HighPoint Resources (HPR) Tops Q3 EPS by 2c

HighPoint Resources (NYSE: HPR) reported Q3 EPS of ($0.03), $0.02 better than the analyst estimate of ($0.05). Revenue for the quarter came in at $121.28 million versus the consensus estimate of $126.72 million.

• Reported production sales volume of 3.4 million barrels of oil equivalent ("MMBoe") for the third quarter of 2019, represents an increase of 20% over the second quarter of 2019 and a 24% increase over the third quarter of 2018
• Oil production sales volume of 2.18 million barrels of oil ("MMBbls") for the third quarter of 2019 or 64% of total equivalent production sales volume, represents an increase of 25% over the second quarter of 2019 and a 27% increase over the third quarter of 2018
• Reported net income of $11.1 million or $0.05 per diluted share and adjusted net income (non-GAAP) of a loss of $7.4 million or $0.03 per diluted share
• EBITDAX (non-GAAP) of $94.3 million increased 33% over the second quarter of 2019 driven by a significant per unit reduction in controllable cash operating costs1 of 29% and 30% compared to both the second quarter of 2019 and third quarter of 2018, respectively
• Continued positive results from DSU 11-63-16 (east pad) as wells are exhibiting a dramatic 120% increase in current daily production rate through 130 days with a shallower decline compared to previously completed wells, demonstrating economic development of both the Niobrara and Codell formations in Hereford
• Encouraging early performance from upspaced DSU 11-63-16 (west pad) that is exhibiting a meaningful increase of 55% in current daily production rate through 85 days compared to previously completed wells and continues ramping to peak production
• Became cash flow positive in the third quarter of 2019
• Semi-annual borrowing base review recently completed with $500 million credit facility reaffirmed

Chief Executive Officer and President Scot Woodall commented, "Our third quarter results are reflective of strong operational execution and were highlighted by robust growth in oil volumes and a significant reduction in cash operating costs that underpinned a 33% increase in EBITDAX to $94 million compared to the second quarter of 2019. We also became cash flow positive during the third quarter, which will enhance liquidity. Following up on our recent positive operational update, we continue to demonstrate a dramatic improvement in Hereford well performance with results showing a substantial and continuous increase in productivity. Today, we are providing a further positive update to the initial seven wells in DSU 11-63-16 that are now showing a 120% increase in current daily production with a shallower decline profile compared to previously completed wells, demonstrating a viable, economic development template for the Hereford field. Similarly, the performance of the four wells on the western side of DSU 11-63-16 continues to improve since our last update, showing a 55% increase in current daily production and are trending to peak production. This continues to build upon the early success of the Hereford optimization program as we assess performance opportunities of upspacing and increased completion intensity."

For earnings history and earnings-related data on HighPoint Resources (HPR) click here.

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