGE RESOURCES CORPORATION (NYSE: RRC) today announced its fourth quarter 2021 financial results and plans for 2022.
Fourth Quarter and Full-Year 2021 Highlights –
Reduced net debt in 2021 by $379 million compared to year-end 2020
All-in 2021 capital spending was $414 million, approximately $11 million less than original budget
2021 daily production averaged 2.13 Bcfe per day
2021 NGL realizations averaged a premium of $1.18 per barrel above Mont Belvieu, a Company record
2021 Direct Operating Expense averaged less than $0.10 per mcfe, a Company record
Realized maximum payout of $29.5 million from contingent derivative based on 2021 commodity prices
PV10 of year-end proved reserves of $12.7 billion, or approximately $40 per share net of debt, assuming NYMEX strip prices at year-end 2021
2022 Guidance and Return of Capital Highlights –
Annual cash dividend of $0.32 per share ($0.08 quarterly), or an approximate 1.5% dividend yield based on recent share price, expected to begin in second half 2022
Authorization of $500 million share repurchase program, or approximately 10% of outstanding shares based on recent market capitalization, effective immediately
2022 capital budget of $460 to $480 million maintains production at 2.12 to 2.16 Bcfe per day, or approximately $0.60 per mcfe, best in Appalachia
2022 well costs expected to average $625 per lateral foot or less, lowest in Appalachia
Free cash flow forecasted to exceed $1 billion in 2022 based on recent strip pricing
Leverage, defined as Net-Debt-to-EBITDAX, forecasted at approximately 1.0x at year-end 2022 based on recent strip pricing
Commenting on the results and 2022 plans, Jeff Ventura, the Company’s CEO said, “During 2021, Range generated significant free cash flow, reduced debt, refinanced near-term maturities, lowered well costs, expanded cash margins and delivered our operational plan safely and for less than budgeted. These results reflect the organization’s continuing focus on capital discipline and further strengthening our financial position as we develop the most prolific natural gas and NGL play in North America. In 2022, we expect to build upon these achievements, generating over $1 billion of free cash flow at recent strip pricing. Range’s improved financial positioning supports our plan to reinstate our dividend program with a yield that is competitive with the broader market, in addition to authorizing a share repurchase program. Given that our equity is currently valued at approximately one-half of proved reserve value, which excludes any value attributable to multiple decades of core inventory, we believe that share repurchases provide an excellent opportunity to create significant, long-term shareholder value. We look forward to the year ahead, as we generate significant free cash flow, further strengthen our balance sheet, return capital to shareholders and maintain our leadership position on environmental efforts.”
Reinstatement of Cash Dividend
Range’s Board of Directors has approved the reinstatement of the Company’s regular quarterly cash dividend, with payments expected to start in the second half of 2022, at an anticipated annual dividend rate of $0.32 per share of the Company’s common stock ($0.08 per quarter). Details regarding the record and payment dates for quarterly dividends will be announced as each quarterly dividend is formally declared by the Board.
Authorization of $500 Million Share Repurchase Program
Range’s Board of Directors approved an expansion of the Company’s share repurchase program with $500 million available and effective immediately. This repurchase program, which is equivalent to approximately 10% of Range’s market capitalization, is expected to be funded with free cash flow generation.
As deemed appropriate by Range management, Range may repurchase shares in the open market from time to time, or in privately negotiated transactions, in compliance with SEC rules and federal securities laws. The authorization under the program does not have a stated expiration date. The repurchase program does not obligate Range to acquire any particular amount of common stock and, in Range’s discretion, it may be modified or discontinued at any time.
Financial Discussion
Except for generally accepted accounting principles (“GAAP”) reported amounts, specific expense categories exclude non-cash impairments, unrealized mark-to-market adjustment on derivatives, non-cash stock compensation and other items shown separately on the attached tables. “Unit costs” as used in this release are composed of direct operating, transportation, gathering, processing and compression, production and ad valorem taxes, general and administrative, interest and depletion, depreciation and amortization costs divided by production. See “Non-GAAP Financial Measures” for a definition of each of the non-GAAP financial measures and the tables that reconcile each of the non-GAAP measures to their most directly comparable GAAP financial measure.
Capital Expenditures
Fourth quarter 2021 drilling and completions expenditures were $83.7 million and $8.6 million was invested in acreage and gathering facilities. Total 2021 capital expenditures were $414 million, including $388 million on drilling and completion, and a combined $26 million on acreage, gas gathering systems and other investments.
Financial Position
In 2021, Range reduced net debt by $379 million. As of December 31, 2021, Range had total debt outstanding of $2.95 billion and $214 million of cash on hand. This was the Company’s fourth consecutive year of debt reduction. Range had zero borrowings under its credit facility as of year-end 2021, providing liquidity in excess of $2 billion.
In fourth quarter 2021, Range realized a total of $29.5 million in contingent derivative settlement gains related to the North Louisiana divestiture. This represents the maximum amount that Range could receive pertaining to 2021 commodity prices, and Range expects to receive the cash proceeds in the first half of 2022. Range has the potential to receive an additional $45.5 million in contingent payments based on natural gas, NGL and oil prices in 2022 and 2023. At year-end 2021, the fair value of these remaining contingent payments was approximately $26.6 million.
In January 2022, Range issued $500 million aggregate principal amount of 4.75% senior notes due 2030 and used proceeds and cash on hand to redeem all outstanding 9.25% senior notes due 2026. As a result, Range’s interest expense is expected to improve by 25% year-over-year in 2022 to an approximate $0.21 per mcfe annual midpoint average.
Fourth Quarter 2021 Results
GAAP revenues for fourth quarter 2021 totaled $1.57 billion, GAAP net cash provided from operating activities (including changes in working capital) was $318 million, and GAAP net income was $891 million ($3.47 per diluted share). Fourth quarter earnings results include a $310 million mark-to-market derivative gain due to decreases in commodity prices.
Non-GAAP revenues for fourth quarter 2021 totaled $976 million, and cash flow from operations before changes in working capital, a non-GAAP measure, was $424 million. Adjusted net income comparable to analysts’ estimates, a non-GAAP measure, was $242 million ($0.96 per diluted share) in fourth quarter 2021.
The following table details Range’s fourth quarter 2021 unit costs per mcfe(a):
Expenses | 4Q 2021 | 3Q 2021 | Increase (Decrease) | ||||||
Direct operating | $ | 0.09 | $ | 0.10 | (10%) | ||||
Transportation, gathering, | 1.59 | 1.51 | 5% | ||||||
Production and ad valorem taxes | 0.05 | 0.04 | 25% | ||||||
General and administrative(a) | 0.15 | 0.16 | (6%) | ||||||
Interest expense(a) | 0.27 | 0.28 | (4%) | ||||||
Total cash unit costs(b) | 2.14 | 2.08 | 3% | ||||||
Depletion, depreciation and | 0.46 | 0.47 | (2%) | ||||||
Total unit costs plus DD&A(b) | $ | 2.59 | $ | 2.56 | 1% | ||||
(a) Excludes stock-based compensation, legal settlements and amortization of deferred financing costs.
(b) May not add due to rounding.
The following table details Range’s average production and realized pricing for fourth quarter 2021:
4Q21 Production & Realized Pricing | ||||||||
Natural Gas | Oil (Bbl) | NGLs | Natural Gas | |||||
Net production per day | 1,533,609 | 8,674 | 102,126 | 2,198,413 | ||||
Average NYMEX price | $5.82 | $77.02 | $36.44 | |||||
Differential, including basis hedging | (0.44) | (6.95) | (0.18) | |||||
Realized prices before NYMEX hedges | 5.38 | 70.07 | 36.26 | $5.71 | ||||
Settled NYMEX hedges | (2.11) | (17.51) | (1.48) | (1.61) | ||||
Average realized prices after hedges | $ 3.27 | $ 52.56 | $ 34.77 | $ 4.10 | ||||
Fourth quarter 2021 natural gas, NGLs and oil price realizations (including the impact of cash-settled hedges and derivative settlements) averaged $4.10 per mcfe.
The average natural gas price, including the impact of basis hedging, was $5.38 per mcf, or a ($0.44) per mcf differential to NYMEX. This represents the highest quarterly pre-hedge natural gas realization since 2014. In addition, Range realized a contingent derivative settlement gain of $20 million related to natural gas prices in 2021.
Crude oil and condensate price realizations, before realized hedges, averaged $70.07 per barrel, or $6.95 below WTI (West Texas Intermediate). This represents the highest quarterly pre-hedge condensate realization since 2014. In addition, Range realized a contingent derivative settlement gain of $3.5 million related to WTI prices in 2021.
Pre-hedge NGL realizations were $36.26 per barrel, an improvement of $2.21 per barrel versus the third quarter of 2021 and approximately 47% of WTI. This represents the highest quarterly pre-hedge NGL realization since 2013. In addition, Range realized a contingent derivative settlement gain of $6 million related to NGL prices in 2021.
2021 Proved Reserves
Summary of Changes in Proved Reserves | ||
(in Bcfe) | ||
Balance at December 31, 2020 | 17,203 | |
Extensions, discoveries and additions | 1,603 | |
Performance revisions | 134 | |
Locations re-entered to development plan | 913 | |
Reclassification of PUD to unproved under SEC 5-year rule | (1,323 | ) |
Price revisions | 23 | |
Production | (778 | ) |
Balance at December 31, 2021 | 17,775 | |
As shown in the table below, the present value (PV10) of reserves under SEC methodology was $14.9 billion at December 31, 2021. For comparison, the PV10 using year-end 2021 NYMEX strip average prices of $3.27 per Mmbtu for natural gas and $60.76 per barrel of oil would have been $12.7 billion, assuming the same proven reserve volumes.
2021 SEC | Year-End | |||||
Natural Gas Price ($/Mmbtu) | $3.60 | $3.27 | ||||
WTI Oil Price ($/Bbl) | $66.34 | $60.76 | ||||
Proved Reserves PV10 ($ billions) | $14.9 | $12.7 | ||||
(a) | Average realized prices for estimating year-end 2021 reserves and PV10 were $3.30 per mcf, $59.35 per barrel of crude oil and $28.41 per barrel of NGLs. Updated from prior press release. |
(b) | Average realized prices for calculating PV10, based on year-end strip pricing, were $3.09 per mcf, $53.40 per barrel of crude oil and $25.63 per barrel of NGLs. Updated from prior press release. |
Year-end 2021 reserves included 7.4 Tcfe of proved undeveloped reserves from 360 wells planned to be developed within the next five years with an expected development cost of $0.29 per mcfe. Beyond the five-year reserve calculation window, Range has thousands of high-quality wells in the Marcellus, Utica and Upper Devonian horizons.
2022 Capital Program and Guidance
Range’s 2022 all-in capital budget is expected to be $460 to $480 million. The capital budget includes approximately $425 to $445 million for drilling and recompletions, and $35 million for leasehold and other investments. The Company expects to turn to sales 54 Marcellus wells in southwest Pennsylvania and nine Marcellus wells in northeast Pennsylvania, which offer compelling returns at strip pricing, as the Company utilizes existing infrastructure. The longest laterals in Range’s 2022 program are in the liquids-rich acreage, with 56% of the lateral feet turned to sales expected in the liquids window.
The table below summarizes expected 2022 activity and 2021 regarding the number of wells to sales in each area.
Planned Wells | Wells TIL in | |||
SW PA Super-Rich | 7 | 17 | ||
SW PA Wet | 21 | 20 | ||
SW PA Dry | 26 | 31 | ||
NE PA Dry | 9 | - | ||
Total Appalachia | 63 | 68 |
In 2021, Range turned to sales 68 wells across its southwest Pennsylvania acreage. This exceeded prior guidance of 60 TILs in 2021, which is the result of efficiency gains that allowed eight wells to be pulled into late December 2021 that were originally planned for early 2022.
The development plan for 2022 is consistent with 2021 as Range is targeting a maintenance program, holding 2021 production approximately flat with annual average production of 2,120 – 2,160 Mmcfe per day. Range’s production guidance incorporates planned third-party downstream maintenance that affects Range’s first half 2022 production by approximately 40 Mmcfe per day and weather-related downtime in February that affected first quarter 2022 by approximately 35 Mmcfe per day. Despite these transient delays, Range is expecting to deliver maintenance production at a capital cost of approximately $0.60 per mcfe, which is expected to be the most efficient program in Appalachia.
Based on recent strip pricing, Range expects pre-hedge NGL price realizations to increase by approximately $5 per barrel in 2022 versus the 2021 average, resulting in an increase of approximately $180 million in annual pre-hedge revenue. As previously disclosed, these higher realized NGL prices will result in slightly higher processing costs, as Range’s processing costs are based on the price received. Net of price-linked processing costs, the increase in forecasted NGL prices is expected to add approximately $140 million in cash flow versus 2021, demonstrating continued strong margin expansion with rising NGL prices. Additionally, in 2022, Range’s gathering costs are expected to improve by approximately $25 million versus 2021, driven by contractual declines in Range’s gathering fees, while contracted gathering capacity remains the same. The decline in gathering costs largely offsets the aforementioned increase in processing costs, such that Range’s 2022 GP&T expense guidance of $1.52 to $1.56 per mcfe is approximately in-line with 2021 GP&T expense per mcfe, despite higher NGL prices. Range expects an additional $25 million in gathering expense savings in 2023 and annual savings of more than $100 million by 2030 when compared to 2021 levels.
Guidance – 2022
Capital & Production Guidance
Range is targeting a maintenance program in 2022, holding production approximately flat at 2.12 – 2.16 Bcfe per day, with ~30% attributed to liquids production. Range’s 2022 all-in capital budget is $460 million - $480 million.
Full Year 2022 Expense Guidance
Direct operating expense: | $0.09 - $0.11 per mcfe |
Transportation, gathering, processing and compression expense: | $1.52 - $1.56 per mcfe |
Production tax expense: | $0.03 - $0.05 per mcfe |
Exploration expense: | $22 - $28 million |
G&A expense: | $0.15 - $0.17 per mcfe |
Interest expense: | $0.20 - $0.22 per mcfe |
DD&A expense: | $0.46 - $0.50 per mcfe |
Net brokered gas marketing expense: | $8 - $14 million |
Full Year 2022 Price Guidance
Based on recent market indications, Range expects to average the following price differentials for its production in 2022.
Natural Gas:(1) | NYMEX minus $0.35 to $0.45 |
Natural Gas Liquids (including ethane):(2) | Mont Belvieu plus $0.00 to $2.00 per barrel |
Oil/Condensate: | WTI minus $6.00 to $8.00 |
(1) Including basis hedging
(2) Weighting based on 53% ethane, 27% propane, 7% normal butane, 4% iso-butane and 9% natural gasoline.
Hedging Status
Range hedges portions of its expected future production volumes to increase the predictability of cash flow and to help maintain a strong, flexible financial position. In aggregate, Range has approximately 50% of its expected 2022 net revenue hedged. Please see the detailed hedging schedule posted on the Range website under Investor Relations - Financial Information.
Range has also hedged Marcellus and other basis differentials for natural gas and NGL exports to limit volatility between benchmarks and regional prices. The combined fair value of the natural gas basis, NGL freight and spread hedges as of December 31, 2021 was a net gain of $16.2 million.
Conference Call Information
A conference call to review the financial results is scheduled on Wednesday, February 23 at 9:00 a.m. ET. To participate in the call, please dial (877) 928-8777 and provide conference code 7986479 about 10 minutes prior to the scheduled start time.
A simultaneous webcast of the call may be accessed at www.rangeresources.com. The webcast will be archived for replay on the Company's website until March 22.
Non-GAAP Financial Measures
Adjusted net income comparable to analysts’ estimates as set forth in this release represents income or loss from operations before income taxes adjusted for certain non-cash items (detailed in the accompanying table) less income taxes. We believe adjusted net income comparable to analysts’ estimates is calculated on the same basis as analysts’ estimates and that many investors use this published research in making investment decisions and evaluating operational trends of the Company and its performance relative to other oil and gas producing companies. Diluted earnings per share (adjusted) as set forth in this release represents adjusted net income comparable to analysts’ estimates on a diluted per share basis. A table is included which reconciles income or loss from operations to adjusted net income comparable to analysts’ estimates and diluted earnings per share (adjusted). On its website, the Company provides additional comparative information on prior periods along with non-GAAP revenue disclosures.
Cash flow from operations before changes in working capital (sometimes referred to as “adjusted cash flow”) as defined in this release represents net cash provided by operations before changes in working capital and exploration expense adjusted for certain non-cash compensation items. Cash flow from operations before changes in working capital is widely accepted by the investment community as a financial indicator of an oil and gas company’s ability to generate cash to internally fund exploration and development activities and to service debt. Cash flow from operations before changes in working capital is also useful because it is widely used by professional research analysts in valuing, comparing, rating and providing investment recommendations of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Cash flow from operations before changes in working capital is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operations, investing, or financing activities as an indicator of cash flows, or as a measure of liquidity. A table is included which reconciles net cash provided by operations to cash flow from operations before changes in working capital as used in this release. On its website, the Company provides additional comparative information on prior periods for cash flow, cash margins and non-GAAP earnings as used in this release.
The cash prices realized for oil and natural gas production, including the amounts realized on cash-settled derivatives and net of transportation, gathering, processing and compression expense, is a critical component in the Company’s performance tracked by investors and professional research analysts in valuing, comparing, rating and providing investment recommendations and forecasts of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Due to the GAAP disclosures of various derivative transactions and third-party transportation, gathering, processing and compression expense, such information is now reported in various lines of the income statement. The Company believes that it is important to furnish a table reflecting the details of the various components of each income statement line to better inform the reader of the details of each amount and provide a summary of the realized cash-settled amounts and third-party transportation, gathering, processing and compression expense, which were historically reported as natural gas, NGLs and oil sales. This information is intended to bridge the gap between various readers’ understanding and fully disclose the information needed.
The Company discloses in this release the detailed components of many of the single line items shown in the GAAP financial statements included in the Company’s Annual Report on Form 10-K. The Company believes that it is important to furnish this detail of the various components comprising each line of the Statements of Operations to better inform the reader of the details of each amount, the changes between periods and the effect on its financial results.
We believe that the presentation of PV10 is relevant and useful to our investors as supplemental disclosure to the standardized measure, or after-tax amount, because it presents the discounted future net cash flows attributable to our proved reserves before taking into account future corporate income taxes and our current tax structure. While the standardized measure is dependent on the unique tax situation of each company, PV10 is based on prices and discount factors that are consistent for all companies. Because of this, PV10 can be used within the industry and by creditors and security analysts to evaluate estimated net cash flows from proved reserves on a more comparable basis.
RANGE RESOURCES CORPORATION (NYSE: RRC) is a leading U.S. independent natural gas and NGL producer with operations focused on stacked-pay projects in the Appalachian Basin. The Company is headquartered in Fort Worth, Texas. More information about Range can be found at www.rangeresources.com.
Included within this release are certain “forward-looking statements” within the meaning of the federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that are not limited to historical facts, but reflect Range’s current beliefs, expectations or intentions regarding future events. Words such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “outlook”, “estimate,” “predict,” “potential,” “pursue,” “target,” “continue,” and similar expressions are intended to identify such forward-looking statements.
All statements, except for statements of historical fact, made within regarding activities, events or developments the Company expects, believes or anticipates will or may occur in the future, such as those regarding future well costs, expected asset sales, well productivity, future liquidity and financial resilience, anticipated exports and related financial impact, NGL market supply and demand, improving commodity fundamentals and pricing, future capital efficiencies, future shareholder value, emerging plays, capital spending, anticipated drilling and completion activity, acreage prospectivity, expected pipeline utilization and future guidance information, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on assumptions and estimates that management believes are reasonable based on currently available information; however, management's assumptions and Range's future performance are subject to a wide range of business risks and uncertainties and there is no assurance that these goals and projections can or will be met. Any number of factors could cause actual results to differ materially from those in the forward-looking statements. Further information on risks and uncertainties is available in Range's filings with the Securities and Exchange Commission (SEC), including its most recent Annual Report on Form 10-K. Unless required by law, Range undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events after the date they are made.
The SEC permits oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are estimates that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions as well as the option to disclose probable and possible reserves. Range has elected not to disclose its probable and possible reserves in its filings with the SEC. Range uses certain broader terms such as "resource potential,” “unrisked resource potential,” "unproved resource potential" or "upside" or other descriptions of volumes of resources potentially recoverable through additional drilling or recovery techniques that may include probable and possible reserves as defined by the SEC's guidelines. Range has not attempted to distinguish probable and possible reserves from these broader classifications. The SEC’s rules prohibit us from including in filings with the SEC these broader classifications of reserves. These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of actually being realized. Unproved resource potential refers to Range's internal estimates of hydrocarbon quantities that may be potentially discovered through exploratory drilling or recovered with additional drilling or recovery techniques and have not been reviewed by independent engineers. Unproved resource potential does not constitute reserves within the meaning of the Society of Petroleum Engineer's Petroleum Resource Management System and does not include proved reserves. Area wide unproven resource potential has not been fully risked by Range's management. “EUR”, or estimated ultimate recovery, refers to our management’s estimates of hydrocarbon quantities that may be recovered from a well completed as a producer in the area. These quantities may not necessarily constitute or represent reserves within the meaning of the Society of Petroleum Engineer’s Petroleum Resource Management System or the SEC’s oil and natural gas disclosure rules. Actual quantities that may be recovered from Range's interests could differ substantially. Factors affecting ultimate recovery include the scope of Range's drilling program, which will be directly affected by the availability of capital, drilling and production costs, commodity prices, availability of drilling services and equipment, drilling results, lease expirations, transportation constraints, regulatory approvals, field spacing rules, recoveries of gas in place, length of horizontal laterals, actual drilling results, including geological and mechanical factors affecting recovery rates and other factors. Estimates of resource potential may change significantly as development of our resource plays provides additional data.
In addition, our production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. Investors are urged to consider closely the disclosure in our most recent Annual Report on Form 10-K, available from our website at www.rangeresources.com or by written request to 100 Throckmorton Street, Suite 1200, Fort Worth, Texas 76102. You can also obtain this Form 10-K on the SEC’s website at www.sec.gov or by calling the SEC at 1-800-SEC-0330.
SOURCE: Range Resources Corporation
Range Investor Contacts:
Laith Sando, Vice President – Investor Relations
817-869-4267
lsando@rangeresources.com
Range Media Contacts:
Mark Windle, Director of Corporate Communications
724-873-3223
mwindle@rangeresources.com
RANGE RESOURCES CORPORATION
STATEMENTS OF OPERATIONS | |||||||||||||||||||||||
Based on GAAP reported earnings with additional | |||||||||||||||||||||||
details of items included in each line in Form 10-K | |||||||||||||||||||||||
(Unaudited, in thousands, except per share data) | |||||||||||||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||||
2021 | 2020 | % | 2021 | 2020 | % | ||||||||||||||||||
Revenues and other income: | |||||||||||||||||||||||
Natural gas, NGLs and oil sales (a) | $ | 1,140,520 | $ | 444,806 | $ | 3,215,027 | $ | 1,607,713 | |||||||||||||||
Derivative fair value income (loss) | 309,566 | 85,529 | (650,216 | ) | 187,711 | ||||||||||||||||||
Brokered natural gas, marketing and other (b) | 116,692 | 67,771 | 364,029 | 171,622 | |||||||||||||||||||
ARO settlement loss (b) | — | (4 | ) | (3 | ) | (22 | ) | ||||||||||||||||
Other (b) | 52 | 784 | 1,386 | 1,673 | |||||||||||||||||||
Total revenues and other income | 1,566,830 | 598,886 | 162 | % | 2,930,223 | 1,968,697 | 49 | % | |||||||||||||||
Costs and expenses: | |||||||||||||||||||||||
Direct operating | 17,310 | 15,945 | 73,977 | 91,079 | |||||||||||||||||||
Direct operating – stock-based compensation (c) | 324 | 268 | 1,310 | 1,078 | |||||||||||||||||||
Transportation, gathering, processing and compression | 320,785 | 256,742 | 1,174,469 | 1,088,490 | |||||||||||||||||||
Production and ad valorem taxes | 9,138 | 3,935 | 29,317 | 24,617 | |||||||||||||||||||
Brokered natural gas and marketing | 119,656 | 69,053 | 365,494 | 186,900 | |||||||||||||||||||
Brokered natural gas and marketing – stock-based compensation (c) | 455 | 511 | 1,794 | 1,416 | |||||||||||||||||||
Exploration | 6,717 | 9,076 | 22,048 | 31,375 | |||||||||||||||||||
Exploration – non-cash stock-based compensation (c) | 391 | 388 | 1,507 | 1,279 | |||||||||||||||||||
Abandonment and impairment of unproved properties | — | 2,730 | 7,206 | 19,334 | |||||||||||||||||||
General and administrative | 30,708 | 31,307 | 121,008 | 123,859 | |||||||||||||||||||
General and administrative – stock-based compensation (c) | 11,041 | 8,834 | 39,673 | 32,905 | |||||||||||||||||||
General and administrative – lawsuit settlements | 510 | 579 | 8,885 | 2,251 | |||||||||||||||||||
General and administrative – bad debt expense | 200 | — | 200 | 400 | |||||||||||||||||||
Exit and termination costs | 12,104 | 13,739 | 21,661 | 545,244 | |||||||||||||||||||
Exit and termination costs – stock-based compensation (c) | — | 145 | — | 2,165 | |||||||||||||||||||
Deferred compensation plan (d) | (21,200 | ) | 2,254 | 68,351 | 12,541 | ||||||||||||||||||
Interest expense | 54,004 | 46,389 | 218,043 | 184,201 | |||||||||||||||||||
Interest expense – amortization of deferred financing costs (e) | 2,358 | 2,137 | 9,293 | 8,466 | |||||||||||||||||||
Gain on early extinguishment of debt | — | 25 | 98 | (14,068 | ) | ||||||||||||||||||
Depletion, depreciation and amortization | 92,427 | 90,551 | 364,555 | 394,330 | |||||||||||||||||||
Impairment of proved property | — | — | — | 78,955 | |||||||||||||||||||
Loss (gain) on sale of assets | 23 | 1,652 | (701 | ) | (110,791 | ) | |||||||||||||||||
Total costs and expenses | 656,951 | 556,260 | 18 | % | 2,528,188 | 2,706,026 | -7 | % | |||||||||||||||
Income (loss) before income taxes | 909,879 | 42,626 | 2035 | % | 402,035 | (737,329 | ) | 155 | % | ||||||||||||||
Income tax expense (benefit): | |||||||||||||||||||||||
Current | 763 | (157 | ) | 7,984 | (523 | ) | |||||||||||||||||
Deferred | 17,750 | 4,382 | (17,727 | ) | (25,029 | ) | |||||||||||||||||
18,513 | 4,225 | (9,743 | ) | (25,552 | ) | ||||||||||||||||||
Net income (loss) | $ | 891,366 | $ | 38,401 | 2221 | % | $ | 411,778 | $ | (711,777 | ) | 158 | % | ||||||||||
Net Income (Loss) Per Common Share: | |||||||||||||||||||||||
Basic | $ | 3.57 | $ | 0.16 | $ | 1.65 | $ | (2.95 | ) | ||||||||||||||
Diluted | $ | 3.47 | $ | 0.15 | $ | 1.61 | $ | (2.95 | ) | ||||||||||||||
Weighted average common shares outstanding, as reported: | |||||||||||||||||||||||
Basic | 243,369 | 240,174 | 1 | % | 242,862 | 241,373 | 1 | % | |||||||||||||||
Diluted | 250,441 | 246,286 | 2 | % | 249,314 | 241,373 | 3 | % | |||||||||||||||
(a) | See separate natural gas, NGLs and oil sales information table. |
(b) | Included in Brokered natural gas, marketing and other revenues in the 10-K. |
(c) | Costs associated with stock compensation and restricted stock amortization, which have been reflected in the categories associated with the direct personnel costs, which are combined with the cash costs in the 10-K. |
(d) | Reflects the change in market value of the vested Company stock held in the deferred compensation plan. |
(e) | Included in interest expense in the 10-K. |
RANGE RESOURCES CORPORATION
BALANCE SHEETS | |||||||
(In thousands) | December 31, | December 31, | |||||
2021 | 2020 | ||||||
(Audited) | (Audited) | ||||||
Assets | |||||||
Current assets | $ | 730,927 | $ | 266,508 | |||
Derivative assets | 44,339 | 40,012 | |||||
Natural gas and oil properties, successful efforts method | 5,754,656 | 5,686,809 | |||||
Transportation and field assets | 3,494 | 4,161 | |||||
Operating lease right-of-use assets | 40,832 | 63,581 | |||||
Other | 86,259 | 75,865 | |||||
$ | 6,660,507 | $ | 6,136,936 | ||||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities | $ | 984,388 | $ | 673,445 | |||
Asset retirement obligations | 5,310 | 6,689 | |||||
Derivative liabilities | 162,767 | 26,707 | |||||
Bank debt | — | 693,123 | |||||
Senior notes | 2,707,770 | 2,329,745 | |||||
Senior subordinated notes | — | 17,384 | |||||
Total debt | 2,707,770 | 3,040,252 | |||||
Deferred tax liability | 117,642 | 135,267 | |||||
Derivative liabilities | 8,216 | 9,746 | |||||
Deferred compensation liability | 137,102 | 81,481 | |||||
Operating lease liabilities | 24,861 | 43,155 | |||||
Asset retirement obligations and other liabilities | 101,509 | 91,157 | |||||
Divestiture contract obligation | 325,279 | 391,502 | |||||
Common stock and retained earnings | 2,115,820 | 1,668,146 | |||||
Other comprehensive loss | (150 | ) | (479 | ) | |||
Common stock held in treasury stock | (30,007 | ) | (30,132 | ) | |||
Total stockholders’ equity | 2,085,663 | 1,637,535 | |||||
$ | 6,660,507 | $ | 6,136,936 |
RECONCILIATION OF TOTAL REVENUES AND | |||||||||||||||||||||
(Unaudited, in thousands) | |||||||||||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||||||
2021 | 2020 | % | 2021 | 2020 | % | ||||||||||||||||
Total revenues and other income, as reported | $ | 1,566,830 | $ | 598,886 | 162 | % | $ | 2,930,223 | $ | 1,968,697 | 49 | % | |||||||||
Adjustment for certain special items: | |||||||||||||||||||||
Total change in fair value related to derivatives prior to settlement (gain) loss | (590,414 | ) | (68,143 | ) | 130,203 | 134,918 | |||||||||||||||
ARO settlement loss | — | 4 | 3 | 22 | |||||||||||||||||
Total revenues, as adjusted, non-GAAP | $ | 976,416 | $ | 530,747 | 84 | % | $ | 3,060,429 | $ | 2,103,637 | 46 | % | |||||||||
RANGE RESOURCES CORPORATION
CASH FLOWS FROM OPERATING ACTIVITIES | |||||||||||||||||
(Unaudited in thousands) | |||||||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||
Net income (loss) | $ | 891,366 | $ | 38,401 | $ | 411,778 | $ | (711,777 | ) | ||||||||
Adjustments to reconcile net cash provided from continuing operations: | |||||||||||||||||
Deferred income tax expense (benefit) | 17,750 | 4,382 | (17,727 | ) | (25,029 | ) | |||||||||||
Depletion, depreciation, amortization and impairment | 92,427 | 90,551 | 364,555 | 473,285 | |||||||||||||
Exploration dry hole and impairment costs | — | 888 | — | 888 | |||||||||||||
Abandonment and impairment of unproved properties | — | 2,730 | 7,206 | 19,334 | |||||||||||||
Derivative fair value (income) loss | (309,566 | ) | (85,529 | ) | 650,216 | (187,711 | ) | ||||||||||
Cash settlements on derivative financial instruments | (280,848 | ) | 17,386 | (520,013 | ) | 322,629 | |||||||||||
Divestiture contract obligation, including accretion, net of gain | 11,873 | 13,245 | 20,340 | 499,934 | |||||||||||||
Allowance for bad debts | 200 | — | 200 | 400 | |||||||||||||
Amortization of deferred issuance costs and other | 2,094 | 1,896 | 8,347 | 6,919 | |||||||||||||
Deferred and stock-based compensation | (9,590 | ) | 10,172 | 110,356 | 48,552 | ||||||||||||
Loss (gain) on sale of assets and other | 23 | 1,652 | (701 | ) | (110,791 | ) | |||||||||||
Loss (gain) on early extinguishment of debt | — | 25 | 98 | (14,068 | ) | ||||||||||||
Changes in working capital: | |||||||||||||||||
Accounts receivable | (134,334 | ) | (66,804 | ) | (250,538 | ) | 24,539 | ||||||||||
Other current assets | 2,434 | 6,796 | (1,140 | ) | 1,010 | ||||||||||||
Accounts payable | 4,918 | 20,134 | 39,231 | (32,686 | ) | ||||||||||||
Accrued liabilities and other | 28,912 | 33,781 | (29,260 | ) | (46,748 | ) | |||||||||||
Net changes in working capital | (98,070 | ) | (6,093 | ) | (241,707 | ) | (53,885 | ) | |||||||||
Net cash provided from operating activities | $ | 317,659 | $ | 89,706 | $ | 792,948 | $ | 268,680 | |||||||||
RECONCILIATION OF NET CASH PROVIDED FROM OPERATING | |||||||||||||||||
(Unaudited, in thousands) | |||||||||||||||||
Three Months Ended December 31, | Twelve Months Ended December 31, | ||||||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||||||
Net cash provided from operating activities, as reported | $ | 317,659 | $ | 89,706 | $ | 792,948 | $ | 268,680 | |||||||||
Net changes in working capital | 98,070 | 6,093 | 241,707 | 53,885 | |||||||||||||
Exploration expense | 6,717 | 8,188 | 22,048 | 30,487 | |||||||||||||
Lawsuit settlements | 510 | 579 | 8,885 | 2,251 | |||||||||||||
Exit and termination costs – severance costs only | — | 271 | 394 | 5,908 | |||||||||||||
One-time midstream termination payment | — | — | — | 28,500 | |||||||||||||
Accrued transportation contract release | — | 222 | — | 10,900 | |||||||||||||
Non-cash compensation adjustment and other | 1,096 | 2,474 | 4,155 | 4,403 | |||||||||||||
Cash flow from operations before changes in working capital – non-GAAP measure | $ | 424,052 | $ | 107,533 | $ | 1,070,137 | $ | 405,014 | |||||||||
ADJUSTED WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||||||
