Comstock Resources(CRK)2025-05-01 17:33Financial Performance - Natural gas and oil sales for Q1 2025 were $413.0 million, an increase of $125.0 million (43%) compared to $288.0 million in Q1 2024, driven by higher natural gas prices[92]. - The company reported a net loss of $115.4 million, or $0.40 per share, for Q1 2025, compared to a net loss of $14.5 million, or $0.05 per share, in Q1 2024[104]. - Interest expense increased to $54.8 million in Q1 2025 from $49.6 million in Q1 2024, primarily due to the issuance of an additional $400.0 million in senior notes[102]. Production and Sales - The average realized price for natural gas in Q1 2025 was $3.58 per Mcf, a 74% increase from $2.06 per Mcf in Q1 2024[92]. - Natural gas production decreased by 18% to 115.0 Bcf in Q1 2025 from 139.4 Bcf in Q1 2024[92]. - Gas services revenue increased by $52.1 million (109%) to $99.9 million in Q1 2025 from $47.8 million in Q1 2024, primarily due to higher natural gas prices[94]. Capital Expenditures and Liquidity - Total capital expenditures for Q1 2025 were $298.3 million, a decrease from $348.2 million in Q1 2024[106]. - As of March 31, 2025, the company had $1.0 billion in liquidity, including $990 million of unused borrowing capacity[111]. - The company expects to spend an additional $780 million to $880 million on drilling, completion, and infrastructure activities in the remaining nine months of 2025[110]. Debt and Financial Obligations - The company had approximately $3.1 billion principal amount of long-term debt outstanding, with $965.0 million at a fixed rate of 5.875% and $1.62 billion at a fixed rate of 6.75%[121]. - The fair market value of the 5.875% senior notes due in 2030 was $909.5 million, while the 6.75% senior notes due in 2029 had a fair market value of $1.58 billion[121]. - The company is subject to financial covenants, including maintaining a leverage ratio of less than 4.0 to 1.0, which will reduce to 3.75 to 1.0 by June 30, 2025[114]. Tax and Regulatory Matters - The company reported $743.0 million in U.S. federal net operating loss (NOL) carryforwards and $1.8 billion in certain state NOL carryforwards, with an estimated $740.6 million and $1.2 billion expected to expire unused[115]. - The company is currently under examination by the IRS and the state of Louisiana, but believes its significant filing positions will be sustained[116]. Market Conditions and Risk - The company’s financial condition is highly dependent on the prevailing market prices of natural gas and oil, which are subject to wide fluctuations[118]. - An increase of 10% in the market price of natural gas would decrease the fair value of the company's natural gas price swaps and collars by approximately $154.2 million[120]. - The company had natural gas price swaps hedging approximately 149.9 Bcf of 2025 production at an average price of $3.48 per MMBtu and 116.8 Bcf of 2026 production at an average price of $3.51 per MMBtu[119]. Taxation and Fees - The company pays a commitment fee of 0.375% to 0.50% on the unused portion of the committed borrowing base under its bank credit facility[114]. - Production and ad valorem taxes decreased by $6.7 million (38%) to $11.2 million in Q1 2025 from $17.9 million in Q1 2024[95].