Southwestern Energy (SWN) Q4 Results - Feb 28

[dan_s]

SWN is the last of the Sweet 16 to report Q4 results. It is a recent addition to the Sweet 16. A few comments and I will get to work on updating the forecast/valuation model.
> I have followed and modeled this company for over twelve years.
> The solved a lot of the debt problems by selling their Fayetteville Shale assets for $1.65 Billion
> SWN and all of our "gassers" are reporting much better netback prices for gas and NGLs in the Appalachia Region (Marcellus & Utica Shale Plays)
> SWN will have a good year in 2019 if natural gas averages more than $2.50.
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Southwestern Energy Company (SWN) today announced financial and operating results for the fourth quarter and year-end December 31, 2018. Fiscal year 2018 highlights, compared to prior year include:
Southwestern Energy recorded net income attributable to common stock of $307 million or $0.54 per diluted share and $535 million or $0.93 per diluted share for the fourth quarter and year ended December 31, 2018, respectively. < Q4 results beat my forecast.
• Reported net cash provided by operating activities of $1.22 billion and net cash flow of $1.35 billion, generating $100 million in free cash flow above capital investment of $1.25 billion;
• Total Company production of 946 Bcfe, above midpoint of guidance, adjusted for Fayetteville sale;
• Grew Appalachia production 21 percent to 702 Bcfe and liquids production 40 percent to 63,100 barrels per day;
• 23 percent higher weighted average realized price in Appalachia of $2.82 per Mcfe, net of transportation;
• Generated a $1.66 per Mcfe margin in Appalachia, an increase of 43 percent;
• Total Company proved reserves of 11.9 Tcfe, including 33 percent liquids, and pre-tax PV-10 value of $6.5 billion;
• Restructured G&A and reduced interest costs resulting in estimated future annual savings of $155 million;
• Closed Fayetteville sale on December 3rd receiving net proceeds of $1.65 billion;
• Reduced senior notes and bank debt by $2.1 billion;
• Repurchased 44 million shares of common stock for $199 million at an average price of $4.53 per share, as of February 28, 2019.

“The Company’s continued outperformance, the resulting advantaged balance sheet and impressive operational execution have set a solid foundation for further value growth,” said Bill Way, President and Chief Executive Officer, Southwestern Energy. “We carry strong momentum into 2019, refocused, reengineered and reenergized as a leading Appalachia basin operator, with a flexible, high value natural gas and natural gas liquids portfolio, supported by a net debt/EBITDA ratio of less than 2X.”