Chesapeake Energy Corporation (NYSE:CHK) today announced financial and operational results for the 2012 third quarter. For the 2012 third quarter, Chesapeake reported a net loss to common stockholders of $2.055 billion ($3.19 per fully diluted common share), ebitda of negative $2.367 billion (defined as net income (loss) before income taxes, interest expense and depreciation, depletion and amortization) and operating cash flow of $1.118 billion (defined as cash flow from operating activities before changes in assets and liabilities) on revenue of $2.970 billion and production of 381 billion cubic feet of natural gas equivalent (bcfe).
The company’s 2012 third quarter results include various items that are typically not included in published estimates of the company’s financial results by certain securities analysts. Excluding such items for the 2012 third quarter, Chesapeake reported adjusted net income to common stockholders of $33 million ($0.10 per fully diluted common share) and adjusted ebitda of $1.021 billion. The primary excluded items from the 2012 third quarter reported results are the following:
- a noncash after-tax impairment charge of $2.022 billion related to the carrying value of natural gas and oil properties (primarily resulting from a 10% decrease in trailing 12-month average first-day-of-the-month natural gas prices as of September 30, 2012, compared to June 30, 2012, and the impairment of certain undeveloped leasehold, primarily in the Williston and DJ Basins);
- an unrealized noncash after-tax mark-to-market loss of $63 million resulting from the company’s natural gas, oil and natural gas liquids (NGL) and interest rate hedging programs;
- an after-tax charge of $28 million related to losses on sales and impairments of certain fixed assets and other; and
- a net after-tax gain of $19 million related to the sale of an investment.
A reconciliation of operating cash flow, ebitda, adjusted ebitda and adjusted net income to comparable financial measures calculated in accordance with generally accepted accounting principles is presented on pages 19 – 22 of this release.