Montage Resources — Merger or Acquisition (August 2020)
15 slides from Montage Resources's merger presentation, Aug 12, 2020
Slide 1: Key metrics of the new combined enterprise
Certain key metrics of the new combined enterprise are shown below. SWN MR SWN + MR Production (for the quarter ended June 30, 2020) Natural Gas (Bcf) Oil/Condensate (MBbls) 1,083 1,523 NGLs (MBbls) 6,111 7,085 Total Production (Bcfe) Net Acres (1) Northeast Appalachia 173,994 34,900 208,894 Southwe
Slide 2: Appalachia Consolidation: Acquisition of Montage Resources
Appalachia Consolidation Acquisition of Montage Resources NYSE: SWN www.swn.com August 12, 2020 Exhibit 99.2
Slide 3: Forward-Looking Statements
Forward-Looking Statements Certain statements and information in this presentation may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The words “believe,” “expect,” “anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “cou
Slide 4: Additional Information and Where To Find It
Additional Information and Where To Find It In connection with the proposed acquisition by the Company of Montage (the “Proposed Transaction”), the Company will file with the SEC a registration statement on Form S-4 to register the shares of the Company’s common stock to be issued in connection with
Slide 5: SWN strategy: scale, shareholder returns, resilience
Increase Scale Position SWN as a gas and gas liquids leader in Appalachia Shareholder Returns Driven Strategy Increasing Resilience & Relevance Through People & Innovation Capitalize on strategic opportunities in an industry in transition Prioritize transactions that deliver impactful synergies and
Slide 6: Complementary Appalachia acquisition transforms SWN
Financial metrics include Return on Capital Employed, Cash Flow per Debt Adjusted Share, Cash Flow per Share, Free Cash Flow per Share and Earnings per Share. Based on strip pricing as of July 30, 2020. Free cash flow is a non-GAAP financial measure. See explanation on page 14. Complementary Appalac
Slide 7: SWN + MR Overview
SWN Southwest Appalachia Net Acres: 287,693(3) YE 2019 Proved Reserves: 7.9 Tcfe(3) 1H2020 Production: 962 MMcfe/d(5) 50% gas 42% NGL 8% oil SWN Northeast Appalachia Net Acres: 173,994(3) YE 2019 Proved Reserves: 4.8 Tcf(3) 1H2020 Production: 1,247 MMcf/d(5) 100% gas Montage Net Acres: 324,500(4) YE
Slide 8: Transaction Summary: no premium, all-stock transaction
No premium, all-stock transaction MR shareholders will receive 1.8656 SWN common shares for every share of MR stock owned Southwestern shareholders will own ~90% of the combined company Subject to customary closing conditions and regulatory approvals, including approval by MR shareholders EnCap, Mon
Slide 9: Montage Asset Base
324,500 net acres(1) across Southeast Ohio, Northwest West Virginia and Northeast Pennsylvania spanning all commodity windows 183,700 acres in Utica Shale Fairway 56,500 acres in proven, stacked pay, high return Marcellus super rich Montage Asset Base High quality acreage As of June 30, 2020. As of
Slide 10: Acquired assets provide attractive returns
Acquired assets provide attractive returns Portfolio integrates well with near-term development plans; drilling across all acreage Proven, high return dry gas Utica in core of play with proximity to major markets Tier 1 Marcellus super rich gas complementing Southwest Appalachia rich gas and super r
Slide 11: Building on financial strength
Building on financial strength Retains peer leading maturity window with ample liquidity Proceeds from equity issuance will be used to reduce near-term maturities Potential to opportunistically refinance the remainder of MR 8.875% Senior Notes due 2023 Improving debt metrics Accretive to leverage ra
Slide 12: Increases scale and improves investable value proposition
Increases scale… Creates the 3rd largest producer in Appalachia, in both total equivalent and liquids production Scale improves stability and resilience Increases locations economic at current strip pricing(1) …and improves investable value proposition Enhances credit metrics Expect free cash flow s
Slide 13: Transaction Aligns with SWN Strategy
Transaction Aligns with SWN Strategy Accretive long-term value proposition for shareholders Strengthens financial metrics Delivers free cash flow Create Sustainable Value Accretive to leverage Improves fixed cost structure Protect Financial Strength Enhances economic inventory Optimizes firm transpo
Slide 14: Premier asset base across West Virginia, Pennsylvania and Ohio
Premier asset base – 786,000 acres across West Virginia, Pennsylvania and Ohio Tier 1 natural gas acreage – high-rate, high-value natural gas assets; approximately 80% of production natural gas Basin leading liquids production – highest yield condensate acreage Free cash flow starting in 2021 Return
Slide 15: Non-GAAP definitions
Pre-tax PV-10 is defined as PV-10 before the impact of taxes. Pre-tax PV-10 is a non-GAAP financial measure and generally differs from standardized measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net revenues. Neither pr
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