Northern Oil And Gas (NYSE: NOG) reported Q1 EPS of $0.17, $0.05 better than the analyst estimate of $0.12. Revenue for the quarter came in at $79.14 million versus the consensus estimate of $74.27 million.

HIGHLIGHTS

• Daily production exceeded guidance, increasing 35% year-over-year and 7.5% sequentially to average approximately 18,000 barrels of oil equivalent (“Boe”) per day in the first quarter, for a total of 1,619,521 Boe
• Exited the quarter with 19.0 net wells in process after adding 5.8 net wells to production and 6.5 net wells to the drilling and completing list
• Raising full year 2018 production guidance; expect average daily production to increase by 26 - 30% over 2017, versus prior guidance of 18 - 22% (estimates do not include the recently announced Salt Creek acquisition)
• Increased activity is expected to add 22 - 24 net wells to production during 2018, an increase of two net wells versus prior guidance (estimates do not include the recently announced Salt Creek acquisition)
• Completed a $93.4 million underwritten common stock offering in April 2018; expect to close the previously announced bond exchange agreement and related transactions by May 15, 2018
• On April 26, 2018, the company announced a definitive agreement with Salt Creek Oil and Gas, LLC to acquire producing assets and acreage in the core of the Williston Basin

GUIDANCE

Northern is raising its 2018 annual production guidance range to 18,650 - 19,240 Boe per day, which represents a 26% - 30% increase over 2017 production. As a result of increased activity, Northern now expects to add approximately 22 - 24 net wells to production for the year. In addition, as Northern continues to strengthen and grow its drilling and completing inventory, the company is revising its drilling and completion capital budget to $172 - $187 million, an increase of $20 million over prior guidance, to reflect the growth in our drilling and completing inventory and the additional net wells expected to be completed in 2018. With additional capital allocated to acquisitions, workovers, and other capitalized costs, the total revised capital budget is $185 - $200 million for 2018. These estimates do not include the recently announced Salt Creek acquisition.

Based on favorable first quarter results, Northern is lowering its 2018 guidance on production expenses and taxes, while maintaining general and administrative expense guidance. With greater than anticipated production growth in North Dakota the company expects an increase in average differentials for the remainder of 2018. Management’s current expectations for operating metrics for 2018 are as follows:

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