Antero Resources (AR) Q3 Results - Oct 27

[dan_s]

I will update my AR forecast/valuation model tomorrow.

DENVER, Oct. 27, 2021 /PRNewswire/ -- Antero Resources Corporation (NYSE: AR) ("Antero Resources", "Antero", or the "Company") today announced its third quarter 2021 financial and operational results. The relevant consolidated financial statements are included in Antero Resource's Quarterly Report on Form 10-Q for the quarter ended September 30, 2021.

Third Quarter 2021 Highlights Include:

Net production averaged 3.25 Bcfe/d, including 169 MBbl/d of liquids

Realized pre-hedge natural gas equivalent price of $5.15 per Mcfe, a $1.14 per Mcfe premium to NYMEX pricing

Net loss was $549 million, Adjusted Net Income was $61 million (Non-GAAP)

Adjusted EBITDAX was $358 million (Non-GAAP); net cash provided by operating activities was $313 million

Free Cash Flow was $91 million (Non-GAAP)

Net Debt at quarter end was $2.3 billion, a $660 million reduction from year end 2020 (Non-GAAP)

Net Debt to last twelve months Adjusted EBITDAX declined to 1.6x (Non-GAAP)

Subsequent Events Include:

Released 200 MMcf/d of firm transportation commitments on October 1, 2021

Received corporate ratings upgrades from Moody's and S&P Global to Ba2 and BB, respectively

Extended credit facility to 2026, borrowing base increased 23% to $3.5 billion and elected to reduce commitments to $1.5 billion

Published annual ESG report citing industry-low greenhouse gas intensity and methane leak loss rate, with no routine gas flaring, and reiterated environmental reduction goals for 2025

Paul Rady, Chairman, President and Chief Executive Officer of Antero Resources commented, "Antero's third quarter financial results benefited from our significant C3+ NGL exposure. We produced over 110,000 Bbls/d of C3+ NGLs with a realized pre-hedge price of over $52 per barrel, a 139% increase from the prior year period. Antero's unique business strategy has positioned us as the second largest NGL producer in the U.S. with a firm transportation portfolio that delivered peer-leading EBITDAX margins during the quarter. Based on today's strip prices, we are targeting over $900 million of Free Cash Flow in 2021, including over $300 million during the fourth quarter, despite being over 90% hedged on natural gas. This 90% hedged position on natural gas is reduced to 50% beginning in January of 2022, increasing our natural gas exposure to rising prices. In addition, we do not have any liquids hedges in 2022."

Mr. Rady continued, "This year's ESG report highlights the foundation of Antero Resources' success – a focus on People, Performance, and Purpose. Our relentless focus on these principals has allowed us to successfully navigate the ever-changing global economy, while continuing to deliver stakeholder value. As a substantial LPG producer and exporter, we are uniquely positioned to positively impact global energy poverty. For the last several years, approximately one-third of our LPG exports have gone to developing nations, including the nations of Nigeria, Peru and India, improving people's health, safety and livelihood through the displacement of more expensive and more carbon-intensive sources of energy."

Michael Kennedy, Chief Financial Officer and Senior Vice President of Finance of Antero Resources said, "During the third quarter we continued to make progress toward our absolute debt target of $2.0 billion. Since the beginning of the year, we have reduced debt by nearly $700 million, driving our leverage down to 1.6x. Based on today's strip prices, we anticipate achieving our debt target in early 2022, with leverage falling below 1.0x during the first quarter of 2022. Looking ahead and using today's backwardated commodity strips, we anticipate Free Cash flow in 2022 to be well in excess of 2021, which we intend to use for additional debt reduction and return of capital to our shareholders."