Attached files
| file | filename |
|---|---|
| 8-K - 8-K - WPX ENERGY, INC. | d784908d8k.htm |
| EX-10.1 - EX-10.1 - WPX ENERGY, INC. | d784908dex101.htm |
| EX-10.2 - EX-10.2 - WPX ENERGY, INC. | d784908dex102.htm |
EXHIBIT 99.1
UNAUDITED PRO FORMA CONDENSED FINANCIAL INFORMATION
We prepared the following unaudited pro forma condensed consolidated financial statements by applying certain pro forma adjustments to the historical consolidated financial statements of WPX Energy, Inc. The pro forma adjustments give effect to the probable disposition of our operations in the Powder River Basin (“Disposition”). It is anticipated that these operations will qualify as discontinued operations and as a result would be reclassified from income (loss) from continuing operations to discontinued operations in accordance with the provisions of “Presentation of Financial Statements” in the Accounting Standards Codification in future filings.
These pro forma condensed consolidated financial statements include adjustments for the Powder River Basin disposition because we believe the disposition is probable under the standards of Rule 11-01 of Regulation S-X.
The unaudited pro forma condensed consolidated statements of operations for the year ended December 31, 2013 and for the six months ended June 30, 2014 give effect to the reclassification of the results of the Powder River Basin from continuing operations. The unaudited pro forma condensed balance sheet as of June 30, 2014 assumes the transaction occurred on June 30, 2014.
The unaudited pro forma condensed consolidated financial statements are presented for illustrative purposes only to reflect the Disposition and do not represent what our results of operations or financial position would actually have been had the Disposition occurred on the dates noted above, or project our results of operations or financial position for any future periods. The unaudited pro forma condensed consolidated financial statements are intended to provide information about the continuing impact of the Disposition as if it had been consummated earlier and do not represent any conclusions about whether such operations of the Powder River Basin will be reported as discontinued operations. The pro forma adjustments are based on available information and certain assumptions that management believes are factually supportable and are expected to have a continuing impact on our results of operations. In the opinion of management, all adjustments necessary to present fairly the unaudited pro forma condensed consolidated financial statements have been made.
WPX Energy, Inc.
Pro Forma Condensed Consolidated Balance Sheet
As of June 30, 2014
| WPX Energy Inc. – As Reported |
Disposition (a) |
Pro forma | ||||||||||
| (In millions) (Unaudited) |
||||||||||||
| Assets |
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| Current assets: |
||||||||||||
| Cash and cash equivalents |
$ | 105 | $ | 155 | $ | 260 | ||||||
| Accounts receivable, net of allowance |
502 | — | 502 | |||||||||
| Deferred income taxes |
58 | — | 58 | |||||||||
| Derivative assets |
47 | — | 47 | |||||||||
| Inventories |
81 | (1 | ) | 80 | ||||||||
| Margin deposits |
49 | — | 49 | |||||||||
| Other |
35 | — | 35 | |||||||||
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| Total current assets |
877 | 154 | 1,031 | |||||||||
| Investments |
151 | (17 | ) | 134 | ||||||||
| Properties and equipment (successful efforts method of accounting) |
11,808 | (171 | ) | 11,637 | ||||||||
| Less – accumulated depreciation, depletion and amortization |
(4,870 | ) | 8 | (4,862 | ) | |||||||
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| Properties and equipment, net |
6,938 | (163 | ) | 6,775 | ||||||||
| Derivative assets |
13 | — | 13 | |||||||||
| Other noncurrent assets |
39 | — | 39 | |||||||||
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| Total assets |
$ | 8,018 | $ | (26 | ) | $ | 7,992 | |||||
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| Liabilities and Equity |
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| Current liabilities: |
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| Accounts payable |
$ | 684 | $ | — | $ | 684 | ||||||
| Accrued and other current liabilities |
178 | (3 | ) | 175 | ||||||||
| Customer margin deposits payable |
7 | — | 7 | |||||||||
| Derivative liabilities |
144 | — | 144 | |||||||||
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| Total current liabilities |
1,013 | (3 | ) | 1,010 | ||||||||
| Deferred income taxes |
718 | — | 718 | |||||||||
| Long-term debt |
1,794 | — | 1,794 | |||||||||
| Derivative liabilities |
8 | — | 8 | |||||||||
| Asset retirement obligations |
317 | (47 | ) | 270 | ||||||||
| Other noncurrent liabilities |
44 | — | 44 | |||||||||
| Equity: |
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| Stockholders’ equity: |
||||||||||||
| Preferred stock |
— | — | — | |||||||||
| Common stock |
2 | — | 2 | |||||||||
| Additional paid-in-capital |
5,544 | — | 5,544 | |||||||||
| Accumulated deficit |
(1,525 | ) | 24 | (1,501 | ) | |||||||
| Accumulated other comprehensive income (loss) |
(1 | ) | — | (1 | ) | |||||||
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| Total stockholders’ equity |
4,020 | 24 | 4,044 | |||||||||
| Noncontrolling interests in consolidated subsidiaries |
104 | — | 104 | |||||||||
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| Total equity |
4,124 | 24 | 4,148 | |||||||||
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| Total liabilities and equity |
$ | 8,018 | $ | (26 | ) | $ | 7,992 | |||||
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WPX Energy, Inc.
Pro Forma Condensed Consolidated Statement of Operations
| For the Six Months Ended June 30, 2014 | ||||||||||||
| WPX Energy Inc. – As Reported |
Disposition (b) |
Pro forma | ||||||||||
| (In millions, except per share amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| Revenues: |
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| Product revenues: |
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| Natural gas sales |
$ | 701 | $ | (110 | ) | $ | 591 | |||||
| Oil and condensate sales |
398 | 398 | ||||||||||
| Natural gas liquid sales |
116 | 116 | ||||||||||
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| Total product revenues |
1,215 | (110 | ) | 1,105 | ||||||||
| Gas management |
792 | — | 792 | |||||||||
| Net gain (loss) on derivatives not designated as hedges |
(212 | ) | — | (212 | ) | |||||||
| Other |
6 | — | 6 | |||||||||
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| Total revenues |
1,801 | (110 | ) | 1,691 | ||||||||
| Costs and expenses: |
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| Lease and facility operating |
156 | (21 | ) | 135 | ||||||||
| Gathering, processing and transportation |
203 | (35 | ) | 168 | ||||||||
| Taxes other than income |
89 | (8 | ) | 81 | ||||||||
| Gas management, including charges for unutilized pipeline capacity |
624 | — | 624 | |||||||||
| Exploration |
72 | — | 72 | |||||||||
| Depreciation, depletion and amortization |
422 | (8 | ) | 414 | ||||||||
| Loss on sale of working interests in the Piceance Basin |
195 | — | 195 | |||||||||
| General and administrative |
146 | (2 | ) | 144 | ||||||||
| Other—net |
6 | — | 6 | |||||||||
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| Total costs and expenses |
1,913 | (74 | ) | 1,839 | ||||||||
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| Operating income (loss) |
(112 | ) | (36 | ) | (148 | ) | ||||||
| Interest expense |
(57 | ) | — | (57 | ) | |||||||
| Interest capitalized |
1 | (1 | ) | — | ||||||||
| Investment income and other |
9 | (2 | ) | 7 | ||||||||
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| Income (loss) from continuing operations before income taxes |
(159 | ) | (39 | ) | (198 | ) | ||||||
| Provision (benefit) for income taxes |
(45 | ) | (14 | ) | (59 | ) | ||||||
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| Income (loss) from continuing operations |
(114 | ) | (25 | ) | (139 | ) | ||||||
| Less: Net income (loss) attributable to noncontrolling interests |
3 | — | 3 | |||||||||
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| Net income (loss) attributable to WPX Energy, Inc. |
$ | (117 | ) | $ | (25 | ) | $ | (142 | ) | |||
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| Amounts attributable to WPX Energy, Inc.: |
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| Basic and Diluted Earnings (loss) per common share attributable to WPX Energy, Inc.: |
$ | (0.58 | ) | $ | (0.70 | ) | ||||||
| Weighted-average shares |
202.1 | 202.1 | ||||||||||
WPX Energy, Inc.
Pro Forma Condensed Consolidated Statement of Operations
| For the Year Ended December 31, 2013 | ||||||||||||
| WPX |
Disposition |
Pro forma |
||||||||||
| (In millions, except per share amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| Revenues: |
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| Product revenues: |
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| Natural gas sales |
$ | 1,093 | $ | (178 | ) | $ | 915 | |||||
| Oil and condensate sales |
649 | — | 649 | |||||||||
| Natural gas liquid sales |
230 | — | 230 | |||||||||
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| Total product revenues |
1,972 | (178 | ) | 1,794 | ||||||||
| Gas management |
891 | — | 891 | |||||||||
| Net gain (loss) on derivatives not designated as hedges |
(124 | ) | — | (124 | ) | |||||||
| Other |
22 | — | 22 | |||||||||
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| Total revenues |
2,761 | (178 | ) | 2,583 | ||||||||
| Costs and expenses: |
||||||||||||
| Lease and facility operating |
308 | (44 | ) | 264 | ||||||||
| Gathering, processing and transportation |
433 | (80 | ) | 353 | ||||||||
| Taxes other than income |
141 | (15 | ) | 126 | ||||||||
| Gas management, including charges for unutilized pipeline capacity |
931 | — | 931 | |||||||||
| Exploration |
431 | (1 | ) | 430 | ||||||||
| Depreciation, depletion and amortization |
940 | (48 | ) | 892 | ||||||||
| Impairment of producing properties and costs of acquired unproved reserves |
1,055 | (192 | ) | 863 | ||||||||
| Gain on sale of Powder River Basin deep rights leasehold |
(36 | ) | 36 | — | ||||||||
| General and administrative |
289 | (6 | ) | 283 | ||||||||
| Other—net |
17 | (5 | ) | 12 | ||||||||
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| Total costs and expenses |
4,509 | (355 | ) | 4,154 | ||||||||
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| Operating income (loss) |
(1,748 | ) | 177 | (1,571 | ) | |||||||
| Interest expense |
(108 | ) | — | (108 | ) | |||||||
| Interest capitalized |
5 | (4 | ) | 1 | ||||||||
| Investment income, impairment of equity method investment and other |
5 | (4 | ) | 1 | ||||||||
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| Income (loss) from continuing operations before income taxes |
(1,846 | ) | 169 | (1,677 | ) | |||||||
| Provision (benefit) for income taxes |
(655 | ) | 62 | (593 | ) | |||||||
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| Income (loss) from continuing operations |
(1,191 | ) | 107 | (1,084 | ) | |||||||
| Less: Net income (loss) attributable to noncontrolling interests |
(6 | ) | — | (6 | ) | |||||||
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| Net income (loss) attributable to WPX Energy, Inc. |
$ | (1,185 | ) | $ | 107 | $ | (1,078 | ) | ||||
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| Amounts attributable to WPX Energy, Inc.: |
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|
Basic and Diluted Earnings (loss) per common share attributable to WPX Energy, Inc.: |
$ | (5.91 | ) | $ | (5.38 | ) | ||||||
| Weighted-average shares |
200.5 | 200.5 | ||||||||||
WPX Energy, Inc.
Notes to Pro Forma Condensed Consolidated Financial Statements
(Unaudited)
Note 1. Pro Forma Adjustments and Assumptions
Details of the adjustments are as follows:
| (a) | Assumes receipt of $155 million of cash on June 30, 2014 for the assets and liabilities of Powder River operations that are part of the probable Disposition. The $155 million purchase price does not assume any closing adjustments. The other amounts presented are the adjustments necessary to reflect the removal of the Powder River Basin assets and liabilities that are part of the Disposition from our consolidated historical financial statements. |
| (b) | Amounts presented are the adjustments necessary to reflect the removal of the results of operations of the Powder River Basin from our consolidated historical financial statements. |