Magnolia Oil & Gas Corporation · NYSE:MGY
Magnolia Oil & Gas — Q3 2021 Earnings Presentation
20 slides from Magnolia Oil & Gas's earnings presentation, Nov 1, 2021
Slide 1: Third Quarter 2021 Earnings Presentation
Third Quarter 2021 Earnings Presentation November 2, 2021 Stephen Chazen – Chairman, President & CEO Christopher Stavros – Executive Vice President & CFO Brian Corales – Vice President, Investor Relations
Slide 2: Disclaimer
Disclaimer 2 FORWARD LOOKING STATEMENTS The information in this presentation and the oral statements made in connection therewith include “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities
Slide 3: 3Q 2021 Highlights
Magnolia Oil & Gas – 3Q 2021 Highlights 3 • Generated total net income of $160 million or 67 cents per diluted share during 3Q21. • Total production for 3Q21 increased 4% sequentially to 67.4 Mboe/d. Giddings production increased 80% from 3Q20 levels. • Generated adjusted EBITDAX of $222 million, wi
Slide 4: 3Q 2021 Key Metrics
Magnolia Oil & Gas – 3Q 2021 Key Metrics 4 Adj. Net Income (1) & Adj. EPS (1) Total Production 67.4 Mboe/d (4% sequential growth) Adjusted EBITDAX (1) $221.5 Million D&C Capex $67.2 Million 30% of Adj. EBITDAX Free Cash Flow (1) $143.5 Million Giddings Production 36.8 Mboe/d (80% YOY growth) (1) Adj
Slide 5: 3Q 2021 QTD Cash Flow Summary
3Q 2021 QTD Cash Flow Summary 190 211 6 19 68 75 245 0 50 100 150 200 250 300 350 400 450 Cash 06/30/21 Cash Flow from Operations Changes in WC and Other Dividends D&C and Facilities Capital Common Stock Repurchases Cash 09/30/21(1) (3) (2) (4) ($In millions) (1) Cash flow from operations before cha
Slide 6: YTD Cash Flow Summary
YTD Cash Flow Summary 193 528 10 19 163 284 245 0 100 200 300 400 500 600 700 800 Cash 12/31/20 Cash Flow from Operations Acquisitions and Other Dividends D&C and Facilities Capital Common Stock Repurchases Cash 9/30/21 (1) (2) (5)(4)(3) (In millions) (1) Cash flow from operations before changes in
Slide 7: Share Repurchase Summary Through 3Q 2021
Share Repurchase Summary Through 3Q 2021 7 Quarterly Share Reduction Summary (Million Shares) • Since the initial repurchase authorization in 3Q19, Magnolia has reduced its dilutive share count by 15.1(1) million shares of Class A common stock as well as 19 million shares of Class B common stock, fo
Slide 8: Summary Balance Sheet
Magnolia Oil & Gas – Summary Balance Sheet 8 (in thousands) September 30, 2021 December 31, 2020 Cash $245,023 $192,561 Current assets 131,730 88,965 Property, plant and equipment, net 1,195,875 1,149,527 Other assets 13,151 22,367 Total assets $1,585,779 $1,453,420 Current liabilities $190,685 $128
Slide 9: 3Q 2021 Capital Structure and Liquidity Overview
3Q 2021 Capital Structure and Liquidity Overview 9 Capital Structure Overview • Maintaining low financial leverage profile ‒ Net Debt / Total Book Capitalization of 12% ‒ Net Debt / Q3 Annualized adjusted EBITDAX of 0.2x • Current Liquidity of $695 million, including fully undrawn credit facility (1
Slide 10: Margin and Cost Structure
Magnolia Oil & Gas – Margin and Cost Structure 10 (1) Lease operating expenses exclude non-cash stock based compensation of $0.1 million, or $0.02 per boe, for each of the quarters ended September 30, 2021 & June 30, 2021. (2) General and administrative expenses exclude non-cash stock based compensa
Slide 11: Differentiated Dividend Framework
Magnolia Oil & Gas – Differentiated Dividend Framework 11 • Differentiated dividend framework is aligned with the principles of our business model and reinforces our plan. • The initiation of a dividend conveys our continued confidence in the business plan and the quality of our assets. • Our approa
Slide 12: Appendix
Appendix MAGNOLIA L& GAS
Slide 13: Overview
Magnolia Oil & Gas – Overview • High-quality, low-risk pure-play South Texas operator with a core Eagle Ford and Austin Chalk position acquired at an attractive entry multiple • Significant scale and PDP base generates material free cash flow, reduces development risk, and increases optionality • As
Slide 14: Free Cash Flow Reconciliation
Free Cash Flow Reconciliation 14 (1) Free cash flow is a non-GAAP measure. For reasons management believes this is useful to investors, refer to slide 2 “Non-GAAP Financial Measures.” (in thousands) Free Cash Flow Reconciliation For the Quarter Ended September 30, 2021 For the Quarter Ended Septembe
Slide 15: Reconciliation of Net Income to Adjusted EBITDAX
Reconciliation of Net Income to Adjusted EBITDAX 15 (1) EBITDAX and Adjusted EBITDAX are non-GAAP measures. For reasons management believes these are useful to Investors, refer to slide 2 “Non-GAAP Financial Measures.” (in thousands) Adjusted EBITDAX reconciliation to net income: For the Quarter End
Slide 16: Adjusted Net Income Reconciliation
Adjusted Net Income Reconciliation 16 (1) Adjusted Net Income is a non-GAAP measure. For reasons management believes this is useful to investors, refer to slide 2 “Non-GAAP Financial Measure.” (2) Shares of Class B Common Stock, and corresponding Magnolia LLC Units, are anti-dilutive in the calculat
Slide 17: Adjusted Earnings Reconciliation
Adjusted Earnings Reconciliation 17 (1) Adjusted earnings is a non-GAAP measure. For reasons management believes this is useful to investors, refer to slide 2 “Non-GAAP Financial Measures.” (in thousands) For the Quarter Ended September 30, 2021 Per Share Diluted EPS For the Quarter Ended September
Slide 18: Operating Highlights
Magnolia Oil & Gas – Operating Highlights 18 (1) Benchmarks are the NYMEX WTI and NYMEX HH average prices for oil and natural gas, respectively. For the Quarter Ended September 30, 2021 For the Quarter Ended September 30, 2020 Production: Oil (MBbls) 2,851 2,485 Natural gas (MMcf) 11,429 9,444 Natur
Slide 19: Production Results
Magnolia Oil & Gas – Production Results 19 Combined Karnes Giddings & Other Combined Karnes Giddings & Other Three Months Ended September 30, 2021 Three Months Ended September 30, 2020 Production: Oil (MBbls) 2,851 1,631 1,220 2,485 2,025 460 Natural gas (MMcf) 11,429 3,872 7,557 9,444 3,888 5,556 N
Slide 20: Commitment to Sustainability
Commitment to Sustainability 20 ENVIRONMENTAL SOCIAL GOVERNANCE Flaring Flare less than 1% of our total net production Fugitive Emissions Operate vent and flare systems to minimize fugitive emissions from storage tanks Water Resources Operations do not produce large volumes of water after initial pr