Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 05, 2015 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | CRK | |
Entity Registrant Name | COMSTOCK RESOURCES INC | |
Entity Central Index Key | 23,194 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 47,720,176 |
CONSOLIDATED BALANCE SHEETS (Un
CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
ASSETS | ||
Cash and Cash Equivalents | $ 163,840 | $ 2,071 |
Accounts Receivable: | ||
Oil and gas sales | 19,680 | 32,849 |
Joint interest operations | 4,084 | 16,192 |
Derivative Financial Instruments | 1,314 | |
Other Current Assets | 2,933 | 10,105 |
Total current assets | 191,851 | 61,217 |
Property and Equipment: | ||
Unevaluated oil and gas properties | 80,449 | 201,459 |
Oil and gas properties, successful efforts method | 4,299,265 | 4,282,088 |
Other | 19,515 | 19,630 |
Accumulated depreciation, depletion and amortization | (3,083,879) | (2,305,008) |
Net property and equipment | 1,315,350 | 2,198,169 |
Other Assets | 22,473 | 14,951 |
Total Assets | 1,529,674 | 2,274,337 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Accounts Payable | 51,213 | 117,329 |
Accrued Liabilities | 39,764 | 44,842 |
Total current liabilities | 90,977 | 162,171 |
Long-term Debt | 1,297,312 | 1,070,445 |
Deferred Income Taxes | 10,981 | 154,547 |
Reserve for Future Abandonment Costs | 15,106 | 14,900 |
Other Non-Current Liabilities | 2,002 | |
Total liabilities | $ 1,414,376 | $ 1,404,065 |
Commitments and Contingencies | ||
Stockholders’ Equity: | ||
Common stock – $0.50 par, 75,000,000 shares authorized, 47,725,176 and 46,858,415 shares outstanding at September 30, 2015 and December 31, 2014, respectively | $ 23,863 | $ 23,429 |
Additional paid-in capital | 483,592 | 480,434 |
Accumulated earnings (deficit) | (392,157) | 366,409 |
Total stockholders’ equity | 115,298 | 870,272 |
Total liabilities and stockholders' equity | $ 1,529,674 | $ 2,274,337 |
CONSOLIDATED BALANCE SHEETS (U3
CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares | Sep. 30, 2015 | Dec. 31, 2014 |
Statement Of Financial Position [Abstract] | ||
Common stock, par value | $ 0.50 | $ 0.50 |
Common stock, shares authorized | 75,000,000 | 75,000,000 |
Common stock, shares outstanding | 47,725,176 | 46,858,415 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Oil sales | $ 27,706 | $ 107,899 | $ 124,783 | $ 309,283 |
Natural gas sales | 33,654 | 37,084 | 80,411 | 133,332 |
Total revenues | 61,360 | 144,983 | 205,194 | 442,615 |
Operating expenses: | ||||
Production taxes | 2,170 | 6,369 | 8,951 | 18,437 |
Gathering and transportation | 3,729 | 3,125 | 9,842 | 10,039 |
Lease operating | 16,687 | 15,858 | 49,650 | 44,899 |
Exploration | 5,040 | 11,449 | 70,309 | 11,449 |
Depreciation, depletion and amortization | 79,445 | 99,977 | 261,907 | 283,390 |
General and administrative | 5,653 | 7,927 | 20,795 | 25,910 |
Impairment of oil and gas properties | 544,714 | 15 | 547,101 | 271 |
(Gain) loss on sale of oil and gas properties | (52) | 111,778 | ||
Total operating expenses | 657,386 | 144,720 | 1,080,333 | 394,395 |
Operating income (loss) | (596,026) | 263 | (875,139) | 48,220 |
Other income (expenses): | ||||
Interest income | 138 | 308 | ||
Net gain on extinguishment of debt | 51,054 | 55,586 | ||
Gain (loss) on derivative financial instruments | 1,078 | 12,033 | 1,705 | (2,763) |
Other income | 273 | 223 | 746 | 513 |
Interest expense | (32,159) | (14,912) | (86,720) | (43,359) |
Total other income (expenses) | 20,384 | (2,656) | (28,375) | (45,609) |
Income (loss) before income taxes | (575,642) | (2,393) | (903,514) | 2,611 |
Benefit from (provision for) income taxes | 30,646 | 490 | 144,948 | (1,451) |
Net income (loss) | $ (544,996) | $ (1,903) | $ (758,566) | $ 1,160 |
Net income (loss) per share: | ||||
Net income (loss), Basic | $ (11.81) | $ (0.04) | $ (16.45) | $ 0.02 |
Net income (loss), Diluted | $ (11.81) | (0.04) | $ (16.45) | 0.02 |
Dividends per common share | $ 0.125 | $ 0.375 | ||
Weighted average shares outstanding: | ||||
Basic | 46,150 | 46,651 | 46,100 | 46,628 |
Diluted | 46,150 | 46,651 | 46,100 | 46,948 |
CONSOLIDATED STATEMENT OF STOCK
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (Unaudited) - 9 months ended Sep. 30, 2015 - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Earnings (Deficit) |
Beginning Balance at Dec. 31, 2014 | $ 870,272 | $ 23,429 | $ 480,434 | $ 366,409 |
Beginning Balance, Shares at Dec. 31, 2014 | 46,858 | |||
Stock-based compensation | 6,061 | $ 473 | 5,588 | |
Stock-based compensation, Shares | 945 | |||
Restricted stock used for tax withholdings | (526) | $ (39) | (487) | |
Restricted stock used for tax withholdings, Shares | (78) | |||
Excess income taxes from stock-based compensation | (1,943) | (1,943) | ||
Net loss | (758,566) | (758,566) | ||
Ending Balance at Sep. 30, 2015 | $ 115,298 | $ 23,863 | $ 483,592 | $ (392,157) |
Ending Balance, Shares at Sep. 30, 2015 | 47,725 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ (758,566) | $ 1,160 |
Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||
Loss on sale of oil and gas properties | 111,778 | |
Deferred income taxes | (146,118) | 1,487 |
Leasehold impairments, dry hole costs and other exploration costs | 70,309 | 11,449 |
Impairment of oil and gas properties | 547,101 | 271 |
Depreciation, depletion and amortization | 261,907 | 283,390 |
(Gain) loss on derivative financial instruments | (1,705) | 2,763 |
Settlements of derivative financial instruments | 391 | (5,702) |
Net gain on extinguishment of debt | (55,586) | |
Amortization of debt discount, premium and issuance costs | 3,952 | 3,140 |
Stock-based compensation | 6,061 | 7,842 |
Excess income taxes from stock-based compensation | 1,943 | 1,087 |
(Increase) decrease in accounts receivable | 25,277 | (20,257) |
(Increase) decrease in other current assets | 7,292 | (1,561) |
Increase (decrease) in accounts payable and accrued liabilities | (50,560) | 43,914 |
Net cash provided by operating activities | 23,476 | 328,983 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Capital expenditures | (232,896) | (502,362) |
Proceeds from asset sales | 102,674 | |
Net cash used for investing activities | (130,222) | (502,362) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Borrowings | 790,000 | 300,750 |
Principal payments on debt | (502,815) | (100,000) |
Debt issuance costs | (16,201) | (2,524) |
Tax withholdings related to restricted stock | (526) | (2,349) |
Excess income taxes from stock-based compensation | (1,943) | (1,087) |
Dividends paid | (17,945) | |
Net cash provided by financing activities | 268,515 | 176,845 |
Net increase in cash and cash equivalents | 161,769 | 3,466 |
Cash and cash equivalents, beginning of period | 2,071 | 2,967 |
Cash and cash equivalents, end of period | $ 163,840 | $ 6,433 |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES – Basis of Presentation In management's opinion, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial position of Comstock Resources, Inc. and subsidiaries ("Comstock" or the "Company") as of September 30, 2015, the related results of operations for the three months and nine months ended September 30, 2015 and 2014, and cash flows for the nine months ended September 30, 2015 and 2014. Net income (loss) and comprehensive income (loss) are the same in all periods presented. All adjustments are of a normal recurring nature unless otherwise disclosed. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to those rules and regulations, although Comstock believes that the disclosures made are adequate to make the information presented not misleading. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in Comstock's Annual Report on Form 10-K for the year ended December 31, 2014. The results of operations for the three months and nine months ended September 30, 2015 are not necessarily an indication of the results expected for the full year. These unaudited consolidated financial statements include the accounts of Comstock and its wholly-owned and controlled subsidiaries. Property and Equipment The Company follows the successful efforts method of accounting for its oil and gas properties. Costs incurred to acquire oil and gas leasehold are capitalized. Unproved oil and gas properties are periodically assessed and any impairment in value is charged to exploration expense. The costs of unproved properties which are determined to be productive are transferred to oil and gas properties and amortized on an equivalent unit-of-production basis. The Company recognized impairment charges in exploration expense of $5.1 million and $68.6 during the three and nine months ended September 30, 2015, respectively, related to certain leases that the Company currently does not plan to develop. There were no impairments of unproved property in the first nine months of 2014. The Company also assesses the need for an impairment of the capitalized costs for its oil and gas properties on a property basis. During the three months ended September 30, 2015, reductions to management's oil and natural gas price outlook resulted in indications of impairment of the Company's oil properties in South Texas and certain natural gas properties in Texas and Louisiana. Accordingly, the Company recognized an impairment of $544.7 million and $547.1 million for the three months and nine months ended September 30, 2015, respectively, to reduce the carrying value of these properties to their estimated fair value. The Company determines the fair values of its oil and gas properties using a discounted cash flow model and proved and risk adjusted probable reserves. Undrilled acreage can also be valued based on sales transactions in comparable areas. Significant Level 3 assumptions associated with the calculation of discounted future cash flows included in the cash flow model include management's outlook for oil and natural gas prices, production costs, capital expenditures, and future production as well as estimated proved reserves and risk-adjusted probable reserves. Management's oil and natural gas price outlook is developed based on third-party longer-term price forecasts as of each measurement date. The expected future net cash flows are discounted using an appropriate discount rate in determining a property's fair value. The following table presents the fair value and impairments recorded by the Company during the three months ended September 30, 2015, as well as the average oil price per barrel and gas price per thousand cubic feet over the life of the properties and the applicable discount rates utilized in the Company's assessments: Fair Value Impairment Management's Price Outlook Annual Discount Rate Oil Gas (In thousands) (Per barrel) (Per Mcf) Oil properties $ 330,257 $ 405,308 $73.70 $4.04 10% Natural gas properties $ 61,625 $ 139,406 $75.91 $3.91 10% It is reasonably possible that the Company's estimates of undiscounted future net cash flows attributable to its oil and gas properties may change in the future. The primary factors that may affect estimates of future cash flows include future adjustments, both positive and negative, to proved and appropriate risk-adjusted probable and possible oil and gas reserves, results of future drilling activities, future prices for oil and natural gas, and increases or decreases in production and capital costs. As a result of these changes, or if in the future the Company does not have access to sufficient capital to develop all of its proved and risk-adjusted probable reserves used in its assessment, there may be further impairments in the carrying values of these or other properties. During the three months ended September 30, 2015, the Company completed the sale of certain oil and gas properties located in and near Burleson County, Texas. The Company received net proceeds of $102.7 million and recognized a net loss on sale of $111.8 million. Results of operations for these properties were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Total oil and gas sales $ 2,239 $ 4,170 $ 18,036 $ 6,655 Total operating expenses (1) (337 ) (14,735 ) (66,251 ) (16,627 ) Operating income (loss) $ 1,902 $ (10,565 ) $ (48,215 ) $ (9,972 ) (1) Includes direct operating expenses, depreciation, depletion and amortization and exploration expense. Excludes interest expense and general and administrative expenses. In January 2015, the Company purchased a 20% interest in an airplane that previously had been owned 80% by the Company and 20% by two executive officers of the Company. The purchase price for the 20% interest of $1.7 million was based on the then fair market value of the airplane determined by a third party. This related party transaction was approved by the Company's audit committee and board of directors. Accrued Liabilities Accrued liabilities at September 30, 2015 and December 31, 2014 consist of the following: As of As of (In thousands) Accrued drilling costs $ 4,492 $ 26,269 Accrued interest 23,796 9,011 Accrued ad valorem taxes 4,500 — Current deferred income taxes payable 460 — Accrued rig termination fees — 2,600 Other accrued liabilities 6,516 6,962 $ 39,764 $ 44,842 Reserve for Future Abandonment Costs Comstock's asset retirement obligations relate to future plugging and abandonment expenses on its oil and gas properties and related facilities disposal. The following table summarizes the changes in Comstock's total estimated liability during the nine months ended September 30, 2015 and 2014: Nine Months Ended 2015 2014 (In thousands) Future abandonment costs — beginning of period $ 14,900 $ 14,534 Accretion expense 600 615 New wells placed on production 309 1,045 Liabilities settled and assets disposed of (703 ) (76 ) Future abandonment costs — end of period $ 15,106 $ 16,118 Derivative Financial Instruments and Hedging Activities Comstock periodically uses swaps, floors and collars to hedge oil and natural gas prices and interest rates. Swaps are settled monthly based on differences between the prices specified in the instruments and the settlement prices of futures contracts. Generally, when the applicable settlement price is less than the price specified in the contract, Comstock receives a settlement from the counterparty based on the difference multiplied by the volume or amounts hedged. Similarly, when the applicable settlement price exceeds the price specified in the contract, Comstock pays the counterparty based on the difference. Comstock generally receives a settlement from the counterparty for floors when the applicable settlement price is less than the price specified in the contract, which is based on the difference multiplied by the volumes hedged. For collars, generally Comstock receives a settlement from the counterparty when the settlement price is below the floor and pays a settlement to the counterparty when the settlement price exceeds the cap. No settlement occurs when the settlement price falls between the floor and cap. All of the Company's derivative financial instruments are used for risk management purposes and, by policy, none are held for trading or speculative purposes. Comstock minimizes credit risk to counterparties of its derivative financial instruments through formal credit policies, monitoring procedures, and diversification. All of Comstock's derivative financial instruments are with parties that are lenders under its bank credit facility. The Company is not required to provide any credit support to its counterparties other than cross collateralization with the assets securing its bank credit facility. None of the Company's derivative financial instruments involve payment or receipt of premiums. As of September 30, 2015, the Company had the following outstanding commodity derivatives: Commodity and Derivative Type Weighted-Average Contract Volume Contract Period Price Swap Agreements $3.20 per Mcf 2,700 October 2015 – June 2016 None of the Company's derivative contracts have been designated as cash flow hedges. The Company recognizes cash settlements and changes in the fair value of its derivative financial instruments as a single component of other income (expenses). The Company recognized a gain of $1.1 million and $1.7 million related to the change in fair value of its natural gas swap agreements during the three months and nine months ended September 30, 2015, respectively. Cash settlements on natural gas derivative financial instruments were receipts of $0.4 million for the three months and nine months ended September 30, 2015, respectively. The Company had gains of $12.0 million and losses of $2.8 million related to its oil swap agreements during the three months and nine months ended September 30, 2014, respectively. Cash settlements on oil derivative financial instruments were payments of $0.4 million and $5.7 million for the three months and nine months ended September 30, 2014, respectively. The estimated fair value and carrying value of the Company's derivative financial instruments was an asset of $1.3 million as of September 30, 2015, and was classified as a current asset. There were no derivative financial instruments outstanding on December 31, 2014. Stock-Based Compensation Comstock accounts for employee stock-based compensation under the fair value method. Compensation cost is measured at the grant date based on the fair value of the award and is recognized over the award vesting period. During the three months ended September 30, 2015 and 2014, the Company recognized $2.1 million and $2.8 million, respectively, of stock-based compensation expense within general and administrative expenses related to awards of restricted stock and performance stock units to its employees and directors. For the nine months ended September 30, 2015 and 2014, the Company recognized $6.1 million and $7.8 million, respectively, of stock-based compensation expense within general and administrative expenses. During the nine months ended September 30, 2015, the Company granted 1,010,371 shares of restricted stock with a grant date fair value of $5.4 million or $5.34 per share to its employees. The fair value of each restricted share on the date of grant was equal to its market price. As of September 30, 2015, Comstock had 1,575,302 shares of unvested restricted stock outstanding at a weighted average grant date fair value of $9.90 per share. Total unrecognized compensation cost related to unvested restricted stock grants of $6.6 million as of September 30, 2015 is expected to be recognized over a period of 1.5 years. During the nine months ended September 30, 2015, the Company granted 471,249 performance share units ("PSUs") with a grant date fair value of $2.1 million, or $4.38 per unit, to its employees. As of September 30, 2015, Comstock had 669,604 PSUs outstanding at a weighted average grant date fair value of $9.13 per unit. The number of shares of common stock to be issued related to the PSUs is based on the Company's stock price performance as compared to its peers which could result in the issuance of anywhere from zero to 1,400,173 shares of common stock. Total unrecognized compensation cost related to these grants of $2.6 million as of September 30, 2015 is expected to be recognized over a period of 1.9 years. As of September 30, 2015, Comstock had outstanding options to purchase 102,650 shares of common stock at a weighted average exercise price of $32.94 per share. All of the stock options were exercisable and there were no unrecognized compensation costs related to the stock options as of September 30, 2015. No stock options were exercised during the three months or nine months ended September 30, 2015 or 2014. Income Taxes In recording deferred income tax assets, the Company considers whether it is more likely than not that some portion or all of its deferred income tax assets will be realized in the future. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those deferred income tax assets would be deductible. The Company believes that after considering all the available objective evidence, historical and prospective, with greater weight given to historical evidence, management is not able to determine that it is more likely than not that all of its deferred tax assets will be realized and, therefore, has established a valuation allowance of $178.6 million and $71.6 million against its net federal deferred tax assets and state deferred tax assets, respectively, at September 30, 2015. The Company will continue to assess the valuation allowance against deferred tax assets considering all available information obtained in future reporting periods. The following is an analysis of consolidated income tax expense (benefit): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Current provision $ 687 $ (73 ) $ 1,170 $ (36 ) Deferred provision (benefit) (31,333 ) (417 ) (146,118 ) 1,487 Provision for (benefit from) income taxes $ (30,646 ) $ (490 ) $ (144,948 ) $ 1,451 Deferred income taxes are provided to reflect the future tax consequences or benefits of differences between the tax basis of assets and liabilities and their reported amounts in the financial statements using enacted tax rates. The difference between the Company's effective tax rate and the 35% federal statutory rate is caused by non-deductible stock compensation, state taxes and the establishing of a valuation allowance on deferred taxes. The impact of these items varies based upon the Company's projected full year loss and the jurisdictions that are expected to generate the projected losses. The difference between the Company's customary rate of 35% and the effective tax rate on income (loss) before income taxes is due to the following: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Tax at statutory rate 35.0 % 35.0 % 35.0 % 35.0 % Tax effect of: State income taxes net of federal benefit 2.0 5.5 2.1 (5.5 ) Nondeductible stock-based compensation — (15.1 ) (0.1 ) 20.1 Valuation allowance on deferred tax assets – Federal (31.0 ) — (19.8 ) — Valuation allowance on deferred tax asset – State (0.7 ) — (1.2 ) — Other — (4.9 ) — 6.0 Effective tax rate 5.3 % 20.5 % 16.0 % 55.6 % The Company's federal income tax returns for the years subsequent to December 31, 2011, remain subject to examination. The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2009. A state tax return in one state jurisdiction is currently under review. The Company has evaluated the preliminary findings in this jurisdiction and believes it is more likely than not that the ultimate resolution of these matters will not have a material effect on the Company's financial statements. The Company currently believes that all other significant filing positions are highly certain and that all of its other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on the consolidated financial statements. Therefore, the Company has not established any significant reserves for uncertain tax positions. Future use of the Company's federal and state net operating loss carryforwards may be limited in the event that a cumulative change in the ownership of Comstock's common stock by more than 50% occurs within a three-year period. Such a change in ownership could result in a substantial portion of Comstock's net operating loss carryforwards being eliminated or becoming restricted, and the Company may need to recognize an additional valuation allowance reflecting the restricted use of these net operating loss carryforwards in the period when such an ownership change occurred. The Company established a rights plan on October 1, 2015 to deter ownership changes that would trigger this limitation (see Note 5). Fair Value Measurements The Company holds or has held certain items that are required to be measured at fair value. These include cash and cash equivalents held in bank accounts and derivative financial instruments in the form of oil and natural gas price swap agreements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy is followed for disclosure to show the extent and level of judgment used to estimate fair value measurements: Level 1 – Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Level 2 – Inputs used to measure fair value, other than quoted prices included in Level 1, are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. Level 3 – Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management's estimates of market participant assumptions. The Company's valuation of cash and cash equivalents is a Level 1 measurement. The Company's natural gas price swap agreements are not traded on a public exchange. Their value is determined utilizing a discounted cash flow model based on inputs that are readily available in public markets and, accordingly, the valuation of these swap agreements is categorized as a Level 2 measurement. The following table summarizes financial assets and liabilities accounted for at fair value as of September 30, 2015: Carrying Level 1 Level 2 (In thousands) Assets measured at fair value on a recurring basis: Cash and cash equivalents held in bank accounts $ 163,840 $ 163,840 $ — Derivative financial instruments 1,314 — 1,314 Total assets $ 165,154 $ 163,840 $ 1,314 As of September 30, 2015, the Company's other financial instruments, comprised solely of its fixed rate debt, had a carrying value of $1.3 billion and a fair value of $645.6 million. The fair market value of the Company's fixed rate debt was based on quoted prices as of September 30, 2015, a Level 2 measurement. Earnings Per Share Basic earnings per share is determined without the effect of any outstanding potentially dilutive stock options or PSUs and diluted earnings per share is determined with the effect of outstanding stock options and PSUs that are potentially dilutive. Unvested share-based payment awards containing nonforfeitable rights to dividends are considered to be participatory securities and are included in the computation of basic and diluted earnings per share pursuant to the two-class method. PSUs represent the right to receive a number of shares of the Company's common stock that may range from zero to up to three times the number of PSUs granted on the award date based on the achievement of certain performance measures during a performance period. The number of potentially dilutive shares related to PSUs is based on the number of shares, if any, which would be issuable at the end of the respective period, assuming that date was the end of the contingency period. The treasury stock method is used to measure the dilutive effect of PSUs. Basic and diluted earnings (loss) per share for the three months and nine months ended September 30, 2015 and 2014 were determined as follows: Three Months Ended September 30, 2015 2014 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Net loss $ (544,996 ) $ (1,903 ) Income allocable to unvested stock grants — (151 ) Basic net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Effect of dilutive securities: Stock options — — — — Performance share units — — — — Diluted net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Nine Months Ended September 30, 2015 2014 Shares Per Income Shares Per (In thousands, except per share amounts) Net income (loss) $ (758,566 ) $ 1,160 Income allocable to unvested stock grants — (444 ) Basic net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,628 $ 0.02 Effect of dilutive securities: Stock options — — — — Performance share units — — — 320 Diluted net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,948 $ 0.02 At September 30, 2015 and December 31, 2014, 1,575,302 and 1,207,527 shares of restricted stock, respectively, are included in common stock outstanding as such shares have a nonforfeitable right to participate in any dividends that might be declared and have the right to vote on matters submitted to the Company's stockholders. Weighted average shares of unvested restricted stock outstanding during the three months and nine months ended September 30, 2015 and 2014 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Unvested restricted stock 1,576 1,210 1,430 1,184 Options to purchase common stock and PSUs that were outstanding and that were excluded as anti-dilutive from the determination of diluted earnings per share are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands except per share/unit data) Weighted average stock options 103 115 106 115 Weighted average exercise price per share $ 32.94 $ 32.90 $ 32.98 $ 32.90 Weighted average performance share units 670 257 631 — Weighted average grant date fair value per unit $ 9.13 $ 20.71 $ 9.13 $ — For the nine months ended September 30, 2014, the excluded options that were anti-dilutive were at exercise prices in excess of the average stock price. All stock options and unvested PSUs were anti-dilutive to earnings and excluded from weighted average shares used in the computation of earnings per share in the three months ended September 30, 2014 and the three months and nine months ended September 30, 2015 due to the net loss in the periods. Supplementary Information With Respect to the Consolidated Statements of Cash Flows For the purpose of the consolidated statements of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. At September 30, 2015 and December 31, 2014, the Company's cash investments consisted of cash held in bank accounts. The following is a summary of cash payments made for interest and income taxes: Nine Months Ended September 30, 2015 2014 (In thousands) Interest payments $ 68,877 $ 30,914 Income tax payments $ 77 $ 1,467 The Company capitalizes interest on its unevaluated oil and gas property costs during periods when it is conducting exploration activity on this acreage. The Company capitalized interest of $2.7 million for the three months ended September 30, 2014 and $0.9 million and $7.5 million for the nine months ended September 30, 2015 and 2014, respectively, which reduced interest expense. Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Equity [Abstract] | |
Stockholders' Equity | (2) STOCKHOLDERS' EQUITY – The Company did not pay dividends during the nine months ended September 30, 2015, but paid dividends of $17.9 million during the nine months ended September 30, 2014. In 2013, the Board of Directors approved an open market share repurchase plan which permits the Company to repurchase up to $100.0 million of its common stock on the open market. The Company did not make any purchases under this plan during the nine months ended September 30, 2015 or 2014, and future repurchases under this plan are limited under the terms of the Company's outstanding debt. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | (3) LONG-TERM DEBT – At September 30, 2015, long-term debt was comprised of: (In thousands) 7 3 4 $ 391,496 10 700,000 9 1 2 205,816 $ 1,297,312 In March 2015, Comstock issued $700.0 million of 10% senior secured notes (the "Secured Notes") which are due on March 15, 2020. Interest on the Secured Notes is payable semi-annually on each March 15 and September 15. Net proceeds from the issuance of the Secured Notes of $684.0 million were used to retire the Company's bank credit facility and for general corporate purposes. Comstock also has outstanding (i) $387.5 million of 7¾% senior notes (the "2019 Notes") which are due on April 1, 2019 and bear interest which is payable semi-annually on each April 1 and October 1 and (ii) $211.6 million of 9½% senior notes (the "2020 Notes") which are due on June 15, 2020 and bear interest which is payable semi-annually on each June 15 and December 15. The Secured Notes are secured on a first-priority basis equally and ratably with the Company's revolving credit facility described below, subject to payment priorities in favor of the revolving credit facility by the collateral securing the revolving credit facility, which consists of, among other things, at least 80% of the Company's and its subsidiaries' oil and gas properties. The Secured Notes, the 2019 Notes and the 2020 Notes are general obligations of Comstock and are guaranteed by all of Comstock's subsidiaries. Such subsidiary guarantors are 100% owned and all of the guarantees are full and unconditional and joint and several obligations. There are no restrictions on the ability of Comstock to obtain funds from its subsidiaries through dividends or loans. As of September 30, 2015, Comstock had no material assets or operations which are independent of its subsidiaries. During the nine months ended September 30, 2015, the Company purchased $12.5 million in principal amount of the 2019 Notes and $88.4 million in principal amount of the 2020 Notes for $37.8 million. The gain of $59.3 million recognized on the purchase of the 2019 Notes and 2020 Notes and the loss resulting from the write-off of deferred loan costs associated with the Company's bank credit facility of $3.7 million are included in the net gain on extinguishment of debt, which is reported as a component of other income (loss). In connection with the issuance of the Secured Notes, Comstock entered into a $50.0 million revolving credit facility with Bank of Montreal and Bank of America, N.A. The revolving credit facility is a four year credit commitment that matures on . Indebtedness under the revolving credit facility is guaranteed by all of the Company's subsidiaries and is secured by substantially all of Comstock's and its subsidiaries' assets. Borrowings under the revolving credit facility bear interest, at Comstock's option, at either (1) LIBOR plus 2.5% or (2) the base rate (which is the higher of the administrative agent's prime rate, the federal funds rate plus 0.5% or 30 day LIBOR plus 1.0%) plus 1.5%. A commitment fee of 0.5% per annum is payable quarterly on the unused credit line. The revolving credit facility contains covenants that, among other things, restrict the payment of cash dividends and repurchases of common stock, limit the amount of additional debt that Comstock may incur and limit the Company's ability to make certain loans, investments and divestitures. The only financial covenants are the maintenance of a current ratio of at least 1.0 to 1.0 and the maintenance of an asset coverage ratio of proved developed reserves to total debt outstanding under the revolving credit facility of at least 2.5 to 1.0. The Company was in compliance with these covenants as of 30, 2015. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (4) Commitments and Contingencies – From time to time, Comstock is involved in certain litigation that arises in the normal course of its operations. The Company records a loss contingency for these matters when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. The Company does not believe the resolution of these matters will have a material effect on the Company's financial position or results of operations. In connection with its exploration and development activities, the Company contracts for drilling rigs. As of September 30, 2015, the Company had commitments for contracted drilling services through November 2015 of $1.3 million. The Company has entered into natural gas transportation and treating agreements through July 2019. Maximum commitments under these transportation agreements as of September 30, 2015 totaled $7.1 million. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Events [Abstract] | |
Subsequent Events | (5) SUBSEQUENT EVENTS – On October 1, 2015, the Company entered into a net operating loss carryforwards ("NOLs") rights plan (the "Rights Plan") with American Stock Transfer & Trust Company, LLC, as rights agent. In connection therewith, the board of directors of the Company declared a dividend of one preferred share purchase right ("Right") for each outstanding share of the Company's common stock. The dividend was payable on October 16, 2015 to stockholders of record as of the close of business on October 12, 2015. In addition, one Right automatically attached to each share of common stock issued between the record date and the date when the Rights become exercisable. The Rights Plan was adopted in an effort to prevent potential significant limitations under Section 382 of the Internal Revenue Code of 1986, as amended (the "Code"), on Comstock's ability to utilize its current NOLs to reduce its future tax liabilities. If Comstock experiences an "ownership change," as defined in Section 382 of the Code, the Company's ability to fully utilize its NOLs on an annual basis will be substantially limited, and the timing of the usage of the NOLs could be substantially delayed, which could accordingly significantly impair the value of those benefits. The Rights Plan works by imposing a significant penalty upon any person or group that acquires 4.9% or more of the Company's outstanding common stock without the approval of the board of directors (an "Acquiring Person"). The Rights Plan also gives discretion to the Board to determine that someone is an Acquiring Person even if they do not own 4.9% or more of the outstanding common stock but do own 4.9% or more in value of the Company's outstanding stock, as determined pursuant to Section 382 of the Code and the regulations promulgated thereunder. Stockholders who currently own 4.9% or more of the Company's common stock will not trigger the Rights unless they acquire additional shares, subject to certain exceptions set forth in the Rights Plan. In addition, the Board has established procedures to consider requests to exempt certain acquisitions of the Company's securities from the Rights Plan if the board of directors determines that doing so would not limit or impair the availability of the NOLs or is otherwise in the best interests of the Company. |
Summary of Significant Accoun12
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation In management's opinion, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly the financial position of Comstock Resources, Inc. and subsidiaries ("Comstock" or the "Company") as of September 30, 2015, the related results of operations for the three months and nine months ended September 30, 2015 and 2014, and cash flows for the nine months ended September 30, 2015 and 2014. Net income (loss) and comprehensive income (loss) are the same in all periods presented. All adjustments are of a normal recurring nature unless otherwise disclosed. The accompanying unaudited consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and disclosures normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States have been omitted pursuant to those rules and regulations, although Comstock believes that the disclosures made are adequate to make the information presented not misleading. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in Comstock's Annual Report on Form 10-K for the year ended December 31, 2014. The results of operations for the three months and nine months ended September 30, 2015 are not necessarily an indication of the results expected for the full year. These unaudited consolidated financial statements include the accounts of Comstock and its wholly-owned and controlled subsidiaries. |
Property and Equipment | Property and Equipment The Company follows the successful efforts method of accounting for its oil and gas properties. Costs incurred to acquire oil and gas leasehold are capitalized. Unproved oil and gas properties are periodically assessed and any impairment in value is charged to exploration expense. The costs of unproved properties which are determined to be productive are transferred to oil and gas properties and amortized on an equivalent unit-of-production basis. The Company recognized impairment charges in exploration expense of $5.1 million and $68.6 during the three and nine months ended September 30, 2015, respectively, related to certain leases that the Company currently does not plan to develop. There were no impairments of unproved property in the first nine months of 2014. The Company also assesses the need for an impairment of the capitalized costs for its oil and gas properties on a property basis. During the three months ended September 30, 2015, reductions to management's oil and natural gas price outlook resulted in indications of impairment of the Company's oil properties in South Texas and certain natural gas properties in Texas and Louisiana. Accordingly, the Company recognized an impairment of $544.7 million and $547.1 million for the three months and nine months ended September 30, 2015, respectively, to reduce the carrying value of these properties to their estimated fair value. The Company determines the fair values of its oil and gas properties using a discounted cash flow model and proved and risk adjusted probable reserves. Undrilled acreage can also be valued based on sales transactions in comparable areas. Significant Level 3 assumptions associated with the calculation of discounted future cash flows included in the cash flow model include management's outlook for oil and natural gas prices, production costs, capital expenditures, and future production as well as estimated proved reserves and risk-adjusted probable reserves. Management's oil and natural gas price outlook is developed based on third-party longer-term price forecasts as of each measurement date. The expected future net cash flows are discounted using an appropriate discount rate in determining a property's fair value. The following table presents the fair value and impairments recorded by the Company during the three months ended September 30, 2015, as well as the average oil price per barrel and gas price per thousand cubic feet over the life of the properties and the applicable discount rates utilized in the Company's assessments: Fair Value Impairment Management's Price Outlook Annual Discount Rate Oil Gas (In thousands) (Per barrel) (Per Mcf) Oil properties $ 330,257 $ 405,308 $73.70 $4.04 10% Natural gas properties $ 61,625 $ 139,406 $75.91 $3.91 10% It is reasonably possible that the Company's estimates of undiscounted future net cash flows attributable to its oil and gas properties may change in the future. The primary factors that may affect estimates of future cash flows include future adjustments, both positive and negative, to proved and appropriate risk-adjusted probable and possible oil and gas reserves, results of future drilling activities, future prices for oil and natural gas, and increases or decreases in production and capital costs. As a result of these changes, or if in the future the Company does not have access to sufficient capital to develop all of its proved and risk-adjusted probable reserves used in its assessment, there may be further impairments in the carrying values of these or other properties. During the three months ended September 30, 2015, the Company completed the sale of certain oil and gas properties located in and near Burleson County, Texas. The Company received net proceeds of $102.7 million and recognized a net loss on sale of $111.8 million. Results of operations for these properties were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Total oil and gas sales $ 2,239 $ 4,170 $ 18,036 $ 6,655 Total operating expenses (1) (337 ) (14,735 ) (66,251 ) (16,627 ) Operating income (loss) $ 1,902 $ (10,565 ) $ (48,215 ) $ (9,972 ) (1) Includes direct operating expenses, depreciation, depletion and amortization and exploration expense. Excludes interest expense and general and administrative expenses. In January 2015, the Company purchased a 20% interest in an airplane that previously had been owned 80% by the Company and 20% by two executive officers of the Company. The purchase price for the 20% interest of $1.7 million was based on the then fair market value of the airplane determined by a third party. This related party transaction was approved by the Company's audit committee and board of directors. |
Accrued Liabilities | Accrued Liabilities Accrued liabilities at September 30, 2015 and December 31, 2014 consist of the following: As of As of (In thousands) Accrued drilling costs $ 4,492 $ 26,269 Accrued interest 23,796 9,011 Accrued ad valorem taxes 4,500 — Current deferred income taxes payable 460 — Accrued rig termination fees — 2,600 Other accrued liabilities 6,516 6,962 $ 39,764 $ 44,842 |
Reserve for Future Abandonment Costs | Reserve for Future Abandonment Costs Comstock's asset retirement obligations relate to future plugging and abandonment expenses on its oil and gas properties and related facilities disposal. The following table summarizes the changes in Comstock's total estimated liability during the nine months ended September 30, 2015 and 2014: Nine Months Ended 2015 2014 (In thousands) Future abandonment costs — beginning of period $ 14,900 $ 14,534 Accretion expense 600 615 New wells placed on production 309 1,045 Liabilities settled and assets disposed of (703 ) (76 ) Future abandonment costs — end of period $ 15,106 $ 16,118 |
Derivative Financial Instruments and Hedging Activities | Derivative Financial Instruments and Hedging Activities Comstock periodically uses swaps, floors and collars to hedge oil and natural gas prices and interest rates. Swaps are settled monthly based on differences between the prices specified in the instruments and the settlement prices of futures contracts. Generally, when the applicable settlement price is less than the price specified in the contract, Comstock receives a settlement from the counterparty based on the difference multiplied by the volume or amounts hedged. Similarly, when the applicable settlement price exceeds the price specified in the contract, Comstock pays the counterparty based on the difference. Comstock generally receives a settlement from the counterparty for floors when the applicable settlement price is less than the price specified in the contract, which is based on the difference multiplied by the volumes hedged. For collars, generally Comstock receives a settlement from the counterparty when the settlement price is below the floor and pays a settlement to the counterparty when the settlement price exceeds the cap. No settlement occurs when the settlement price falls between the floor and cap. All of the Company's derivative financial instruments are used for risk management purposes and, by policy, none are held for trading or speculative purposes. Comstock minimizes credit risk to counterparties of its derivative financial instruments through formal credit policies, monitoring procedures, and diversification. All of Comstock's derivative financial instruments are with parties that are lenders under its bank credit facility. The Company is not required to provide any credit support to its counterparties other than cross collateralization with the assets securing its bank credit facility. None of the Company's derivative financial instruments involve payment or receipt of premiums. As of September 30, 2015, the Company had the following outstanding commodity derivatives: Commodity and Derivative Type Weighted-Average Contract Volume Contract Period Price Swap Agreements $3.20 per Mcf 2,700 October 2015 – June 2016 None of the Company's derivative contracts have been designated as cash flow hedges. The Company recognizes cash settlements and changes in the fair value of its derivative financial instruments as a single component of other income (expenses). The Company recognized a gain of $1.1 million and $1.7 million related to the change in fair value of its natural gas swap agreements during the three months and nine months ended September 30, 2015, respectively. Cash settlements on natural gas derivative financial instruments were receipts of $0.4 million for the three months and nine months ended September 30, 2015, respectively. The Company had gains of $12.0 million and losses of $2.8 million related to its oil swap agreements during the three months and nine months ended September 30, 2014, respectively. Cash settlements on oil derivative financial instruments were payments of $0.4 million and $5.7 million for the three months and nine months ended September 30, 2014, respectively. The estimated fair value and carrying value of the Company's derivative financial instruments was an asset of $1.3 million as of September 30, 2015, and was classified as a current asset. There were no derivative financial instruments outstanding on December 31, 2014. |
Stock-Based Compensation | Stock-Based Compensation Comstock accounts for employee stock-based compensation under the fair value method. Compensation cost is measured at the grant date based on the fair value of the award and is recognized over the award vesting period. During the three months ended September 30, 2015 and 2014, the Company recognized $2.1 million and $2.8 million, respectively, of stock-based compensation expense within general and administrative expenses related to awards of restricted stock and performance stock units to its employees and directors. For the nine months ended September 30, 2015 and 2014, the Company recognized $6.1 million and $7.8 million, respectively, of stock-based compensation expense within general and administrative expenses. During the nine months ended September 30, 2015, the Company granted 1,010,371 shares of restricted stock with a grant date fair value of $5.4 million or $5.34 per share to its employees. The fair value of each restricted share on the date of grant was equal to its market price. As of September 30, 2015, Comstock had 1,575,302 shares of unvested restricted stock outstanding at a weighted average grant date fair value of $9.90 per share. Total unrecognized compensation cost related to unvested restricted stock grants of $6.6 million as of September 30, 2015 is expected to be recognized over a period of 1.5 years. During the nine months ended September 30, 2015, the Company granted 471,249 performance share units ("PSUs") with a grant date fair value of $2.1 million, or $4.38 per unit, to its employees. As of September 30, 2015, Comstock had 669,604 PSUs outstanding at a weighted average grant date fair value of $9.13 per unit. The number of shares of common stock to be issued related to the PSUs is based on the Company's stock price performance as compared to its peers which could result in the issuance of anywhere from zero to 1,400,173 shares of common stock. Total unrecognized compensation cost related to these grants of $2.6 million as of September 30, 2015 is expected to be recognized over a period of 1.9 years. As of September 30, 2015, Comstock had outstanding options to purchase 102,650 shares of common stock at a weighted average exercise price of $32.94 per share. All of the stock options were exercisable and there were no unrecognized compensation costs related to the stock options as of September 30, 2015. No stock options were exercised during the three months or nine months ended September 30, 2015 or 2014. |
Income Taxes | Income Taxes In recording deferred income tax assets, the Company considers whether it is more likely than not that some portion or all of its deferred income tax assets will be realized in the future. The ultimate realization of deferred income tax assets is dependent upon the generation of future taxable income during the periods in which those deferred income tax assets would be deductible. The Company believes that after considering all the available objective evidence, historical and prospective, with greater weight given to historical evidence, management is not able to determine that it is more likely than not that all of its deferred tax assets will be realized and, therefore, has established a valuation allowance of $178.6 million and $71.6 million against its net federal deferred tax assets and state deferred tax assets, respectively, at September 30, 2015. The Company will continue to assess the valuation allowance against deferred tax assets considering all available information obtained in future reporting periods. The following is an analysis of consolidated income tax expense (benefit): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Current provision $ 687 $ (73 ) $ 1,170 $ (36 ) Deferred provision (benefit) (31,333 ) (417 ) (146,118 ) 1,487 Provision for (benefit from) income taxes $ (30,646 ) $ (490 ) $ (144,948 ) $ 1,451 Deferred income taxes are provided to reflect the future tax consequences or benefits of differences between the tax basis of assets and liabilities and their reported amounts in the financial statements using enacted tax rates. The difference between the Company's effective tax rate and the 35% federal statutory rate is caused by non-deductible stock compensation, state taxes and the establishing of a valuation allowance on deferred taxes. The impact of these items varies based upon the Company's projected full year loss and the jurisdictions that are expected to generate the projected losses. The difference between the Company's customary rate of 35% and the effective tax rate on income (loss) before income taxes is due to the following: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Tax at statutory rate 35.0 % 35.0 % 35.0 % 35.0 % Tax effect of: State income taxes net of federal benefit 2.0 5.5 2.1 (5.5 ) Nondeductible stock-based compensation — (15.1 ) (0.1 ) 20.1 Valuation allowance on deferred tax assets – Federal (31.0 ) — (19.8 ) — Valuation allowance on deferred tax asset – State (0.7 ) — (1.2 ) — Other — (4.9 ) — 6.0 Effective tax rate 5.3 % 20.5 % 16.0 % 55.6 % The Company's federal income tax returns for the years subsequent to December 31, 2011, remain subject to examination. The Company's income tax returns in major state income tax jurisdictions remain subject to examination for various periods subsequent to December 31, 2009. A state tax return in one state jurisdiction is currently under review. The Company has evaluated the preliminary findings in this jurisdiction and believes it is more likely than not that the ultimate resolution of these matters will not have a material effect on the Company's financial statements. The Company currently believes that all other significant filing positions are highly certain and that all of its other significant income tax positions and deductions would be sustained under audit or the final resolution would not have a material effect on the consolidated financial statements. Therefore, the Company has not established any significant reserves for uncertain tax positions. Future use of the Company's federal and state net operating loss carryforwards may be limited in the event that a cumulative change in the ownership of Comstock's common stock by more than 50% occurs within a three-year period. Such a change in ownership could result in a substantial portion of Comstock's net operating loss carryforwards being eliminated or becoming restricted, and the Company may need to recognize an additional valuation allowance reflecting the restricted use of these net operating loss carryforwards in the period when such an ownership change occurred. The Company established a rights plan on October 1, 2015 to deter ownership changes that would trigger this limitation (see Note 5). |
Fair Value Measurements | Fair Value Measurements The Company holds or has held certain items that are required to be measured at fair value. These include cash and cash equivalents held in bank accounts and derivative financial instruments in the form of oil and natural gas price swap agreements. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. A three-level hierarchy is followed for disclosure to show the extent and level of judgment used to estimate fair value measurements: Level 1 – Inputs used to measure fair value are unadjusted quoted prices that are available in active markets for the identical assets or liabilities as of the reporting date. Level 2 – Inputs used to measure fair value, other than quoted prices included in Level 1, are either directly or indirectly observable as of the reporting date through correlation with market data, including quoted prices for similar assets and liabilities in active markets and quoted prices in markets that are not active. Level 2 also includes assets and liabilities that are valued using models or other pricing methodologies that do not require significant judgment since the input assumptions used in the models, such as interest rates and volatility factors, are corroborated by readily observable data from actively quoted markets for substantially the full term of the financial instrument. Level 3 – Inputs used to measure fair value are unobservable inputs that are supported by little or no market activity and reflect the use of significant management judgment. These values are generally determined using pricing models for which the assumptions utilize management's estimates of market participant assumptions. The Company's valuation of cash and cash equivalents is a Level 1 measurement. The Company's natural gas price swap agreements are not traded on a public exchange. Their value is determined utilizing a discounted cash flow model based on inputs that are readily available in public markets and, accordingly, the valuation of these swap agreements is categorized as a Level 2 measurement. The following table summarizes financial assets and liabilities accounted for at fair value as of September 30, 2015: Carrying Level 1 Level 2 (In thousands) Assets measured at fair value on a recurring basis: Cash and cash equivalents held in bank accounts $ 163,840 $ 163,840 $ — Derivative financial instruments 1,314 — 1,314 Total assets $ 165,154 $ 163,840 $ 1,314 As of September 30, 2015, the Company's other financial instruments, comprised solely of its fixed rate debt, had a carrying value of $1.3 billion and a fair value of $645.6 million. The fair market value of the Company's fixed rate debt was based on quoted prices as of September 30, 2015, a Level 2 measurement. |
Earnings Per Share | Earnings Per Share Basic earnings per share is determined without the effect of any outstanding potentially dilutive stock options or PSUs and diluted earnings per share is determined with the effect of outstanding stock options and PSUs that are potentially dilutive. Unvested share-based payment awards containing nonforfeitable rights to dividends are considered to be participatory securities and are included in the computation of basic and diluted earnings per share pursuant to the two-class method. PSUs represent the right to receive a number of shares of the Company's common stock that may range from zero to up to three times the number of PSUs granted on the award date based on the achievement of certain performance measures during a performance period. The number of potentially dilutive shares related to PSUs is based on the number of shares, if any, which would be issuable at the end of the respective period, assuming that date was the end of the contingency period. The treasury stock method is used to measure the dilutive effect of PSUs. Basic and diluted earnings (loss) per share for the three months and nine months ended September 30, 2015 and 2014 were determined as follows: Three Months Ended September 30, 2015 2014 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Net loss $ (544,996 ) $ (1,903 ) Income allocable to unvested stock grants — (151 ) Basic net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Effect of dilutive securities: Stock options — — — — Performance share units — — — — Diluted net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Nine Months Ended September 30, 2015 2014 Shares Per Income Shares Per (In thousands, except per share amounts) Net income (loss) $ (758,566 ) $ 1,160 Income allocable to unvested stock grants — (444 ) Basic net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,628 $ 0.02 Effect of dilutive securities: Stock options — — — — Performance share units — — — 320 Diluted net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,948 $ 0.02 At September 30, 2015 and December 31, 2014, 1,575,302 and 1,207,527 shares of restricted stock, respectively, are included in common stock outstanding as such shares have a nonforfeitable right to participate in any dividends that might be declared and have the right to vote on matters submitted to the Company's stockholders. Weighted average shares of unvested restricted stock outstanding during the three months and nine months ended September 30, 2015 and 2014 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Unvested restricted stock 1,576 1,210 1,430 1,184 Options to purchase common stock and PSUs that were outstanding and that were excluded as anti-dilutive from the determination of diluted earnings per share are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands except per share/unit data) Weighted average stock options 103 115 106 115 Weighted average exercise price per share $ 32.94 $ 32.90 $ 32.98 $ 32.90 Weighted average performance share units 670 257 631 — Weighted average grant date fair value per unit $ 9.13 $ 20.71 $ 9.13 $ — For the nine months ended September 30, 2014, the excluded options that were anti-dilutive were at exercise prices in excess of the average stock price. All stock options and unvested PSUs were anti-dilutive to earnings and excluded from weighted average shares used in the computation of earnings per share in the three months ended September 30, 2014 and the three months and nine months ended September 30, 2015 due to the net loss in the periods. |
Supplementary Information With Respect to the Consolidated Statements of Cash Flows | Supplementary Information With Respect to the Consolidated Statements of Cash Flows For the purpose of the consolidated statements of cash flows, the Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents. At September 30, 2015 and December 31, 2014, the Company's cash investments consisted of cash held in bank accounts. The following is a summary of cash payments made for interest and income taxes: Nine Months Ended September 30, 2015 2014 (In thousands) Interest payments $ 68,877 $ 30,914 Income tax payments $ 77 $ 1,467 The Company capitalizes interest on its unevaluated oil and gas property costs during periods when it is conducting exploration activity on this acreage. The Company capitalized interest of $2.7 million for the three months ended September 30, 2014 and $0.9 million and $7.5 million for the nine months ended September 30, 2015 and 2014, respectively, which reduced interest expense. |
Recent Accounting Pronouncements | Recent accounting pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2014-09, Revenue from Contracts with Customers (Topic 606) In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements - Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity's Ability to Continue as a Going Concern In April 2015, the FASB issued ASU No. 2015-03, Interest-Imputation of Interest, Simplifying the Presentation of Debt Issuance Costs |
Summary of Significant Accoun13
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounting Policies [Abstract] | |
Schedule of Fair Value Impairments, Average Prices of Oil and Gas Properties And Applicable Discount Rates | The following table presents the fair value and impairments recorded by the Company during the three months ended September 30, 2015, as well as the average oil price per barrel and gas price per thousand cubic feet over the life of the properties and the applicable discount rates utilized in the Company's assessments: Fair Value Impairment Management's Price Outlook Annual Discount Rate Oil Gas (In thousands) (Per barrel) (Per Mcf) Oil properties $ 330,257 $ 405,308 $73.70 $4.04 10% Natural gas properties $ 61,625 $ 139,406 $75.91 $3.91 10% |
Operating Income (Loss) Results of Operations | Results of operations for these properties were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Total oil and gas sales $ 2,239 $ 4,170 $ 18,036 $ 6,655 Total operating expenses (1) (337 ) (14,735 ) (66,251 ) (16,627 ) Operating income (loss) $ 1,902 $ (10,565 ) $ (48,215 ) $ (9,972 ) (1) Includes direct operating expenses, depreciation, depletion and amortization and exploration expense. Excludes interest expense and general and administrative expenses. |
Summary of Accrued Liabilities | Accrued liabilities at September 30, 2015 and December 31, 2014 consist of the following: As of As of (In thousands) Accrued drilling costs $ 4,492 $ 26,269 Accrued interest 23,796 9,011 Accrued ad valorem taxes 4,500 — Current deferred income taxes payable 460 — Accrued rig termination fees — 2,600 Other accrued liabilities 6,516 6,962 $ 39,764 $ 44,842 |
Summary of Changes in Reserve for Future Abandonment Costs | The following table summarizes the changes in Comstock's total estimated liability during the nine months ended September 30, 2015 and 2014: Nine Months Ended 2015 2014 (In thousands) Future abandonment costs — beginning of period $ 14,900 $ 14,534 Accretion expense 600 615 New wells placed on production 309 1,045 Liabilities settled and assets disposed of (703 ) (76 ) Future abandonment costs — end of period $ 15,106 $ 16,118 |
Summary of Outstanding Oil Price Derivatives | As of September 30, 2015, the Company had the following outstanding commodity derivatives: Commodity and Derivative Type Weighted-Average Contract Volume Contract Period Price Swap Agreements $3.20 per Mcf 2,700 October 2015 – June 2016 |
Income Tax Expense (Benefit) | The following is an analysis of consolidated income tax expense (benefit): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Current provision $ 687 $ (73 ) $ 1,170 $ (36 ) Deferred provision (benefit) (31,333 ) (417 ) (146,118 ) 1,487 Provision for (benefit from) income taxes $ (30,646 ) $ (490 ) $ (144,948 ) $ 1,451 |
Difference Between Customary Rate and Effective Tax Rate on Income (Loss) Before Income Taxes Due | The difference between the Company's customary rate of 35% and the effective tax rate on income (loss) before income taxes is due to the following: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 Tax at statutory rate 35.0 % 35.0 % 35.0 % 35.0 % Tax effect of: State income taxes net of federal benefit 2.0 5.5 2.1 (5.5 ) Nondeductible stock-based compensation — (15.1 ) (0.1 ) 20.1 Valuation allowance on deferred tax assets – Federal (31.0 ) — (19.8 ) — Valuation allowance on deferred tax asset – State (0.7 ) — (1.2 ) — Other — (4.9 ) — 6.0 Effective tax rate 5.3 % 20.5 % 16.0 % 55.6 % |
Summary of Financial Assets and Liabilities at Fair Value | The following table summarizes financial assets and liabilities accounted for at fair value as of September 30, 2015: Carrying Level 1 Level 2 (In thousands) Assets measured at fair value on a recurring basis: Cash and cash equivalents held in bank accounts $ 163,840 $ 163,840 $ — Derivative financial instruments 1,314 — 1,314 Total assets $ 165,154 $ 163,840 $ 1,314 |
Basic and Diluted Earnings (Loss) Per Share | Basic and diluted earnings (loss) per share for the three months and nine months ended September 30, 2015 and 2014 were determined as follows: Three Months Ended September 30, 2015 2014 Loss Shares Per Loss Shares Per (In thousands, except per share amounts) Net loss $ (544,996 ) $ (1,903 ) Income allocable to unvested stock grants — (151 ) Basic net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Effect of dilutive securities: Stock options — — — — Performance share units — — — — Diluted net loss attributable to common stock $ (544,996 ) 46,150 $ (11.81 ) $ (2,054 ) 46,651 $ (0.04 ) Nine Months Ended September 30, 2015 2014 Shares Per Income Shares Per (In thousands, except per share amounts) Net income (loss) $ (758,566 ) $ 1,160 Income allocable to unvested stock grants — (444 ) Basic net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,628 $ 0.02 Effect of dilutive securities: Stock options — — — — Performance share units — — — 320 Diluted net income (loss) attributable to common stock $ (758,566 ) 46,100 $ (16.45 ) $ 716 46,948 $ 0.02 |
Weighted Average Shares of Unvested Restricted Stock | Weighted average shares of unvested restricted stock outstanding during the three months and nine months ended September 30, 2015 and 2014 were as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands) Unvested restricted stock 1,576 1,210 1,430 1,184 |
Common Stock Stock Options Excluded as Anti-Dilutive from Determination of Diluted Earnings Per Share | Options to purchase common stock and PSUs that were outstanding and that were excluded as anti-dilutive from the determination of diluted earnings per share are as follows: Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 (In thousands except per share/unit data) Weighted average stock options 103 115 106 115 Weighted average exercise price per share $ 32.94 $ 32.90 $ 32.98 $ 32.90 Weighted average performance share units 670 257 631 — Weighted average grant date fair value per unit $ 9.13 $ 20.71 $ 9.13 $ — |
Cash Payments Made for Interest and Income Taxes | The following is a summary of cash payments made for interest and income taxes: Nine Months Ended September 30, 2015 2014 (In thousands) Interest payments $ 68,877 $ 30,914 Income tax payments $ 77 $ 1,467 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | At September 30, 2015, long-term debt was comprised of: (In thousands) 7 3 4 $ 391,496 10 700,000 9 1 2 205,816 $ 1,297,312 |
Summary of Significant Accoun15
Summary of Significant Accounting Policies - Additional Information 1 (Detail) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Jan. 31, 2015ExecutiveOfficers | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Dec. 31, 2014USD ($) | |
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Impairment charges for unevaluated properties | $ 5,100,000 | $ 68,600,000 | $ 0 | |||
Impairment charges related to oil and gas properties | 544,700,000 | 547,100,000 | ||||
Net proceeds from sale of oil and gas property | 102,700,000 | |||||
Loss on sale of oil and gas properties | 111,800,000 | $ 111,778,000 | ||||
Acquired interest in corporate airplane | 20.00% | 20.00% | ||||
Pre-Acquisition Company interest in corporate airplane | 80.00% | |||||
Number of executive officers | ExecutiveOfficers | 2 | |||||
Pre-Acquisition executive officers interest in corporate airplane | 20.00% | |||||
Consideration paid for interest in corporate airplane | $ 1,700,000 | |||||
Cash flow hedges derivative instruments | 0 | 0 | ||||
(Payments) receipts on derivative financial instruments | (391,000) | 5,702,000 | ||||
Derivative Financial Instruments - Current Asset | 1,314,000 | 1,314,000 | ||||
Derivative Financial Instruments | $ 0 | |||||
Natural Gas | ||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Total gain (loss) on oil price swaps | 1,100,000 | 1,700,000 | ||||
(Payments) receipts on derivative financial instruments | $ 400,000 | $ 400,000 | ||||
Oil | ||||||
Operations And Summary Of Significant Accounting Policies [Line Items] | ||||||
Total gain (loss) on oil price swaps | $ 12,000,000 | (2,800,000) | ||||
(Payments) receipts on derivative financial instruments | $ (400,000) | $ (5,700,000) |
Summary of Significant Accoun16
Summary of Significant Accounting Policies - Schedule of Fair Value Impairments, Average Prices of Oil and Gas Properties And Applicable Discount Rates (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($)$ / bbl$ / Mcf | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | |
Fair Value And Impairments Oil And Gas Properties [Line Items] | ||||
Impairment of oil and gas properties | $ 544,714 | $ 15 | $ 547,101 | $ 271 |
Oil Properties | ||||
Fair Value And Impairments Oil And Gas Properties [Line Items] | ||||
Fair Value | 330,257 | 330,257 | ||
Impairment of oil and gas properties | $ 405,308 | |||
Management's Oil Price Outlook | $ / bbl | 73.70 | |||
Management's Gas Price Outlook | $ / Mcf | 4.04 | |||
Annual Discount Rate | 10.00% | |||
Natural Gas Properties | ||||
Fair Value And Impairments Oil And Gas Properties [Line Items] | ||||
Fair Value | $ 61,625 | $ 61,625 | ||
Impairment of oil and gas properties | $ 139,406 | |||
Management's Oil Price Outlook | $ / bbl | 75.91 | |||
Management's Gas Price Outlook | $ / Mcf | 3.91 | |||
Annual Discount Rate | 10.00% |
Summary of Significant Accoun17
Summary of Significant Accounting Policies - Operating Income (Loss) Results of Operations (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Oil And Gas Properties Sold [Abstract] | |||||
Total oil and gas sales | $ 2,239 | $ 4,170 | $ 18,036 | $ 6,655 | |
Total operating expenses | [1] | (337) | (14,735) | (66,251) | (16,627) |
Operating income (loss) | $ 1,902 | $ (10,565) | $ (48,215) | $ (9,972) | |
[1] | Includes direct operating expenses, depreciation, depletion and amortization and exploration expense. Excludes interest expense and general and administrative expenses. |
Summary of Significant Accoun18
Summary of Significant Accounting Policies - Summary of Accrued Liabilities (Detail) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Accrued Liabilities, Current [Abstract] | ||
Accrued drilling costs | $ 4,492 | $ 26,269 |
Accrued interest | 23,796 | 9,011 |
Accrued ad valorem taxes | 4,500 | |
Current deferred income taxes payable | 460 | |
Accrued rig termination fees | 2,600 | |
Other accrued liabilities | 6,516 | 6,962 |
Total accrued expenses | $ 39,764 | $ 44,842 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies - Summary of Changes in Reserve for Future Abandonment Costs (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Asset Retirement Obligations Noncurrent [Abstract] | ||
Future abandonment costs — beginning of period | $ 14,900 | $ 14,534 |
Accretion expense | 600 | 615 |
New wells placed on production | 309 | 1,045 |
Liabilities settled and assets disposed of | (703) | (76) |
Future abandonment costs — end of period | $ 15,106 | $ 16,118 |
Summary of Significant Accoun20
Summary of Significant Accounting Policies - Summary of Outstanding Commodity Derivatives (Detail) - Natural Gas Price Swap Agreements | 9 Months Ended |
Sep. 30, 2015$ / McfMMcf | |
Derivative [Line Items] | |
Commodity Derivatives Weighted Average Contract Price | 3.20 |
Commodity Derivatives Contract Volume | MMcf | 2,700 |
Commodity Derivatives Beginning of Remaining Contract Period | Oct. 1, 2015 |
Commodity Derivatives End of Remaining Contract Period | Jun. 30, 2016 |
Summary of Significant Accoun21
Summary of Significant Accounting Policies - Additional Information 2 (Detail) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($)Unit$ / shares$ / EquityUnitshares | Sep. 30, 2014USD ($)shares | Sep. 30, 2015USD ($)Unit$ / shares$ / EquityUnitshares | Sep. 30, 2014USD ($)shares | Dec. 31, 2014shares | |
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Stock-based compensation expense recognized | $ 6,061,000 | $ 7,842,000 | |||
Federal | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Deferred tax assets valuation allowance | $ 178,600,000 | 178,600,000 | |||
State | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Deferred tax assets valuation allowance | $ 71,600,000 | $ 71,600,000 | |||
Restricted Stock | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Number of shares granted | shares | 1,010,371 | ||||
Restricted stock grant date fair value | $ 5,400,000 | ||||
Grant date fair value of share units, per unit | $ / shares | $ 5.34 | ||||
Shares of unvested restricted stock outstanding | shares | 1,575,302 | 1,575,302 | 1,207,527 | ||
Weighted average grant date fair value of stock grants per share | $ / shares | $ 9.90 | $ 9.90 | |||
Unrecognized compensation cost | $ 6,600,000 | $ 6,600,000 | |||
Period in which compensation cost expected to be recognized | 1 year 6 months | ||||
Potential Performance Shares | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Unrecognized compensation cost | $ 2,600,000 | $ 2,600,000 | |||
Period in which compensation cost expected to be recognized | 1 year 10 months 24 days | ||||
Number of units granted | Unit | 471,249 | ||||
Performance units grant date fair value | $ 2,100,000 | ||||
Grant date fair value of share units, per unit | $ / EquityUnit | 4.38 | ||||
Number of performance stock units ("PSUs") outstanding | Unit | 669,604 | 669,604 | |||
Weighted average grant date fair value of PSUs per unit | $ / EquityUnit | 9.13 | 9.13 | |||
Potential Performance Shares | Minimum | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Common stock, shares, potentially issuable in exchange for Share Units | shares | 0 | 0 | |||
Potential Performance Shares | Maximum | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Common stock, shares, potentially issuable in exchange for Share Units | shares | 1,400,173 | 1,400,173 | |||
Stock Options | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Unrecognized compensation cost | $ 0 | $ 0 | |||
Number of Options Outstanding | shares | 102,650 | 102,650 | |||
Weighted average exercise price | $ / shares | $ 32.94 | $ 32.94 | |||
Number of option, Exercised | shares | 0 | 0 | 0 | 0 | |
General and Administrative Expense | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Stock-based compensation expense recognized | $ 2,100,000 | $ 2,800,000 | $ 6,100,000 | $ 7,800,000 |
Summary of Significant Accoun22
Summary of Significant Accounting Policies - Income Tax Expense (Benefit) (Detail) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Income Tax Disclosure [Abstract] | ||||
Current provision | $ 687 | $ (73) | $ 1,170 | $ (36) |
Deferred provision (benefit) | (31,333) | (417) | (146,118) | 1,487 |
Provision for (benefit from) income taxes | $ (30,646) | $ (490) | $ (144,948) | $ 1,451 |
Summary of Significant Accoun23
Summary of Significant Accounting Policies - Additional Information 3 (Detail) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015USD ($)shares | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)Jurisdictionsshares | Sep. 30, 2014USD ($) | Dec. 31, 2014shares | |
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Customary rate | 35.00% | 35.00% | 35.00% | 35.00% | |
State jurisdiction currently under review | Jurisdictions | 1 | ||||
Cumulative common stock ownership change over three year period that could limit federal and state net operating loss carry forwards | 50.00% | ||||
Rights Plan establishment date | Oct. 1, 2015 | ||||
Long-term debt, including current portion, Carrying Value | $ 1,297,312 | $ 1,297,312 | |||
Performance multiplier, minimum | 0.00% | ||||
Performance multiplier, maximum | 300.00% | ||||
Interest costs, capitalized during period | $ 2,700 | $ 900 | $ 7,500 | ||
Restricted Stock | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Shares of unvested restricted stock outstanding | shares | 1,575,302 | 1,575,302 | 1,207,527 | ||
Fixed Rate Debt | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Long-term debt, including current portion, Carrying Value | $ 1,300,000 | $ 1,300,000 | |||
Level 2 | Fixed Rate Debt | |||||
Operations And Summary Of Significant Accounting Policies [Line Items] | |||||
Long-term debt, including current portion, Fair Value | $ 645,600 | $ 645,600 |
Summary of Significant Accoun24
Summary of Significant Accounting Policies - Difference Between Customary Rate and Effective Tax Rate on Income (Loss) Before Income Taxes Due (Detail) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Line Items] | ||||
Tax at statutory rate | 35.00% | 35.00% | 35.00% | 35.00% |
State income taxes net of federal benefit | 2.00% | 5.50% | 2.10% | (5.50%) |
Nondeductible stock-based compensation | (15.10%) | (0.10%) | 20.10% | |
Other | (4.90%) | 6.00% | ||
Effective tax rate | 5.30% | 20.50% | 16.00% | 55.60% |
Federal | ||||
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Line Items] | ||||
Valuation allowance on deferred tax assets | (31.00%) | (19.80%) | ||
State | ||||
Effective Income Tax Rate Continuing Operations Tax Rate Reconciliation [Line Items] | ||||
Valuation allowance on deferred tax assets | (0.70%) | (1.20%) |
Summary of Significant Accoun25
Summary of Significant Accounting Policies - Summary of Financial Assets and Liabilities at Fair Value (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Assets measured at fair value on a recurring basis: | |
Derivative Financial Instruments - Current Asset | $ 1,314 |
Fair Value, Measurements, Recurring | |
Assets measured at fair value on a recurring basis: | |
Cash and cash equivalents held in bank accounts | 163,840 |
Derivative Financial Instruments - Current Asset | 1,314 |
Total assets | 165,154 |
Fair Value, Measurements, Recurring | Level 1 | |
Assets measured at fair value on a recurring basis: | |
Cash and cash equivalents held in bank accounts | 163,840 |
Total assets | 163,840 |
Fair Value, Measurements, Recurring | Level 2 | |
Assets measured at fair value on a recurring basis: | |
Derivative Financial Instruments - Current Asset | 1,314 |
Total assets | $ 1,314 |
Summary of Significant Accoun26
Summary of Significant Accounting Policies - Basic and Diluted Earnings (Loss) Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ (544,996) | $ (1,903) | $ (758,566) | $ 1,160 |
Income allocable to unvested stock grants | (151) | (444) | ||
Basic net income (loss) attributable to common stock | (544,996) | (2,054) | (758,566) | 716 |
Diluted net income (loss) attributable to common stock | $ (544,996) | $ (2,054) | $ (758,566) | $ 716 |
Basic net income (loss) attributable to common stock, Shares | 46,150 | 46,651 | 46,100 | 46,628 |
Effect of dilutive securities: Performance share units, Shares | 320 | |||
Diluted net income (loss) attributable to common stock, Shares | 46,150 | 46,651 | 46,100 | 46,948 |
Basic net income (loss) attributable to common stock, Per Share | $ (11.81) | $ (0.04) | $ (16.45) | $ 0.02 |
Diluted net income (loss) attributable to common stock, Per Share | $ (11.81) | $ (0.04) | $ (16.45) | $ 0.02 |
Summary of Significant Accoun27
Summary of Significant Accounting Policies - Weighted Average Shares of Unvested Restricted Stock (Detail) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | ||||
Unvested restricted stock | 1,576 | 1,210 | 1,430 | 1,184 |
Summary of Significant Accoun28
Summary of Significant Accounting Policies - Common Stock Stock Options Excluded as Anti-Dilutive from Determination of Diluted Earnings Per Share (Detail) shares in Thousands, EquityUnit in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2014EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2015EquityUnit$ / shares$ / EquityUnitshares | Sep. 30, 2014$ / sharesshares | |
Earnings Per Share [Abstract] | ||||
Weighted average stock options | shares | 103 | 115 | 106 | 115 |
Weighted average exercise price per share | $ / shares | $ 32.94 | $ 32.90 | $ 32.98 | $ 32.90 |
Weighted average performance share units | EquityUnit | 670 | 257 | 631 | |
Weighted average grant date fair value per unit | 9.13 | 20.71 | 9.13 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies - Cash Payments Made for Interest and Income Taxes (Detail) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash Payments [Abstract] | ||
Interest payments | $ 68,877 | $ 30,914 |
Income tax payments | $ 77 | $ 1,467 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) - USD ($) | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2013 | |
Equity [Abstract] | |||
Dividend paid | $ 0 | $ 17,900,000 | |
Approved amount for open market repurchase of common stock | $ 100,000,000 | ||
Stock Purchased Under Open Market Amount | $ 0 | $ 0 |
Long-Term Debt - Long-Term Debt
Long-Term Debt - Long-Term Debt (Detail) $ in Thousands | Sep. 30, 2015USD ($) |
Debt Instrument [Line Items] | |
Long-term Debt | $ 1,297,312 |
7 3/4% Senior Notes due 2019 | |
Debt Instrument [Line Items] | |
Long-term Debt | 391,496 |
10 % Senior Secured Notes due 2020 | |
Debt Instrument [Line Items] | |
Long-term Debt | 700,000 |
9 1/2% Senior Notes due 2020 | |
Debt Instrument [Line Items] | |
Long-term Debt | $ 205,816 |
Long-Term Debt - Long-Term De32
Long-Term Debt - Long-Term Debt (Parenthetical) (Detail) | Sep. 30, 2015 | Mar. 31, 2015 |
7 3/4% Senior Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Interest rate on senior notes | 7.75% | |
10 % Senior Secured Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Interest rate on senior notes | 10.00% | 10.00% |
9 1/2% Senior Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Interest rate on senior notes | 9.50% |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Detail) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended |
Mar. 31, 2015 | Sep. 30, 2015 | |
Debt Instrument [Line Items] | ||
Minimum percentage of oil and gas properties used as collateral against Secured Notes and credit facility | 80.00% | |
Write off of deferred issuance cost | $ 3.7 | |
Bank credit facility | ||
Debt Instrument [Line Items] | ||
Ownership percentage of guarantor subsidiary | 100.00% | |
10 % Senior Secured Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Debt instrument outstanding, value | $ 700 | |
Interest rate on senior notes | 10.00% | 10.00% |
Maturity of senior notes | Mar. 15, 2020 | |
Net proceeds from issuance of debt | $ 684 | |
Frequency of interest payments | semi-annually on each March 15 and September 15 | |
7 3/4% Senior Notes due 2019 | ||
Debt Instrument [Line Items] | ||
Debt instrument outstanding, value | $ 387.5 | |
Interest rate on senior notes | 7.75% | |
Maturity of senior notes | Apr. 1, 2019 | |
Frequency of interest payments | semi-annually on each April 1 and October 1 | |
Principal amount of notes repurchased | $ 12.5 | |
9 1/2% Senior Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Debt instrument outstanding, value | $ 211.6 | |
Interest rate on senior notes | 9.50% | |
Maturity of senior notes | Jun. 15, 2020 | |
Frequency of interest payments | semi-annually on each June 15 and December 15 | |
Principal amount of notes repurchased | $ 88.4 | |
7 3/4% Senior Notes due 2019 And 9 1/2% Senior Notes due 2020 | ||
Debt Instrument [Line Items] | ||
Payment for repurchase of notes | 37.8 | |
Gain on repurchased amount of notes | $ 59.3 |
Long-Term Debt - Additional I34
Long-Term Debt - Additional Information 1 (Detail) - Revolving Credit Facility $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Debt Instrument [Line Items] | |
Bank credit facility | $ 50 |
Line of credit facility commitment term (in years) | 4 years |
Maturity of credit facility | Mar. 4, 2019 |
Spread rate over LIBOR for interest rate on credit facility | 2.50% |
Stated percentage over federal funds rate to calculate base rate | 0.50% |
Stated percentage over 30 day LIBOR to calculate base rate | 1.00% |
Spread rate over base rate for interest rate on credit facility | 1.50% |
Commitment fee on unused borrowing base | 0.50% |
Current ratio | 100.00% |
Asset coverage ratio | 250.00% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments for contracted drilling services | $ 1.3 |
Contract term related to drilling services | through November 2015 |
Natural gas transportation and treating agreements | through July 2019 |
Maximum commitments under natural gas transportation and treating agreements | $ 7.1 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Detail) - NOL Rights Plan - Subsequent Event | Oct. 01, 2015Itemshares |
Subsequent Event [Line Items] | |
Number of rights declared for each common stock | shares | 1 |
Number of rights automatically attached | 1 |
Dividend payable date | Oct. 16, 2015 |
Dividend record date | Oct. 12, 2015 |
Threshold percentage of common stock to be qualified as an acquiring person | 4.90% |