Pioneer Natural Resources(US:PXD)2022-08-02 20:52Financial Performance - Net income attributable to common stockholders for Q2 2022 was $2.4 billion ($9.30 per diluted share), up from $380 million ($1.54 per diluted share) in Q2 2021, reflecting a $2.0 billion increase in oil and gas revenues due to a 69% rise in average realized commodity prices per BOE [158]. - Oil and gas revenues for Q2 2022 reached $4.639 billion, a 73% increase from $2.682 billion in Q2 2021, with total revenues for the first half of 2022 at $8.570 billion, up from $4.505 billion in the same period of 2021 [173]. - The company reported a net loss of $56 million in interest and other income for Q2 2022, compared to a loss of $20 million in Q2 2021 [179]. - Gain on disposition of assets increased to $36 million in Q2 2022 from $2 million in Q2 2021, primarily due to divestments in the Midland Basin [190]. - The income tax provision increased significantly from $120 million in H1 2021 to $657 million in H1 2022, driven by a $2.5 billion increase in income before income taxes [218]. - Net cash provided by operating activities rose from $1,843 million in H1 2021 to $5,805 million in H1 2022, an increase of $3,962 million [227]. Production and Sales - Average daily sales volumes increased by 2% to 642,844 BOEPD in Q2 2022 compared to 629,468 BOEPD in Q2 2021, driven by successful horizontal drilling and production from the DoublePoint Acquisition [158]. - The company expects average daily production for Q3 2022 to be between 635 - 660 MBOE, with average daily oil production projected at 345 - 360 MBbls [164]. - The company successfully completed 214 horizontal wells in the Midland Basin during the first half of 2022, with 51% of these wells being Spraberry interval wells [171]. - The company entered into long-term marketing contracts to purchase and sell 40,000 barrels of oil per day starting May 2022 and 30,000 barrels per day starting August 2022 [186]. Costs and Expenses - Production costs per BOE for Q3 2022 are estimated to be between $12.00 - $13.50, with DD&A costs projected at $10.50 - $12.00 [164]. - Oil and gas production costs rose to $478 million in Q2 2022, up from $316 million in Q2 2021, marking a $162 million increase [192]. - Total production costs per BOE increased by 48% to $8.18 in Q2 2022 from $5.51 in Q2 2021, with lease operating expenses rising by 22% and gathering, processing, and transportation expenses increasing by 70% [195]. - Lease operating expense per BOE increased by 22% to $3.71 for the three months ended June 30, 2022, compared to $3.05 in 2021 [195]. - Gathering, processing, and transportation expense per BOE rose by 70% to $4.53 for the three months ended June 30, 2022, compared to $2.66 in 2021 [195]. - Workover costs per BOE surged by 162% to $1.02 for the three months ended June 30, 2022, compared to $0.39 in 2021 [195]. - Production and ad valorem taxes increased by 118% to $271 million for the three months ended June 30, 2022, compared to $153 million in 2021 [198]. Dividends and Share Repurchases - The company declared and paid variable dividends of $2.3 billion, or $9.60 per common share, during the six months ended June 30, 2022 [230]. - The company paid base dividends of $530 million, or $1.56 per common share, in H1 2022, compared to $213 million, or $1.11 per common share, in H1 2021 [229]. - The Company paid dividends of $2.9 billion in 2022, including a quarterly base dividend of $1.10 per share and a variable dividend of $7.47 per share declared on August 2, 2022 [40][233]. - The company repurchased 2.1 million shares for $499 million during Q2 2022, compared to no share repurchases in Q2 2021 [162]. Capital Expenditures and Financial Position - The capital budget for 2022 was revised to a range of $3.6 billion to $3.8 billion, up from the previous range of $3.3 billion to $3.6 billion, due to inflation impacts [223]. - As of June 30, 2022, the company had unrestricted cash of $2.6 billion and $2.0 billion of unused borrowing capacity under its Credit Facility [225]. - The company expects to fund its 2022 capital budget primarily from operating cash flow and cash on hand [224]. - The company redeemed $1.3 billion of its outstanding senior notes during the six months ended June 30, 2022 [231]. Commodity Prices and Derivatives - Average oil prices for Q2 2022 were $108.41 per Bbl, up from $66.07 per Bbl in Q2 2021, while average gas prices increased to $6.76 per Mcf from $2.83 per Mcf [160]. - Noncash derivative gain for commodity price derivatives was $72 million in Q2 2022, a significant recovery from a loss of $279 million in Q2 2021 [183]. - The company experienced a total commodity derivative loss of $3 million in Q2 2022, a substantial improvement from a loss of $836 million in Q2 2021 [183]. - The company’s derivative obligations as of June 30, 2022, represented net liabilities of $442 million, including $167 million related to offsetting oil and gas commodity derivative trades [245]. Other Financial Metrics - Cash interest expense decreased by 20.5% to $31 million for the three months ended June 30, 2022, compared to $39 million in 2021 [212]. - The weighted average cash interest rate on the Company's indebtedness decreased to 1.8% for the six months ended June 30, 2022, compared to 1.9% in 2021 [213]. - The effective tax rate for Q2 2022 was 22%, a decrease of 2% from 24% in Q2 2021 [218]. - Other expenses decreased from $47 million in Q2 2021 to $5 million in Q2 2022, primarily due to $36 million in transaction costs related to acquisitions [215].