Gulfport Energy(GPOR) - 2024 Q2 - Quarterly Report

General Information This section provides general company information, including filing details and outstanding common stock shares - Gulfport Energy Corporation filed its Form 10-Q for the quarterly period ended June 30, 2024, as a large accelerated filer[1][2] - As of July 29, 2024, 18,107,078 shares of the registrant's common stock were outstanding[2] Cautionary Note Regarding Forward-Looking Statements This section warns that forward-looking statements are subject to risks and uncertainties, and actual results may differ materially - This Form 10-Q includes forward-looking statements subject to known and unknown risks, uncertainties, and other factors that may cause actual results to differ materially[8] - Forward-looking statements are based on management's expectations and beliefs concerning future events, reflecting estimates and assumptions that are difficult to predict and beyond control[9] - The Company disclaims any duty to update forward-looking statements, except as required by applicable law[11] PART I FINANCIAL INFORMATION This section presents the company's unaudited consolidated financial statements and management's discussion and analysis Item 1. Consolidated Financial Statements (Unaudited) This section presents Gulfport Energy Corporation's unaudited consolidated financial statements, including balance sheets, statements of operations, stockholders' equity, and cash flows, along with detailed notes explaining significant accounting policies, property and equipment, debt, equity, compensation, and other financial items for the periods ended June 30, 2024 and 2023 Consolidated Balance Sheets This section presents the company's financial position, detailing assets, liabilities, and equity at specific points in time Consolidated Balance Sheet Highlights (in thousands) | Metric | June 30, 2024 | December 31, 2023 | | :----------------------------------- | :------------ | :---------------- | | Total Assets | $3,238,243 | $3,267,613 | | Total Liabilities | $1,074,542 | $1,061,719 | | Total Stockholders' Equity | $2,119,913 | $2,161,680 | | Current Assets | $270,271 | $396,806 | | Short-term derivative instruments | $147,243 | $233,226 | | Accounts receivable—oil, natural gas, and natural gas liquids sales | $94,346 | $122,479 | | Total Property and Equipment, net | $2,376,878 | $2,252,299 | | Long-term debt | $679,503 | $667,382 | Consolidated Statements of Operations (Three Months Ended June 30, 2024 and 2023) This section outlines the company's financial performance, including revenues, expenses, and net income or loss for the three-month period Key Financials (Three Months Ended June 30, in thousands) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Total Revenues | $181,117 | $304,706 | | Net (loss) gain on natural gas, oil and NGL derivatives | $(8,615) | $96,788 | | Natural gas sales | $144,458 | $159,246 | | (Loss) Income From Operations | $(18,119) | $102,583 | | Net (Loss) Income | $(26,212) | $93,687 | | Net (Loss) Income Attributable to Common Stockholders | $(27,307) | $78,365 | | Basic EPS | $(1.51) | $4.23 | Consolidated Statements of Operations (Six Months Ended June 30, 2024 and 2023) This section outlines the company's financial performance, including revenues, expenses, and net income or loss for the six-month period Key Financials (Six Months Ended June 30, in thousands) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Total Revenues | $464,346 | $1,035,927 | | Natural gas sales | $332,744 | $441,780 | | Net gain on natural gas, oil and NGL derivatives | $36,521 | $474,849 | | Income From Operations | $63,647 | $625,170 | | Net Income | $25,823 | $616,741 | | Net Income Attributable to Common Stockholders | $20,154 | $521,545 | | Basic EPS | $1.11 | $27.91 | Consolidated Statements of Stockholders' Equity This section details changes in the company's equity accounts, including net income, stock repurchases, and stock compensation Stockholders' Equity Activity (Six Months Ended June 30, 2024, in thousands) | Metric | January 1, 2024 | June 30, 2024 | | :----------------------------------- | :-------------- | :------------ | | Total Stockholders' Equity | $2,161,680 | $2,119,913 | | Net income (loss) | $52,035 (Q1) | $(26,212) (Q2) | | Repurchase of common stock under Repurchase Program | $(29,788) (Q1) | $(25,017) (Q2) | | Stock compensation | $3,587 (Q1) | $4,990 (Q2) | | Common stock withheld for income taxes on share-based awards | $(1,086) (Q1) | $(20,498) (Q2) | Consolidated Statements of Cash Flows This section summarizes the company's cash inflows and outflows from operating, investing, and financing activities Cash Flow Summary (Six Months Ended June 30, in thousands) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Net cash provided by operating activities | $311,487 | $411,406 | | Net cash used in investing activities | $(246,498) | $(281,593) | | Net cash used in financing activities | $(65,685) | $(131,803) | | Net change in cash and cash equivalents | $(696) | $(1,990) | | Cash and cash equivalents at end of period | $1,233 | $5,269 | Notes to Consolidated Financial Statements This section provides detailed explanations and supplementary information for the consolidated financial statements 1. Summary of Significant Accounting Policies This section describes the key accounting principles, methods, and recent accounting pronouncements adopted by the company - Gulfport is an independent natural gas-weighted exploration and production company focused on Utica, Marcellus, and SCOOP Woodford and Springer formations[25] - The company is evaluating ASU 2023-07 (Segment Reporting) effective for fiscal years beginning after December 15, 2023, and ASU 2023-09 (Income Taxes) effective for annual reporting periods beginning after December 15, 2024[27][28] - The SEC issued final climate-related disclosure rules in March 2024, requiring disclosure of material climate-related risks and greenhouse gas emissions, currently stayed pending judicial review[29] Accounts Payable and Accrued Liabilities (in thousands) | Category | June 30, 2024 | December 31, 2023 | | :------------------------------------------ | :------------ | :---------------- | | Revenue payable and suspense | $119,769 | $148,598 | | Accounts payable | $53,492 | $43,517 | | Accrued capital expenditures | $39,597 | $38,322 | | Accrued transportation, gathering, processing and compression | $36,138 | $32,849 | | Other accrued liabilities | $41,982 | $44,250 | | Total accounts payable and accrued liabilities | $290,978 | $309,532 | 2. Property and Equipment This section details the company's property and equipment, including proved and unproved oil and natural gas properties and potential impairment Property and Equipment (in thousands) | Category | June 30, 2024 | December 31, 2023 | | :----------------------------------- | :------------ | :---------------- | | Proved oil and natural gas properties | $3,171,811 | $2,904,519 | | Unproved properties | $218,399 | $204,233 | | Total property and equipment, net | $2,376,878 | $2,252,299 | - No impairment of oil and natural gas properties was recorded for the three or six months ended June 30, 2024 or 2023[34] - A non-cash impairment of assets is reasonably likely to occur in the third quarter of 2024 due to declining commodity prices[35] Capitalized General and Administrative Costs (in millions) | Period | 2024 | 2023 | | :----------------------------------- | :--- | :--- | | Three months ended June 30 | $6.3 | $5.4 | | Six months ended June 30 | $12.0 | $10.5 | 3. Long-Term Debt This section provides information on the company's long-term debt, including senior unsecured notes and credit facility details Long-Term Debt (in thousands) | Category | June 30, 2024 | December 31, 2023 | | :----------------------------------- | :------------ | :---------------- | | 8.0% senior unsecured notes due 2026 | $550,000 | $550,000 | | Credit Facility due 2027 | $130,000 | $118,000 | | Total long-term debt, net | $679,503 | $667,382 | - The Credit Facility's borrowing base was reaffirmed at $1.1 billion with elected commitments of $900 million on April 18, 2024[41] - As of June 30, 2024, the Company had $130.0 million outstanding borrowings under the Credit Facility and was in compliance with all covenants[44] - The 2026 Senior Notes (8.0% due 2026) have a carrying value of $549.5 million and a fair value of $556.1 million at June 30, 2024[47] 4. Mezzanine Equity This section outlines the terms and activity related to the company's preferred stock, including dividends and conversions - Preferred stock holders are entitled to cumulative quarterly dividends at 10% per annum for cash dividends and 15% for PIK Dividends[49] - The preferred stock outstanding at June 30, 2024, would convert to approximately 3.1 million shares of common stock[50] Preferred Stock Activity (Six Months Ended June 30, in thousands) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Preferred stock, beginning of period | $44,214 | $52,295 | | Conversion of preferred stock | $(426) | $(5,836) | | Preferred stock, end of period | $43,788 | $46,459 | Cash Dividends on Preferred Stock (in millions) | Period | 2024 | 2023 | | :----------------------------------- | :--- | :--- | | Three months ended June 30 | $1.1 | $1.3 | | Six months ended June 30 | $2.2 | $2.6 | 5. Equity This section details common stock activity, including share repurchases and the status of the Disputed Claims Reserve - In January 2024, the remaining 62,000 shares in the Disputed Claims Reserve were issued to claimants, with no remaining shares[57] - The Repurchase Program was increased to $650 million and extended through December 31, 2024[59] Share Repurchase Program Activity (Six Months Ended June 30, 2024, in thousands) | Period | Shares Purchased | Dollar Value of Purchased Shares | Average Price Paid Per Share | | :----------------------------------- | :--------------- | :------------------------------- | :--------------------------- | | First quarter 2024 | 210 | $29,492 | $140.39 | | Second quarter 2024 | 161 | $25,000 | $155.65 | | Total | 371 | $54,492 | $147.00 | - Since inception, the Company has repurchased 4.7 million shares for $454.1 million at a weighted average price of $95.87 per share[60] 6. Stock-Based Compensation This section reports the expense and outstanding awards related to the company's stock-based compensation plans Stock-Based Compensation Expense (in millions) | Period | 2024 | 2023 | | :----------------------------------- | :--- | :--- | | Three months ended June 30 | $5.0 | $3.0 | | Six months ended June 30 | $8.6 | $5.6 | - As of June 30, 2024, the Company awarded approximately 444,493 restricted stock units and 462,982 performance vesting restricted stock units[61] - The aggregate fair value of share-based awards that vested during the six months ended June 30, 2024, was approximately $49.2 million, significantly higher than $4.8 million in 2023[63] - Unrecognized compensation expense for RSUs was $17.3 million (weighted average period of 2.06 years) and for PSUs was $10.8 million (weighted average period of 2.17 years) as of June 30, 2024[64][66] 7. Restructuring Costs This section details restructuring expenses incurred due to organizational changes and their impact on financial results - Restructuring costs of $2.9 million (three months) and $4.8 million (six months) were recognized in 2023 due to organizational changes and new CEO appointment[67] - Of these 2023 expenses, $0.8 million (three months) and $1.3 million (six months) were non-cash charges from accelerated vesting of share-based grants[67] - As of June 30, 2023, there were no remaining employee termination liabilities[67] 8. Earnings (Loss) Per Share This section presents the calculation of basic and diluted earnings per share, including potential dilutive securities Net (Loss) Income Per Common Share (Three Months Ended June 30) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Net (Loss) Income Attributable to Common Stockholders | $(27,307) | $78,365 | | Basic EPS | $(1.51) | $4.23 | | Diluted EPS | $(1.51) | $4.18 | | Weighted average common shares outstanding—Basic | 18,144 | 18,518 | Net Income Per Common Share (Six Months Ended June 30) | Metric | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Net Income Attributable to Common Stockholders | $20,154 | $521,545 | | Basic EPS | $1.11 | $27.91 | | Diluted EPS | $1.09 | $27.60 | | Weighted average common shares outstanding—Basic | 18,169 | 18,688 | - There were 3.1 million potential shares of common stock issuable due to convertible preferred stock for the three and six months ended June 30, 2024[69] 9. Commitments and Contingencies This section outlines the company's future firm commitments, including transportation and sales, and discusses legal proceedings Firm Transportation and Gathering Commitments (in thousands) | Year | Amount | | :----------------------------------- | :------------ | | Remaining 2024 | $111,569 | | 2025 | $137,728 | | 2026 | $134,257 | | 2027 | $136,425 | | 2028 | $136,581 | | Thereafter | $600,031 | | Total | $1,256,591 | Future Firm Sales Commitments (MMBtu per day) | Year | Volume | | :----------------------------------- | :------------ | | Remaining 2024 | 10,000 | | 2025 | 68,000 | | 2026 | 75,000 | | 2027 | 12,000 | | Total | 165,000 | - The Company has approximately $7.2 million in remaining commitments to purchase inventory and other materials for 2024[76] - Management believes no pending or threatened lawsuit or dispute is likely to have a material adverse effect on future consolidated financial position, results of operations or cash flows[84] 10. Derivative Instruments This section describes the company's use of derivative instruments to manage commodity price risk and their financial impact - The Company hedges 30% to 70% of forecasted current year annual production, typically for the next 12 to 36 months, and does not use derivatives for speculative purposes[86] Total Commodity Derivative Position (in thousands) | Metric | June 30, 2024 | December 31, 2023 | | :----------------------------------- | :------------ | :---------------- | | Short-term derivative asset | $147,243 | $233,226 | | Long-term derivative asset | $38,220 | $47,566 | | Short-term derivative liability | $(43,838) | $(21,963) | | Long-term derivative liability | $(20,941) | $(18,602) | | Total commodity derivative position | $120,684 | $240,227 | Total (Losses) Gains on Natural Gas, Oil and NGL Derivatives (Three Months Ended June 30, in thousands) | Category | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Total (losses) gains on natural gas, oil and NGL derivatives | $(8,615) | $96,788 | Total Gains on Natural Gas, Oil and NGL Derivatives (Six Months Ended June 30, in thousands) | Category | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Total gains on natural gas, oil and NGL derivatives | $36,521 | $474,849 | 11. Fair Value Measurements This section categorizes financial assets and liabilities based on their fair value measurement levels and valuation techniques - Fair value measurements are classified into Level 1 (quoted prices in active markets), Level 2 (observable inputs other than Level 1), and Level 3 (unobservable inputs)[105] Financial Assets and Liabilities by Valuation Level (June 30, 2024, in thousands) | Category | Level 1 | Level 2 | Level 3 | | :----------------------------------- | :------ | :------ | :------ | | Derivative instruments (Assets) | $— | $185,463 | $— | | Contingent consideration arrangement (Assets) | $— | $— | $2,900 | | Derivative instruments (Liabilities) | $— | $64,779 | $— | - The fair value of the contingent consideration arrangement was $2.9 million at June 30, 2024, with no gain or loss recognized for the three and six months ended June 30, 2024[107] 12. Revenue from Contracts with Customers This section explains the company's revenue recognition policies and details receivables arising from customer contracts - Revenue is recognized when performance obligations are satisfied, typically upon delivery and transfer of product control, with variable consideration based on market pricing[110] - Gathering, processing, compression, and transportation fees are presented as expenses[111] Receivables from Contracts with Customers (in millions) | Metric | June 30, 2024 | December 31, 2023 | | :----------------------------------- | :------------ | :---------------- | | Receivables from contracts with customers | $94.3 | $122.5 | 13. Leases This section provides information on the company's operating leases, including lease costs, terms, and discount rates - The Company has operating leases for drilling rigs, office space, and other equipment, with terms typically one to five years[115][116] Total Lease Cost (in thousands) | Period | 2024 | 2023 | | :----------------------------------- | :------------ | :------------ | | Three months ended June 30 | $9,401 | $11,493 | | Six months ended June 30 | $22,755 | $24,184 | - The weighted-average remaining lease term as of June 30, 2024, was 0.86 years, with a weighted-average discount rate of 6.65%[120] 14. Income Taxes This section details the company's effective income tax rates, deferred tax assets, and valuation allowances Effective Income Tax Rate | Period | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Three months ended June 30 | 22.8% | 0% | | Six months ended June 30 | 22.0% | 0% | - The higher effective tax rates in 2024 are primarily related to the valuation allowance the Company had in place at June 30, 2023[121] - The Company has an $85.8 million valuation allowance associated with its federal and state deferred tax assets[122] 15. Related Party Transactions This section discloses transactions between the company and its related parties, such as common stock repurchases - On March 19, 2024, the Company purchased 97,219 shares of common stock from Silver Point Capital, L.P. for approximately $15.0 million under the Repurchase Program[123] - In June 2023, the Company purchased 215,060 shares from Silver Point Capital, L.P. for approximately $20.4 million[123] 16. Subsequent Events This section reports significant events that occurred after the balance sheet date but before the financial statements were issued Natural Gas Basis Swaps Entered Subsequent to June 30, 2024 (as of July 29, 2024) | Period | Type of Derivative Instrument | Index | Daily Volume (MMBtu/d) | Weighted Average Price ($/MMBtu) | | :----------------------------------- | :---------------------------- | :---------- | :--------------------- | :------------------------------- | | 2025 | Basis Swaps | TETCO M2 | 20,000 | $(0.93) | Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations This section provides management's analysis of Gulfport Energy's financial condition and results of operations, highlighting operational and financial achievements, production and drilling activities, and a detailed comparison of financial performance for the three and six months ended June 30, 2024, versus 2023, along with discussions on liquidity and capital resources Introduction This section introduces the Management's Discussion and Analysis, updating financial condition and operational changes - MD&A updates the financial condition discussion from the 2023 Form 10-K and analyzes changes for the periods ended June 30, 2024 and 2023[127] Overview This section provides an overview of Gulfport's business, focusing on its natural gas-weighted E&P strategy and principal properties - Gulfport is a natural gas-weighted E&P company with principal properties in eastern Ohio (Utica and Marcellus) and central Oklahoma (SCOOP Woodford and Springer formations)[128] - Strategy focuses on safe, environmentally responsible asset development, sustainable cash flow generation, margin improvement, operating efficiencies, and capital returns to shareholders[128] Recent Developments This section highlights recent corporate actions, including credit facility reaffirmation, share repurchases, and market volatility impacts - On April 18, 2024, the Credit Facility borrowing base was reaffirmed at $1.1 billion with elected commitments remaining at $900 million[129] - During Q2 2024, the Company repurchased 160,622 shares for $25.0 million at a weighted average price of $155.65 per share[129] - Global conflicts (Ukraine, Middle East) are increasing volatility in financial and energy markets, amplifying inflation and supply chain constraints[129] 2024 Operational and Financial Highlights This section summarizes key operational and financial achievements for the second quarter of 2024, including production and liquidity - Total net production averaged 1,050.1 MMcfe per day in Q2 2024[130] - Generated $123.5 million of operating cash flows[130] - Repurchased 160,622 shares for $25.0 million[130] - Exited Q2 2024 with total liquidity of $707.4 million[130] 2024 Production and Drilling Activity This section details the company's production volumes and drilling activities for the reported periods, including well spuds and sales Total Net Production (MMcfe/day) | Period | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Three Months Ended | 1,050,137 | 1,039,323 | | Six Months Ended | 1,051,929 | 1,048,292 | Natural Gas Production (Mcf/day) | Period | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Three Months Ended | 972,487 | 945,910 | | Six Months Ended | 973,025 | 945,163 | - In Q2 2024, five gross (5.0 net) wells were spud and four gross (3.8 net) operated Utica wells commenced sales[134] - As of July 29, 2024, one operated drilling rig was running in Ohio (Utica formation), with no operated drilling rigs in SCOOP[134] Comparison of Quarter-to-Date This section compares the company's financial performance for the three months ended June 30, 2024, against the same period in 2023 Natural Gas, Oil and Condensate and NGL Sales (Three Months Ended June 30, in thousands) | Category | June 30, 2024 | June 30, 2023 | % Change | | :----------------------------------- | :------------ | :------------ | :------- | | Natural gas sales | $144,458 | $159,246 | (9)% | | Oil and condensate sales | $19,127 | $22,602 | (15)% | | NGL sales | $26,147 | $26,070 | — % | | Total sales | $189,732 | $207,918 | (9)% | Average Price, Including Settled Derivatives ($/Mcfe) | Period | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Natural gas | $2.66 | $2.42 | | Oil and condensate | $75.43 | $71.45 | | NGL | $27.93 | $26.27 | | Combined | $2.93 | $2.76 | Key Operating Expenses Per Mcfe (Three Months Ended June 30) | Expense Category | June 30, 2024 | June 30, 2023 | % Change | | :----------------------------------- | :------------ | :------------ | :------- | | Lease operating expenses | $0.17 | $0.17 | (3)% | | Taxes other than income | $0.07 | $0.08 | (13)% | | Transportation, gathering, processing and compression | $0.91 | $0.91 | — % | | Depreciation, depletion and amortization | $0.82 | $0.85 | (3)% | | General and administrative expenses, net | $0.11 | $0.09 | 24% | - Interest expense increased by 10% to $15.2 million, driven by a higher average outstanding balance on the Credit Facility[147] Comparison of Year-to-Date This section compares the company's financial performance for the six months ended June 30, 2024, against the same period in 2023 Natural Gas, Oil and Condensate and NGL Sales (Six Months Ended June 30, in thousands) | Category | June 30, 2024 | June 30, 2023 | % Change | | :----------------------------------- | :------------ | :------------ | :------- | | Natural gas sales | $332,744 | $441,780 | (25)% | | Oil and condensate sales | $40,828 | $53,316 | (23)% | | NGL sales | $54,253 | $65,982 | (18)% | | Total sales | $427,825 | $561,078 | (24)% | Average Price, Including Settled Derivatives ($/Mcfe) | Period | June 30, 2024 | June 30, 2023 | | :----------------------------------- | :------------ | :------------ | | Natural gas | $2.77 | $2.87 | | Oil and condensate | $73.38 | $71.26 | | NGL | $28.73 | $29.47 | | Combined | $3.05 | $3.24 | Key Operating Expenses Per Mcfe (Six Months Ended June 30) | Expense Category | June 30, 2024 | June 30, 2023 | % Change | | :----------------------------------- | :------------ | :------------ | :------- | | Lease operating expenses | $0.17 | $0.19 | (10)% | | Taxes other than income | $0.08 | $0.10 | (19)% | | Transportation, gathering, processing and compression | $0.90 | $0.91 | (1)% | | Depreciation, depletion and amortization | $0.83 | $0.84 | (1)% | | General and administrative expenses, net | $0.10 | $0.09 | 14% | - Interest expense increased by 10% to $30.2 million, primarily due to a higher average outstanding balance on the Credit Facility[161] Liquidity and Capital Resources This section discusses the company's financial resources, including cash flow, debt, and capital expenditures, to meet future obligations - The Company believes its annual free cash flow, Credit Facility borrowing capacity, and cash on hand will provide sufficient liquidity for the next 12 months and foreseeable future[166] Liquidity and Debt (in millions) | Metric | June 30, 2024 | July 29, 2024 | | :----------------------------------- | :------------ | :------------ | | Cash and cash equivalents | $1.2 | $4.3 | | Outstanding borrowings under Credit Facility | $130.0 | $132.0 | | Letters of credit outstanding | $63.8 | $63.8 | | Outstanding 2026 Senior Notes | $550.0 | $550.0 | | Total principal amount of funded debt | $680.0 | $682.0 | - Capital expenditures for the six months ended June 30, 2024, totaled $265.5 million, including $212.5 million for drilling and completion[173] - Estimated 2024 drilling and completion capital expenditures are $330-$360 million, with expected production of 1,055 to 1,070 MMcfe per day[174] - Off-balance sheet arrangements include $63.8 million in letters of credit and $43.8 million in surety bonds, primarily for firm transportation agreements[182] Item 3. Quantitative and Qualitative Disclosures About Market Risk Gulfport utilizes derivative instruments, including swaps, options, costless collars, and basis swaps, to manage exposure to volatile natural gas, oil, and NGL prices. As of June 30, 2024, the net asset derivative position was $120.7 million. The company is also exposed to interest rate risk on its floating-rate Credit Facility - The Company uses derivative instruments (swaps, options, costless collars, basis swaps) to mitigate risks from volatile natural gas, oil, and NGL prices[188][191][192] - The net asset derivative position was $120.7 million at June 30, 2024, down from $240.2 million at December 31, 2023[193] - A 10% increase in underlying commodity prices would decrease the asset by approximately $78.0 million, while a 10% decrease would increase it by $76.3 million[193] - The Credit Facility bears floating interest rates, exposing the Company to interest rate risk. As of June 30, 2024, $130.0 million was outstanding at a weighted average rate of 8.33% for the six months[194] Item 4. Controls and Procedures Management, under the supervision of the CEO and CFO, concluded that Gulfport's disclosure controls and procedures were effective as of June 30, 2024. No material changes in internal control over financial reporting occurred during the last fiscal quarter - As of June 30, 2024, disclosure controls and procedures were evaluated and deemed effective by the CEO and CFO[196] - Controls provide reasonable, not absolute, assurance due to inherent limitations and judgment in cost-benefit analysis[197] - No material changes in internal control over financial reporting occurred during the last fiscal quarter[198] PART II OTHER INFORMATION This section contains additional required disclosures not covered in the financial statements, including legal, risk, and equity matters Item 1. Legal Proceedings Information regarding legal proceedings is detailed in Note 9 of the consolidated financial statements, which covers ongoing litigation and regulatory matters - Legal proceedings information is set forth in Note 9 of the consolidated financial statements[200] Item 1A. Risk Factors The Company's business is subject to various risks that could materially adversely affect its financial condition, operating results, liquidity, and stock price. These factors are described in detail in Item 1A of the Annual Report on Form 10-K for the year ended December 31, 2023, and elsewhere in this Form 10-Q - Factors that could materially adversely affect the business are described in Item 1A of the Annual Report on Form 10-K for 2023 and elsewhere in this Form 10-Q[201] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds There were no unregistered sales of equity securities during the period. The Company repurchased 289,884 shares of common stock for tax withholding requirements and under its publicly announced repurchase program during the three months ended June 30, 2024 - No unregistered sales of equity securities occurred[201] Common Stock Repurchase Activity (Three Months Ended June 30, 2024) | Period | Total Number of Shares Purchased | Average Price Paid per Share | Total number of shares purchased as part of publicly announced plans or programs | Approximate maximum dollar value of shares that may yet be purchased under plans or programs | | :----------------------------------- | :------------------------------- | :--------------------------- | :------------------------------------------------------------------------------- | :----------------------------------------------------------------------------------------- | | April 1 - April 30 | 5,345 | $163.62 | — | $220,858,000 | | May 1 - May 31 | 204,652 | $157.35 | 80,837 | $208,263,000 | | June 1 - June 30 | 79,887 | $155.49 | 79,785 | $195,858,000 | | Total | 289,884 | $156.95 | 160,622 | | Item 3. Defaults Upon Senior Securities There were no defaults upon senior securities during the reporting period - No defaults upon senior securities occurred[202] Item 4. Mine Safety Disclosures This item is not applicable to Gulfport Energy Corporation - Mine Safety Disclosures are not applicable[202] Item 5. Other Information No officers or directors adopted or terminated any Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during the three months ended June 30, 2024 - No officers or directors adopted or terminated Rule 10b5-1 trading arrangements or non-Rule 10b5-1 trading arrangements during Q2 2024[203] Item 6. Exhibits This section lists all exhibits filed as part of the Form 10-Q, including certifications, XBRL documents, and previously incorporated by reference documents such as the Amended Joint Chapter 11 Plan of Reorganization and Amended and Restated Certificate of Incorporation and Bylaws - Exhibits include certifications (31.1, 31.2, 32.1, 32.2) and XBRL documents (101.INS, 101.SCH, 101.CAL, 101.DEF, 101.LAB, 101.PRE, 104)[204] - Previously incorporated documents include the Amended Joint Chapter 11 Plan of Reorganization (Exhibit 2.1) and Amended and Restated Certificate of Incorporation and Bylaws (Exhibits 3.1, 3.2)[204] Signatures The report is signed on behalf of Gulfport Energy Corporation by Michael Hodges, Chief Financial Officer, on August 7, 2024 - The report was signed by Michael Hodges, Chief Financial Officer, on August 7, 2024[205]