SM Energy Q1 Results - April 30
Posted: Fri Apr 30, 2021 9:32 am
SM will suffer this year from their "Bad Hedges", but they should be able to remain free cash flow positive for the year.
> First quarter 2021 adjusted net loss was $5.7 million, or $0.05 per diluted common share, which compares to my forecast of a net loss of $33.5 million, or $0.29 per share.
> First quarter 2021 net cash provided by operating activities of $105.6 million before net change in working capital of ($51.4) million totaled $157.1 million, compares to my forecast of $150.0 million.
> First quarter 2021 production of 111,600 Boepd compares to my forecast of 119,000 Boepd. SM had quite a bit of production that was forced to shut-in during late February thanks to winter storm Uri.
Hedging during a pandemic is not a good idea, but SM's bankers forced them to lock in some low prices.
COMMODITY DERIVATIVES
Commodity hedge positions as of April 29, 2021:
OIL: Approximately 75-80% of expected 2Q-4Q oil production is hedged to WTI at an average price of $40.66/Bbl.
OIL, Midland Basin differential: Approximately 60-65% of expected 2Q-4Q Midland Basin oil production is hedged to the local price point at a positive $0.76/Bbl basis.
NATURAL GAS: Approximately 85% of expected 2Q-4Q natural gas production is hedged. 38,659 BBtu is hedged to HSC at an average price of $2.42/MMBtu, and 22,943 BBtu is hedged to WAHA at an average price of $1.82/MMBtu.
NGL hedges are by individual product and include propane and normal butane swaps for the remainder of 2021.
> First quarter 2021 adjusted net loss was $5.7 million, or $0.05 per diluted common share, which compares to my forecast of a net loss of $33.5 million, or $0.29 per share.
> First quarter 2021 net cash provided by operating activities of $105.6 million before net change in working capital of ($51.4) million totaled $157.1 million, compares to my forecast of $150.0 million.
> First quarter 2021 production of 111,600 Boepd compares to my forecast of 119,000 Boepd. SM had quite a bit of production that was forced to shut-in during late February thanks to winter storm Uri.
Hedging during a pandemic is not a good idea, but SM's bankers forced them to lock in some low prices.
COMMODITY DERIVATIVES
Commodity hedge positions as of April 29, 2021:
OIL: Approximately 75-80% of expected 2Q-4Q oil production is hedged to WTI at an average price of $40.66/Bbl.
OIL, Midland Basin differential: Approximately 60-65% of expected 2Q-4Q Midland Basin oil production is hedged to the local price point at a positive $0.76/Bbl basis.
NATURAL GAS: Approximately 85% of expected 2Q-4Q natural gas production is hedged. 38,659 BBtu is hedged to HSC at an average price of $2.42/MMBtu, and 22,943 BBtu is hedged to WAHA at an average price of $1.82/MMBtu.
NGL hedges are by individual product and include propane and normal butane swaps for the remainder of 2021.