Kosmos Energy(US:KOS)2023-02-28 14:24Financial Performance - Oil and gas revenue for 2022 reached $2,245.4 million, a significant increase of 68.7% compared to $1,332.0 million in 2021[496]. - Total revenues and other income for 2022 amounted to $2,299.8 million, up 72.5% from $1,333.8 million in 2021[496]. - Net income for 2022 was $226.6 million, a turnaround from a net loss of $77.8 million in 2021[496]. - Basic net income per share for 2022 was $0.50, compared to a loss of $0.19 per share in 2021[496]. - Total costs and expenses increased to $1,962.7 million in 2022, up 42.4% from $1,377.2 million in 2021[496]. - Net cash provided by operating activities for 2022 was $1,130.5 million, a substantial increase from $374.3 million in 2021[501]. - The company did not declare dividends in 2022, maintaining a dividend of $0.0452 per share in 2021[496]. Assets and Liabilities - The net book value of the company's oil and gas properties was $3.8 billion as of December 31, 2022, with a depletion expense of $471.4 million for the year[472]. - As of December 31, 2022, the company's asset retirement obligations totaled $302.5 million[475]. - The company's total assets decreased from $4,940.7 million in 2021 to $4,580.0 million in 2022, reflecting a decline of approximately 7.3%[494]. - Long-term debt decreased from $2,590.5 million in 2021 to $2,195.9 million in 2022, a reduction of approximately 15.2%[494]. - The company's accumulated deficit improved from $(1,712.4) million in 2021 to $(1,485.8) million in 2022, indicating a reduction of approximately 13.3%[494]. - The company's total current liabilities increased from $530.9 million in 2021 to $574.3 million in 2022, an increase of approximately 8.2%[494]. Risk Management - The company manages market and counterparty credit risk in accordance with established policies, determining the timing and extent of derivative transactions[449]. - The company utilizes oil derivative contracts to mitigate exposure to commodity price risk, reflecting a proactive approach to risk management[528]. - As of December 31, 2022, the company's open commodity derivative instruments were in a net asset position of $1.5 million, with a hypothetical 10% price increase in commodity futures expected to decrease future pre-tax earnings by approximately $30.8 million[457]. Impairments and Write-downs - The company recorded an impairment of $450.0 million related to certain oil and gas proved properties during the year ended December 31, 2022[479]. - The company reported an impairment of long-lived assets of $450.0 million in 2022, compared to no impairment in 2021[501]. - Impairment charges of $450,000,000 were recognized for long-lived assets due to negative proved oil and gas reserve revisions, reducing the carrying value of the TEN Fields to an estimated fair value of $235,700,000[628]. Capital Expenditures and Investments - The company is focused on expanding its operations in the offshore Atlantic Margins, particularly in Ghana, Equatorial Guinea, and the U.S. Gulf of Mexico[504]. - In March 2022, the company acquired an additional 5.5% interest in the Winterfell area for $9.6 million, increasing its participating interest to 25.0% in certain Green Canyon blocks[540]. - In June 2022, the company acquired an additional 5.9% interest in the Kodiak oil field for approximately $29.0 million, raising its working interest from 29.1% to 35.0%[542]. - The company extended the Block G petroleum contract term to 2040, agreeing to a work program that includes drilling three development wells and one exploration well[541]. Debt and Financing - Outstanding borrowings totaled approximately $770.0 million as of December 31, 2022, with a weighted average interest rate of 8.3%, exposing the company to interest rate risk[458]. - The Company issued $650 million of 7.125% Senior Notes in April 2019, with net proceeds of approximately $640 million used to redeem previous notes and repay debt[587]. - The Company issued $400 million of 7.750% Senior Notes in October 2021, receiving net proceeds of approximately $395 million for refinancing purposes[594]. - The Company issued $450 million of 7.500% Senior Notes in March 2021, with net proceeds of approximately $444.4 million used to repay debt and for general corporate purposes[601]. - The GoM Term Loan bears an effective interest rate of approximately 6.9% per annum and includes an accordion feature for incremental commitments of up to $100 million[607]. Shareholder Equity and Compensation - The total equity-based compensation to be recognized on unvested restricted stock units was $20,100,000 over a weighted average period of 1.7 years as of December 31, 2022[636]. - Share-based compensation expense for the year ended December 31, 2022, was $34,546,000, an increase from $31,651,000 in 2021[640]. - The fair value of awards vested in 2022 was $22,205,000, significantly higher than $9,435,000 in 2021[640]. Taxation - The total tax benefit for the year ended December 31, 2022, was $5,933,000, compared to $5,786,000 in 2021[640]. - The net tax shortfall (windfall) for the year ended December 31, 2022, was $673,000, a decrease from $6,307,000 in 2021[640].