RANGE RESOURCES CORPORATION (NYSE: RRC) today announced its second quarter 2013 financial results.
Second Quarter Highlights –
- Record daily production of 910 Mmcfe per day, an increase of 27% over the prior-year quarter; 30% adjusted for the New Mexico asset sale
- Adjusted cash flow was $227 million, an increase of 46% as compared to the prior year quarter
- Unit costs decline 7% as compared to the prior-year quarter
- New Mexico asset sale for $275 million closed April 1 st generating $83 million pre-tax gain
- Class leading liquids-rich wells drilled in Pennsylvania continue to provide impressive results
- Initial ethane deliveries to Mariner West commenced July 21 st
Changes in Guidance –
- Type curve and EUR increased 38% over the 2012 type curve in the super-rich SW PA area to 1.82 Mmboe (10.9 Bcfe)
- Type curve and EUR increased 41% in wet SW PA area to 12.3 Bcfe
- Type curve and EUR increased 63% in dry SW PA area to 12.2 Bcf
- Tighter spacing positive test results with 500 feet between laterals in Marcellus adds 12 to 15 Tcfe of unproved resource potential attributable to the super-rich and wet areas in the southwest
Commenting on the announcement, Jeff Ventura, Range’s President and CEO, said, “Range had an impressive first half of 2013, continuing to set record production results while decreasing our unit costs. Our balance sheet and liquidity are set for continued growth as outlined in our business plan of growing production 20% to 25% for many years. Importantly, cash flow growth is expected to outpace our production growth percentage. With the progress made during the first half of 2013, we are focused on the higher end of our production growth range for 2013. The first deliveries of ethane into Mariner West to Sarnia, Canada commenced start up operations on July 21 st. Range has access to the only operating de-ethanizer in Appalachia while others are still under construction. This will allow us to continue our planned growth without concern for pipeline quality requirements. Additional ethane and propane transportation projects are scheduled to become operational next year conforming to our growth plans. Our growth is led by our approximate one million acre leasehold position in Pennsylvania which essentially doubles when stacked pay reservoirs across most of our acreage in the Basin are considered. This acreage position is anchored by the Marcellus, one of the most prolific reservoirs in the U.S. We believe that our 20% to 25% production growth that we expect to deliver for many years, coupled with the high returns, low cost and low reinvestment risk will drive substantial per share value for our shareholders for years to come.”Financial Discussion (Except for generally accepted accounting principles (“GAAP”) reported amounts, specific expense categories exclude non-cash impairments, unrealized mark-to-market on derivatives, non-cash stock compensation and other items shown separately on the attached tables.) GAAP revenues for the second quarter of 2013 totaled $673 million (a 50% increase as compared to second quarter 2012), GAAP net cash provided from operating activities including changes in working capital was $79 million (a 38% decrease as compared to second quarter 2012 primarily due to the payment of a previously announced legal settlement) and GAAP earnings increased by 159% to $144 million ($0.88 per diluted share) versus $56 million ($0.34 per diluted share) in the second quarter 2012.