Gulfport Energy(GPOR) - 2025 Q2 - Quarterly Results

Production Volumes by Asset Area Production Volumes by Asset Area: Three Months Ended June 30, 2025 For the three months ended June 30, 2025, total natural gas production decreased by 8.3% year-over-year, while oil and condensate production significantly increased by 185.5% Production Volumes by Asset Area: Three Months Ended June 30, 2025 | Production Type | June 30, 2025 (Mcf/day or Bbl/day) | June 30, 2024 (Mcf/day or Bbl/day) | YoY Change (%) | | :---------------- | :--------------------------------- | :--------------------------------- | :------------- | | Natural gas (Total) | 891,359 | 972,487 | -8.3% | | Oil and condensate (Total) | 7,843 | 2,747 | 185.5% | | NGL (Total) | 11,313 | 10,195 | 11.0% | | Combined (Total Mcfe/day) | 1,006,299 | 1,050,137 | -4.2% | - Utica & Marcellus remained the dominant asset area for natural gas production (736,420 Mcf/day) and combined equivalents (800,557 Mcfe/day) for the three months ended June 30, 2025[3] Production Volumes by Asset Area: Six Months Ended June 30, 2025 Over the six months ended June 30, 2025, total natural gas production decreased by 11.1% compared to the prior year, while oil and condensate production more than doubled Production Volumes by Asset Area: Six Months Ended June 30, 2025 | Production Type | June 30, 2025 (Mcf/day or Bbl/day) | June 30, 2024 (Mcf/day or Bbl/day) | YoY Change (%) | | :---------------- | :--------------------------------- | :--------------------------------- | :------------- | | Natural gas (Total) | 864,735 | 973,025 | -11.1% | | Oil and condensate (Total) | 6,570 | 3,038 | 116.3% | | NGL (Total) | 10,641 | 10,113 | 5.2% | | Combined (Total Mcfe/day) | 968,002 | 1,051,929 | -8.0% | - Similar to the three-month period, Utica & Marcellus was the largest contributor to natural gas (711,829 Mcf/day) and combined equivalent production (766,023 Mcfe/day) for the six months ended June 30, 2025[5] Production and Pricing Production and Pricing: Three Months Ended June 30, 2025 For the three months ended June 30, 2025, total sales significantly increased by 64.2% year-over-year, driven by higher natural gas and oil prices Production and Pricing: Three Months Ended June 30, 2025 | Metric | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------------------- | :------------ | :------------ | :------------- | | Total Sales (Natural gas, oil, NGL) | $311,515 | $189,732 | 64.2% | | Natural Gas Production Volumes (MMcf) | 81,114 | 88,496 | -8.3% | | Oil and Condensate Production Volumes (MBbl) | 714 | 250 | 185.6% | | NGL Production Volumes (MBbl) | 1,030 | 928 | 11.0% | | Average Price, including settled derivatives ($/Mcf) - Natural Gas | $3.19 | $2.66 | 19.9% | | Average Price, including settled derivatives ($/Bbl) - Oil | $61.58 | $75.43 | -18.3% | | Average Price, including settled derivatives ($/Bbl) - NGL | $27.65 | $27.93 | -1.0% | | Total Production Costs ($/Mcfe) | $1.22 | $1.14 | 7.0% | - The impact from settled derivatives on natural gas prices decreased significantly from $1.03/Mcf in 2024 to $0.22/Mcf in 2025, while for oil, it shifted from a negative impact of ($1.08)/Bbl to a positive $3.38/Bbl[7] Production and Pricing: Six Months Ended June 30, 2025 For the six months ended June 30, 2025, total sales increased by 53.1% year-over-year, primarily due to higher natural gas and oil prices Production and Pricing: Six Months Ended June 30, 2025 | Metric | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------------------- | :------------ | :------------ | :------------- | | Total Sales (Natural gas, oil, NGL) | $655,097 | $427,825 | 53.1% | | Natural Gas Production Volumes (MMcf) | 156,517 | 177,091 | -11.6% | | Oil and Condensate Production Volumes (MBbl) | 1,189 | 553 | 115.0% | | NGL Production Volumes (MBbl) | 1,926 | 1,841 | 4.6% | | Average Price, including settled derivatives ($/Mcf) - Natural Gas | $3.39 | $2.77 | 22.4% | | Average Price, including settled derivatives ($/Bbl) - Oil | $63.68 | $73.38 | -13.2% | | Average Price, including settled derivatives ($/Bbl) - NGL | $30.07 | $28.73 | 4.7% | | Total Production Costs ($/Mcfe) | $1.26 | $1.15 | 9.6% | - The average price for natural gas without the impact of derivatives increased from $1.88/Mcf in 2024 to $3.34/Mcf in 2025, contributing significantly to the overall sales increase[8] Consolidated Statements of Income Consolidated Statements of Income: Three Months Ended June 30, 2025 For the three months ended June 30, 2025, Gulfport Energy reported a significant turnaround, moving from a net loss to substantial net income Consolidated Statements of Income: Three Months Ended June 30, 2025 | Metric (in thousands, except per share) | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------- | :------------ | :------------ | :------------- | | Total Revenues | $447,616 | $181,117 | 147.1% | | Net gain (loss) on derivatives | $136,101 | ($8,615) | N/A | | Income (Loss) from Operations | $250,768 | ($18,119) | N/A | | Net Income (Loss) | $184,466 | ($26,212) | N/A | | Net Income (Loss) Attributable to Common Stockholders | $163,040 | ($27,307) | N/A | | Basic EPS | $9.21 | ($1.51) | N/A | | Diluted EPS | $9.12 | ($1.51) | N/A | - Income tax expense shifted from a benefit of ($7,587) thousand in 2024 to an expense of $51,670 thousand in 2025, reflecting the company's improved profitability[10] Consolidated Statements of Income: Six Months Ended June 30, 2025 For the six months ended June 30, 2025, Gulfport Energy reported a substantial increase in net income and income from operations compared to the prior year Consolidated Statements of Income: Six Months Ended June 30, 2025 | Metric (in thousands, except per share) | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------- | :------------ | :------------ | :------------- | | Total Revenues | $644,650 | $464,346 | 38.8% | | Net (loss) gain on derivatives | ($10,447) | $36,521 | N/A | | Income from Operations | $262,782 | $63,647 | 312.9% | | Net Income | $184,002 | $25,823 | 612.5% | | Net Income Attributable to Common Stockholders | $161,951 | $20,154 | 703.6% | | Basic EPS | $9.10 | $1.11 | 719.8% | | Diluted EPS | $9.01 | $1.09 | 726.6% | - Operating expenses decreased by 4.7% year-over-year, contributing to the significant increase in income from operations[12] Consolidated Balance Sheets Consolidated Balance Sheets as of June 30, 2025 As of June 30, 2025, Gulfport Energy's total assets increased by 3.3% from December 31, 2024, primarily driven by an increase in net property and equipment Consolidated Balance Sheets as of June 30, 2025 | Metric (in thousands) | June 30, 2025 | December 31, 2024 | Change (%) | | :-------------------------------------- | :------------ | :---------------- | :--------- | | Total Assets | $2,959,457 | $2,865,697 | 3.3% | | Total Current Assets | $197,923 | $231,313 | -14.4% | | Total Property and Equipment, Net | $2,189,797 | $2,018,271 | 8.5% | | Total Liabilities | $1,162,422 | $1,116,956 | 4.1% | | Total Current Liabilities | $389,619 | $345,508 | 12.8% | | Long-term debt | $695,154 | $702,857 | -1.1% | | Total Stockholders' Equity | $1,765,679 | $1,711,393 | 3.2% | - Cash and cash equivalents increased significantly from $1,473 thousand at December 31, 2024, to $3,794 thousand at June 30, 2025, representing a 157.6% increase[14] - Accounts receivable—oil, natural gas, and natural gas liquids sales decreased by 17.5% from $155,942 thousand to $128,614 thousand[14] Consolidated Statement of Cash Flows Consolidated Statement of Cash Flows: Three Months Ended June 30, 2025 For the three months ended June 30, 2025, net cash provided by operating activities increased significantly, primarily due to a shift from net loss to net income and a large net gain on derivative instruments Consolidated Statement of Cash Flows: Three Months Ended June 30, 2025 | Metric (in thousands) | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------- | :------------ | :------------ | :------------- | | Net cash provided by operating activities | $231,403 | $123,465 | 87.4% | | Net cash used in investing activities | ($145,188) | ($127,546) | 13.8% | | Net cash used in financing activities | ($87,763) | ($2,895) | 2931.2% | | Net change in cash and cash equivalents | ($1,548) | ($6,976) | -77.8% | | Cash and cash equivalents at end of period | $3,794 | $1,233 | 207.7% | - Principal payments on the Credit Facility increased from $208,000 thousand in 2024 to $286,000 thousand in 2025, and common stock repurchases under the Repurchase Program increased from $24,302 thousand to $51,691 thousand[18] Consolidated Statement of Cash Flows: Six Months Ended June 30, 2025 For the six months ended June 30, 2025, net cash provided by operating activities increased significantly, driven by higher net income Consolidated Statement of Cash Flows: Six Months Ended June 30, 2025 | Metric (in thousands) | June 30, 2025 | June 30, 2024 | YoY Change (%) | | :-------------------------------------- | :------------ | :------------ | :------------- | | Net cash provided by operating activities | $408,683 | $311,487 | 31.2% | | Net cash used in investing activities | ($253,965) | ($246,498) | 3.0% | | Net cash used in financing activities | ($152,397) | ($65,685) | 132.0% | | Net change in cash and cash equivalents | $2,321 | ($696) | N/A | | Cash and cash equivalents at end of period | $3,794 | $1,233 | 207.7% | - Repurchase of common stock under the Repurchase Program increased from $38,793 thousand in 2024 to $109,500 thousand in 2025. The company also had an early retirement of 2026 Senior Notes totaling $25,702 thousand[20] 2025E Guidance Gulfport Energy's 2025 guidance projects average daily gas equivalent production between 1,040 and 1,065 MMcfe/day, with liquids production ranging from 18.0 to 20.5 MBbl/day 2025E Guidance Metrics | Metric | Low | High | | :-------------------------------------------------- | :---- | :---- | | Average daily gas equivalent (MMcfe/day) | 1,040 | 1,065 | | Average daily liquids production (MBbl/day) | 18.0 | 20.5 | | % Gas | ~89% | | | Natural gas differential to NYMEX settled price ($/Mcf) | ($0.20) | ($0.35) | | NGL (% of WTI) | 40% | 50% | | Oil differential to NYMEX WTI ($/Bbl) | ($5.50) | ($6.50) | | Lease operating expense ($/Mcfe) | $0.19 | $0.22 | | Taxes other than income ($/Mcfe) | $0.08 | $0.10 | | Transportation, gathering, processing and compression ($/Mcfe) | $0.93 | $0.97 | | Recurring cash general and administrative ($/Mcfe) | $0.12 | $0.14 | | Total base capital expenditures (in millions) | $370 | $395 | - The guidance assumes commodity strip prices as of July 14, 2025, adjusted for applicable differentials, and no property acquisitions or divestitures[21] Derivatives As of July 30, 2025, Gulfport Energy has various hedging positions across natural gas, oil, and NGLs for 3Q2025, 4Q2025, and full years 2025, 2026, and 2027 Derivative Positions as of July 30, 2025 | Contract Type | Period | Volume (BBtupd/Bblpd) | Weighted Average Price ($/MMBtu or $/Bbl) | | :-------------------------------- | :----- | :-------------------- | :---------------------------------------- | | Natural Gas Fixed Price Swaps | Full Year 2025 | 270 | $3.82 | | Natural Gas Fixed Price Collars | Full Year 2025 | 240 | Floor: $3.42, Ceiling: $4.27 | | Natural Gas Fixed Price Calls Sold | Full Year 2025 | 187 | $5.84 | | Oil Fixed Price Swaps | Full Year 2025 | 3,000 | $73.29 | | C3 Propane Fixed Price Swaps | Full Year 2025 | 3,000 | $29.89 | | Tetco M2 Basis Differential | Full Year 2025 | 230 | ($0.96) | | Rex Zone 3 Basis Differential | Full Year 2025 | 110 | ($0.20) | - Gulfport has natural gas fixed price swaps extending through 2027 and collars through 2027, indicating a long-term hedging strategy for a portion of its natural gas production[25] - Oil fixed price swaps are in place for 3Q2025, 4Q2025, and Full Year 2025, but no oil swaps are listed for 2026 or 2027[25] Non-GAAP Reconciliations Definitions of Non-GAAP Financial Measures Gulfport Energy utilizes several non-GAAP financial measures, including Adjusted Net Income, Adjusted EBITDA, Adjusted Free Cash Flow, and Recurring General and Administrative Expense, to evaluate performance and provide additional insights to investors - Adjusted Net Income is defined as net income (loss) adjusted for non-cash derivative loss (gain), non-recurring G&A, stock-based compensation, other non-material expenses, and the tax effect of these adjustments[29] - Adjusted EBITDA is calculated as net income (loss) plus interest expense, income tax expense (benefit), DD&A and accretion, non-cash derivative loss (gain), non-recurring G&A, stock-based compensation, and other non-material expenses[30] - Adjusted Free Cash Flow is defined as adjusted EBITDA plus certain non-cash items from operating activities, less interest expense, current income tax expense, capitalized expenses incurred, and capital expenditures incurred[31] Adjusted Net Income Adjusted Net Income, a non-GAAP measure, showed a significant increase for both the three and six months ended June 30, 2025, compared to the prior year Adjusted Net Income: Three and Six Months Ended June 30 Three Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net Income (Loss) (GAAP) | $184,466 | ($26,212) | N/A | | Non-cash derivative (gain) loss | ($116,661) | $99,357 | N/A | | Tax effect of adjustments | $24,469 | ($23,730) | N/A | | Adjusted Net Income (Non-GAAP) | $97,104 | $53,998 | 79.8% | Six Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net Income (GAAP) | $184,002 | $25,823 | 612.5% | | Non-cash derivative loss | $19,997 | $119,543 | -83.3% | | Tax effect of adjustments | ($6,021) | ($27,936) | -78.5% | | Adjusted Net Income (Non-GAAP) | $205,511 | $125,101 | 64.3% | - Income taxes were approximately 22% for both the three and six months ended June 30, 2025, consistent with the prior year[34][37] Adjusted EBITDA Adjusted EBITDA, a key non-GAAP liquidity measure, demonstrated strong growth for both the three and six months ended June 30, 2025 Adjusted EBITDA: Three and Six Months Ended June 30 Three Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net Income (Loss) (GAAP) | $184,466 | ($26,212) | N/A | | DD&A and accretion | $74,230 | $79,120 | -6.2% | | Non-cash derivative (gain) loss | ($116,661) | $99,357 | N/A | | Adjusted EBITDA (Non-GAAP) | $212,266 | $164,419 | 29.1% | Six Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net Income (GAAP) | $184,002 | $25,823 | 612.5% | | DD&A and accretion | $140,470 | $159,698 | -12.0% | | Non-cash derivative loss | $19,997 | $119,543 | -83.3% | | Adjusted EBITDA (Non-GAAP) | $430,583 | $350,162 | 23.0% | - The significant positive adjustment for non-cash derivative gain in 2025 (three months) and a smaller loss in 2025 (six months) compared to large losses in 2024, played a crucial role in the higher Adjusted EBITDA[39][41] Adjusted Free Cash Flow Adjusted Free Cash Flow, a non-GAAP measure indicating cash available after capital expenditures, saw substantial increases for both the three and six months ended June 30, 2025 Adjusted Free Cash Flow: Three and Six Months Ended June 30 Three Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net cash provided by operating activity (GAAP) | $231,403 | $123,465 | 87.4% | | Capital expenditures incurred | ($127,399) | ($123,141) | 3.5% | | Adjusted Free Cash Flow (Non-GAAP) | $64,589 | $20,196 | 219.8% | Six Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | Net cash provided by operating activity (GAAP) | $408,683 | $311,487 | 31.2% | | Capital expenditures incurred | ($289,762) | ($249,379) | 16.2% | | Adjusted Free Cash Flow (Non-GAAP) | $101,191 | $59,044 | 71.4% | - For the three months ended June 30, 2025, incurred capital expenditures included $2.9 million of non-D&C capital and $0.3 million of non-operated capital expenditures, excluding $6.9 million in targeted discretionary acreage acquisitions[44] - For the six months ended June 30, 2025, incurred capital expenditures included $4.3 million of non-D&C capital and $1.5 million of non-operated capital expenditures, also excluding $6.9 million in targeted discretionary acreage acquisitions[49] Recurring General and Administrative Expenses Recurring General and Administrative (G&A) expenses, a non-GAAP measure, showed a slight increase for both the three and six months ended June 30, 2025 Recurring General and Administrative Expenses: Three and Six Months Ended June 30 Three Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | General and administrative expense (GAAP) | $10,926 | $10,752 | 1.6% | | Capitalized general and administrative expense | $6,433 | $6,330 | 1.6% | | Non-recurring general and administrative expense | ($666) | ($718) | -7.2% | | Recurring general and administrative before capitalization (Non-GAAP) | $16,693 | $16,364 | 2.0% | Six Months Ended June 30: | Metric (in thousands) | 2025 | 2024 | YoY Change (%) | | :-------------------- | :--- | :--- | :------------- | | General and administrative expense (GAAP) | $19,927 | $19,950 | -0.1% | | Capitalized general and administrative expense | $12,665 | $12,035 | 5.2% | | Non-recurring general and administrative expense | ($1,031) | ($1,528) | -32.6% | | Recurring general and administrative before capitalization (Non-GAAP) | $31,561 | $30,457 | 3.6% | - The non-recurring general and administrative expenses, related to the administration of the prior Chapter 11 filing, decreased for both periods, indicating a reduction in these specific costs[53][55]