Pioneer Natural Resources (PXD) Q1 Results - May 6

[dan_s]

Pioneer Natural Resources Company Reports First Quarter 2020 Financial and Operating Results

Pioneer Natural Resources Company (NYSE:PXD) ("Pioneer" or "the Company") today reported financial and operating results for the quarter ended March 31, 2020. Pioneer reported first quarter net income attributable to common stockholders of $289 million, or $1.74 per diluted share. These results include the effects of noncash mark-to-market adjustments and certain other unusual items. Excluding these items, non-GAAP adjusted income for the first quarter was $190 million, or $1.15 per diluted share. < Compares to my forecast of $199 million net income, $1.24/share.
Cash flow from operating activities for the first quarter was $825 million. < Compares to my forecast of adjusted cash flow from operations of $748 million, $4.67.

Highlights

Delivered strong first quarter free cash flow of $100 million

Averaged first quarter oil production of 223 thousand barrels of oil per day (MBOPD), in the upper half of guidance

Averaged first quarter production of 375 thousand barrels of oil equivalent per day (MBOEPD), at the top end of guidance < Compares to my forecast of 370,000 Boepd.

Capital expenditures of $620 million during the first quarter, significantly underspending planned capital budget

Further reducing 2020 capital budget by additional $300 million from March update; total reduction of approximately 55% when compared to original 2020 budget

Decreasing production costs by $60 million to $70 million in 2020

Reducing corporate overhead related costs by $80 million to $90 million in 2020

CEO, Officers and Board of Directors electing voluntary compensation reductions, including a greater than 70% reduction for CEO in total cash compensation

President and CEO Scott D. Sheffield stated, "Through these challenging times, Pioneer's primary focus will continue to be the health and safety of our employees and the communities within which we operate. Despite the macroeconomic headwinds during the first quarter, the team executed at a very high level, generating $100 million of free cash flow.

"Drilling and completions efficiencies continued to improve, exceeding full-year 2020 targets in the first three months of the year, resulting in well cost reductions and greater capital efficiency than expected. This led to materially underspending our first quarter capital budget and underpins our revised full-year program that maintains similar production to 2019 levels while achieving a 55% reduction3 to our original capital budget.

"Pioneer entered this difficult environment with one of the strongest balance sheets in the sector and it is our plan to emerge from this downturn in a similar position. As evidenced by our additional capital reduction and other cost reduction initiatives, our business plan remains flexible and responsive to economic conditions. I am confident that our strong balance sheet, world-class assets and dedicated employees are competitive advantages that will continue to differentiate Pioneer.".
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My updated forecast/valuation model for PXD will be posted to the EPG website in the morning on May 7.