RRC
$23.54
Range Resources
($.31)
(1.30%)
Earnings Details
3rd Quarter September 2022
Monday, October 24, 2022 4:30:00 PM
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Summary

Range Resources Misses

Range Resources (RRC) reported 3rd Quarter September 2022 earnings of $1.37 per share on revenue of $1.1 billion. The consensus earnings estimate was $1.32 per share on revenue of $1.0 billion. The Earnings Whisper number was $1.38 per share. Revenue grew 267.0% on a year-over-year basis.

Range Resources Corp is a Texas-based independent natural gas, natural gas liquids & Oil company engaged in the exploration, development and acquisition of primarily gas properties, in the Southwestern & Appalachian regions of the United States.

Results
Reported Earnings
$1.37
Earnings Whisper
$1.38
Consensus Estimate
$1.32
Reported Revenue
$1.11 Bil
Revenue Estimate
$1.04 Bil
Growth
Earnings Growth
Revenue Growth
Power Rating
Grade
Earnings Release

Range Announces Third Quarter 2022 Results

FORT WORTH, Texas, Oct. 24, 2022 (GLOBE NEWSWIRE) -- RANGE RESOURCES CORPORATION (NYSE: RRC) today announced its third quarter 2022 financial results. 

Third Quarter 2022 Highlights –

  • Highest cash flow from operating activities in Company history ? $521 million
  • Highest cash flow from operations, before working capital changes, in Company history ? $550 million
  • Capital spending was $138 million, approximately 29% of the 2022 budget
  • Quarterly dividend of $0.08 per quarter initiated in September
  • Share repurchase authorization increased by $1 billion in October
  • Repurchased 5.7 million shares at an average of $29.41 per share
  • Realizations before NYMEX hedges of $7.40 per mcfe
  • Natural gas differentials, including basis hedging, averaged ($0.38) per mcf to NYMEX
  • Pre-hedge NGL realizations of $35.30 per barrel
  • Production averaged 2.13 Bcfe per day, approximately 70% natural gas

Commenting on the quarter, Jeff Ventura, the Company’s CEO said, “Range delivered record free cash flow and cash flow per share in the third quarter, allowing us to reduce net debt while increasing returns of capital to shareholders. Range has unlocked a massive inventory of high-quality wells in the Marcellus, measured in decades, and translated that inventory into a business capable of generating healthy free cash flow and returns of capital through the cycles. As a result of Range’s organic operational and financial performance, commitment to disciplined spending and confidence in free cash flow sustainability, we are tripling our share repurchase authorization to $1.5 billion. We continue to view share repurchases as a compelling investment, given favorable long-term fundamentals and the underlying value of our de-risked multi-decade core inventory. This repeatable, low-risk, low-decline asset base underpins Range’s peer-leading capital intensity and resilient free cash flow profile.”

Financial Discussion

Except for generally accepted accounting principles (“GAAP”) reported amounts, specific expense categories exclude non-cash impairments, unrealized mark-to-market adjustment on derivatives, non-cash stock compensation and other items shown separately on the attached tables. “Unit costs” as used in this release are composed of direct operating, transportation, gathering, processing and compression, production, and ad valorem taxes, general and administrative, interest and depletion, depreciation and amortization costs divided by production. See “Non-GAAP Financial Measures” for a definition of each of the non-GAAP financial measures and the tables that reconcile each of the non-GAAP measures to their most directly comparable GAAP financial measure.

Third Quarter 2022 Results

GAAP revenues for third quarter 2022 totaled $1.1 billion, GAAP net cash provided from operating activities (including changes in working capital) was $521 million, and GAAP net income was $373 million ($1.49 per diluted share).  Third quarter earnings results include a $458 million mark-to-market derivative loss due to the increases in commodity prices.

Non-GAAP revenues for third quarter 2022 totaled $1.1 billion, and cash flow from operations before changes in working capital, a non-GAAP measure, was $550 million.  Adjusted net income comparable to analysts’ estimates, a non-GAAP measure, was $336 million ($1.37 per diluted share) in third quarter 2022.

The following table details Range’s third quarter 2022 unit costs per mcfe(a):

Expenses 3Q 2022
(per mcfe)
 2Q 2022
(per mcfe)
  Increase (Decrease)
       
Direct operating $0.11  $0.10  10%
Transportation, gathering,           
processing and compression(a)  1.65   1.70  (3%)
Production and ad valorem taxes  0.04   0.04  0%
General and administrative(a)  0.16   0.17  (6%)
Interest expense(a)  0.19   0.21  (10%)
Total cash unit costs(b)  2.15   2.22  (3)%
Depletion, depreciation and           
amortization (DD&A)  0.46   0.46  0%
Total unit costs plus DD&A(b) $ 2.61  $ 2.68  (3)%


 (a)Excludes stock-based compensation, one-time settlements, and amortization of deferred financing costs.
 (b)May not add due to rounding.
   

The following table details Range’s average production and realized pricing for third quarter 2022(a):

 3Q22 Production & Realized Pricing
  Natural Gas
(Mcf)

 Oil
(Bbl)

 NGLs
(Bbl)

 Natural Gas
Equivalent
(Mcfe)

         
Net production per day  1,487,640   7,098   100,387   2,132,550 
         
Average NYMEX price $8.19  $91.55  $36.83   
Differential, including basis hedging  (0.38)  (6.86)  (1.53)  
Realized prices before NYMEX hedges  7.81   84.69   35.30   7.40 
Settled NYMEX hedges  (3.39)  (29.28)  0.44   (2.45)
Average realized prices after hedges $ 4.42  $ 55.41  $ 35.74  $ 4.95 


 (a)May not add due to rounding
   

Third quarter 2022 natural gas, NGLs and oil price realizations (including the impact of cash-settled hedges and derivative settlements) averaged $4.95 per mcfe.

  • The average natural gas price, including the impact of basis hedging, was $7.81 per mcf, or a ($0.38) per mcf differential to NYMEX. Natural gas realizations for Range have remained strong in recent months, and as a result, the Company is improving guidance for average 2022 natural gas differentials versus NYMEX to an expected range of ($0.30) to ($0.35) per mcf.

  • Range’s pre-hedge NGL price for 3Q was $35.30 per barrel, an increase of $1.25 versus the prior year quarter and approximately $1.53 below the Mont Belvieu weighted equivalent. During the third quarter, the spread between European naphtha and Mont Belvieu ethane prices decreased considerably. This change in relative pricing for a portion of Range’s sales was the primary driver of Range’s discount to Mont Belvieu for the quarter. The Company expects a slight improvement to its fourth quarter differential and further improvement into 2023 based on forward commodity pricing.

  • Crude oil and condensate price realizations, before realized hedges, averaged $84.69 per barrel, or $6.86 below WTI (West Texas Intermediate). Range continues to expect the 2022 condensate differential to average $6.00-$8.00 below WTI.

Financial Position and Share Buyback

During the third quarter, Range purchased 5.7 million shares at an average price of approximately $29.41 per share. On October 21st, Range’s Board of Directors authorized a $1 billion increase to the Company’s share repurchase program. Range currently has approximately 242 million shares outstanding and $1.2 billion of availability on the share repurchase program.

As of September 30, 2022, Range had net debt outstanding of approximately $2.2 billion, consisting of $2.4 billion of senior notes and $157 million in cash. On a trailing twelve-month basis, Range’s leverage ratio, defined as Net-Debt-to-EBITDAX, was approximately 1.0x, with further improvement expected over the coming quarters.

Capital Expenditures

Third quarter 2022 drilling and completion expenditures were $133 million. In addition, during the quarter, $5 million was invested in acreage leasehold and gathering systems. Third quarter capital spending represents approximately 29% of Range’s total capital budget in 2022. Total capital expenditures year to date were $382 million at the end of the third quarter. Range expects capital expenditures to trend toward the upper end of its full-year 2022 capital spending guidance of $460 million to $480 million.

Production and Operational Activity

Production for third quarter was 2.13 Bcfe per day, representing a 3% increase over second quarter 2022. The Company expects a similar production increase in the fourth quarter. This will place Range near the low-end of annual guidance of 2.12 – 2.16 Bcfe per day, despite unplanned third-party midstream maintenance that impacted third and fourth quarter volumes. The Company is currently producing approximately 2.2 Bcfe per day.

The table below summarizes expected 2022 activity regarding the number of wells to sales in each area.

 Wells TIL
3Q 2022
 Calendar 2022
Planned TIL
 Remaining
2022
SW PA Super-Rich0 7 3
SW PA Wet8 21 7
SW PA Dry4 26 6
NE PA Dry6 9 3
Total Wells18 63 19


Guidance – 2022

Capital & Production Guidance

As previously noted, Range is targeting holding production approximately flat at 2.12 – 2.16 Bcfe per day, approximately 30% attributed to liquids production, with expectations at the lower end of guidance for the full year 2022 given timing of third-party infrastructure maintenance. Range’s 2022 all-in capital budget is $460 million - $480 million with expectations at the upper end of the guidance.

Updated Full Year 2022 Expense Guidance

Direct operating expense:$0.09 - $0.11 per mcfe
Transportation, gathering, processing and 
compression expense:$1.56 - $1.64 per mcfe
Production tax expense:$0.04 - $0.05 per mcfe
Exploration expense:$22 - $28 million
G&A expense:$0.15 - $0.17 per mcfe
Interest expense:$0.19 - $0.21 per mcfe
DD&A expense:$0.46 - $0.50 per mcfe
Net brokered gas marketing expense:$10 - $15 million


Updated Price Guidance

Based on recent market indications, Range expects to average the following price differentials for its production.

FY 2022 Natural Gas:(1)NYMEX minus $0.30 to $0.35
4Q 2022 Natural Gas Liquids (including ethane):(2)MB minus $0.50 - $1.50 per barrel
FY 2022 Oil/Condensate:WTI minus $6.00 to $8.00


 (1)
Including basis hedging
 (2)
Mont Belvieu-equivalent pricing based on weighting of 53% ethane, 27% propane, 7% normal butane, 4% iso-butane and 9% natural gasoline.
   

Hedging Status

Range hedges portions of its expected future production volumes to increase the predictability of cash flow and to help improve and maintain a strong, flexible financial position. Please see the detailed hedging schedule posted on the Range website under Investor Relations - Financial Information.

Range has also hedged Marcellus and other basis differentials for natural gas to limit volatility between benchmark and regional prices. The combined fair value of natural gas basis hedges as of September 30, 2022, was a net gain of $23.8 million.

Conference Call Information

A conference call to review the financial results is scheduled on Tuesday, October 25 at 8:00 AM Central Time (9:00 AM Eastern Time). Please click here to pre-register for the conference call and obtain a dial in number with passcode.

A simultaneous webcast of the call may be accessed at www.rangeresources.com. The webcast will be archived for replay on the Company's website until November 24th.

Non-GAAP Financial Measures

Adjusted net income comparable to analysts’ estimates as set forth in this release represents income or loss from operations before income taxes adjusted for certain non-cash items (detailed in the accompanying table) less income taxes. We believe adjusted net income comparable to analysts’ estimates is calculated on the same basis as analysts’ estimates and that many investors use this published research in making investment decisions and evaluating operational trends of the Company and its performance relative to other oil and gas producing companies. Diluted earnings per share (adjusted) as set forth in this release represents adjusted net income comparable to analysts’ estimates on a diluted per share basis. A table is included which reconciles income or loss from operations to adjusted net income comparable to analysts’ estimates and diluted earnings per share (adjusted). On its website, the Company provides additional comparative information on prior periods along with non-GAAP revenue disclosures.

Cash flow from operations before changes in working capital (sometimes referred to as “adjusted cash flow”) as defined in this release represents net cash provided by operations before changes in working capital and exploration expense adjusted for certain non-cash compensation items. Cash flow from operations before changes in working capital is widely accepted by the investment community as a financial indicator of an oil and gas company’s ability to generate cash to internally fund exploration and development activities and to service debt. Cash flow from operations before changes in working capital is also useful because it is widely used by professional research analysts in valuing, comparing, rating and providing investment recommendations of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Cash flow from operations before changes in working capital is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operations, investing, or financing activities as an indicator of cash flows, or as a measure of liquidity. A table is included which reconciles net cash provided by operations to cash flow from operations before changes in working capital as used in this release. On its website, the Company provides additional comparative information on prior periods for cash flow, cash margins and non-GAAP earnings as used in this release.

The cash prices realized for oil and natural gas production, including the amounts realized on cash-settled derivatives and net of transportation, gathering, processing and compression expense, is a critical component in the Company’s performance tracked by investors and professional research analysts in valuing, comparing, rating and providing investment recommendations and forecasts of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Due to the GAAP disclosures of various derivative transactions and third-party transportation, gathering, processing and compression expense, such information is now reported in various lines of the income statement. The Company believes that it is important to furnish a table reflecting the details of the various components of each income statement line to better inform the reader of the details of each amount and provide a summary of the realized cash-settled amounts and third-party transportation, gathering, processing and compression expense, which were historically reported as natural gas, NGLs and oil sales. This information is intended to bridge the gap between various readers’ understanding and fully disclose the information needed.

The Company discloses in this release the detailed components of many of the single line items shown in the GAAP financial statements included in the Company’s Annual or Quarterly Reports on Form 10-K or 10-Q. The Company believes that it is important to furnish this detail of the various components comprising each line of the Statements of Operations to better inform the reader of the details of each amount, the changes between periods and the effect on its financial results.

We believe that the presentation of PV10 value of our proved reserves is a relevant and useful metric for our investors as supplemental disclosure to the standardized measure, or after-tax amount, because it presents the discounted future net cash flows attributable to our proved reserves before taking into account future corporate income taxes and our current tax structure. While the standardized measure is dependent on the unique tax situation of each company, PV10 is based on prices and discount factors that are consistent for all companies. Because of this, PV10 can be used within the industry and by credit and security analysts to evaluate estimated net cash flows from proved reserves on a more comparable basis.

RANGE RESOURCES CORPORATION (NYSE: RRC) is a leading U.S. independent natural gas and NGL producer with operations focused on stacked-pay projects in the Appalachian Basin. The Company is headquartered in Fort Worth, Texas.  More information about Range can be found at www.rangeresources.com.

Included within this release are certain “forward-looking statements” within the meaning of the federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that are not limited to historical facts, but reflect Range’s current beliefs, expectations or intentions regarding future events.  Words such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “outlook”, “estimate,” “predict,” “potential,” “pursue,” “target,” “continue,” and similar expressions are intended to identify such forward-looking statements.

All statements, except for statements of historical fact, made within regarding activities, events or developments the Company expects, believes or anticipates will or may occur in the future, such as those regarding future well costs, expected asset sales, well productivity, future liquidity and financial resilience, anticipated exports and related financial impact, NGL market supply and demand, improving commodity fundamentals and pricing, future capital efficiencies, future shareholder value, emerging plays, capital spending, anticipated drilling and completion activity, acreage prospectivity, expected pipeline utilization and future guidance information, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on assumptions and estimates that management believes are reasonable based on currently available information; however, management's assumptions and Range's future performance are subject to a wide range of business risks and uncertainties and there is no assurance that these goals and projections can or will be met. Any number of factors could cause actual results to differ materially from those in the forward-looking statements. Further information on risks and uncertainties is available in Range's filings with the Securities and Exchange Commission (SEC), including its most recent Annual Report on Form 10-K. Unless required by law, Range undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events after the date they are made.

The SEC permits oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are estimates that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions as well as the option to disclose probable and possible reserves. Range has elected not to disclose its probable and possible reserves in its filings with the SEC. Range uses certain broader terms such as "resource potential,” “unrisked resource potential,” "unproved resource potential" or "upside" or other descriptions of volumes of resources potentially recoverable through additional drilling or recovery techniques that may include probable and possible reserves as defined by the SEC's guidelines. Range has not attempted to distinguish probable and possible reserves from these broader classifications. The SEC’s rules prohibit us from including in filings with the SEC these broader classifications of reserves. These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of actually being realized. Unproved resource potential refers to Range's internal estimates of hydrocarbon quantities that may be potentially discovered through exploratory drilling or recovered with additional drilling or recovery techniques and have not been reviewed by independent engineers. Unproved resource potential does not constitute reserves within the meaning of the Society of Petroleum Engineer's Petroleum Resource Management System and does not include proved reserves. Area wide unproven resource potential has not been fully risked by Range's management. “EUR”, or estimated ultimate recovery, refers to our management’s estimates of hydrocarbon quantities that may be recovered from a well completed as a producer in the area. These quantities may not necessarily constitute or represent reserves within the meaning of the Society of Petroleum Engineer’s Petroleum Resource Management System or the SEC’s oil and natural gas disclosure rules. Actual quantities that may be recovered from Range's interests could differ substantially. Factors affecting ultimate recovery include the scope of Range's drilling program, which will be directly affected by the availability of capital, drilling and production costs, commodity prices, availability of drilling services and equipment, drilling results, lease expirations, transportation constraints, regulatory approvals, field spacing rules, recoveries of gas in place, length of horizontal laterals, actual drilling results, including geological and mechanical factors affecting recovery rates and other factors. Estimates of resource potential may change significantly as development of our resource plays provides additional data.

In addition, our production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. Investors are urged to consider closely the disclosure in our most recent Annual Report on Form 10-K, available from our website at www.rangeresources.com or by written request to 100 Throckmorton Street, Suite 1200, Fort Worth, Texas 76102. You can also obtain this Form 10-K on the SEC’s website at www.sec.gov or by calling the SEC at 1-800-SEC-0330.

SOURCE: Range Resources Corporation

Range Investor Contact:

Laith Sando, Vice President – Investor Relations
817-869-4267
lsando@rangeresources.com

Range Media Contact:

Mark Windle, Director of Corporate Communications
724-873-3223
mwindle@rangeresources.com

 


RANGE RESOURCES CORPORATION

STATEMENTS OF OPERATIONS                       
Based on GAAP reported earnings with additional                       
details of items included in each line in Form 10-Q                       
(Unaudited, in thousands, except per share data)                       
 Three Months Ended September 30, Nine Months Ended September 30,
  2022   2021   %   2022   2021   % 
                        
Revenues and other income:                       
Natural gas, NGLs and oil sales (a)$1,435,152  $849,305      $3,824,395  $2,074,507     
Derivative fair value loss (457,708)  (652,220)      (1,636,687)  (959,782)    
Brokered natural gas, marketing and other (b) 132,681   105,312       326,441   247,337     
ARO settlement gain (loss) (b) 8   (3)      8   (3)    
Other (b) 412   245       2,267   1,334     
Total revenues and other income 1,110,545   302,639   267%  2,516,424   1,363,393   85%
                        
Costs and expenses:                       
Direct operating 20,918   19,926       60,545   56,667     
Direct operating – stock-based compensation (c) 372   319       1,083   986     
Transportation, gathering, processing and compression 323,019   296,510       941,213   853,684     
Transportation, gathering, processing and compression – Settlements           7,500        
Production and ad valorem taxes 8,428   7,140       22,486   20,179     
Brokered natural gas and marketing 126,622   105,392       328,649   245,838     
Brokered natural gas and marketing – stock-based compensation (c) 663   446       1,868   1,339     
Exploration 7,105   5,513       18,540   15,331     
Exploration – non-cash stock-based compensation (c) 393   368       1,163   1,116     
Abandonment and impairment of unproved properties 3,186   2,000       12,319   7,206     
General and administrative 30,714   31,398       94,695   90,300     
General and administrative – stock-based compensation (c) 10,402   9,845       32,245   28,632     
General and administrative – lawsuit settlements 81   7,818       776   8,375     
General and administrative – bad debt expense                   
Exit and termination costs 11,065   11,789       58,249   9,557     
Exit and termination costs – stock-based compensation (c)                   
Deferred compensation plan (d) 5,795   34,278       59,917   89,551     
Interest expense 37,173   54,483       121,137   164,039     
Interest expense – amortization of deferred financing costs (c) 1,563   2,326       6,775   6,935     
Loss on early extinguishment of debt             69,232   98     
Depletion, depreciation and amortization 90,471   93,116       262,573   272,128     
Impairment of proved property                   
Gain on sale of assets (135)  (78)      (548)  (724)    
Total costs and expenses 677,835   682,589   -1%  2,100,417   1,871,237   12%
                        
Income (loss) before income taxes 432,710   (379,950)  214%  416,007   (507,844)  182%
                        
Income tax expense (benefit):                       
Current 6,981   4,484       20,732   7,221     
Deferred 52,642   (34,167)      26,141   (35,477)    
  59,623   (29,683)      46,873   (28,256)    
                        
Net income (loss)$373,087  $(350,267)  207% $369,134  $(479,588)  177%
                        
Net Income (Loss) Per Common Share:                       
Basic$1.52  $(1.44)     $1.48  $(1.98)    
Diluted$1.49  $(1.44)     $1.45  $(1.98)    
                        
Weighted average common shares outstanding, as reported:                       
Basic 239,768   243,311   -1%  242,850   242,692   0%
Diluted 245,023   243,311   1%  248,360   242,692   2%


 (a)See separate natural gas, NGLs and oil sales information table.
 (b)Included in Brokered natural gas, marketing and other revenues in the 10-Q.
 (c)Costs associated with stock compensation and restricted stock amortization, which have been reflected in the categories associated with the direct personnel costs, which are combined with the cash costs in the 10-Q.
 (d)Reflects the change in market value of the vested Company stock held in the deferred compensation plan.
 (e)Included in interest expense in the 10-Q.


RANGE RESOURCES CORPORATION

BALANCE SHEETS       
(In thousands) September 30,   December 31, 
  2022   2021 
  (Unaudited)   (Audited) 
Assets       
Current assets$825,016  $730,927 
Derivative assets 50,772   44,339 
Natural gas and oil properties, successful efforts method 5,871,600   5,754,656 
Transportation and field assets 2,732   3,494 
Operating lease right-of-use assets 96,567   40,832 
Other 73,089   86,259 
 $6,919,776  $6,660,507 
        
Liabilities and Stockholders’ Equity       
Current liabilities$903,623  $766,371 
Asset retirement obligations 5,310   5,310 
Derivative liabilities 652,585   162,767 
Current maturities of long-term debt 528,149   218,017 
        
Bank debt     
Senior notes 1,831,675   2,707,770 
Total debt 1,831,675   2,707,770 
        
Deferred tax liability 143,814   117,642 
Derivative liabilities 155,995   8,216 
Deferred compensation liability 85,750   137,102 
Operating lease liabilities 37,458   24,861 
Asset retirement obligations and other liabilities 99,268   101,509 
Divestiture contract obligation 312,665   325,279 
        
Common stock and retained earnings 2,502,298   2,115,820 
Other comprehensive loss 37   (150)
Common stock held in treasury stock (338,851)  (30,007)
Total stockholders’ equity 2,163,484   2,085,663 
 $6,919,776  $6,660,507 


RECONCILIATION OF TOTAL REVENUES AND OTHER INCOME TO TOTAL REVENUE EXCLUDING CERTAIN ITEMS, a non-GAAP measure              
(Unaudited, in thousands)              
 Three Months Ended
September 30,
  Nine Months Ended
September 30,
  
  2022   2021   %   2022   2021   % 
                        
Total revenues and other income, as reported$1,110,545  $302,639   267% $2,516,424  $1,363,393   85%
Adjustment for certain special items:                       
Total change in fair value related to derivatives prior to settlement (gain) loss (6,969)  492,763       631,165   720,617     
ARO settlement (gain) loss (8)  3       (8)  3     
Total revenues, as adjusted, non-GAAP$1,103,568  $795,405   39% $3,147,581  $2,084,013   51%


RANGE RESOURCES CORPORATION

CASH FLOWS FROM OPERATING ACTIVITIES               
(Unaudited in thousands)               
                
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
                
Net income (loss)$373,087  $(350,267) $369,134  $(479,588)
Adjustments to reconcile net cash provided from continuing operations:               
Deferred income tax expense (benefit) 52,642   (34,167)  26,141   (35,477)
Depletion, depreciation, amortization and impairment 90,471   93,116   262,573   272,128 
Abandonment and impairment of unproved properties 3,186   2,000   12,319   7,206 
Derivative fair value loss 457,708   652,220   1,636,687   959,782 
Cash settlements on derivative financial instruments (464,677)  (159,457)  (1,005,522)  (239,165)
Divestiture contract obligation, including accretion, net of gain 10,930   11,602   57,791   8,467 
Allowance for bad debts           
Amortization of deferred issuance costs and other 1,401   1,994   6,521   6,253 
Deferred and stock-based compensation 17,242   44,833   95,397   119,946 
(Gain) loss on sale of assets and other (135)  (78)  (548)  (724)
Loss on early extinguishment of debt       69,232   98 
                
Changes in working capital:               
Accounts receivable (25,446)  (67,066)  (132,644)  (116,204)
Other current assets 3,621   (2,695)  (19,478)  (3,574)
Accounts payable 15,918   13,073   52,292   34,313 
Accrued liabilities and other (14,979)  (13,254)  (177,806)  (58,172)
Net changes in working capital (20,886)  (69,942)  (277,636)  (143,637)
Net cash provided from operating activities$520,969  $191,854  $1,252,089  $475,289 
                
                
                
RECONCILIATION OF NET CASH PROVIDED FROM OPERATING ACTIVITIES, AS REPORTED, TO CASH FLOW FROM OPERATIONS BEFORE CHANGES IN WORKING CAPITAL, a non-GAAP measure               
(Unaudited, in thousands)               
                
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
Net cash provided from operating activities, as reported$520,969  $191,854  $1,252,089  $475,289 
Net changes in working capital 20,886   69,942   277,636   143,637 
Exploration expense 7,105   5,513   18,540   15,331 
Lawsuit settlements 81   7,818   776   8,375 
Transportation, gathering, processing and compression settlements       7,500    
Non-cash compensation adjustment and other 688   945   1,599   3,453 
Cash flow from operations before changes in working capital – non-GAAP measure$549,729  $276,072  $1,558,140  $646,085 
                
                
                
ADJUSTED WEIGHTED AVERAGE SHARES OUTSTANDING               
(Unaudited, in thousands)               
                
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
Basic:               
Weighted average shares outstanding 245,468   249,780   249,038   249,268 
Stock held by deferred compensation plan (5,700)  (6,469)  (6,188)  (6,576)
Adjusted basic 239,768   243,311   242,850   242,692 
                
Dilutive:               
Weighted average shares outstanding 245,468   249,780   249,038   249,268 
Dilutive stock options under treasury method (445)  (6,469)  (678)  (6,576)
Adjusted dilutive 245,023   243,311   248,360   242,692 


RANGE RESOURCES CORPORATION

RECONCILIATION OF NATURAL GAS, NGLs AND OIL SALES AND DERIVATIVE FAIR VALUE INCOME (LOSS) TO CALCULATED CASH REALIZED NATURAL GAS, NGLs AND OIL PRICES WITH AND WITHOUT THIRD PARTY TRANSPORTATION, GATHERING AND COMPRESSION FEES, a non-GAAP measure     
(Unaudited, in thousands, except per unit data)     
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   %   2022   2021   % 
Natural gas, NGL and oil sales components:                       
Natural gas sales$1,053,863  $494,917      $2,593,540  $1,152,283     
NGL sales 325,989   309,232       1,039,057   795,173     
Oil sales 55,300   45,156       191,798   127,051     
Total oil and gas sales, as reported$1,435,152  $849,305   69% $3,824,395  $2,074,507   84%
                        
Derivative fair value loss, as reported:$(457,708) $(652,220)     $(1,636,687) $(959,782)    
Cash settlements on derivative financial instruments – (gain) loss:                       
Natural gas 449,713   123,932       916,518   132,794     
NGLs (4,150)  26,142       18,673   77,899     
Crude Oil 19,114   9,383       70,331   28,472     
Total change in fair value related to derivatives prior to settlement, a non-GAAP measure$6,969  $(492,763)     $(631,165) $(720,617)    
                        
Transportation, gathering, processing and compression components:                       
Natural gas$176,324  $165,864      $513,548  $486,161     
NGLs 146,695   130,221       435,154   366,649     
Oil    425       11   874     
Total transportation, gathering, processing and compression, as reported$323,019  $296,510      $948,713  $853,684     
                        
Natural gas, NGL and oil sales, including cash-settled derivatives: (c)                       
Natural gas sales$604,150  $370,985      $1,677,022  $1,019,489     
NGL sales 330,139   283,090       1,020,384   717,274     
Oil sales 36,186   35,773       121,467   98,579     
Total$970,475  $689,848   41%  2,818,873   1,835,342   54%
                        
Production of oil and gas during the periods (a):                       
Natural gas (mcf) 136,862,857   137,713,717   -1%  399,834,208   399,929,389   0%
NGL (bbl) 9,235,626   9,080,902   2%  26,473,922   26,977,257   -2%
Oil (bbl) 653,000   710,914   -8%  2,099,630   2,245,972   -7%
Gas equivalent (mcfe) (b) 196,194,613   196,464,613   0%  571,275,520   575,268,763   -1%
                        
Production of oil and gas – average per day (a):                       
Natural gas (mcf) 1,487,640   1,496,888   -1%  1,464,594   1,464,943   0%
NGL (bbl) 100,387   98,705   2%  96,974   98,818   -2%
Oil (bbl) 7,098   7,727   -8%  7,691   8,227   -7%
Gas equivalent (mcfe) (b) 2,132,550   2,135,485   0%  2,092,584   2,107,212   -1%
                        
Average prices, excluding derivative settlements and before third party transportation costs:                       
Natural gas (mcf)$7.70  $3.59   114% $6.49  $2.88   125%
NGL (bbl)$35.30  $34.05   4% $39.25  $29.48   33%
Oil (bbl)$84.69  $63.52   33% $91.35  $56.57   61%
Gas equivalent (mcfe) (b)$7.31  $4.32   69% $6.69  $3.61   86%
                        
Average prices, including derivative settlements before third party transportation costs: (c)                       
Natural gas (mcf)$4.41  $2.69   64% $4.19  $2.55   65%
NGL (bbl)$35.75  $31.17   15% $38.54  $26.59   45%
Oil (bbl)$55.42  $50.32   10% $57.85  $43.89   32%
Gas equivalent (mcfe) (b)$4.95  $3.51   41% $4.93  $3.19   55%
                        
Average prices, including derivative settlements and after third party transportation costs: (d)                       
Natural gas (mcf)$3.13  $1.49   110% $2.91  $1.33   118%
NGL (bbl)$19.86  $16.83   18% $22.11  $13.00   70%
Oil (bbl)$55.41  $49.72   11% $57.85  $43.50   33%
Gas equivalent (mcfe) (b)$3.30  $2.00   64% $3.27  $1.71   91%
                        
Transportation, gathering and compression expense per mcfe$1.65  $1.51   9% $1.66  $1.48   12%


 (a)Represents volumes sold regardless of when produced.
 (b)Oil and NGLs are converted at the rate of one barrel equals six mcfe based upon the approximate relative energy content of oil to natural gas, which is not necessarily indicative of the relationship of oil and natural gas prices.
 (c)Excluding third party transportation, gathering and compression costs.
 (d)Net of transportation, gathering and compression costs.
   

RANGE RESOURCES CORPORATION

RECONCILIATION OF INCOME BEFORE INCOME TAXES AS REPORTED TO INCOME BEFORE INCOME TAXES EXCLUDING CERTAIN ITEMS, a non-GAAP measure     
(Unaudited, in thousands, except per share data)     
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   %   2022   2021   % 
                        
Income (loss) from operations before income taxes, as reported$432,710  $(379,950)  214% $416,007  $(507,844)  182%
Adjustment for certain special items:                       
Gain on sale of assets (135)  (78)      (548)  (724)    
(Gain) loss on ARO settlements (8)  3       (8)  3     
Change in fair value related to derivatives prior to settlement (6,969)  492,763       631,165   720,617     
Abandonment and impairment of unproved properties 3,186   2,000       12,319   7,206     
Loss on early extinguishment of debt           69,232   98     
Transportation, gathering, processing and compression settlements           7,500        
Lawsuit settlements 81   7,818       776   8,375     
Exit and termination costs 11,065   11,789       58,249   9,557     
Brokered natural gas and marketing – non-cash stock-based compensation 663   446       1,868   1,339     
Direct operating – non-cash stock-based compensation 372   319       1,083   986     
Exploration expenses – non-cash stock-based compensation 393   368       1,163   1,116     
General & administrative – non-cash stock-based compensation 10,402   9,845       32,245   28,632     
Deferred compensation plan – non-cash adjustment 5,795   34,278       59,917   89,551     
                        
Income before income taxes, as adjusted 457,555   179,601   155%  1,290,968   358,912   260%
                        
Income tax expense, as adjusted                       
Current 6,981   4,484       20,732   7,221     
Deferred (a) 114,389   44,900       322,742   89,728     
                        
Net income excluding certain items, a non-GAAP measure$336,185  $130,217   158% $947,494  $261,963   262%
                        
Non-GAAP income per common share                       
Basic$1.40  $0.54   159% $3.90  $1.08   261%
Diluted$1.37  $0.52   163% $3.82  $1.05   264%
                        
Non-GAAP diluted shares outstanding, if dilutive 245,023   249,607       248,360   248,620     


 (a)Deferred taxes are estimated to be approximately 25% for 2022 and 2021.
   

RANGE RESOURCES CORPORATION

RECONCILIATION OF NET INCOME (LOSS), EXCLUDING CERTAIN ITEMS AND ADJUSTMENT EARNINGS PER SHARE, non-GAAP measures               
(In thousands, except per share data)               
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
                
Net income (loss), as reported$373,087  $(350,267) $369,134  $(479,588)
Adjustment for certain special items:               
Gain on sale of assets (135)  (78)  (548)  (724)
Loss (gain) on ARO settlements (8)  3   (8)  3 
Loss on early extinguishment of debt       69,232   98 
Change in fair value related to derivatives prior to settlement (6,969)  492,763   631,165   720,617 
Transportation, gathering, processing and compression settlements       7,500    
Abandonment and impairment of unproved properties 3,186   2,000   12,319   7,206 
Lawsuit settlements 81   7,818   776   8,375 
Exit and termination costs 11,065   11,789   58,249   9,557 
Non-cash stock-based compensation 11,830   10,978   36,359   32,073 
Deferred compensation plan 5,795   34,278   59,917   89,551 
Tax impact (61,747)  (79,067)  (296,601)  (125,205)
                
Net income excluding certain items, a non-GAAP measure$336,185  $130,217  $947,494  $261,963 
                
Net income (loss) per diluted share, as reported$1.49  $(1.44) $1.45  $(1.98)
Adjustment for certain special items per diluted share:               
(Gain) loss on sale of assets (0.00)  (0.00)  (0.00)  (0.00)
Loss (gain) on ARO settlements 0.00   0.00   0.00   0.00 
Loss on early extinguishment of debt       0.28   0.00 
Change in fair value related to derivatives prior to settlement (0.03)  1.97   2.54   2.90 
Transportation, gathering, processing and compression settlements       0.03    
Abandonment and impairment of unproved properties 0.01   0.01   0.05   0.03 
Lawsuit settlements 0.00   0.03   0.00   0.03 
Exit and termination costs 0.05   0.05   0.23   0.04 
Non-cash stock-based compensation 0.05   0.04   0.15   0.13 
Deferred compensation plan 0.02   0.14   0.24   0.36 
Adjustment for rounding differences       0.01   (0.01)
Tax impact (0.25)  (0.32)  (1.19)  (0.50)
Dilutive share impact (rabbi trust and other) 0.03   0.04   0.03   0.05 
                
Net income per diluted share, excluding certain items, a non-GAAP measure$1.37  $0.52  $3.82  $1.05 
                
Adjusted earnings per share, a non-GAAP measure:               
Basic$1.40  $0.54  $3.90  $1.08 
Diluted$1.37  $0.52  $3.82  $1.05 


RANGE RESOURCES CORPORATION

RECONCILIATION OF CASH MARGIN PER MCFE, a non-GAAP measure               
(Unaudited, in thousands, except per unit data)               
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
                
Revenues               
Natural gas, NGL and oil sales, as reported$1,435,152  $849,305  $3,824,395  $2,074,507 
Derivative fair value income loss, as reported (457,708)  (652,220)  (1,636,687)  (959,782)
Less non-cash fair value (gain) loss (6,969)  492,763   631,165   720,617 
Brokered natural gas and marketing and other, as reported 133,101   105,554   328,716   248,668 
Less ARO settlement and other (gains) losses (420)  (242)  (2,275)  (1,331)
Cash revenue applicable to production 1,103,156   795,160   3,145,314   2,082,679 
                
Expenses               
Direct operating, as reported 21,290   20,245   61,628   57,653 
Less direct operating stock-based compensation (372)  (319)  (1,083)  (986)
Transportation, gathering and compression, as reported 323,019   296,510   948,713   853,684 
Less transportation, gathering and compression settlements       (7,500)   
Production and ad valorem taxes, as reported 8,428   7,140   22,486   20,179 
Brokered natural gas and marketing, as reported 127,285   105,838   330,517   247,177 
Less brokered natural gas and marketing stock-based compensation (663)  (446)  (1,868)  (1,339)
General and administrative, as reported 41,197   49,061   127,716   127,307 
Less G&A stock-based compensation (10,402)  (9,845)  (32,245)  (28,632)
Less lawsuit settlements (81)  (7,818)  (776)  (8,375)
Interest expense, as reported 38,736   56,809   127,912   170,974 
Less amortization of deferred financing costs (1,563)  (2,326)  (6,775)  (6,935)
Cash expenses 546,874   514,849   1,568,725   1,430,707 
                
Cash margin, a non-GAAP measure$556,282  $280,311  $1,576,589  $651,972 
                
Mmcfe produced during period 196,195   196,465   571,276   575,269 
                
Cash margin per mcfe$2.84  $1.43  $2.76  $1.13 
                
                
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME TAXES TO CASH MARGIN               
(Unaudited, in thousands, except per unit data)               
 Three Months Ended September 30,  Nine Months Ended September 30, 
  2022   2021   2022   2021 
                
Income (loss) before income taxes, as reported$432,710  $(379,950) $416,007  $(507,844)
Adjustments to reconcile income (loss) before income taxes to cash margin:               
ARO settlements and other gains (420)  (242)  (2,275)  (1,331)
Derivative fair value loss 457,708   652,220   1,636,687   959,782 
Net cash receipts on derivative settlements (464,677)  (159,457)  (1,005,522)  (239,165)
Transportation, gathering and compression settlements       7,500    
Exploration expense 7,105   5,513   18,540   15,331 
Lawsuit settlements 81   7,818   776   8,375 
Exit and termination costs 11,065   11,789   58,249   9,557 
Deferred compensation plan 5,795   34,278   59,917   89,551 
Stock-based compensation (direct operating, brokered natural gas and marketing, general and administrative and termination costs) 11,830   10,978   36,359   32,073 
Interest – amortization of deferred financing costs 1,563   2,326   6,775   6,935 
Depletion, depreciation and amortization 90,471   93,116   262,573   272,128 
Gain on sale of assets (135)  (78)  (548)  (724)
Loss on early extinguishment of debt       69,232   98 
Abandonment and impairment of unproved properties 3,186   2,000   12,319   7,206 
Cash margin, a non-GAAP measure$556,282  $280,311  $1,576,589  $651,972 
                

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Source: Range Resources Corporation