Oasis Petroleum Inc. Announces Quarter and Year Ending December 31, 2015 Earnings and Provides an Operational Update and its 2016 Outlook

HOUSTON, Feb. 24, 2016 /PRNewswire/ -- Oasis Petroleum Inc. (NYSE: OAS) ("Oasis" or the "Company") today announced financial and operational results for the quarter and year ended December 31, 2015 and provided its 2016 outlook.

2015 Highlights

  • Increased average daily production 11% year-over-year to 50,477 barrels of oil equivalent per day ("Boepd") in 2015 and increased fourth quarter of 2015 production to 50,652 Boepd.
  • Completed and placed on production 80 gross (62.4 net) operated wells during 2015 and 16 gross (10.7 net) operated wells during the fourth quarter of 2015. As of December 31, 2015, the Company had 85 gross operated wells awaiting completion.  
  • Reduced lease operating expenses ("LOE") per barrel of oil equivalent ("Boe") by 23% to $7.84 per Boe for the year ended December 31, 2015.
  • Adjusted EBITDA was $820.2 million for the year ended December 31, 2015 as compared to $952.8 million for the year ended December 31, 2014. For a definition of Adjusted EBITDA and a reconciliation of Adjusted EBITDA to net income and net cash provided by operating activities, see "Non-GAAP Financial Measures" below.
  • Net loss was $40.2 million for the year ended December 31, 2015 as compared to net income of $506.9 million for the year ended December 31, 2014. Lower realized prices for oil and natural gas reduced net income (loss) by $641.2 million year over year.
  • Capital expenditures ("CapEx") were $610.0 million for the year ended December 31, 2015, a 61% decrease year over year.

"Given the challenging market backdrop, Oasis continues to focus on protecting its balance sheet while improving operational results," said Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer.  "Oasis was free cash flow positive in 2015, as we lowered drilling and completion capital by 70% and LOE per Boe by 23% year over year. We reduced our high intensity well costs by about 30% from the fourth quarter of 2014 to the second half of 2015, and, at the same time, production performance of our high intensity wells continued to track 30% to in excess of 50% improvement to our base completion type curve in the core.  Additionally, our midstream business reported $66.3 million of Adjusted EBITDA in 2015, up from $26.5 million in 2014.  The team increased volumes flowing on our gathering lines from 40% exiting 2014 to 75% exiting 2015, significantly improving our cost structure in a low price environment as reflected in our lower per barrel LOE expense."

Mr. Nusz added, "We have set our 2016 drilling and completion CapEx program at $200 million and continue to project that 2016 cash flow from Adjusted EBITDA less cash interest will cover our CapEx plan, excluding midstream, at approximately $35 per barrel WTI.  We also now have about 70% of our projected oil volumes hedged at over $51 per barrel WTI in 2016."

2016 Plan

Highlights for 2016 include:

  • $400 million total CapEx budget
  • Completing 46 gross (28.6 net) operated wells in 2016
  • 100% of completions are high intensity in the core
  • Running two rigs in Wild Basin

2016 Range

Metric


Production (Boepd)


Full Year 2016

46,000 - 49,000

Full Year Financial Metrics


LOE ($ per Boe)

$7.75 - $8.50

Marketing, transportation and gathering ("MT&G") ($ per Boe)(1)

$1.70 - $1.90

General and administrative ("G&A") ($ in millions)(2)

$90 - $95

Production taxes (% of oil and gas revenue)

~9.0%

CapEx Budget ($ in millions)


Drilling and completion

$200

OMS, including Wild Basin infrastructure

$140

Other(3)

$60



(1)

Excludes the effect of non-cash valuation charges.

(2)

Includes non-cash amortization of restricted stock of $24-26 million.  Net Oasis Well Services ("OWS") G&A is projected to increase by $7-8 million in 2015 compared to 2014 due to lower working interest in wells being completed, although gross OWS G&A is expected to decrease by approximately $12 million due to less overall activity.

(3)

Includes $18 million for capitalized interest.  Capitalized interest is excluded in the cash flow calculation, as it is included in cash interest.

 

Fourth Quarter 2015 and Fiscal Year 2015 Results
The Company's average daily production and revenues are detailed in the following table:


Quarter Ended:


Year Ended:


12/31/2015


9/30/2015


12/31/2015


12/31/2014

Average daily production (Boepd)

50,652



50,546



50,477



45,656


Percent Oil

85.5

%


87.7

%


87.3

%


89.3

%

Average oil sales price, without derivative settlements (per Bbl)

$

37.77



$

41.61



$

43.04



$

82.73


Differential to NYMEX West Texas Intermediate crude oil index prices ("WTI")

4.29



4.82



5.72



9.34


Revenues ($ in thousands):








Oil

$

150,448



$

169,672



$

692,497



$

1,231,251


Natural gas

7,985



5,598



29,175



72,753


Well services (OWS)

16,986



15,381



44,294



74,610


Midstream services (OMS)

6,648



6,584



23,769



11,614


Total revenues

$

182,067



$

197,235



$

789,735



$

1,390,228


 

Select expenses are detailed in the following table:



Quarter Ended:


Year Ended:



12/31/2015


9/30/2015


12/31/2015


12/31/2014

Select expenses ($ in thousands):









LOE


$

31,925



$

35,670



$

144,481



$

169,600


MT&G(1)


7,321



7,582



29,852



26,189


Non-cash valuation charges


976



883



1,758



2,314


Production taxes


15,669



16,676



69,584



127,648


Well services (OWS)


6,938



8,498



21,833



45,605


Midstream services (OMS)


1,723



1,525



6,198



4,647


Depreciation, depletion and amortization ("DD&A")


123,892



123,734



485,322



412,334


Total of select expenses


$

188,444



$

194,568



$

759,028



$

788,337


Operating expenses:









LOE ($ per Boe)


$

6.85



$

7.67



$

7.84



$

10.18


MT&G ($ per Boe)(1)


1.57



1.63



1.62



1.61


Production taxes (% of oil and gas revenue)


9.9

%


9.5

%


9.6

%


9.8

%

DD&A ($ per Boe)


$

26.59



$

26.61



$

26.34



$

24.74




(1)

Excludes non-cash valuation charges on pipeline imbalances and linefill.

 

Due to lower expected future oil prices, the Company reviewed its proved oil and natural gas properties for impairment as of December 31, 2015 and 2014. As a result, the Company recorded a non-cash impairment loss of $9.4 million in the fourth quarter of 2015 to adjust the carrying value of its proved oil and natural gas properties held for sale to their estimated fair value. For the year ended December 31, 2014, the Company recorded a non-cash impairment loss of $40.0 million for certain legacy wells producing from conventional reservoirs in the Williston Basin. During the fourth quarters of 2015 and 2014, the Company also recorded non-cash impairment charges of $11.7 million and $5.0 million, respectively, for unproved properties due to leases that expired during the period and periodic assessments of unproved properties.

G&A expenses for the fourth quarter of 2015 totaled $25.3 million, and for the year ended December 31, 2015, G&A totaled $92.5 million. The fourth quarter of 2015 included bank fees related to consent solicitations on the Company's senior unsecured notes. G&A expenses for the Company's exploration and production segment totaled $21.9 million in the fourth quarter of 2015 and $83.0 million in the full year of 2015. Exploration and production G&A expenses were $4.70 per Boe in the fourth quarter of 2015 and $4.50 per Boe in the full year of 2015. Amortization of stock-based compensation, which is included in G&A expenses, was $5.6 million, or $1.21 per Boe, in the fourth quarter of 2015 and $25.3 million, or $1.37 per Boe, in the full year of 2015.

As a result of entering into derivative contracts and the effect of the forward strip oil price changes, the Company incurred a $99.1 million net gain on derivative instruments, including net cash settlement receipts from derivatives of $79.0 million, for the fourth quarter of 2015 and a $210.4 million net gain on derivative instruments, including net cash settlement receipts of $370.4 million, for the full year of 2015. The net cash settlement receipts from derivative instruments of $79.0 million in the fourth quarter of 2015 included $25.3 million, $25.5 million and $28.2 million from contract settlements in September 2015, October 2015 and November 2015, respectively. The Company's derivative instruments do not qualify for and were not designated as hedging instruments for accounting purposes.

Interest expense was $36.9 million for the fourth quarter of 2015 and $149.6 million for the full year of 2015. Capitalized interest totaled $4.8 million for the fourth quarter of 2015 and $18.6 million for the full year of 2015. Cash interest, calculated as interest expense plus capitalized interest less amortization of deferring financing costs, totaled $40.0 million for the fourth quarter of 2015 and $161.0 million for the full year of 2015.

For the three months ended December 31, 2015, the Company recorded an income tax expense of $1.7 million, resulting in an effective tax rate of 30.1% as a percentage of its pre-tax income for the quarter. The Company's income tax benefit for the year ended December 31, 2015 was recorded at $16.1 million, or 28.6% of pre-tax net loss.

Adjusted EBITDA for the fourth quarter of 2015 was $176.7 million and adjusted EBITDA for the full year 2015 was $820.2 million.

The Company reported net income of $4.0 million in the fourth quarter of 2015. For the full year 2015, Oasis reported a net loss of $40.2 million. Excluding certain non-cash items and their tax effect in the fourth quarter of 2015 and full year of 2015, Adjusted Net Income (non-GAAP) was $6.7 million, or $0.05 per diluted share, and $93.8 million, or $0.72 per diluted share, respectively. For a definition of Adjusted Net Income and a reconciliation of net income to Adjusted Net Income, see "Non-GAAP Financial Measures" below.

Capital Expenditures

The following table depicts the Company's CapEx for the year ended December 31, 2015:


2015

CapEx ($ in thousands)


Exploration and production (E&P)

$

465,698


Midstream services (OMS)

96,947


Well services (OWS)

21,711


Other(1)

25,643


Total CapEx(2)

$

609,999




(1)

Other CapEx includes such items as administrative capital and capitalized interest.

(2)

CapEx reflected in the table above differs from the amounts shown in the statement of cash flows in the Company's condensed consolidated financial statements because amounts reflected in the table above include accrued liabilities for CapEx, while the amounts presented in the statement of cash flows are presented on a cash basis.

 

Liquidity

On February 2, 2016, Oasis completed a public equity offering of 39.1 million shares, which resulted in net proceeds to the Company of $182.9 million.  On February 23, 2016, Oasis completed its spring redetermination of its borrowing base.  As a result, the Company's borrowing base was set at $1,150 million.  The next redetermination is October 1, 2016.  As of December 31, 2015, Oasis had cash and cash equivalents of $9.7 million and $138.0 million of borrowings and $5.2 million of outstanding letters of credit issued under its revolving credit facility.  Pro forma for the equity raise and the new borrowing base, Oasis had $1,199.4 million of liquidity as of December 31, 2015.

Hedging Activity

As of February 24, 2016, the Company had the following outstanding commodity derivate contracts, all of which are priced relative to WTI crude oil index prices and settle monthly:

Type


Floor


Ceiling


Bopd

2016 Swaps







First Half (Jan - June)


$

54.20



$

54.20



28,000


Second Half (July - Dec)


$

50.10



$

50.10



28,000


Partial Year (Mar - June)


$

39.35



$

39.35



3,000


2017 Hedges







Full Year Swaps


$

49.25



$

49.25



6,000


Full Year Collars


$

40.00



$

47.58



2,000


 

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including the Company's drilling program, production, derivatives activities, capital expenditure levels and other guidance included in this press release. These statements are based on certain assumptions made by the Company based on management's experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include changes in oil and natural gas prices, the timing of planned capital expenditures, availability of acquisitions, uncertainties in estimating proved reserves and forecasting production results, operational factors affecting the commencement or maintenance of producing wells, the condition of the capital markets generally, as well as the Company's ability to access them, the proximity to and capacity of transportation facilities, and uncertainties regarding environmental regulations or litigation and other legal or regulatory developments affecting the Company's business and other important factors that could cause actual results to differ materially from those projected as described in the Company's reports filed with the SEC.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise, except as required by applicable law.

About Oasis Petroleum Inc.

Oasis is an independent exploration and production company focused on the acquisition and development of unconventional oil and natural gas resources, primarily operating in the Williston Basin. For more information, please visit the Company's website at www.oasispetroleum.com.

 



Oasis Petroleum Inc. Financial Statements

OASIS PETROLEUM INC.

CONSOLIDATED BALANCE SHEET

(Unaudited)




December 31,



2015


2014



(In thousands, except share data)

ASSETS





Current assets





Cash and cash equivalents


$

9,730



$

45,811


Accounts receivable — oil and gas revenues


96,495



130,934


Accounts receivable — joint interest and other


100,914



175,537


Inventory


11,072



21,354


Prepaid expenses


7,328



14,273


Derivative instruments


139,697



302,159


Other current assets


50



6,539


Total current assets


365,286



696,607


Property, plant and equipment





Oil and gas properties (successful efforts method)


6,284,401



5,966,140


Other property and equipment


443,265



313,439


Less: accumulated depreciation, depletion, amortization and impairment


(1,509,424)



(1,092,793)


Total property, plant and equipment, net


5,218,242



5,186,786


Assets held for sale


26,728




Derivative instruments


15,776



13,348


Other assets


23,343



12,335


Total assets


$

5,649,375



$

5,909,076


LIABILITIES AND STOCKHOLDERS' EQUITY





Current liabilities





Accounts payable


$

9,983



$

20,958


Revenues and production taxes payable


132,356



209,890


Accrued liabilities


167,669



410,379


Accrued interest payable


49,413



49,786


Deferred income taxes




97,499


Advances from joint interest partners


4,647



6,616


Other current liabilities


6,500




Total current liabilities


370,568



795,128


Long-term debt


2,302,584



2,670,664


Deferred income taxes


608,155



526,770


Asset retirement obligations


35,338



42,097


Liabilities held for sale


10,228




Other liabilities


3,160



2,116


Total liabilities


3,330,033



4,036,775


Commitments and contingencies





Stockholders' equity





Common stock, $0.01 par value: 300,000,000 shares authorized; 139,583,990 shares issued and 139,076,064 shares outstanding at December 31, 2015 and 101,627,296 shares issued and 101,341,619 shares outstanding at December 31, 2014


1,376



1,001


Treasury stock, at cost: 507,926 shares and 285,677 shares at December 31, 2015 and 2014, respectively


(13,620)



(10,671)


Additional paid-in-capital


1,497,065



1,007,202


Retained earnings


834,521



874,769


Total stockholders' equity


2,319,342



1,872,301


Total liabilities and stockholders' equity


$

5,649,375



$

5,909,076


 

OASIS PETROLEUM INC.

CONSOLIDATED STATEMENT OF OPERATIONS

(Unaudited)




Three Months Ended December 31,


Year Ended December 31,



2015


2014


2015


2014



(In thousands, except per share data)

Revenues









Oil and gas revenues


$

158,433



$

273,269



$

721,672



$

1,304,004


Well services and midstream revenues


23,634



26,403



68,063



86,224


Total revenues


182,067



299,672



789,735



1,390,228


Operating expenses









Lease operating expenses


31,925



44,697



144,481



169,600


Well services and midstream operating expenses


8,661



15,641



28,031



50,252


Marketing, transportation and gathering expenses


8,297



9,527



31,610



29,133


Production taxes


15,669



26,768



69,584



127,648


Depreciation, depletion and amortization


123,892



116,814



485,322



412,334


Exploration expenses


117



1,109



2,369



3,064


Rig termination






3,895




Impairment of oil and gas properties


21,364



44,995



46,109



47,238


General and administrative expenses


25,308



24,120



92,498



92,306


Total operating expenses


235,233



283,671



903,899



931,575


Gain (loss) on sale of properties




(77)





186,999


Operating income (loss)


(53,166)



15,924



(114,164)



645,652


Other income (expense)









Net gain on derivative instruments


99,091



306,758



210,376



327,011


Interest expense, net of capitalized interest


(36,946)



(39,822)



(149,648)



(158,390)


Other income (expense)


(3,305)



(55)



(2,935)



195


Total other income (expense)


58,840



266,881



57,793



168,816


Income (loss) before income taxes


5,674



282,805



(56,371)



814,468


Income tax benefit (expense)


(1,706)



(106,301)



16,123



(307,591)


Net income (loss)


$

3,968



$

176,504



$

(40,248)



$

506,877


Earnings per share:









Basic


$

0.03



$

1.77



$

(0.31)



$

5.09


Diluted


0.03



1.77



(0.31)



5.05


Weighted average shares outstanding:









Basic


137,184



99,767



130,186



99,677


Diluted


137,184



99,767



130,186



100,365


 

OASIS PETROLEUM INC.

SELECTED FINANCIAL AND OPERATIONAL STATS




Three Months Ended December 31,


Year Ended December 31,



2015


2014


2015


2014

Operating results ($ in thousands):





Revenues









Oil


$

150,448



$

258,913



$

692,497



$

1,231,251


Natural gas


7,985



14,356



29,175



72,753


Well services and midstream


23,634



26,403



68,063



86,224


Total revenues


$

182,067



$

299,672



$

789,735



$

1,390,228


Production data:









Oil (MBbls)


3,983



4,123



16,091



14,883


Natural gas (MMcf)


4,062



2,939



14,002



10,691


Oil equivalents (MBoe)


4,660



4,613



18,424



16,664


Average daily production (Boe/d)


50,652



50,143



50,477



45,656


Average sales prices:









Oil, without derivative settlements (per Bbl)


$

37.77



$

62.79



$

43.04



$

82.73


Oil, with derivative settlements (per Bbl)(1)


57.60



70.44



66.06



83.19


Natural gas (per Mcf)(2)


1.97



4.89



2.08



6.81


Costs and expenses (per Boe of production):









Lease operating expenses


$

6.85



$

9.69



$

7.84



$

10.18


Marketing, transportation and gathering expenses(3)


1.57



1.48



1.62



1.61


Production taxes


3.36



5.80



3.78



7.66


Depreciation, depletion and amortization


26.59



25.32



26.34



24.74


General and administrative expenses


5.43



5.23



5.02



5.54




(1)

Realized prices include gains or losses on cash settlements for commodity derivatives, which do not qualify for and were not designated as hedging instruments for accounting purposes. Cash settlements represent the cumulative gains and losses on our derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(2)

Natural gas prices include the value for natural gas and natural gas liquids.

(3)

Excludes non-cash valuation charges.

 

OASIS PETROLEUM INC.

CONSOLIDATED STATEMENT OF CASH FLOWS

(Unaudited)




Year Ended December 31,



2015


2014



(In thousands)

Cash flows from operating activities:





Net income (loss)


$

(40,248)



$

506,877


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





Depreciation, depletion and amortization


485,322



412,334


Gain on sale of properties




(186,999)


Impairment of oil and gas properties


46,109



47,238


Deferred income taxes


(16,114)



307,457


Derivative instruments


(210,376)



(327,011)


Stock-based compensation expenses


25,272



21,302


Deferred financing costs amortization and other


12,299



11,028


Working capital and other changes:





Change in accounts receivable


108,461



16,702


Change in inventory


6,873



(3,776)


Change in prepaid expenses


1,828



(3,199)


Change in other current assets


6,489



(6,135)


Change in other assets


(950)



114


Change in accounts payable and accrued liabilities


(71,617)



76,723


Change in other current liabilities


6,500




Change in other liabilities


(33)



(139)


Net cash provided by operating activities


359,815



872,516


Cash flows from investing activities:





Capital expenditures


(819,847)



(1,354,281)


Acquisition of oil and gas properties


(28,817)



(46,247)


Proceeds from sale of properties


1,075



324,852


Costs related to sale of properties




(2,337)


Derivative settlements


370,410



6,774


Advances from joint interest partners


(1,969)



(6,213)


Net cash used in investing activities


(479,148)



(1,077,452)


Cash flows from financing activities:





Proceeds from revolving credit facility


630,000



620,000


Principal payments on revolving credit facility


(992,000)



(455,570)


Deferred financing costs


(14,632)



(99)


Proceeds from sale of common stock


462,833




Purchases of treasury stock


(2,949)



(5,309)


Other




(176)


Net cash provided by financing activities


83,252



158,846


Decrease in cash and cash equivalents


(36,081)



(46,090)


Cash and cash equivalents:





Beginning of period


45,811



91,901


End of period


$

9,730



$

45,811


Supplemental cash flow information:





Cash paid for interest, net of capitalized interest


$

145,333



$

150,181


Cash paid for taxes




5,329


Cash received for income tax refunds


5,548




Supplemental non-cash transactions:





Change in accrued capital expenditures


$

(260,060)



$

169,710


Change in asset retirement obligations


3,972



6,182


 

Non-GAAP Financial Measures

Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of the Company's consolidated financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted EBITDA as earnings before interest expense, income taxes, depreciation, depletion, amortization, exploration expenses and other similar non-cash or non-recurring charges. Adjusted EBITDA is not a measure of net income or cash flows as determined by United States generally accepted accounting principles, or GAAP.

The following table presents reconciliations of the GAAP financial measures of net income and net cash provided by operating activities to the non-GAAP financial measure of Adjusted EBITDA for the periods presented:

Adjusted EBITDA Reconciliations




Three Months Ended

December 31,


Year Ended

December 31,



2015


2014


2015


2014



(In thousands)

Net income (loss)


$

3,968



$

176,504



$

(40,248)



$

506,877


Loss (gain) on sale of properties




77





(186,999)


Net gain on derivative instruments


(99,091)



(306,758)



(210,376)



(327,011)


Derivative settlements(1)


78,974



31,547



370,410



6,774


Interest expense, net of capitalized interest


36,946



39,822



149,648



158,390


Depreciation, depletion and amortization


123,892



116,814



485,322



412,334


Impairment of oil and gas properties


21,364



44,995



46,109



47,238


Exploration expenses


117



1,109



2,369



3,064


Rig termination






3,895




Stock-based compensation expenses


5,643



5,547



25,272



21,302


Income tax expense (benefit)


1,706



106,301



(16,123)



307,591


Other non-cash adjustments


3,174



3,561



3,956



3,284


Adjusted EBITDA


$

176,693



$

219,519



$

820,234



$

952,844











Net cash provided by operating activities


$

79,478



$

199,024



$

359,815



$

872,516


Derivative settlements(1)


78,974



31,547



370,410



6,774


Interest expense, net of capitalized interest


36,946



39,822



149,648



158,390


Exploration expenses


117



1,109



2,369



3,064


Rig termination






3,895




Deferred financing costs amortization and other


(4,831)



(5,819)



(12,299)



(11,028)


Current tax expense


(9)



(3,608)



(9)



134


Changes in working capital


(17,156)



(46,117)



(57,551)



(80,290)


Other non-cash adjustments


3,174



3,561



3,956



3,284


Adjusted EBITDA


$

176,693



$

219,519



$

820,234



$

952,844




(1)

Cash settlements represent the cumulative gains and losses on the Company's derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

 

The following tables present reconciliations of the GAAP financial measure of income before income taxes to the non-GAAP financial measure of Adjusted EBITDA for the Company's three reportable business segments for the periods presented:

Segment Adjusted EBITDA Reconciliations




Exploration and Production



Three Months Ended

December 31,


Year Ended

December 31,



2015


2014


2015


2014



(In thousands)

Income (loss) before income taxes


$

(14,868)



$

274,934



$

(118,970)



$

779,591


Loss (gain) on sale of properties




77





(186,999)


Net gain on derivative instruments


(99,091)



(306,758)



(210,376)



(327,011)


Derivative settlements(1)


78,974



31,547



370,410



6,774


Interest expense, net of capitalized interest


36,946



39,822



149,648



158,390


Depreciation, depletion and amortization


122,028



114,705



479,693



406,960


Impairment of oil and gas properties


21,364



44,995



46,109



47,238


Exploration expenses


117



1,109



2,369



3,064


Rig termination






3,895




Stock-based compensation expenses


5,486



5,303



24,762



20,701


Other non-cash adjustments


2,937



2,591



3,719



2,314


Adjusted EBITDA


$

153,893



$

208,325



$

751,259



$

911,022




(1)

Cash settlements represent the cumulative gains and losses on the Company's derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

 



Well Services



Three Months Ended

December 31,


Year Ended

December 31,



2015


2014


2015


2014



(In thousands)

Income before income taxes


$

19,608



$

17,741



$

49,197



$

70,953


Depreciation, depletion and amortization


4,643



4,362



19,073



14,080


Stock-based compensation expenses


422



475



1,952



1,658


Other non-cash adjustments


237



970



237



970


Adjusted EBITDA


$

24,910



$

23,548



$

70,459



$

87,661


 



Midstream Services



Three Months Ended

December 31,


Year Ended

December 31,



2015


2014


2015


2014



(In thousands)

Income before income taxes


$

15,828



$

6,876



$

59,867



$

22,730


Depreciation, depletion and amortization


1,695



1,032



5,764



3,744


Stock-based compensation expenses


162





692




Adjusted EBITDA


$

17,685



$

7,908



$

66,323



$

26,474


 

Adjusted Net Income and Adjusted Diluted Earnings Per Share are supplemental non-GAAP financial measures that are used by management and external users of the Company's consolidated financial statements, such as industry analysts, investors, lenders and rating agencies. The Company defines Adjusted Net Income as net income after adjusting first for (1) the impact of certain non-cash and non-recurring items, including non-cash changes in the fair value of derivative instruments, impairment of oil and gas properties, and other similar non-cash and non-recurring charges, and then (2) the non-cash and non-recurring items' impact on taxes based on the Company's effective tax rate applicable to those items in the same period. Adjusted Net Income is not a measure of net income as determined by GAAP. The Company defines Adjusted Diluted Earnings Per Share as Adjusted Net Income divided by diluted weighted average shares outstanding.

The following table presents reconciliations of the GAAP financial measure of net income to the non-GAAP financial measure of Adjusted Net Income and the GAAP financial measure of diluted earnings per share to the non-GAAP financial measure of Adjusted Diluted Earnings Per Share for the periods presented:

Adjusted Net Income and Adjusted Diluted Earnings Per Share Reconciliations



Three Months Ended
December 31,


Year Ended
December 31,


2015


2014


2015


2014







Net income (loss)

$

3,968



$

176,504



$

(40,248)



$

506,877


Loss (gain) on sale of properties



77





(186,999)


Net gain on derivative instruments

(99,091)



(306,758)



(210,376)



(327,011)


Derivative settlements(1)

78,974



31,547



370,410



6,774


Impairment of oil and gas properties

21,364



44,995



46,109



47,238


Rig termination





3,895




Other non-cash adjustments

3,174



3,561



3,956



3,284


Tax impact(2)

(1,653)



85,195



(79,991)



172,482


Adjusted Net Income

$

6,736



$

35,121



$

93,755



$

222,645










Diluted earnings per share

$

0.03



$

1.77



$

(0.31)



$

5.05


Loss (gain) on sale of properties







(1.86)


Net gain on derivative instruments

(0.72)



(3.07)



(1.62)



(3.26)


Derivative settlements(1)

0.58



0.32



2.85



0.07


Impairment of oil and gas properties

0.16



0.45



0.35



0.47


Rig termination





0.03




Other non-cash adjustments

0.02



0.04



0.03



0.03


Tax impact(2)

(0.02)



0.84



(0.61)



1.72


Adjusted Diluted Earnings Per Share

$

0.05



$

0.35



$

0.72



$

2.22










Diluted weighted average shares outstanding

137,184



99,767



130,186



100,365










Effective tax rate applicable to adjustment items

37.4

%


37.6

%


37.4

%


37.8

%



(1)

Cash settlements represent the cumulative gains and losses on the Company's derivative instruments for the periods presented and do not include a recovery of costs that were paid to acquire or modify the derivative instruments that were settled.

(2)

The tax impact is computed utilizing the Company's effective tax rate applicable to the adjustments for certain non-cash and non-recurring items.

 

 

SOURCE Oasis Petroleum Inc.

For further information: Richard Robuck, 1-281-404-9602