| Adjusted EBITDAX Reconciliation Adjusted EBITDAX (1) (in thousands) Reconciliation of net income (GAAP) to Adjusted EBITDAX (non-GAAP) to net cash provided by operating activities (GAAP): For the Three Months Ended March 31, 2015 2014 Net income (GAAP) Interest expense Other non-operating income, net Income tax benefit (expense) Depletion, depreciation, amortization, and asset retirement obligation liability accretion Exploration (2) Impairment of proved properties Abandonment and impairment of unproved properties Stock-based compensation expense Derivative (gain) loss Derivative settlement gain (loss) (3) Change in Net Profits Plan liability (Gain) loss on divestiture activity Other, net Adjusted EBITDAX (Non-GAAP) Interest expense Other non-operating income, net Income tax benefit (expense) Exploration (2) Exploratory dry hole expense Amortization of deferred financing costs Deferred income taxes Plugging and abandonment Other, net Changes in current assets and liabilities Net cash provided by operating activities (GAAP) $(53,058) 32,647 (571) (33,453) 217,401 35,732 55,526 11,627 6,024 (154,167) 161,229 (4,334) 35,802 1,450 $65,607 24,190 (26) 38,863 177,215 19,938 - 2,801 6,344 97,662 (28,940) (1,776) (2,958) - $311,855 $398,920 ($32,647) 571 33,453 (35,732) 16,275 1,957 (33,727) (2,425) 46 24,296 ($24,190) 26 (38,863) (19,938) - 1,477 38,374 (1,325) (3,103) (51,650) $283,922 $299,728 (1) Adjusted EBITDAX represents income (loss) before interest expense, interest income, income taxes, depreciation, depletion, amortization, and accretion, exploration expense, property impairments, non-cash stock compensation expense, derivative gains and losses net of settlements, change in the Net Profits Plan liability, and gains and losses on divestitures. Adjusted EBITDAX excludes certain items that we believe affect the comparability of operating results and can exclude items that are generally one-time in nature or whose timing and/or amount cannot be reasonably estimated. Adjusted EBITDAX is a non-GAAP measure that is presented because we believe that it provides useful additional information to investors and analysts, as a performance measure, for analysis of our ability to internally generate funds for exploration, development, acquisitions, and to service debt. We are also subject to a financial covenant under our credit facility based on our debt to adjusted EBITDAX ra tio. In addition, adjusted EBITDAX is widely used by professional research analysts and others in the valuation, comparison, and investment recommendations of companies in the oil and gas exploration and production industry, an d many investors use the published research of industry research analysts in making investment decisions. Adjusted EBITDAX should not be considered in isolation or as a substitute for net income (loss), incom e (loss) from operations, net cash provided by operating activities, or profitability or liquidity measures prepared under GAAP. Because adjusted EBITDAX excludes some, but not all items that affect net income (loss) and ma y vary among companies, the adjusted EBITDAX amounts presented may not be comparable to similar metrics of other companies. (2) Stock-based compensation expense is a component of exploration expense and general and administrative expense on the accompa nying statements of operations. Therefore, the exploration line items shown in the reconciliation above will vary from the amount shown on the accompanying statements of operations for the component of stock -based compensation expense recorded to exploration. (3) Derivative settlement gain (loss) is reported net of the change in accrued settlements between periods in the derivative cash settlements line item on the condensed consolidated statements of cash flows within net cash 32 provided by operating activities. |
