Adjusted Net Income

The following table provides a reconciliation of net income (GAAP) to adjusted net income (non-GAAP) for the periods indicated:
                   
Three Months Ended Six Months Ended
June 30, June 30,
(in thousands, except per share amounts)     2013     2012       2013     2012
 
Net income - as reported $ 84,700 $ 319,297 $ 114,793 $ 350,414
 
Adjustments for certain non-cash and unusual items:
Unrealized gain on commodity derivatives (68,749 ) (394,763 ) (3,716 ) (268,581 )
Impairments of long-lived assets 65,375 - 65,375 -
Leasehold abandonments 2,940 8,437 7,327 8,557
Loss on extinguishment of debt 28,616 - 28,616 -
Discontinued operations:
(Gain) loss on sale of assets 764 - (19,599 ) -
Tax impact (a)   (11,144 )   147,577     (30,031 )   99,329  
Adjusted net income $ 102,502   $ 80,548   $ 162,765   $ 189,719  
 
Adjusted earnings per share:
Basic $ 0.98 $ 0.78 $ 1.55 $ 1.84
Diluted $ 0.98 $ 0.78 $ 1.55 $ 1.83
                                 
 
(a) The tax impact is computed utilizing the Company's adjusted statutory effective federal and state income tax rates. The income tax rates for the three and six months ended June 30, 2013 and 2012 were 38.5%, 38.2%, 38.5% and 38.2%, respectively.
 

Adjusted Cash Flows

The following table provides a reconciliation of cash flows from operating activities (GAAP) to adjusted cash flows (non-GAAP) for the periods indicated:
       
Six Months Ended
June 30,
(in thousands)     2013     2012
 
Cash flows from operating activities $ 487,129 $ 610,965
Settlements received from (paid on) derivatives not designated as hedges (a)   7,591   (23,624 )
Adjusted cash flows $ 494,720 $ 587,341  
             
 
(a) Amounts are presented in cash flows from investing activities for GAAP purposes.
 

EBITDAX

EBITDAX (as defined below) is presented herein, and reconciled from the generally accepted accounting principles ("GAAP") measure of net income because of its wide acceptance by the investment community as a financial indicator of a company's ability to internally fund exploration and development activities.

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