CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS | 6 Months Ended |
Jun. 30, 2014 |
Guarantees [Abstract] | ' |
CONDENSED CONSOLIDATING GUARANTOR FINANCIAL STATEMENTS | ' |
NOTE 19 - CONDENSED CONSOLIDATED GUARANTOR FINANCIAL STATEMENTS |
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Guarantor Subsidiaries |
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Certain of the Company’s subsidiaries, including Alpha Hunter Drilling, LLC, Bakken Hunter, LLC, Shale Hunter, Magnum Hunter Marketing, LLC, Magnum Hunter Production, Inc., NGAS Hunter, LLC, Triad Hunter, and Viking International Resources, Co., Inc. (collectively, "Guarantor Subsidiaries"), jointly and severally guarantee on a senior unsecured basis, the obligations of the Company under all the Senior Notes issued under the indenture entered into by the Company on May 16, 2012, as supplemented. The Guarantor Subsidiaries also may guarantee any debt of the Company issued pursuant to the Form S-3 Registration Statement filed by the Company with the SEC on August 5, 2014 (see "Note 20 - Subsequent Events"). |
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These condensed consolidating guarantor financial statements have been revised to reflect Eagle Ford Hunter and PRC Williston as non-guarantors as the subsidiaries are no longer guarantors of the Company's Senior Notes. |
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Condensed consolidating financial information for Magnum Hunter Resources Corporation, the Guarantor Subsidiaries and the other subsidiaries of the Company (the "Non Guarantor Subsidiaries") as of June 30, 2014 and December 31, 2013, and for the three and six months ended June 30, 2014 and 2013, are as follows: |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Balance Sheets |
(in thousands) |
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| | | | | | | | | | | | | | | | | | | |
| As of June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
ASSETS | | | | | | | | | |
Current assets | $ | 37,995 | | | $ | 75,812 | | | $ | 15,539 | | | $ | (7,733 | ) | | $ | 121,613 | |
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Intercompany accounts receivable | 1,083,102 | | | — | | | — | | | (1,083,102 | ) | | — | |
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Property and equipment (using successful efforts method of accounting) | 5,939 | | | 1,381,891 | | | 310,195 | | | — | | | 1,698,025 | |
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Investment in subsidiaries | 279,116 | | | 101,485 | | | — | | | (380,601 | ) | | — | |
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Assets held for sale and other | 17,246 | | | 88,394 | | | 38,079 | | | — | | | 143,719 | |
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Total Assets | $ | 1,423,398 | | | $ | 1,647,582 | | | $ | 363,813 | | | $ | (1,471,436 | ) | | $ | 1,963,357 | |
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LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | |
Current liabilities | $ | 63,583 | | | $ | 118,934 | | | $ | 51,453 | | | $ | (7,774 | ) | | $ | 226,196 | |
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Intercompany accounts payable | — | | | 1,036,163 | | | 46,901 | | | (1,083,064 | ) | | — | |
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Long-term liabilities | 765,072 | | | 39,346 | | | 180,359 | | | — | | | 984,777 | |
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Redeemable preferred stock | 100,000 | | | — | | | 149,379 | | | — | | | 249,379 | |
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Shareholders' equity (deficit) | 494,743 | | | 453,139 | | | (64,279 | ) | | (380,598 | ) | | 503,005 | |
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Total Liabilities and Shareholders' Equity | $ | 1,423,398 | | | $ | 1,647,582 | | | $ | 363,813 | | | $ | (1,471,436 | ) | | $ | 1,963,357 | |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Balance Sheets |
(in thousands) |
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| | | | | | | | | | | | | | | | | | | |
| As of December 31, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
ASSETS | | | | | | | | | |
Current assets | $ | 53,161 | | | $ | 43,841 | | | $ | 27,096 | | | $ | (3,372 | ) | | $ | 120,726 | |
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Intercompany accounts receivable | 965,138 | | | — | | | — | | | (965,138 | ) | | — | |
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Property and equipment (using successful efforts method of accounting) | 7,214 | | | 1,272,027 | | | 234,838 | | | — | | | 1,514,079 | |
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Investment in subsidiaries | 372,236 | | | 102,314 | | | — | | | (474,550 | ) | | — | |
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Other assets | 17,308 | | | 100,894 | | | 103,644 | | | — | | | 221,846 | |
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Total Assets | $ | 1,415,057 | | | $ | 1,519,076 | | | $ | 365,578 | | | $ | (1,443,060 | ) | | $ | 1,856,651 | |
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LIABILITIES AND SHAREHOLDERS' EQUITY | | | | | | | | | |
Current liabilities | $ | 54,826 | | | $ | 97,520 | | | $ | 34,929 | | | $ | (3,410 | ) | | $ | 183,865 | |
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Intercompany accounts payable | — | | | 921,237 | | | 43,866 | | | (965,103 | ) | | — | |
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Long-term liabilities | 818,651 | | | 39,067 | | | 127,663 | | | — | | | 985,381 | |
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Redeemable preferred stock | 100,000 | | | — | | | 136,675 | | | — | | | 236,675 | |
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Shareholders' equity (deficit) | 441,580 | | | 461,252 | | | 22,445 | | | (474,547 | ) | | 450,730 | |
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Total Liabilities and Shareholders' Equity | $ | 1,415,057 | | | $ | 1,519,076 | | | $ | 365,578 | | | $ | (1,443,060 | ) | | $ | 1,856,651 | |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Statements of Operations |
(in thousands) |
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| | | | | | | | | | | | | | | | | | | |
| Three Months Ended June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Revenues | $ | 6 | | | $ | 125,536 | | | $ | 12,560 | | | $ | (5,586 | ) | | $ | 132,516 | |
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Expenses | 36,512 | | | 112,757 | | | 52,768 | | | (5,417 | ) | | 196,620 | |
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Income (loss) from continuing operations before equity in net income of subsidiaries | (36,506 | ) | | 12,779 | | | (40,208 | ) | | (169 | ) | | (64,104 | ) |
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Equity in net income of subsidiaries | (19,314 | ) | | (984 | ) | | — | | | 20,298 | | | — | |
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Income (loss) from continuing operations before income tax | (55,820 | ) | | 11,795 | | | (40,208 | ) | | 20,129 | | | (64,104 | ) |
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Income tax benefit (expense) | — | | | — | | | — | | | — | | | — | |
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Income (loss) from continuing operations | (55,820 | ) | | 11,795 | | | (40,208 | ) | | 20,129 | | | (64,104 | ) |
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Income from discontinued operations, net of tax | — | | | 2,376 | | | 1,342 | | | 171 | | | 3,889 | |
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Gain on sale of discontinued operations, net of tax | (15,480 | ) | | — | | | 10,268 | | | — | | | (5,212 | ) |
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Net income (loss) | (71,300 | ) | | 14,171 | | | (28,598 | ) | | 20,300 | | | (65,427 | ) |
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Net income attributable to non-controlling interest | — | | | — | | | — | | | 780 | | | 780 | |
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Net income (loss) attributable to Magnum Hunter Resources Corporation | (71,300 | ) | | 14,171 | | | (28,598 | ) | | 21,080 | | | (64,647 | ) |
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Dividends on preferred stock | (8,848 | ) | | — | | | (6,482 | ) | | — | | | (15,330 | ) |
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Net income (loss) attributable to common shareholders | $ | (80,148 | ) | | $ | 14,171 | | | $ | (35,080 | ) | | $ | 21,080 | | | $ | (79,977 | ) |
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| Three Months Ended June 30, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Revenues | $ | 12 | | | $ | 62,065 | | | $ | 8,090 | | | $ | (2,259 | ) | | $ | 67,908 | |
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Expenses | 16,577 | | | 74,612 | | | 17,930 | | | (2,197 | ) | | 106,922 | |
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Income (loss) from continuing operations before equity in net income of subsidiaries | (16,565 | ) | | (12,547 | ) | | (9,840 | ) | | (62 | ) | | (39,014 | ) |
Equity in net income of subsidiaries | (29,060 | ) | | (113 | ) | | (1,582 | ) | | 30,755 | | | — | |
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Income (loss) from continuing operations before income tax | (45,625 | ) | | (12,660 | ) | | (11,422 | ) | | 30,693 | | | (39,014 | ) |
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Income tax benefit (expense) | 41,900 | | | (1,654 | ) | | (946 | ) | | — | | | 39,300 | |
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Income (loss) from continuing operations | (3,725 | ) | | (14,314 | ) | | (12,368 | ) | | 30,693 | | | 286 | |
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Income (loss) from discontinued operations, net of tax | (8,453 | ) | | 18,903 | | | (18,196 | ) | | 62 | | | (7,684 | ) |
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Gain on sale of discontinued operations, net of tax | 172,452 | | | — | | | — | | | — | | | 172,452 | |
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Net income (loss) | 160,274 | | | 4,589 | | | (30,564 | ) | | 30,755 | | | 165,054 | |
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Net income attributable to non-controlling interest | — | | | — | | | — | | | 386 | | | 386 | |
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Net income (loss) attributable to Magnum Hunter Resources Corporation | 160,274 | | | 4,589 | | | (30,564 | ) | | 31,141 | | | 165,440 | |
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Dividends on preferred stock | (8,877 | ) | | — | | | (5,252 | ) | | — | | | (14,129 | ) |
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Net income (loss) attributable to common shareholders | $ | 151,397 | | | $ | 4,589 | | | $ | (35,816 | ) | | $ | 31,141 | | | $ | 151,311 | |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Statements of Operations |
(in thousands) |
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| | | | | | | | | | | | | | | | | | | |
| Six Months Ended June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Revenues | $ | 114 | | | $ | 229,550 | | | $ | 21,258 | | | $ | (10,962 | ) | | $ | 239,960 | |
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Expenses | 71,305 | | | 219,841 | | | 61,460 | | | (10,641 | ) | | 341,965 | |
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Income (loss) from continuing operations before equity in net income of subsidiaries | (71,191 | ) | | 9,709 | | | (40,202 | ) | | (321 | ) | | (102,005 | ) |
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Equity in net income of subsidiaries | (48,129 | ) | | (829 | ) | | — | | | 48,958 | | | — | |
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Income (loss) from continuing operations before income tax | (119,320 | ) | | 8,880 | | | (40,202 | ) | | 48,637 | | | (102,005 | ) |
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Income tax benefit (expense) | — | | | — | | | — | | | — | | | — | |
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Income (loss) from continuing operations | (119,320 | ) | | 8,880 | | | (40,202 | ) | | 48,637 | | | (102,005 | ) |
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Income from discontinued operations, net of tax | — | | | 2,259 | | | 4,669 | | | 323 | | | 7,251 | |
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Gain (loss) on sale of discontinued operations, net of tax | (19,799 | ) | | (18,649 | ) | | 6,074 | | | — | | | (32,374 | ) |
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Net income (loss) | (139,119 | ) | | (7,510 | ) | | (29,459 | ) | | 48,960 | | | (127,128 | ) |
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Net income attributable to non-controlling interest | — | | | — | | | — | | | 889 | | | 889 | |
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Net income (loss) attributable to Magnum Hunter Resources Corporation | (139,119 | ) | | (7,510 | ) | | (29,459 | ) | | 49,849 | | | (126,239 | ) |
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Dividends on preferred stock | (17,668 | ) | | — | | | (12,558 | ) | | — | | | (30,226 | ) |
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Net income (loss) attributable to common shareholders | $ | (156,787 | ) | | $ | (7,510 | ) | | $ | (42,017 | ) | | $ | 49,849 | | | $ | (156,465 | ) |
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| Six Months Ended June 30, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Revenues | $ | (163 | ) | | $ | 109,427 | | | $ | 16,581 | | | $ | (3,703 | ) | | $ | 122,142 | |
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Expenses | 56,209 | | | 146,285 | | | 28,747 | | | (3,723 | ) | | 227,518 | |
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Income (loss) from continuing operations before equity in net income of subsidiaries | (56,372 | ) | | (36,858 | ) | | (12,166 | ) | | 20 | | | (105,376 | ) |
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Equity in net income of subsidiaries | (38,143 | ) | | (642 | ) | | (9,387 | ) | | 48,172 | | | — | |
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Income (loss) from continuing operations before income tax | (94,515 | ) | | (37,500 | ) | | (21,553 | ) | | 48,192 | | | (105,376 | ) |
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Income tax benefit (expense) | 41,945 | | | 3,200 | | | (946 | ) | | — | | | 44,199 | |
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Income (loss) from continuing operations | (52,570 | ) | | (34,300 | ) | | (22,499 | ) | | 48,192 | | | (61,177 | ) |
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Income (loss) from discontinued operations, net of tax | (8,453 | ) | | 18,794 | | | (1,242 | ) | | (20 | ) | | 9,079 | |
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Gain on sale of discontinued operations, net of tax | 172,452 | | | — | | | — | | | — | | | 172,452 | |
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Net income (loss) | 111,429 | | | (15,506 | ) | | (23,741 | ) | | 48,172 | | | 120,354 | |
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Net income attributable to non-controlling interest | — | | | — | | | — | | | 889 | | | 889 | |
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Net income (loss) attributable to Magnum Hunter Resources Corporation | 111,429 | | | (15,506 | ) | | (23,741 | ) | | 49,061 | | | 121,243 | |
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Dividends on preferred stock | (17,783 | ) | | — | | | (9,834 | ) | | — | | | (27,617 | ) |
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Net income (loss) attributable to common shareholders | $ | 93,646 | | | $ | (15,506 | ) | | $ | (33,575 | ) | | $ | 49,061 | | | $ | 93,626 | |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Statements of Comprehensive Income (Loss) |
(in thousands) |
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| Three Months Ended June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Net income (loss) | $ | (71,300 | ) | | $ | 14,171 | | | $ | (28,598 | ) | | $ | 20,300 | | | $ | (65,427 | ) |
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Foreign currency translation gain | — | | | — | | | 1,130 | | | — | | | 1,130 | |
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Unrealized loss on available for sale securities | — | | | (549 | ) | | — | | | — | | | (549 | ) |
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Amounts reclassified from accumulated other comprehensive income upon sale of Williston Hunter Canada, Inc. | 20,741 | | | — | | | — | | | — | | | 20,741 | |
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Comprehensive income (loss) | (50,559 | ) | | 13,622 | | | (27,468 | ) | | 20,300 | | | (44,105 | ) |
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Comprehensive income attributable to non-controlling interest | — | | | — | | | — | | | 780 | | | 780 | |
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Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (50,559 | ) | | $ | 13,622 | | | $ | (27,468 | ) | | $ | 21,080 | | | $ | (43,325 | ) |
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| Three Months Ended June 30, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Net income (loss) | $ | 160,274 | | | $ | 4,589 | | | $ | (30,564 | ) | | $ | 30,755 | | | $ | 165,054 | |
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Foreign currency translation loss | — | | | — | | | (7,070 | ) | | — | | | (7,070 | ) |
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Unrealized gain (loss) on available for sale securities | 4,700 | | | (234 | ) | | — | | | — | | | 4,466 | |
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Comprehensive income (loss) | 164,974 | | | 4,355 | | | (37,634 | ) | | 30,755 | | | 162,450 | |
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Comprehensive income attributable to non-controlling interest | — | | | — | | | — | | | 386 | | | 386 | |
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Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | 164,974 | | | $ | 4,355 | | | $ | (37,634 | ) | | $ | 31,141 | | | $ | 162,836 | |
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| Six Months Ended June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Net income (loss) | $ | (139,119 | ) | | $ | (7,510 | ) | | $ | (29,459 | ) | | $ | 48,960 | | | $ | (127,128 | ) |
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Foreign currency translation loss | — | | | — | | | (1,218 | ) | | — | | | (1,218 | ) |
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Unrealized loss on available for sale securities | — | | | (605 | ) | | — | | | — | | | (605 | ) |
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Amounts reclassified from accumulated other comprehensive income upon sale of Williston Hunter Canada, Inc. | 20,741 | | | — | | | — | | | — | | | 20,741 | |
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Comprehensive income (loss) | (118,378 | ) | | (8,115 | ) | | (30,677 | ) | | 48,960 | | | (108,210 | ) |
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Comprehensive income attributable to non-controlling interest | — | | | — | | | — | | | 889 | | | 889 | |
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Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | (118,378 | ) | | $ | (8,115 | ) | | $ | (30,677 | ) | | $ | 49,849 | | | $ | (107,321 | ) |
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| Six Months Ended June 30, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Net income (loss) | $ | 111,429 | | | $ | (15,506 | ) | | $ | (23,741 | ) | | $ | 48,172 | | | $ | 120,354 | |
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Foreign currency translation loss | — | | | — | | | (11,799 | ) | | — | | | (11,799 | ) |
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Unrealized gain (loss) on available for sale securities | 4,700 | | | (251 | ) | | — | | | — | | | 4,449 | |
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Comprehensive income (loss) | 116,129 | | | (15,757 | ) | | (35,540 | ) | | 48,172 | | | 113,004 | |
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Comprehensive income attributable to non-controlling interest | — | | | — | | | — | | | 889 | | | 889 | |
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Comprehensive income (loss) attributable to Magnum Hunter Resources Corporation | $ | 116,129 | | | $ | (15,757 | ) | | $ | (35,540 | ) | | $ | 49,061 | | | $ | 113,893 | |
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Magnum Hunter Resources Corporation and Subsidiaries |
Condensed Consolidating Statements of Cash Flows |
(in thousands) |
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| Six Months Ended June 30, 2014 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Cash flow from operating activities | $ | (192,121 | ) | | $ | 182,620 | | | $ | 28,248 | | | $ | — | | | $ | 18,747 | |
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Cash flow from investing activities | 49,572 | | | (177,365 | ) | | (57,579 | ) | | — | | | (185,372 | ) |
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Cash flow from financing activities | 111,324 | | | 3,038 | | | 19,629 | | | — | | | 133,991 | |
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Effect of exchange rate changes on cash | — | | | — | | | 41 | | | — | | | 41 | |
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Net increase (decrease) in cash | (31,225 | ) | | 8,293 | | | (9,661 | ) | | — | | | (32,593 | ) |
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Cash at beginning of period | 47,895 | | | (17,651 | ) | | 11,469 | | | — | | | 41,713 | |
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Cash at end of period | $ | 16,670 | | | $ | (9,358 | ) | | $ | 1,808 | | | $ | — | | | $ | 9,120 | |
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| Six Months Ended June 30, 2013 |
| Magnum Hunter | | 100% Owned Guarantor | | Non Guarantor | | Consolidating/ Eliminating Adjustments | | Magnum Hunter |
Resources | Subsidiaries | Subsidiaries | Resources |
Corporation | | | Corporation |
| | | Consolidated |
Cash flow from operating activities | $ | (156,721 | ) | | $ | 146,932 | | | $ | 83,657 | | | $ | — | | | $ | 73,868 | |
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Cash flow from investing activities | 371,970 | | | (152,127 | ) | | (115,645 | ) | | — | | | 104,198 | |
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Cash flow from financing activities | (224,493 | ) | | 4,051 | | | 17,852 | | | — | | | (202,590 | ) |
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Effect of exchange rate changes on cash | — | | | — | | | (357 | ) | | — | | | (357 | ) |
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Net increase (decrease) in cash | (9,244 | ) | | (1,144 | ) | | (14,493 | ) | | — | | | (24,881 | ) |
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Cash at beginning of period | 26,871 | | | (4,186 | ) | | 34,938 | | | — | | | 57,623 | |
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Cash at end of period | $ | 17,627 | | | $ | (5,330 | ) | | $ | 20,445 | | | $ | — | | | $ | 32,742 | |
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