Sundance Energy — Sundance Energy Australia — Q2 2019 Earnings Presentation
25 slides from Sundance Energy's earnings presentation, Aug 16, 2019
Slide 1: Disclaimers: Important Notice and Disclaimer
Disclaimers Important Notice and Disclaimer IMPORTANT: You are advised to read the following carefully before making any use of the information contained in this presentation. Except as required by law, no representation or warranty, express or implied, is made by Sundance or any of the Sundance Rel
Slide 2: Disclaimers: Industry Data and Forward-Looking Statements
Disclaimers Industry data Certain market and industry data used in connection with this presentation, including in relation to other companies in Sundance’s peer group, may have been obtained from public filings, research, surveys or studies conducted by third parties, including industry or general
Slide 3: Disclaimers: Proved Reserves
Disclaimers Proved Reserves Ryder Scott Company, L.P. (Ryder Scott) has prepared an independent estimate of the proved reserves, future production and income attributable to Sundance Energy’s leasehold interests in the Eagle Ford shale play in the State of Texas, USA as of 1 January 2019. The Compan
Slide 4: A Leading Pure Play Eagle Ford Producer
A Leading Pure Play Eagle Ford Producer Second Quarter Results Firmly Place Sundance On Path to Free Cash Flow Free Cash Flow generation expected in 2H19 Average daily sales volumes of 13,898 boe/d, at top end of public guidance 14 wells turned to sales year to date(5); 4 more wells expected to IP i
Slide 5: Second Quarter 2019 Operational & Financial Results
Second Quarter 2019 Operational & Financial Results Second Quarter 2019 Operational Results 2Q19 average net sales volumes of 13,898 boe/d represent an ~79% year-over-year increase 2Q19 oil as percentage of total sales was 59%, which was lower than expected primarily due to the Dimmit assets (1) and
Slide 6: Ongoing Focus on Reducing Operating Costs
Ongoing Focus on Reducing Operating Costs ~35% Year-Over-Year Reduction in Total Cash Operating Costs Per Boe Ongoing operating cost reduction initiatives drives incremental operating margin and long-term value creation Additional cost-saving opportunities have been identified, with initiatives to a
Slide 7: Third Quarter and Full Year 2019 Guidance
Summary Third Quarter and Full Year 2019 Guidance(1) As per internal Company estimates at 16 May 2019. “GP&T” refers to certain Gathering, Processing and Transportation fees incurred in moving hydrocarbons to market. 2019 Plan Is To Operate Within Cashflow to Deliver Production and Cash Flow Growth
Slide 8: Capitalization Table and Available Liquidity
Capitalization Table and Available Liquidity Strong balance sheet and significant liquidity, with no debt maturities until 4th Quarter of 2022 May 2019 borrowing base redetermination increased RBL capacity ~40% to $170 MM Firmly demonstrates continued creditworthiness of Sundance Increases significa
Slide 9: Corporate Debt Overview
Corporate Debt Overview Reserve Based Loan Amount: $170.0 MM availability; $105 MM drawn(1) Redetermination: Bi-annually Coupon: Floating, Libor + 225-325 bps depending on utilization(2) Term: 4.5 years Maturity: October 2022 Covenants: Current Ratio > 1.0x; Total Debt to EBITDAX < 4.0x; Interest Co
Slide 10: Debt Maturity and Service Schedule
Debt Maturity and Service Schedule No debt maturities until 4th Quarter of 2022 Assuming consensus 2019 EBITDA run flat forward (and ignoring anticipated future growth), Sundance has sufficient cash flow to service current debt levels as shown by elevated Debt Service Coverage Ratio Excludes impact
Slide 11: Positioning for Improved Liquidity and Valuation
Positioning for Improved Liquidity and Valuation Sundance is exploring opportunities for improving trading liquidity and valuation, including the possibility of moving its place of incorporation and primary listing from Australia to the US Management believes that a redomiciliation could have the fo
Slide 12: Assets Deliver Attractive Returns At Lower Oil Prices
Assets Deliver Attractive Returns At Lower Oil Prices Based on Company’s 2019 drilling program cadence of 18 wells per annum. Sundance defines Tier 1 inventory as wells delivering above a 25% IRR. ~23 Years of Oil Rich Tier 1 Eagle Ford Drilling Inventory (1) Drilling Inventory By Location Dispositi
Slide 13: Announced Sale of Dimmit County Asset
Announced Sale of Dimmit County Asset Definitive agreement in place to sell all Dimmit County assets for $29.5 MM purchase price Dimmit Transaction Overview Sale of all remaining Dimmit County assets 19 gross PDP wells ~6,100 net acres Assets contributed 1,389 boepd in 2Q19 average daily sales volum
Slide 14: Year to Date 2019 Development – Quarterhorse Acreage
La Salle McMullen AREA 41 AREA 11 AREA 21 Year to Date 2019 Development – Quarterhorse Acreage 5 1 Atascosa Live Oak Roy Esse Four Well Pad 15H, 16H 17H & 18H 1 Georgia Buck Four Well Pad 01H, 02H, 03H & 10H 2 Justin Tom Two Well Pad Justin Tom 08H & 09H 5 Area 41 HT Chapman Four Well Pad 11H, 12H,
Slide 15: Year to Date 2019 Development – Legacy Acreage
Year to Date 2019 Development – Legacy Acreage Atascosa McMullen La Salle McMullen AREA 41 AREA 11 AREA 21 Legacy Acreage Development Detail 2 wells drilled, completed and brought online Excludes 2 well Red Ranch 18H & 19H pad included in the Dimmit divestiture Bracken well costs to date in line wit
Slide 16: Robust 2019 Initial Production Results Support Growth Plan
Robust 2019 Initial Production Results Support Growth Plan 2019 Operations Support Continued Production Growth Excellent 2019 well results year to date support Sundance’s production and EBITDA growth targets 2019 IP rates reflect revised choke strategy intended to increase EUR and overall well econo
Slide 17: 2018 Wells Continue to Demonstrate Superior Results
2018 Wells Continue to Demonstrate Superior Results 2018 Wells Continue to Outperform on Cumulative Production Basis 2018 wells materially outperformed type curve expectations on an initial production basis Wells continue their outperformance on a cumulative production basis Excludes the Red Ranch 1
Slide 18: Sundance Initial Production and Cumulative Rates vs Peers
Sundance Initial Production and Cumulative Rates vs Peers Sundance 2018 and 2019 IP and Cum rates compare very favorably to recent results from Eagle Ford peers All data is sourced from RS Energy Group (“RSEG”), a respected third party data provider and analytics company focused on the oil and gas m
Slide 19: 2018 Live Oak County Initial Well Performance vs Type Curve
2018 Live Oak County Initial Well Performance (1) vs Type Curve(2) 2018 Area 41 Live Oak wells are outperforming updated type curve by an average of ~ 38% to date Note: Cum Oil Type Curve is normalized to well Lateral Length Well results shown as of July 2019. Type Curve was updated at 31 December 2
Slide 20: 2019 Live Oak County Initial Well Performance vs Type Curve
2019 Live Oak County Initial Well Performance vs Type Curve(1) 2019 Area 41 Live Oak wells are outperforming updated type curve by an average of ~ 16% to date Note: Cum Oil Type Curve is normalized to well Lateral Length Well results shown as of July 2019. Type Curve was updated at 31 December 2018
Slide 21: Atascosa County Initial Well Performance vs Type Curve
Atascosa County Initial Well Performance (1) vs Type Curve(2) 2018 Area 41 Atascosa County wells are outperforming expectations by an average of ~37% to date Note: Cum Oil Type Curve is normalized to well Lateral Length Well results shown as of July 2019. Type Curve was updated at 31 December 2018 t
Slide 22: Robust 2019 Hedge Book Supports Strong Cash Flow Generation
Robust 2019 Hedge Book Supports Strong Cash Flow Generation All figures representative of Sundance’s remaining hedge book through 2023 as at 1st August 2019. Hedge coverage percentage represents hedges as a percentage of the midpoint of Sundance’s public sales volumes guidance assuming a 61% oil cut
Slide 23: High Quality Asset Base – Material Inventory With Low Break Even Costs
High Quality Asset Base – Material Inventory With Low Full-Cycle Break Even Costs ~23 years of highly attractive Tier 1 drilling inventory with $1,110MM(1) of 1P PV10 as at year end 2018 Full-cycle break even costs of ~$30.00 per boe allows production and EBITDA growth under various oil price scenar
Slide 24: For Additional Information Please Contact
For Additional Information Please Contact: United States John Roberts, VP Finance & Investor Relations jroberts@sundanceenergy.net +1 (720) 638-2400 Eric McCrady, CEO & Managing Director emccrady@sundanceenergy.net +1 (303) 543-5703 Australia Mike Hannell, Chairman + 61 8 8274 2128 or + 61 418 834 9
Slide 25: Sundance Energy contact details
NY SUNDANCE energy For A tional information Please Contact: United states John Roberts, VP Finance & Investor Relations roberts@sundanceenergy.net +1(720) 638-2400 Eric MeCrady, CEO & Managing Director emecrady@sundanceenergy.net +1 (303) 543-5703 ‘Australia Mike Hannell, Chairman + 6188274 2128 or
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