Continental Resources (CLR) Misses Q1 EPS by 9c, Revenues Beat

Continental Resources (NYSE: CLR) reported Q1 EPS of ($0.08), $0.09 worse than the analyst estimate of $0.01. Revenue for the quarter came in at $880.8 million versus the consensus estimate of $863.67 million.

• 360,841 Boepd Average Daily 1Q20 Production; up 9% YoY (56% Oil)
• Lowest Cost Producer amongst Oil-Weighted Peers• $3.61 Production Expense per Boe and $1.31 Total G&A per Boe in 1Q20
• Approx. $55 MM Reduction to 2020 G&A through Ongoing Cost Savings Evaluation
• $650.7 MM Capex in 1Q20; 2020 Capex Tracking 3% to 5% below Previously Revised $1.2 B Budget• Zero Stim Crews in the Bakken and Averaging 1 Stim Crew in OK through Remainder of 2020 • Rigs Reduced to 4 by YE20 (80% Reduction from Jan 2020)
• $139 MM of Bonds Retired in March/April at a 53% Weighted Average Discount to Par
• Strong Portfolio Optionality and Liquidity: Positions Company for Market Recovery • 70% of Operated Oil Production Voluntarily Curtailed in May (60% Boepd Curtailed)

"This has been an unprecedented global market environment, which has seen crude oil demand fall by approximately 30% due to the COVID-19 pandemic. Continental is committed to preserving value over volumes. Our assets are secure and we are confident that this deferred production will bring more value to our shareholders in the months to come," said Bill Berry, Chief Executive Officer.

Mr. Berry continued, "Our first quarter results underscore the capital efficient and low cost nature of our assets. Continental is financially strong with ample liquidity and no imminent debt maturities. We remain keenly focused on preserving both our assets and shareholder value for better commodity prices in the future. I want to thank our teams for their safe, efficient and best-in-class operations during this time. We look towards a bright future for both Continental and the U.S. oil and natural gas industry."

Operations Update

"Our assets continued to deliver consistent and repeatable results in the first quarter. Ongoing operating improvements also drove further capital efficiencies, that continued to increase the barrels produced per dollar spent in both the Bakken and Oklahoma. Importantly, Continental remains a low cost leader amongst our oil-weighted peers. First quarter 2020 production expense per Boe and DD&A per Boe fell within our previous guidance and cash G&A per Boe was materially better. This is a testament to the commitment to excellence by our teams and the unmatched shareholder alignment that are fundamental parts of the culture here at Continental," said Jack Stark, President and Chief Operating Officer.

The Company is currently tracking 3% to 5% below its previously revised $1.2 billion Capex budget. The Company also expects to reduce 2020 G&A by approximately $55 million through its ongoing cost savings evaluation. The Company has 70% of operated oil production voluntarily curtailed in May, or 60% of total operated production on a Boe basis. With the added optionality of having over 75% of its world class assets held by production, the Company is well-positioned for a recovery in market conditions. The Company is currently operating 5 rigs and expects to reduce to 4 rigs by year end 2020. This is an 80% reduction from the beginning of 2020. The Company currently has zero stim crews running in the Bakken and expects to average 1 stim crew in the South for the remainder of 2020. Efficiencies continue to build across all aspects of the Company's operations that are positively impacting performance and reducing costs on a sustainable ongoing basis.

For earnings history and earnings-related data on Continental Resources (CLR) click here.

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