Delaware | 81-5365682 | ||||||||||
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
||||||||||
Nine Greenway Plaza, Suite 1300
|
77046 | ||||||||||
Houston,
|
Texas
|
||||||||||
(Address of principal executive offices) | (Zip Code) |
Securities registered pursuant to section 12(b) of the Act: | ||||||||
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
Class A Common Stock, par value $0.0001 | MGY | New York Stock Exchange |
Large accelerated filer | ☒ | Accelerated filer | ☐ | |||||||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ☐ | |||||||||||||||||
Emerging growth company | ☐ |
Page | ||||||||||||||
PART I. | FINANCIAL INFORMATION | |||||||||||||
Item 1. |
Financial Statements
|
|||||||||||||
Consolidated Balance Sheets | ||||||||||||||
Consolidated Statements of Operations (unaudited) | ||||||||||||||
Consolidated Statements of Changes in Stockholders’ Equity (unaudited) | ||||||||||||||
Consolidated Statements of Cash Flows (unaudited) | ||||||||||||||
Notes to Consolidated Financial Statements (unaudited) | ||||||||||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||||||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | |||||||||||||
Item 4. | Controls and Procedures | |||||||||||||
PART II. | OTHER INFORMATION | |||||||||||||
Item 1. | Legal Proceedings | |||||||||||||
Item 1A. | Risk Factors | |||||||||||||
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | |||||||||||||
Item 3. | Defaults Upon Senior Securities | |||||||||||||
Item 4. | Mine Safety Disclosures | |||||||||||||
Item 5. | Other Information | |||||||||||||
Item 6. | Exhibits | |||||||||||||
Signatures |
September 30, 2020 | December 31, 2019 | |||||||||||||
ASSETS | (Unaudited) | (Audited) | ||||||||||||
CURRENT ASSETS | ||||||||||||||
Cash and cash equivalents
|
$ | 148,533 | $ | 182,633 | ||||||||||
Accounts receivable
|
61,243 | 105,775 | ||||||||||||
Drilling advances
|
473 | 299 | ||||||||||||
Other current assets
|
4,613 | 4,511 | ||||||||||||
Total current assets | 214,862 | 293,218 | ||||||||||||
PROPERTY, PLANT AND EQUIPMENT | ||||||||||||||
Oil and natural gas properties | 2,105,774 | 3,815,221 | ||||||||||||
Other | 4,063 | 3,087 | ||||||||||||
Accumulated depreciation, depletion and amortization | (939,888) | (701,551) | ||||||||||||
Total property, plant and equipment, net | 1,169,949 | 3,116,757 | ||||||||||||
OTHER ASSETS | ||||||||||||||
Deferred financing costs, net | 6,632 | 8,390 | ||||||||||||
Equity method investment | 21,789 | 19,730 | ||||||||||||
Intangible assets, net | 12,973 | 23,851 | ||||||||||||
Other long-term assets | 8,074 | 4,460 | ||||||||||||
TOTAL ASSETS | $ | 1,434,279 | $ | 3,466,406 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||||||||
CURRENT LIABILITIES | ||||||||||||||
Accounts payable | $ | 63,475 | $ | 79,428 | ||||||||||
Other current liabilities (Note 8)
|
60,987 | 95,780 | ||||||||||||
Total current liabilities | 124,462 | 175,208 | ||||||||||||
LONG-TERM LIABILITIES | ||||||||||||||
Long-term debt, net | 390,787 | 389,835 | ||||||||||||
Asset retirement obligations, net of current | 100,800 | 93,524 | ||||||||||||
Deferred taxes, net | — | 77,834 | ||||||||||||
Other long-term liabilities | 6,049 | 1,476 | ||||||||||||
Total long-term liabilities | 497,636 | 562,669 | ||||||||||||
COMMITMENTS AND CONTINGENCIES (Note 10)
|
||||||||||||||
STOCKHOLDERS’ EQUITY | ||||||||||||||
Class A Common Stock, $0.0001 par value, 1,300,000 shares authorized, 168,676 shares issued and 165,576 shares outstanding in 2020 and 168,318 shares issued and 167,318 shares outstanding in 2019
|
17 | 17 | ||||||||||||
Class B Common Stock, $0.0001 par value, 225,000 shares authorized, 85,790 shares issued and outstanding in 2020 and 2019
|
9 | 9 | ||||||||||||
Additional paid-in capital | 1,709,043 | 1,703,362 | ||||||||||||
Treasury Stock, at cost, 3,100 shares and 1,000 shares in 2020 and 2019, respectively
|
(23,240) | (10,277) | ||||||||||||
Retained earnings (Accumulated deficit) | (1,153,195) | 82,940 | ||||||||||||
Noncontrolling interest | 279,547 | 952,478 | ||||||||||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ | 1,434,279 | $ | 3,466,406 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | ||||||||||||||||||||
REVENUES | |||||||||||||||||||||||
Oil revenues | $ | 95,677 | $ | 207,840 | $ | 311,153 | $ | 584,009 | |||||||||||||||
Natural gas revenues | 14,895 | 21,243 | 44,238 | 71,208 | |||||||||||||||||||
Natural gas liquids revenues | 10,495 | 15,716 | 29,880 | 51,215 | |||||||||||||||||||
Total revenues | 121,067 | 244,799 | 385,271 | 706,432 | |||||||||||||||||||
OPERATING EXPENSES | |||||||||||||||||||||||
Lease operating expenses | 18,802 | 24,344 | 61,275 | 70,752 | |||||||||||||||||||
Gathering, transportation, and processing | 5,771 | 9,270 | 20,579 | 26,016 | |||||||||||||||||||
Taxes other than income | 7,331 | 13,333 | 22,874 | 40,825 | |||||||||||||||||||
Exploration expense | 701 | 3,924 | 563,589 | 10,017 | |||||||||||||||||||
Impairment of oil and natural gas properties | — | — | 1,381,258 | — | |||||||||||||||||||
Asset retirement obligation accretion | 1,501 | 1,394 | 4,403 | 4,095 | |||||||||||||||||||
Depreciation, depletion and amortization | 44,731 | 143,894 | 238,273 | 385,942 | |||||||||||||||||||
Amortization of intangible assets | 3,626 | 3,626 | 10,879 | 10,879 | |||||||||||||||||||
General and administrative expenses | 16,663 | 17,345 | 50,472 | 52,651 | |||||||||||||||||||
Transaction related costs | — | — | — | 438 | |||||||||||||||||||
Total operating costs and expenses | 99,126 | 217,130 | 2,353,602 | 601,615 | |||||||||||||||||||
OPERATING INCOME (LOSS) | 21,941 | 27,669 | (1,968,331) | 104,817 | |||||||||||||||||||
OTHER INCOME (EXPENSE) | |||||||||||||||||||||||
Income from equity method investee | 1,007 | 92 | 2,059 | 608 | |||||||||||||||||||
Interest expense, net | (7,333) | (6,896) | (21,345) | (21,611) | |||||||||||||||||||
Loss on derivatives, net | (2,208) | — | (2,208) | — | |||||||||||||||||||
Other income (expense), net | (51) | 21 | (510) | 8 | |||||||||||||||||||
Total other income (expense) | (8,585) | (6,783) | (22,004) | (20,995) | |||||||||||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | 13,356 | 20,886 | (1,990,335) | 83,822 | |||||||||||||||||||
Income tax expense (benefit) | (339) | 3,529 | (79,340) | 12,449 | |||||||||||||||||||
NET INCOME (LOSS) | 13,695 | 17,357 | (1,910,995) | 71,373 | |||||||||||||||||||
LESS: Net income (loss) attributable to noncontrolling interest | 4,548 | 6,810 | (674,860) | 29,294 | |||||||||||||||||||
NET INCOME ATTRIBUTABLE TO MAGNOLIA | 9,147 | 10,547 | (1,236,135) | 42,079 | |||||||||||||||||||
LESS: Non-cash deemed dividend related to warrant exchange | — | 2,763 | — | 2,763 | |||||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO CLASS A COMMON STOCK | $ | 9,147 | $ | 7,784 | $ | (1,236,135) | $ | 39,316 | |||||||||||||||
NET INCOME (LOSS) PER SHARE OF CLASS A COMMON STOCK | |||||||||||||||||||||||
Basic | $ | 0.05 | $ | 0.05 | $ | (7.41) | $ | 0.25 | |||||||||||||||
Diluted | $ | 0.05 | $ | 0.05 | $ | (7.41) | $ | 0.24 | |||||||||||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | |||||||||||||||||||||||
Basic | 166,467 | 166,872 | 166,728 | 160,051 | |||||||||||||||||||
Diluted | 170,676 | 167,108 | 166,728 | 161,488 |
Class A
Common Stock |
Class B
Common Stock |
Additional Paid In Capital | Treasury Stock | Retained Earnings | Total Stockholders’ Equity | Noncontrolling Interest |
Total
Equity |
||||||||||||||||||||||||||||
Shares | Value | Shares | Value | Shares | Value | ||||||||||||||||||||||||||||||
Balance, December 31, 2018 | 156,333 | $ | 16 | 93,346 | $ | 9 | $ | 1,641,237 | — | $ | — | $ | 35,507 | $ | 1,676,769 | $ | 1,031,186 | $ | 2,707,955 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 2,432 | — | — | — | 2,432 | — | 2,432 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | (919) | — | — | — | (919) | 832 | (87) | ||||||||||||||||||||||||
Final settlement adjustment related to Business Combination | (496) | — | (1,556) | — | (6,095) | — | — | — | (6,095) | (19,150) | (25,245) | ||||||||||||||||||||||||
Contributions from noncontrolling interest owner | — | — | — | — | — | — | — | — | — | 8,809 | 8,809 | ||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 13,026 | 13,026 | 9,687 | 22,713 | ||||||||||||||||||||||||
Balance, March 31, 2019 | 155,837 | $ | 16 | 91,790 | $ | 9 | $ | 1,636,655 | — | $ | — | $ | 48,533 | $ | 1,685,213 | $ | 1,031,364 | $ | 2,716,577 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 3,115 | — | — | — | 3,115 | — | 3,115 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | 108 | — | — | — | 108 | 634 | 742 | ||||||||||||||||||||||||
Common stock issued in connection with acquisition | 3,055 | — | — | — | 33,693 | — | — | — | 33,693 | — | 33,693 | ||||||||||||||||||||||||
Offering expenses incurred in connection with warrants exchange | — | — | — | — | (1,055) | — | — | — | (1,055) | — | (1,055) | ||||||||||||||||||||||||
Distributions to noncontrolling interest owners | — | — | — | — | — | — | — | — | — | (227) | (227) | ||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 18,506 | 18,506 | 12,797 | 31,303 | ||||||||||||||||||||||||
Balance, June 30, 2019 | 158,892 | $ | 16 | 91,790 | $ | 9 | $ | 1,672,516 | — | $ | — | $ | 67,039 | $ | 1,739,580 | $ | 1,044,568 | $ | 2,784,148 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 2,829 | — | — | — | 2,829 | — | 2,829 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | 28,215 | — | — | — | 28,215 | (36,715) | (8,500) | ||||||||||||||||||||||||
Common stock issued in connection with warrants exchange | 9,179 | 1 | — | — | 1,624 | — | — | (2,763) | (1,138) | — | (1,138) | ||||||||||||||||||||||||
Common stock issued related to stock based compensation, net | 189 | — | — | — | (532) | — | — | — | (532) | — | (532) | ||||||||||||||||||||||||
Common stock repurchased | — | — | — | — | — | 950 | (9,722) | — | (9,722) | — | (9,722) | ||||||||||||||||||||||||
Distributions to noncontrolling interest owners | — | — | — | — | — | — | — | — | — | (489) | (489) | ||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 10,547 | 10,547 | 6,810 | 17,357 | ||||||||||||||||||||||||
Balance, September 30, 2019 | 168,260 | $ | 17 | 91,790 | $ | 9 | $ | 1,704,652 | 950 | $ | (9,722) | $ | 74,823 | $ | 1,769,779 | $ | 1,014,174 | $ | 2,783,953 |
Class A
Common Stock |
Class B
Common Stock |
Additional Paid In Capital |
Treasury
Stock |
Retained Earnings/ Accumulated Deficit | Total Stockholders’ Equity | Noncontrolling Interest |
Total
Equity |
||||||||||||||||||||||||||||
Shares | Value | Shares | Value | Shares | Value | ||||||||||||||||||||||||||||||
Balance, December 31, 2019 | 168,319 | $ | 17 | 85,790 | $ | 9 | $ | 1,703,362 | 1,000 | $ | (10,277) | $ | 82,940 | $ | 1,776,051 | $ | 952,478 | $ | 2,728,529 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 2,879 | — | — | — | 2,879 | — | 2,879 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | (1,793) | — | — | — | (1,793) | 1,793 | — | ||||||||||||||||||||||||
Common stock issued related to stock based compensation, net | 154 | — | — | — | (452) | — | — | — | (452) | — | (452) | ||||||||||||||||||||||||
Class A Common Stock repurchases | — | — | — | — | — | 1,000 | (6,483) | — | (6,483) | — | (6,483) | ||||||||||||||||||||||||
Distributions to noncontrolling interest owners | — | — | — | — | — | — | — | — | — | (284) | (284) | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (1,227,010) | (1,227,010) | (668,289) | (1,895,299) | ||||||||||||||||||||||||
Balance, March 31, 2020 | 168,473 | $ | 17 | 85,790 | $ | 9 | $ | 1,703,996 | 2,000 | $ | (16,760) | $ | (1,144,070) | $ | 543,192 | $ | 285,698 | $ | 828,890 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 3,065 | — | — | — | 3,065 | — | 3,065 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | (907) | — | — | — | (907) | 907 | — | ||||||||||||||||||||||||
Common stock issued related to stock based compensation and other, net | 114 | — | — | — | (33) | — | — | — | (33) | — | (33) | ||||||||||||||||||||||||
Distributions to noncontrolling interest owners | — | — | — | — | — | — | — | — | — | (207) | (207) | ||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | — | (18,272) | (18,272) | (11,119) | (29,391) | ||||||||||||||||||||||||
Balance, June 30, 2020 | 168,587 | $ | 17 | 85,790 | $ | 9 | $ | 1,706,121 | 2,000 | $ | (16,760) | $ | (1,162,342) | $ | 527,045 | $ | 275,279 | $ | 802,324 | ||||||||||||||||
Stock based compensation expense | — | — | — | — | 2,927 | — | — | — | 2,927 | — | 2,927 | ||||||||||||||||||||||||
Changes in ownership interest adjustment | — | — | — | — | 175 | — | — | — | 175 | (175) | — | ||||||||||||||||||||||||
Common stock issued related to stock based compensation and other, net | 89 | — | — | — | (180) | — | — | — | (180) | — | (180) | ||||||||||||||||||||||||
Class A Common Stock repurchases | — | — | — | — | — | 1,100 | (6,480) | — | (6,480) | — | (6,480) | ||||||||||||||||||||||||
Distributions to noncontrolling interest owners | — | — | — | — | — | — | — | — | — | (105) | (105) | ||||||||||||||||||||||||
Net income | — | — | — | — | — | — | — | 9,147 | 9,147 | 4,548 | 13,695 | ||||||||||||||||||||||||
Balance, September 30, 2020 | 168,676 | $ | 17 | 85,790 | $ | 9 | $ | 1,709,043 | 3,100 | $ | (23,240) | $ | (1,153,195) | $ | 532,634 | $ | 279,547 | $ | 812,181 |
Nine Months Ended | ||||||||||||||
September 30, 2020 | September 30, 2019 | |||||||||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||||
NET INCOME (LOSS) | $ | (1,910,995) | $ | 71,373 | ||||||||||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||
Depreciation, depletion and amortization | 238,273 | 385,942 | ||||||||||||
Amortization of intangible assets | 10,879 | 10,879 | ||||||||||||
Exploration expense, non-cash | 561,629 | 536 | ||||||||||||
Impairment of oil and natural gas properties | 1,381,258 | — | ||||||||||||
Asset retirement obligation accretion | 4,403 | 4,095 | ||||||||||||
Amortization of deferred financing costs | 2,710 | 2,644 | ||||||||||||
Loss on derivatives, net | 2,208 | — | ||||||||||||
Deferred tax expense (benefit) | (77,834) | 11,765 | ||||||||||||
Stock based compensation | 8,871 | 8,376 | ||||||||||||
Other | (2,059) | (512) | ||||||||||||
Changes in operating assets and liabilities: | ||||||||||||||
Accounts receivable | 44,532 | (6,937) | ||||||||||||
Accounts payable | (15,953) | 16,034 | ||||||||||||
Accrued liabilities | (15,468) | (22,379) | ||||||||||||
Drilling advances | (174) | 10,205 | ||||||||||||
Other assets and liabilities, net | (1,281) | (3,410) | ||||||||||||
Net cash provided by operating activities | 230,999 | 488,611 | ||||||||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||||
Acquisition of EnerVest properties | — | 4,250 | ||||||||||||
Acquisitions, other | (73,702) | (93,221) | ||||||||||||
Additions to oil and natural gas properties | (157,325) | (351,467) | ||||||||||||
Changes in working capital associated with additions to oil and natural gas properties | (18,972) | (13,392) | ||||||||||||
Other investing | (842) | (247) | ||||||||||||
Net cash used in investing activities | (250,841) | (454,077) | ||||||||||||
CASH FLOW FROM FINANCING ACTIVITIES | ||||||||||||||
Contributions from noncontrolling interest owners | — | 7,301 | ||||||||||||
Distributions to noncontrolling interest owners | (594) | (716) | ||||||||||||
Class A Common Stock repurchases | (12,962) | (9,722) | ||||||||||||
Other financing activities | (702) | (2,666) | ||||||||||||
Net cash used in financing activities | (14,258) | (5,803) | ||||||||||||
NET CHANGE IN CASH AND CASH EQUIVALENTS | (34,100) | 28,731 | ||||||||||||
Cash and cash equivalents – Beginning of period | 182,633 | 135,758 | ||||||||||||
Cash and cash equivalents – End of period | $ | 148,533 | $ | 164,489 | ||||||||||
SUPPLEMENTAL CASH FLOW INFORMATION: | ||||||||||||||
Supplemental non-cash operating activity: | ||||||||||||||
Cash paid (received) for income taxes | $ | (724) | $ | 390 | ||||||||||
Cash paid for interest | 25,445 | 25,687 | ||||||||||||
Supplemental non-cash investing and financing activity: | ||||||||||||||
Accruals or liabilities for capital expenditures | $ | 21,750 | $ | 37,241 | ||||||||||
Equity issuances in connection with acquisitions | — | 33,693 | ||||||||||||
Non-cash deemed dividend related to warrant exchange | — | 2,763 | ||||||||||||
Supplemental non-cash lease operating activity: | ||||||||||||||
Right-of-use assets obtained in exchange for operating lease obligations | $ | 5,500 | $ | 6,720 |
2020 | 2021 | |||||||||||||
Natural gas costless collars: | ||||||||||||||
Notional volume (MMBtu) | 4,600,000 | 12,150,000 | ||||||||||||
Weighted average floor price ($/MMBtu) | $ | 2.31 | $ | 2.31 | ||||||||||
Weighted average ceiling price ($/MMBtu) | $ | 3.00 | $ | 3.00 |
September 30, 2020 | December 31, 2019 | ||||||||||||||||||||||
(In thousands) | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||||||||
Long-term debt | $ | 390,787 | $ | 392,000 | $ | 389,835 | $ | 412,000 |
Fair Value Measurements Using | |||||||||||||||||||||||||||||||||||
(In thousands) | Level 1 | Level 2 | Level 3 | Total Fair Value | Netting | Carrying Amount | |||||||||||||||||||||||||||||
September 30, 2020 | |||||||||||||||||||||||||||||||||||
Current assets: | |||||||||||||||||||||||||||||||||||
Natural gas derivative instruments | $ | — | $ | 2,181 | $ | — | $ | 2,181 | $ | (2,181) | $ | — | |||||||||||||||||||||||
Current liabilities: | |||||||||||||||||||||||||||||||||||
Natural gas derivative instruments | $ | — | $ | 4,389 | $ | — | $ | 4,389 | $ | (2,181) | $ | 2,208 |
(In thousands) | September 30, 2020 | December 31, 2019 | |||||||||
Non-compete intangible assets | $ | 44,400 | $ | 44,400 | |||||||
Accumulated amortization | (31,427) | (20,549) | |||||||||
Intangible assets, net | $ | 12,973 | $ | 23,851 | |||||||
Weighted average amortization period (in years) | 3.25 | 3.25 |
(In thousands) | September 30, 2020 | December 31, 2019 | |||||||||
Accrued capital expenditures | $ | 21,750 | $ | 40,722 | |||||||
Accrued general and administrative expenditures | 9,703 | 9,753 | |||||||||
Accrued ad valorem taxes | 7,027 | 8,741 | |||||||||
Other | 22,507 | 36,564 | |||||||||
Total Other current liabilities | $ | 60,987 | $ | 95,780 |
(In thousands) | September 30, 2020 | December 31, 2019 | |||||||||
Revolving credit facility | $ | — | $ | — | |||||||
Senior Notes due 2026
|
400,000 | 400,000 | |||||||||
Total long-term debt | 400,000 | 400,000 | |||||||||
Less: Unamortized deferred financing cost | (9,213) | (10,165) | |||||||||
Total debt, net | $ | 390,787 | $ | 389,835 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In thousands) | September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | |||||||||||||||||||
Current: | |||||||||||||||||||||||
Federal | $ | — | $ | — | $ | (1,167) | $ | — | |||||||||||||||
State | (339) | 115 | (339) | 684 | |||||||||||||||||||
(339) | 115 | (1,506) | 684 | ||||||||||||||||||||
Deferred: | |||||||||||||||||||||||
Federal | — | 3,135 | (71,792) | 11,588 | |||||||||||||||||||
State | — | 279 | (6,042) | 177 | |||||||||||||||||||
— | 3,414 | (77,834) | 11,765 | ||||||||||||||||||||
Income tax expense (benefit) | $ | (339) | $ | 3,529 | $ | (79,340) | $ | 12,449 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, 2020 | September 30, 2020 | ||||||||||||||||||||||
Restricted Stock Units | Weighted Average Grant Date Fair Value | Restricted Stock Units | Weighted Average Grant Date Fair Value | ||||||||||||||||||||
Unvested RSUs, beginning of period | 1,637,445 | $ | 10.02 | 1,099,901 | $ | 12.97 | |||||||||||||||||
Granted | 21,552 | 6.46 | 874,919 | 7.14 | |||||||||||||||||||
Vested | (110,548) | 14.43 | (426,371) | 13.03 | |||||||||||||||||||
Forfeited | (27,678) | 10.07 | (27,678) | 10.07 | |||||||||||||||||||
Unvested RSUs, end of period | 1,520,771 | $ | 9.65 | 1,520,771 | $ | 9.65 |
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
September 30, 2020 | September 30, 2020 | ||||||||||||||||||||||
Performance Stock Units | Weighted Average Grant Date Fair Value | Performance Stock Units | Weighted Average Grant Date Fair Value | ||||||||||||||||||||
Unvested PSUs, beginning of period | 1,086,419 | $ | 11.28 | 701,128 | $ | 14.31 | |||||||||||||||||
Granted | — | — | 401,958 | 6.14 | |||||||||||||||||||
Vested | (25,260) | 14.58 | (41,927) | 14.58 | |||||||||||||||||||
Forfeited | (30,529) | 10.77 | (30,529) | 10.77 | |||||||||||||||||||
Unvested PSUs, end of period | 1,030,630 | $ | 11.22 | 1,030,630 | $ | 11.22 |
Nine Months Ended | |||||||||||
Grant Date Fair Value Assumptions | September 30, 2020 | September 30, 2019 | |||||||||
Expected term (in years)
|
2.85 |
2.67-2.85
|
|||||||||
Expected volatility | 33.50% |
31.58% - 33.61%
|
|||||||||
Risk-free interest rate | 1.16% |
2.29% - 2.48%
|
Three Months Ended | Nine Months Ended | ||||||||||||||||||||||
(In thousands, except per share data) | September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | |||||||||||||||||||
Basic: | |||||||||||||||||||||||
Net income (loss) attributable to Class A Common Stock | $ | 9,147 | $ | 7,784 | $ | (1,236,135) | $ | 39,316 | |||||||||||||||
Weighted average number of common shares outstanding during the period - basic | 166,467 | 166,872 | 166,728 | 160,051 | |||||||||||||||||||
Net income (loss) per share of Class A Common Stock - basic
|
$ | 0.05 | $ | 0.05 | $ | (7.41) | $ | 0.25 | |||||||||||||||
Diluted: | |||||||||||||||||||||||
Net income (loss) attributable to Class A Common Stock | $ | 9,147 | $ | 7,784 | $ | (1,236,135) | $ | 39,316 | |||||||||||||||
Weighted average number of common shares outstanding during the period - basic | 166,467 | 166,872 | 166,728 | 160,051 | |||||||||||||||||||
Add: Dilutive effect warrants, stock based compensation, and other | 4,209 | 236 | — | 1,437 | |||||||||||||||||||
Weighted average number of common shares outstanding during the period - diluted | 170,676 | 167,108 | 166,728 | 161,488 | |||||||||||||||||||
Net income (loss) per share of Class A Common Stock - diluted
|
$ | 0.05 | $ | 0.05 | $ | (7.41) | $ | 0.24 |
Three Months Ended | ||||||||||||||
(In thousands, except per unit data) | September 30, 2020 | September 30, 2019 | ||||||||||||
Production: | ||||||||||||||
Oil (MBbls) | 2,485 | 3,520 | ||||||||||||
Natural gas (MMcf) | 9,444 | 10,763 | ||||||||||||
NGLs (MBbls) | 937 | 1,245 | ||||||||||||
Total (Mboe) | 4,996 | 6,559 | ||||||||||||
Average daily production: | ||||||||||||||
Oil (Bbls/d) | 27,016 | 38,261 | ||||||||||||
Natural gas (Mcf/d) | 102,653 | 116,989 | ||||||||||||
NGLs (Bbls/d) | 10,181 | 13,533 | ||||||||||||
Total (boe/d) | 54,306 | 71,292 | ||||||||||||
Revenues: | ||||||||||||||
Oil revenues | $ | 95,677 | $ | 207,840 | ||||||||||
Natural gas revenues | 14,895 | 21,243 | ||||||||||||
Natural gas liquids revenues | 10,495 | 15,716 | ||||||||||||
Total revenues | $ | 121,067 | $ | 244,799 | ||||||||||
Average Price: | ||||||||||||||
Oil (per barrel) | $ | 38.50 | $ | 59.05 | ||||||||||
Natural gas (per Mcf) | 1.58 | 1.97 | ||||||||||||
NGLs (per barrel) | 11.20 | 12.62 |
Three Months Ended | ||||||||||||||
(In thousands, except per unit data) | September 30, 2020 | September 30, 2019 | ||||||||||||
Operating Expenses: | ||||||||||||||
Lease operating expenses | $ | 18,802 | $ | 24,344 | ||||||||||
Gathering, transportation, and processing | 5,771 | 9,270 | ||||||||||||
Taxes other than income | 7,331 | 13,333 | ||||||||||||
Exploration expenses | 701 | 3,924 | ||||||||||||
Asset retirement obligation accretion | 1,501 | 1,394 | ||||||||||||
Depreciation, depletion and amortization | 44,731 | 143,894 | ||||||||||||
Amortization of intangible assets | 3,626 | 3,626 | ||||||||||||
General and administrative expenses | 16,663 | 17,345 | ||||||||||||
Total operating costs and expenses | $ | 99,126 | $ | 217,130 | ||||||||||
Other Income (Expense): | ||||||||||||||
Income from equity method investee | $ | 1,007 | $ | 92 | ||||||||||
Interest expense, net | (7,333) | (6,896) | ||||||||||||
Loss on derivatives, net | (2,208) | — | ||||||||||||
Other expense, net | (51) | 21 | ||||||||||||
Total other expense | $ | (8,585) | $ | (6,783) | ||||||||||
Average Operating Costs per boe: | ||||||||||||||
Lease operating expenses | $ | 3.76 | $ | 3.71 | ||||||||||
Gathering, transportation, and processing | 1.16 | 1.41 | ||||||||||||
Taxes other than income | 1.47 | 2.03 | ||||||||||||
Exploration expense | 0.14 | 0.60 | ||||||||||||
Asset retirement obligation accretion | 0.30 | 0.21 | ||||||||||||
Depreciation, depletion and amortization | 8.95 | 21.94 | ||||||||||||
Amortization of intangible assets | 0.73 | 0.55 | ||||||||||||
General and administrative expenses | 3.34 | 2.64 |
Nine Months Ended | ||||||||||||||
(In thousands, except per unit data) | September 30, 2020 | September 30, 2019 | ||||||||||||
Production: | ||||||||||||||
Oil (MBbls) | 8,965 | 9,615 | ||||||||||||
Natural gas (MMcf) | 29,261 | 30,583 | ||||||||||||
NGLs (MBbls) | 3,213 | 3,389 | ||||||||||||
Total (Mboe) | 17,055 | 18,101 | ||||||||||||
Average daily production: | ||||||||||||||
Oil (Bbls/d) | 32,718 | 35,220 | ||||||||||||
Natural gas (Mcf/d) | 106,790 | 112,026 | ||||||||||||
NGLs (Bbls/d) | 11,725 | 12,414 | ||||||||||||
Total (boe/d) | 62,241 | 66,305 | ||||||||||||
Revenues: | ||||||||||||||
Oil revenues | $ | 311,153 | $ | 584,009 | ||||||||||
Natural gas revenues | 44,238 | 71,208 | ||||||||||||
Natural gas liquids revenues | 29,880 | 51,215 | ||||||||||||
Total revenues | $ | 385,271 | $ | 706,432 | ||||||||||
Average Price: | ||||||||||||||
Oil (per barrel) | $ | 34.71 | $ | 60.74 | ||||||||||
Natural gas (per Mcf) | 1.51 | 2.33 | ||||||||||||
NGLs (per barrel) | 9.30 | 15.11 |
Nine Months Ended | ||||||||||||||
(In thousands, except per unit data) | September 30, 2020 | September 30, 2019 | ||||||||||||
Operating Expenses: | ||||||||||||||
Lease operating expenses | $ | 61,275 | $ | 70,752 | ||||||||||
Gathering, transportation, and processing | 20,579 | 26,016 | ||||||||||||
Taxes other than income | 22,874 | 40,825 | ||||||||||||
Exploration expenses | 563,589 | 10,017 | ||||||||||||
Impairment of oil and natural gas properties | 1,381,258 | — | ||||||||||||
Asset retirement obligation accretion | 4,403 | 4,095 | ||||||||||||
Depreciation, depletion and amortization | 238,273 | 385,942 | ||||||||||||
Amortization of intangible assets | 10,879 | 10,879 | ||||||||||||
General and administrative expenses | 50,472 | 52,651 | ||||||||||||
Transaction related costs | — | 438 | ||||||||||||
Total operating costs and expenses | $ | 2,353,602 | $ | 601,615 | ||||||||||
Other Income (Expense): | ||||||||||||||
Income from equity method investee | $ | 2,059 | $ | 608 | ||||||||||
Interest expense, net | (21,345) | (21,611) | ||||||||||||
Loss on derivatives, net | (2,208) | — | ||||||||||||
Other expense, net | (510) | 8 | ||||||||||||
Total other expense | $ | (22,004) | $ | (20,995) | ||||||||||
Average Operating Costs per boe: | ||||||||||||||
Lease operating expenses | $ | 3.59 | $ | 3.91 | ||||||||||
Gathering, transportation, and processing | 1.21 | 1.44 | ||||||||||||
Taxes other than income | 1.34 | 2.26 | ||||||||||||
Exploration expense | 33.05 | 0.55 | ||||||||||||
Impairment of oil and natural gas properties | 80.99 | — | ||||||||||||
Asset retirement obligation accretion | 0.26 | 0.23 | ||||||||||||
Depreciation, depletion and amortization | 13.97 | 21.32 | ||||||||||||
Amortization of intangible assets | 0.64 | 0.60 | ||||||||||||
General and administrative expenses | 2.96 | 2.91 | ||||||||||||
Transaction related costs | — | 0.02 |
Nine Months Ended | ||||||||||||||
(In thousands) | September 30, 2020 | September 30, 2019 | ||||||||||||
Sources of cash and cash equivalents | ||||||||||||||
Net cash provided by operating activities | $ | 230,999 | $ | 488,611 | ||||||||||
Other | — | 11,551 | ||||||||||||
$ | 230,999 | $ | 500,162 | |||||||||||
Uses of cash and cash equivalents | ||||||||||||||
Acquisitions, other | $ | (73,702) | $ | (93,221) | ||||||||||
Additions to oil and natural gas properties | (157,325) | (351,467) | ||||||||||||
Changes in working capital associated with additions to oil and natural gas properties | (18,972) | (13,392) | ||||||||||||
Class A Common Stock repurchases | (12,962) | (9,722) | ||||||||||||
Other | (2,138) | (3,629) | ||||||||||||
(265,099) | (471,431) | |||||||||||||
Decrease in cash and cash equivalents | $ | (34,100) | $ | 28,731 |
Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
(In thousands) | September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | ||||||||||||||||||||||
Drilling and completion | $ | 27,425 | $ | 88,384 | $ | 155,308 | $ | 344,179 | ||||||||||||||||||
Leasehold acquisition costs | 249 | 1,286 | 2,017 | 8,556 | ||||||||||||||||||||||
Total capital expenditures | $ | 27,674 | $ | 89,670 | $ | 157,325 | $ | 352,735 |
Period | Number of Shares of Class A Common Stock Purchased | Average Price Paid per Share |
Total Number of Shares of Class A Common Stock Purchased as Part of Publicly Announced Program (1)
|
Maximum Number of Shares of Class A Common Stock that May Yet be Purchased Under the Program | |||||||||||||||||||
July 1, 2020 - July 31, 2020 | — | $ | — | — | 8,000,000 | ||||||||||||||||||
August 1, 2020 - August 31, 2020 | 97,800 | 6.11 | 97,800 | 7,902,200 | |||||||||||||||||||
September 1, 2020 - September 30, 2020 | 1,002,200 | 5.87 | 1,002,200 | 6,900,000 | |||||||||||||||||||
Total | 1,100,000 | $ | 5.89 | 1,100,000 | 6,900,000 |
Exhibit
Number |
Description | ||||||||||
3.1* | |||||||||||
3.2* | |||||||||||
10.1** |
Borrowing Base Redetermination Agreement and Amendment No. 2 to Credit Agreement, dated as of October 15, 2020, by and among Magnolia Oil & Gas Operating LLC, Magnolia Oil & Gas Intermediate LLC, the lenders from time to time party thereto, Citibank, N.A., as administrative agent and collateral agent as the swingline lender and an issuing bank and each other issuing bank from time to time party thereto.
|
||||||||||
31.1** | |||||||||||
31.2** | |||||||||||
32.1*** | |||||||||||
101.INS** | XBRL Instance Document. | ||||||||||
101.SCH** | XBRL Taxonomy Extension Schema Document. | ||||||||||
101.CAL** | XBRL Taxonomy Extension Calculation Linkbase Document. | ||||||||||
101.DEF** | XBRL Taxonomy Extension Definition Linkbase Document. | ||||||||||
101.LAB** | XBRL Taxonomy Extension Label Linkbase Document. | ||||||||||
101.PRE** | XBRL Taxonomy Extension Presentation Linkbase Document. | ||||||||||
104** | Cover Page Interactive Data File (embedded within the Inline XBRL document). |
MAGNOLIA OIL & GAS CORPORATION | |||||||||||
Date: November 6, 2020 | By: | /s/ Stephen Chazen | |||||||||
Stephen Chazen | |||||||||||
Chief Executive Officer (Principal Executive Officer) | |||||||||||
Date: November 6, 2020 | By: | /s/ Christopher Stavros | |||||||||
Christopher Stavros | |||||||||||
Chief Financial Officer (Principal Financial Officer) |
Date: November 6, 2020 | By: | /s/ Stephen Chazen | ||||||||||||
Stephen Chazen | ||||||||||||||
Chief Executive Officer
(Principal Executive Officer) |
Date: November 6, 2020 | By: | /s/ Christopher Stavros | ||||||||||||
Christopher Stavros | ||||||||||||||
Chief Financial Officer
(Principal Financial Officer) |
Date: November 6, 2020 | By: | /s/ Stephen Chazen | ||||||||||||
Stephen Chazen | ||||||||||||||
Chief Executive Officer
(Principal Executive Officer) |
Date: November 6, 2020 | By: | /s/ Christopher Stavros | ||||||||||||
Christopher Stavros | ||||||||||||||
Chief Financial Officer
(Principal Financial Officer) |