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Gulfport (GPOR) Q1 Earnings Beat Estimates on High Gas Prices

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Gulfport Energy Corporation (GPOR - Free Report) delivered a comprehensive beat in first-quarter 2019, with earnings and sales surpassing estimates. The Oklahoma-based company reported first-quarter adjusted net income per share of 33 cents, beating the Zacks Consensus Estimate of 30 cents on the back of higher-than-expected natural gas realizations. Precisely, natural gas realizations came in at $2.70 per thousand cubic feet, beating the Zacks Consensus Estimate of $2.56. However, the bottom line was below the year-ago EPS of 56 cents a share amid lower production and higher costs.

Revenues of $320.6 million surpassed the Zacks Consensus Estimate of $317 million. The top line, however,declined from the year-ago figure of $325.4 million.

Gulfport Energy Corporation Price, Consensus and EPS Surprise

 

Gulfport Energy Corporation Price, Consensus and EPS Surprise | Gulfport Energy Corporation Quote

Production & Realized Prices

Gulfport’s total oil and gas production decreased to 1,263.6 million cubic feet equivalent per day (MMcfe/d) from 1,288.6MMcfe/d recorded in the corresponding period of last year. Of the total output, 89.7% comprised natural gas. Gas production from Utica Shale declined 3.6% y/y to 89,428 MMcfe. Nearly 78.6% of its output came from the Utica acreage. Output from SCOOP came in at 23,394 MMcfe, a tad higher than the year-ago level of $22,103 MMcfe.

Average realized natural gas oil price (before the impact of derivatives) during the first quarter was $2.70 per thousand cubic feet, higher than the year-ago period’s $2.44. However, average realized natural gas liquids price was 58 cents per gallon, down from the year-ago quarter’s 71 cents. Gulfport fetched $53.10 per barrel of oil during the quarter, down from the year-ago figure of $60.36. Overall, the company realized $3.00 per thousand cubic feet equivalent in the quarter vis-a-vis $2.95a year ago.

Expenses

Total expenses in the quarter under review amounted to $229.1million, reflecting an increase of 6.5% from $215.1 million in the prior-year period. This uptick is mainly attributed to higher production taxes, lease operating expenses, and depreciation and midstream gathering/processing charges incurred in the reported quarter.

Depreciation costs scaled up 6.7% to $118.4 million and midstream gathering/processing expenses rose 9.5% from the prior-year quarter to $70.3 million.

Capex, Balance Sheet & Stock Buyback

In the reported quarter, Gulfport spent $254.9 million on drilling and completion (D&C). As of Mar 31, the natural gas-weighted energy explorer had approximately $17.9 million in cash and cash equivalents. Gulfport had a long-term debt of $2,087.7 million, representing a debt-to-capitalization ratio of around 38.3%.

In January 2019, the company had authorized the repurchase of $400 million shares of its common stock over the next two years, out of which it bought back shares worth $30 million in the quarter under review.

2019 Guidance Retained

Gulfport reiterated its 2019 guidance that was unveiled in January. The upstream player expects 2019 capex in the band of $565-$600 million. It projects 2019 production within 1,360-1,400 MMcfe/d. Moreover, the company expects free cash flow to exceed $100 million.

Zacks Rank & Key Picks

Gulfport currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Meanwhile, investors interested in the energy space can consider some better-ranked players such as:

Devon Energy Corporation (DVN - Free Report) : Devon’s 2019 earnings are expected to grow 65.8% on a year-over-year basis.

Murphy Oil Corporation (MUR - Free Report) : Murphy surpassed earnings estimates in three out of the trailing four quarters, with average positive surprise of 17.33%. The company’s 2019 earnings are expected to grow 26.2%.

Bonanza Creek Energy, Inc. : The company delivered average positive earnings surprise of 14.53% in the trailing four quarters. Bonanza Creek’s 2019 revenues are expected to grow 23.1% y/y.

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