Despite selling off assets in Oklahoma to help balance the books, Range Resources reported a whopping 58 percent decline in revenue and a big loss for the second quarter.
The Fort Worth-based driller, a big player in the Marcellus Shale in the northeastern U.S., said GAAP revenues totaled about $102 million, down from $244.6 million in the second quarter of 2015. Range recorded a $225 million loss, or $1.35 per share, compared to a $119 million, 71 cents a share, in the prior-year quarter.
The financial declines came despite Range closing the sale of its central Oklahoma assets, which included 200 wells, for $77.7 million, boosting production output by 4 percent and dropping unit costs by 8 percent, the company announced.
The second-quarter loss came in at 21 cents a share, narrower than the Zacks estimate of 29 cents. But revenue was far below expectation.
The earnings data was released late Tuesday. In a conference call Wednesday, Range CEO Jeff Ventura still painted a brighter future for the company, saying that the company continues to perform at a high level operationally with its Marcellus assets in Pennsylvania delivering “excellent results.” The company’s $2.6 billion debt level also is its lowest since 2012.
Gas pricing remained challenged during the second quarter, but pricing has improved since and there are signs that later this year and into 2017, supply and demand will be more balanced and pricing could significantly improve.
Ventura said Range plans to run an average of three rigs in the second half of the year, and the company is on target with its $495 million capital budget and predicted better prices for natural gas.
“Gas pricing remained challenged during the second quarter, but pricing has improved since and there are signs that later this year and into 2017, supply and demand will be more balanced and pricing could significantly improve,” Ventura said.
Ventura also said executives “remain excited” about the merger with Memorial Resource Development, which they hope to close by mid-September. Earlier, Ventura had said the transaction would combine “two of the most prolific, high-quality natural gas plays in North America.”
Range announced its Memorial merger in May, an all-stock transaction valued at $4.4 billion, with assumption of $1.1 billion of debt. By buying Memorial’s production in northern Louisiana, Range now has operations closer to the Gulf Coast region.
Like other energy companies, Range has been scaling back its workforce. Earlier this year, the company trimmed jobs in Fort Worth and Pittsburgh, its Marcellus hub. The company laid off 55 people, including 20 in Fort Worth.
Earlier this year, Range also completed the sale of its Bradford County nonoperating Marcellus assets, bringing in $110 million. Range still owns about 19,000 net acres in Oklahoma.
This story contains material from the Star-Telegram archives.