QEP Resources, Inc.

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SEC Filings

10-Q
QEP RESOURCES, INC. filed this Form 10-Q on 07/25/2018
Entire Document
 


Below is a reconciliation of net income (loss) (a GAAP measure) to Adjusted EBITDA. This non-GAAP measure should be considered by the reader in addition to, but not instead of, the financial statements prepared in accordance with GAAP.

 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2018
 
2017
 
2018
 
2017
 
(in millions)
Net income (loss)
$
(336.0
)
 
$
45.4

 
$
(389.6
)
 
$
122.3

Interest expense
38.2

 
34.9

 
73.2

 
68.7

Interest and other (income) expense
3.1

 
(1.8
)
 
3.8

 
(2.4
)
Income tax provision (benefit)
(106.2
)
 
27.3

 
(120.1
)
 
72.9

Depreciation, depletion and amortization
242.2

 
191.5

 
438.7

 
383.3

Unrealized (gains) losses on derivative contracts
33.6

 
(100.3
)
 
43.6

 
(277.6
)
Exploration expenses
0.1

 

 
0.1

 
0.4

Net (gain) loss from asset sales, inclusive of restructuring costs
3.9

 
(19.8
)
 
0.4

 
(19.8
)
Impairment
403.7

 

 
404.4

 
0.1

Adjusted EBITDA
$
282.6

 
$
177.2

 
$
454.5

 
$
347.9


Adjusted EBITDA increased to $282.6 million in the second quarter of 2018 from $177.2 million in the second quarter of 2017, primarily due to a 35% increase in oil and condensate production, mainly in the Permian Basin, a 16% increase in average net realized oil prices and a 71% increase in gas production in Haynesville/Cotton Valley. These changes were partially offset by a $51.9 million increase in realized derivative losses, a $36.4 million decrease in gas sales primarily due to the Pinedale divestiture, and a 4% reduction in average net realized gas prices in the second quarter of 2018 compared to the second quarter of 2017.

Adjusted EBITDA increased to $454.5 million in the first half of 2018 from $347.9 million in the first half of 2017, primarily from a 21% increase in oil and condensate production, mainly in the Permian Basin, a 13% increase in average net realized oil prices and an 88% increase in gas production in Haynesville/Cotton Valley. These increases in the first half of 2018 compared to the first half of 2017 were partially offset by a $78.7 million increase in realized derivative losses and a $68.9 million decrease in gas sales, primarily due to the Pinedale Divestiture.

Revenue

The following table presents our revenues disaggregated by revenue source.

 
Three Months Ended
 
Six Months Ended
 
June 30,
 
June 30,
 
2018
 
2017(1)
 
Change
 
2018
 
2017(1)
 
Change
 
 
 
 
 
 
 
(in millions)
Oil and condensate sales
$
408.5

 
$
216.0

 
$
192.5

 
$
709.2

 
$
437.7

 
$
271.5

Gas sales
97.8

 
134.2

 
(36.4
)
 
199.8

 
268.7

 
(68.9
)
NGL sales
26.4

 
22.8

 
3.6

 
46.2

 
51.8

 
(5.6
)
Oil and condensate, gas and NGL sales, as adjusted(2)
532.7

 
373.0

 
$
159.7

 
955.2

 
758.2

 
197.0

Transportation and processing costs included in revenue(3)
(12.4
)
 

 
(12.4
)
 
(25.1
)
 

 
(25.1
)
Oil and condensate, gas and NGL sales, as presented
$
520.3

 
$
373.0

 
$
147.3

 
$
930.1

 
$
758.2

 
$
171.9

 ____________________________
(1) 
Prior period amounts have not been adjusted under the modified retrospective method for the new revenue recognition rule, refer to Note 2 – Revenue in Part 1, Item I of this Quarterly Report on Form 10-Q.

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