Oasis Petroleum (OAS) Q4 Results - Feb 27

[dan_s]

HOUSTON, Feb. 25, 2020 /PRNewswire/ -- Oasis Petroleum Inc. (Nasdaq: OAS) ("Oasis" or the "Company") today announced financial and operational results for the quarter and year ended December 31, 2019 and provided its 2020 outlook.

"Fourth quarter results demonstrate continued execution and progress towards reducing leverage," said Thomas B. Nusz, Oasis' Chairman and Chief Executive Officer. "Volumes exceeded expectations while spending was lower, driven by a relentless focus on efficiency. A combination of free cash flow and asset sales led Oasis to reduce E&P debt by $188 million over the course of 2019. I'm proud of the Oasis team for rising to the challenge and driving significant cost savings and efficiencies in the back half of 2019. These efforts positioned our 2020 plan to be more capital efficient, especially when we factor in lower well costs and improved cycle times in the Delaware Basin. Oasis is in a compelling position to grow modestly while generating free cash flow and continuing to pay down debt."

2019 Highlights

Produced 87.4 MBoepd in 4Q19, 2% above the upper range of November guidance, with oil volumes at 60.1 MBopd, at the top end of guidance. < Compares to my forecast of 85,000 Boepd and 60,000 barrels of oil per day.

Delivered net cash provided by operating activities of $892.9 million for YE19 and $253.0 million for 4Q19 < Compares to my forecast of $213.6 million operating cash flow for Q4.

Adjusted EBITDA of $1,039.5 million for YE19 and $264.0 million for 4Q19.

LOE per Boe averaged $6.95 per Boe in 2019, approximately 7% below original guidance.

Crude oil differentials were strong over 2019 averaging $1.68 off of NYMEX WTI.

E&P CapEx was $598.0 million for 2019, 4-5% below the $620-640 million plan. < OAS is now generating a lot of free cash flow from operations.

2019 G&A of $123.5 million was 10% below February 2019 guidance.

Oasis Midstream Partners (OMP) delivered approximately $159 million in net Adjusted EBITDA in 2019, 4% above original midpoint guidance.

[dan_s]

I have updated my forecast/valuation model for OAS and it will be posted to the EPG website later today.

I realize "The Sky is Falling" and COVID-19 is going to kill a large percentage of the world's population, BUT I cannot justify OAS trading at less than operating cash flow per share.

They have ~68% of their 1H2020 oil hedged at a weighted average WTI price of $54.99/bbl. Thanks to their hedging program, OAS will generate free cash flow from operations this year even if WTI goes to $40 AND their balance sheet is in much better shape today than it was a year ago.

See my daily updates on COVID-19 under The View From Houston tab.