Press Releases

Gulfport Energy Corporation Reports First Quarter 2020 Financial and Operating Results

OKLAHOMA CITY, May 07, 2020 (GLOBE NEWSWIRE) -- Gulfport Energy Corporation (NASDAQ: GPOR) (“Gulfport” or the “Company”) today reported financial and operational results for the three-months ended March 31, 2020 and provided an update on its 2020 activities.  Key highlights are as follows:

  • Reduced total long-term debt by approximately $79.6 million as of March 31, 2020 when compared to December 31, 2019 primarily through discounted bond repurchases
  • Improved drilling efficiencies as measured by spud to total depth drilling days on a normalized basis in the Utica Shale and SCOOP by 11% and 32%, respectively, versus full year 2019 levels
  • Reported net loss of $517.5 million, or $3.24 per diluted share
  • Reported adjusted net income (non-GAAP) of $16.6 million, or $0.10 per diluted share
  • Generated adjusted EBITDA (non-GAAP) of $128.3 million
  • Reported cash provided by operating activities of $130.8 million
  • Generated operating cash flow (non-GAAP), excluding working capital changes, of $86.7 million
  • Improved 2020 and 2021 gas hedge portfolio with 495 BBtu per day of remaining 2020 natural gas production hedged at an average swap price of $2.88 per MMBtu and 250 BBtu per day of 2021 natural gas production hedged with costless collars at an average floor price of $2.46 per MMBtu and an average ceiling price of $2.81 per MMBtu
  • Completed semi-annual borrowing base redetermination and revolving credit facility redetermined at $700 million, providing adequate liquidity to fund our 2020 capital plan at current strip pricing

See the supplemental tables at the end of this press release for a reconciliation of non-GAAP measures including adjusted net income, EBITDA, adjusted EBITDA, and operating cash flow.

Chief Executive Officer and President, David M. Wood, commented, "During these unprecedented times, our focus is on the health and safety of our employees while continuing to execute on our 2020 capital budget we laid out in February. We remain committed to exercising capital discipline, maximizing cash flow generation, reducing costs and ensuring strong liquidity through the remainder of 2020."

Mr. Wood continued, "Our continued focus on increasing efficiencies and reducing costs led to solid progress during the first quarter of 2020. As planned, Gulfport's 2020 capital program is heavily weighted to the first half of 2020 and as a result, we are well positioned to generate positive free cash flow during the second half of the year."

Continued Debt Reduction
As of May 1, 2020, the Company had repurchased $73.3 million aggregate principal amount of unsecured senior notes for $22.8 million in cash during 2020. Since initiating the debt repurchase program in mid-2019, Gulfport had repurchased $263.4 million aggregate principal amount of unsecured senior notes for $161.6 million cash representing a total discount capture of $101.8 million and an annual cash interest reduction of approximately $11 million.

Balance Sheet and Liquidity
Gulfport completed its spring borrowing base redetermination effective May 1, 2020 and the borrowing base was redetermined at $700 million.  Pro forma for the revised borrowing base,
the Company’s liquidity at May 1, 2020 totaled approximately $269.0 million, comprised of the $700 million borrowing base plus approximately $3.8 million in cash on hand less $326.8 million outstanding letters of credit and $108.0 million of revolver draw as of May 1, 2020.

The revised $700 million borrowing base provides adequate liquidity to finance the Company’s projected 2020 capital plan.

Production and Realized Prices
Gulfport’s net daily production for the first quarter of 2020 averaged approximately 1,054 MMcfe per day. For the first quarter of 2020, Gulfport’s net daily production mix was comprised of approximately 90% natural gas, 7% natural gas liquids ("NGL") and 3% oil.

GULFPORT ENERGY CORPORATION
PRODUCTION SCHEDULE
(Unaudited)
  Three months ended
  March 31,
Production Volumes: 2020   2019
       
Natural gas (MMcf) 86,059     102,079  
Oil (MBbls) 532     612  
NGL (MGal) 46,518     55,830  
Gas equivalent (MMcfe) 95,896     113,726  
Gas equivalent (Mcfe per day) 1,053,799     1,263,617  
       
Average Realized Prices      
(after deducts for transportation costs and before the impact of derivatives):      
       
Natural gas (per Mcf) $ 1.26     $ 2.70  
Oil (per Bbl) $ 43.53     $ 53.10  
NGL (per Gal) $ 0.36     $ 0.58  
Gas equivalent (per Mcfe) $ 1.55     $ 3.00  
       
Average Realized Prices:      
(after deducts for transportation costs and including cash-settlement of derivatives):
       
Natural gas (per Mcf) $ 1.97     $ 2.45  
Oil (per Bbl) $ 61.39     $ 53.13  
NGL (per Gal) $ 0.37     $ 0.59  
Gas equivalent (per Mcfe) $ 2.29     $ 2.78  

The table below summarizes Gulfport’s first quarter of 2020 production by asset area:

GULFPORT ENERGY CORPORATION
PRODUCTION BY AREA
(Unaudited)
  Three months ended
  March 31,
  2020 2019
Utica Shale    
Natural gas (MMcf) 71,505   85,700  
Oil (MBbls) 54   66  
NGL (MGal) 12,221   23,336  
Gas equivalent (MMcfe) 73,575   89,428  
     
SCOOP    
Natural gas (MMcf) 14,550   16,366  
Oil (MBbls) 471   398  
NGL (MGal) 34,297   32,480  
Gas equivalent (MMcfe) 22,274   23,394  
     
Other    
Natural gas (MMcf) 4   13  
Oil (MBbls) 7   148  
NGL (MGal)   15  
Gas equivalent (MMcfe) 47   904  

2020 Capital Expenditures
For the three-month period ended March 31, 2020, Gulfport’s incurred total capital expenditures were $135.3 million. Gulfport’s incurred total capital expenditures includes approximately $127.3 million of operated drilling and completion (“D&C”) capital expenditures, $3.4 million of non-operated D&C expenditures and $4.6 million of land capital expenditures. The Company's 2020 capital program is heavily weighted in first half of 2020 and the Company expects to generate positive cash flow during the second half of 2020.

Operational Update
For the three-month period ended March 31, 2020, key operational updates include:

  • Spud 7 gross and net operated wells in the Utica Shale and 5 gross (4.3 net) operated wells in the SCOOP and had 3 gross wells in various stages of drilling at the end of the first quarter of 2020
  • Completed 15 gross and net operated wells in the Utica Shale and 4 gross (3.8 net) operated wells in the SCOOP during the first quarter of 2020 and had 3 gross wells in various stages of completion at the end of the first quarter of 2020
  • Turned-to-sales 4 gross (3.8 net) operated wells in the SCOOP during the first quarter of 2020 and 3 gross and net operated wells in the Utica Shale after March 19, 2020

The table below summarizes Gulfport's activity for the three-month period ended March 31, 2020:

GULFPORT ENERGY CORPORATION
ACTIVITY SUMMARY
(Unaudited)
       
  Three months ended    
  March 31,   Guidance
  2020   2020
Net Wells Spud      
Utica - Operated 7.0   15
SCOOP - Operated 4.3   8
Total 11.3    
       
Net Wells Turned-to-Sales      
Utica - Operated 3.0   18
SCOOP - Operated 3.8   4
Total 6.8    

Utica Shale
In the Utica Shale, during the first quarter of 2020, Gulfport spud 7 gross and net operated wells. The wells drilled during this period had an average lateral length of approximately 10,200 feet. Normalizing to an 8,000 foot lateral length, Gulfport's average drilling days from spud to rig release totaled approximately 17.7 days, an improvement of 11% from the 2019 average and the best average quarter to date the Company has experienced in the play. In addition, Gulfport turned-to-sales 3 gross (3.0 net) operated wells with an average stimulated lateral length of approximately 15,100 feet.

At present, Gulfport has one operated drilling rig running in the play and expects to continue with this level of activity through October 2020.

SCOOP
In the SCOOP, during the first quarter of 2020, Gulfport spud five gross (4.3 net) operated wells. The wells drilled during this period had an average lateral length of approximately 9,500 feet. Normalizing to a 7,500 foot lateral length, Gulfport's average drilling days from spud to rig release totaled approximately 37.4 days, an improvement of 32% from the 2019 average and similar to the Utica Shale, the best average quarter to date the Company has experienced since entering the play.  In addition, Gulfport turned-to-sales four gross (3.8 net) operated wells with an average stimulated lateral length of approximately 6,500 feet.

At present, Gulfport has one operated drilling rig running in the play and expects to continue with this level of activity for the remainder of 2020.

2020 Capital Budget and Production Guidance
Based on continued efficiencies, service cost deflation and actual results to date, Gulfport currently forecasts 2020 total capital expenditures to be at or below the low end of the previously provided range of $285 million to $310 million.

Because of the sharp decline in oil prices since early March 2020, as well as the current outlook for low oil prices throughout the second quarter of 2020, Gulfport plans to shut in a minimal amount production over the next few months, including a large number of vertical wells in the SCOOP. The Company expects these shut ins to impact its production by less than 20 MMcfe per day.  Gulfport also anticipates some of its non-operated production may be negatively impacted by voluntary shut-ins due to low prices.  In addition, the COVID-19 pandemic creates risks of delays in new drilling and completion activities that could negatively impact Gulfport, its  non-operated partners or its service providers.  Finally, Gulfport is actively exploring opportunities to potentially defer near-term production to later periods in 2020 or early 2021 when gas prices are materially higher in an effort to maximize returns and cash flow.  Considering all of these factors, Gulfport's previously provided production guidance for full year 2020 should no longer be relied upon.

Gulfport reaffirms its previously provided 2020 forecasted realizations and projected operating costs guidance.

Derivatives
Gulfport regularly hedges a portion of its expected production to lock in prices and returns that provide certainty of cash flow to execute on its capital plans. The table below details the Company's hedging positions as of May 7, 2020:

GULFPORT ENERGY CORPORATION
COMMODITY DERIVATIVES - HEDGE POSITION
(Unaudited)
               
               
  2Q2020   3Q2020   4Q2020    
Natural Gas:              
Swap Contracts (NYMEX)              
Volume (BBtupd) 774     345     370      
Price ($ per MMBtu) $ 2.91     $ 2.91     $ 2.80      
               
Basis Swap Contracts (OGT)              
Volume (BBtupd) 10     10     10      
Differential ($ per MMBtu) $ (0.54 )   $ (0.54 )   $ (0.54 )    
               
Basis Swap Contracts (Transco Zone 4)              
Volume (BBtupd) 60     60     60      
Differential ($ per MMBtu) $ (0.05 )   $ (0.05 )   $ (0.05 )    
               
Oil:              
Swap Contracts (WTI)              
Volume (Bblpd)     2,000     2,000      
Price ($ per Bbl) $     $ 35.60     $ 35.60      
               
NGL:              
C3 Propane Swap Contracts              
Volume (Bblpd) 500     500     500      
Price ($ per Gal) $ 0.52     $ 0.52     $ 0.52      
               
               
  2020(1)   2021   2022   2023
Natural Gas:              
Swap Contracts (NYMEX)              
Volume (BBtupd) 495              
Price ($ per MMBtu) $ 2.88     $     $     $  
               
Collars (NYMEX)              
Volume (BBtupd)     250          
Weighted Average Floor Purchase Price ($ per MMBtu) $     $ 2.46     $     $  
Weighted Average Ceiling Sold Price ($ per MMBtu) $     $ 2.81     $     $  
               
Call Option Contracts (NYMEX)              
Volume (BBtupd)         628     628  
Price ($ per MMBtu) $     $     $ 2.90     $ 2.90  
               
Basis Swap Contracts (OGT)              
Volume (BBtupd) 10              
Differential ($ per MMBtu) $ (0.54 )   $     $     $  
               
Basis Swap Contracts (Transco Zone 4)              
Volume (BBtupd) 60              
Differential ($ per MMBtu) $ (0.05 )   $     $     $  
               
Oil:              
Swap Contracts (WTI)              
Volume (Bblpd) 1,338              
Price ($ per Bbl) $ 35.60     $     $     $  
               
NGL:              
C3 Propane Swap Contracts              
Volume (Bblpd) 500              
Price ($ per Gal) $ 0.52     $     $     $  
               
(1) April 1 - December 31, 2020              

Presentation
An updated presentation has been posted to the Company’s website. The presentation can be found at www.gulfportenergy.com under the “Company Information” section on the “Investor Relations” page. Information on the Company’s website does not constitute a portion of this press release.

Conference Call
Gulfport will host its first quarter of 2020 earnings conference call on Friday, May 8, 2020 at 9:00 a.m. Central Time.

Interested parties may listen to the call via Gulfport’s website at www.gulfportenergy.com or by calling toll-free at 866-373-3408 or 412-902-1039 for international callers.  A replay of the call will be available for two weeks at 877-660-6853 or 201-612-7415 for international callers.  The replay passcode is 13695468.  The webcast will also be available for two weeks on the Company’s website and can be accessed on the Company’s “Investor Relations” page.

About Gulfport
Gulfport Energy is an independent natural gas and oil company focused on the exploration and development of natural gas and oil properties in North America and is one of the largest producers of natural gas in the contiguous United States. Headquartered in Oklahoma City, Gulfport holds significant acreage positions in the Utica Shale of Eastern Ohio and the SCOOP Woodford and SCOOP Springer plays in Oklahoma. In addition, Gulfport holds non-core assets that include an approximately 22% equity interest in Mammoth Energy Services, Inc. (NASDAQ: TUSK) and has a position in the Alberta Oil Sands in Canada through its 25% interest in Grizzly Oil Sands ULC. For more information, please visit www.gulfportenergy.com.

Forward Looking Statements
This press release includes “forward-looking statements” for purposes of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that Gulfport expects or anticipates will or may occur in the future, including such things as the expected impact of the COVID-19 pandemic on our business, our industry and the global economy, production and financial guidance, future capital expenditures (including the amount and nature thereof), business strategy and measures to implement strategy, repurchases of our outstanding debt, the timing and completion of asset sales, competitive strength, goals, expansion and growth of Gulfport’s business and operations, plans, market conditions, references to future success, reference to intentions as to future matters and other such matters are forward-looking statements. These statements are based on certain assumptions and analyses made by Gulfport in light of its experience and its perception of historical trends, current conditions and expected future developments as well as other factors it believes are appropriate in the circumstances. However, whether actual results and developments will conform with Gulfport’s expectations and predictions is subject to a number of risks and uncertainties, general economic, market, credit or business conditions that might affect the timing and amount of the repurchase program; the opportunities (or lack thereof) that may be presented to and pursued by Gulfport; Gulfport’s ability to identify, complete and integrate acquisitions of properties and businesses; Gulfport’s ability to achieve the anticipated benefits of its strategic initiatives; competitive actions by other oil and gas companies; changes in laws or regulations; and other factors, many of which are beyond the control of Gulfport. Information concerning these and other factors can be found in the Company’s filings with the Securities and Exchange Commission ("SEC"), including its Forms 10-K, 10-Q and 8-K. Consequently, all of the forward-looking statements made in this press release are qualified by these cautionary statements and there can be no assurances that the actual results or developments anticipated by Gulfport will be realized, or even if realized, that they will have the expected consequences to or effects on Gulfport, its business or operations. Gulfport has no intention, and disclaims any obligation, to update or revise any forward-looking statements, whether as a result of new information, future results or otherwise.

Investors should note that Gulfport announces financial information in SEC filings, press releases and public conference calls.  Gulfport may use the Investors section of its website (www.gulfportenergy.com) to communicate with investors.  It is possible that the financial and other information posted there could be deemed to be material information.  The information on Gulfport’s website is not part of this filing.

Investor Contact:
Jessica Antle – Director, Investor Relations
jantle@gulfportenergy.com
405-252-4550

Media Contact
Reevemark
Paul Caminiti / Hugh Burns / Nicholas Leasure
212-433-4600

GULFPORT ENERGY CORPORATION
CONSOLIDATED BALANCE SHEETS

  March 31, 2020   December 31, 2019
  (Unaudited)    
  (In thousands, except share data)
Assets      
Current assets:      
Cash and cash equivalents $ 1,633     $ 6,060  
Accounts receivable—oil and natural gas sales 74,099     121,210  
Accounts receivable—joint interest and other 42,547     47,975  
Prepaid expenses and other current assets 11,848     4,431  
Short-term derivative instruments 171,755     126,201  
Total current assets 301,882     305,877  
Property and equipment:      
Oil and natural gas properties, full-cost accounting, $1,608,640 and $1,686,666 excluded from amortization in 2020 and 2019, respectively 10,667,532     10,595,735  
Other property and equipment 96,882     96,719  
Accumulated depletion, depreciation, amortization and impairment (7,859,873 )   (7,228,660 )
Property and equipment, net 2,904,541     3,463,794  
Other assets:      
Equity investments 6,225     32,044  
Long-term derivative instruments     563  
Deferred tax asset     7,563  
Operating lease assets 10,186     14,168  
Operating lease assets—related parties     43,270  
Other assets 41,453     15,540  
Total other assets 57,864     113,148  
Total assets $ 3,264,287     $ 3,882,819  
Liabilities and Stockholders’ Equity      
Current liabilities:      
Accounts payable and accrued liabilities $ 437,453     $ 415,218  
Short-term derivative instruments 67     303  
Current portion of operating lease liabilities 9,873     13,826  
Current portion of operating lease liabilities—related parties     21,220  
Current maturities of long-term debt 688     631  
Total current liabilities 448,081     451,198  
Long-term derivative instruments 70,829     53,135  
Asset retirement obligation 59,444     60,355  
Uncertain tax position liability 3,209     3,127  
Non-current operating lease liabilities 313     342  
Non-current operating lease liabilities—related parties     22,050  
Long-term debt, net of current maturities 1,898,362     1,978,020  
Total liabilities 2,480,238     2,568,227  
Commitments and contingencies      
Preferred stock, $0.01 par value; 5,000,000 shares authorized (30,000 authorized as redeemable 12% cumulative preferred stock, Series A), and none issued and outstanding      
Stockholders’ equity:      
Common stock - $.01 par value, 200,000,000 shares authorized, 159,841,930 issued and outstanding at March 31, 2020 and 159,710,955 at December 31, 2019 1,598     1,597  
Paid-in capital 4,209,578     4,207,554  
Accumulated other comprehensive loss (61,863 )   (46,833 )
Accumulated deficit (3,365,264 )   (2,847,726 )
Total stockholders’ equity 784,049     1,314,592  
Total liabilities and stockholders’ equity $ 3,264,287     $ 3,882,819  

GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)

  Three months ended March 31,
  2020   2019
       
  (In thousands, except share data)
Revenues:      
Natural gas sales $ 108,547     $ 276,016  
Oil and condensate sales 23,151     32,482  
Natural gas liquid sales 16,913     32,125  
Net gain (loss) on natural gas, oil and NGL derivatives 98,266     (20,045 )
  246,877     320,578  
Costs and expenses:      
Lease operating expenses 15,986     19,807  
Production taxes 4,799     7,921  
Midstream gathering and processing expenses 57,896     70,282  
Depreciation, depletion and amortization 78,028     118,433  
Impairment of oil and natural gas properties 553,345      
General and administrative expenses 16,169     10,057  
Accretion expense 741     1,067  
  726,964     227,567  
(LOSS) INCOME FROM OPERATIONS (480,087 )   93,011  
OTHER EXPENSE (INCOME):      
Interest expense 32,990     35,621  
Interest income (152 )   (152 )
Gain on debt extinguishment (15,322 )    
Loss (income) from equity method investments, net 10,789     (4,273 )
Other expense (income) 1,856     (427 )
  30,161     30,769  
(LOSS) INCOME BEFORE INCOME TAXES (510,248 )   62,242  
INCOME TAX EXPENSE 7,290      
NET (LOSS) INCOME $ (517,538 )   $ 62,242  
NET (LOSS) INCOME PER COMMON SHARE:      
Basic $ (3.24 )   $ 0.38  
Diluted $ (3.24 )   $ 0.38  
Weighted average common shares outstanding—Basic 159,760,222     162,823,997  
Weighted average common shares outstanding—Diluted 159,760,222     163,099,409  

GULFPORT ENERGY CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)

  Three months ended March 31,
  2020   2019
       
  (In thousands)
Cash flows from operating activities:      
Net (loss) income $ (517,538 )   $ 62,242  
Adjustments to reconcile net (loss) income to net cash provided by operating activities:      
Depletion, depreciation and amortization 78,028     118,433  
Impairment of oil and natural gas properties 553,345      
Loss (income) from equity investments 10,789     (4,132 )
Gain on debt extinguishment (15,322 )    
Net (gain) loss on derivative instruments (98,266 )   20,045  
Cash receipts (payments) on settled derivative instruments 70,733     (24,836 )
Deferred income tax expense 7,290      
Other, net 3,223     5,508  
Changes in operating assets and liabilities:      
Decrease in accounts receivable—oil and natural gas sales 47,111     65,204  
Decrease (increase) in accounts receivable—joint interest and other 6,001     (2,083 )
(Decrease) increase in accounts payable and accrued liabilities (7,637 )   1,366  
Other, net (6,919 )   (1,982 )
Net cash provided by operating activities 130,838     239,765  
Cash flows from investing activities:      
Additions to oil and natural gas properties (113,744 )   (241,391 )
Proceeds from sale of oil and natural gas properties 44,383     52  
Additions to other property and equipment (539 )   (3,848 )
Proceeds from sale of other property and equipment 91     56  
Contributions to equity method investments     (432 )
Net cash used in investing activities (69,809 )   (245,563 )
Cash flows from financing activities:      
Principal payments on borrowings (180,106 )   (150,151 )
Borrowings on line of credit 125,000     150,000  
Repurchases of senior notes (10,204 )    
Payments for repurchases of stock under approved stock repurchase program     (28,212 )
Other, net (146 )   (140 )
Net cash used in financing activities (65,456 )   (28,503 )
Net decrease in cash, cash equivalents and restricted cash (4,427 )   (34,301 )
Cash, cash equivalents and restricted cash at beginning of period 6,060     52,297  
Cash, cash equivalents and restricted cash at end of period $ 1,633     $ 17,996  
Supplemental disclosure of cash flow information:      
Interest payments $ 14,034     $ 15,266  
Income tax receipts $     $ (1,794 )
Supplemental disclosure of non-cash transactions:      
Capitalized stock-based compensation $ 934     $ 1,114  
Asset retirement obligation capitalized $ 381     $ 1,952  
Asset retirement obligation removed due to divestiture $ (2,033 )   $  
Interest capitalized $ 187     $ 766  
Fair value of contingent consideration asset on date of divestiture $ 23,090     $  
Foreign currency translation (loss) gain on equity method investments $ (15,030 )   $ 3,801  

Explanation and Reconciliation of Non-GAAP Financial Measures
EBITDA is a non-GAAP financial measure equal to net (loss) income, the most directly comparable GAAP financial measure, plus interest expense, income tax (benefit) expense, accretion expense, depreciation, depletion and amortization and impairment of oil and gas properties. Adjusted EBITDA is a non-GAAP financial measure equal to EBITDA less non-cash derivative loss (gain), rig terminations fees, gain on debt extinguishment, non-recurring general and administrative expenses and (income) loss from equity method investments. Cash flow from operating activities before changes in operating assets and liabilities is a non-GAAP financial measure equal to cash provided by operating activity before changes in operating assets and liabilities and inclusive of capitalized expenses incurred during the given period. Free cash flow is a non-GAAP measure defined as cash flow from operating activities before changes in operating assets and liabilities (as defined above) less capital expenditures incurred. Adjusted net income is a non-GAAP financial measure equal to pre-tax net (loss) income less non-cash derivative loss (gain), impairment of oil and gas properties, rig terminations fees, gain on debt extinguishment, non-recurring general and administrative expenses and (income) loss from equity method investments. The Company has presented EBITDA, adjusted EBITDA, adjusted net income, cash flow from operating activities before changes in operating assets and liabilities and free cash flow because it uses these measures as an integral part of its internal reporting to evaluate its performance and the performance of its senior management. These measures are considered important indicators of the operational strength of the Company’s business and eliminate the uneven effect of considerable amounts of non-cash depletion, depreciation of tangible assets and amortization of certain intangible assets. A limitation of these measures, however, is that they do not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues in the Company’s business. Management evaluates the costs of such tangible and intangible assets and the impact of related impairments through other financial measures, such as capital expenditures, investment spending and return on capital. Therefore, the Company believes that these measures provide useful information to its investors regarding its performance and overall results of operations. EBITDA, adjusted EBITDA, adjusted net income, cash flow from operating activities before changes in operating assets and liabilities and free cash flow are not intended to be performance measures that should be regarded as an alternative to, or more meaningful than, either net income as an indicator of operating performance or to cash flows from operating activities as a measure of liquidity. In addition, EBITDA, adjusted EBITDA, adjusted net income and cash flow from operating activities before changes in operating assets and liabilities are not intended to represent funds available for reinvestment or other discretionary uses, and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. The EBITDA, adjusted EBITDA, adjusted net income, cash flow from operating activities before changes in operating assets and liabilities and free cash flow presented in this press release may not be comparable to similarly titled measures presented by other companies, and may not be identical to corresponding measures used in the Company’s various agreements.

GULFPORT ENERGY CORPORATION
RECONCILIATION OF EBITDA
(Unaudited)
       
  Three months ended March 31,
  2020   2019
       
   (In thousands)
       
Net (loss) income $ (517,538 )   $ 62,242  
Interest expense 32,990     35,621  
Income tax expense 7,290      
Accretion expense 741     1,067  
Depreciation, depletion and amortization 78,028     118,433  
Impairment of oil and gas properties 553,345      
EBITDA $ 154,856     $ 217,363  


GULFPORT ENERGY CORPORATION
RECONCILIATION OF ADJUSTED EBITDA
(Unaudited)
       
  Three months ended March 31,
  2020   2019
       
   (In thousands)
       
EBITDA $ 154,856     $ 217,363  
       
Adjustments:      
Non-cash derivative gain (28,914 )   (4,791 )
Non-cash derivative loss on contingent payments 1,381      
Rig termination fees 1,649      
Gain on debt extinguishment (15,322 )    
Non-recurring general and administrative expenses 3,905     538  
Loss (income) from equity method investments 10,789     (4,273 )
       
       
Adjusted EBITDA $ 128,344     $ 208,837  
       


GULFPORT ENERGY CORPORATION
RECONCILIATION OF CASH FLOW
(Unaudited)
       
  Three months ended March 31,
  2020   2019
       
   (In thousands)
       
Cash provided by operating activity $ 130,838     $ 239,765  
Adjustments:      
Changes in operating assets and liabilities (38,556 )   (62,505 )
Capitalized expenses incurred(1) (5,618 )   (8,461 )
Operating cash flow $ 86,664     $ 168,799  
Capital expenditures incurred(2) (135,305 )   (274,946 )
Free cash flow $ (48,641 )   $ (106,147 )
       
(1) Includes capitalized general and administrative expense incurred and capitalized interest expenses incurred
(2) Incurred capital expenditures and cash capital expenditures may vary from period to period due to the cash payment cycle


GULFPORT ENERGY CORPORATION
RECONCILIATION OF ADJUSTED NET INCOME
(Unaudited)
       
  Three months ended March 31,
  2020   2019
       
   (In thousands, except share data)
       
(Loss) income before income taxes $ (510,248 )   $ 62,242  
Adjustments:      
Non-cash derivative gain (28,914 )   (4,791 )
Non-cash derivative loss on contingent payments 1,381      
Impairment of oil and gas properties 553,345      
Rig termination fees 1,649      
Gain on debt extinguishment (15,322 )    
Non-recurring general and administrative expenses 3,905     538  
Loss (income) from equity method investments 10,789     (4,273 )
Pre-tax net income excluding adjustments $ 16,585     $ 53,716  
       
Adjusted net income $ 16,585     $ 53,716  
       
Adjusted net income per common share:      
Basic $ 0.10     $ 0.33  
Diluted $ 0.10     $ 0.33  
       
Basic weighted average shares outstanding 159,760,222     162,823,997  
Diluted weighted average shares outstanding 161,312,645     163,099,409  

Gulfport Energy Corporation

Source: Gulfport Energy Corporation