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Montage Resources Corporation Announces Third Quarter 2019 Outperformance, Lowers Cash Production Costs Guidance and Increases Midpoint of Production Guidance for the Full Year 2019

11/07/2019

IRVING, Texas--(BUSINESS WIRE)-- Montage Resources Corporation (NYSE:MR) (the “Company” or “Montage Resources”) today announced its third quarter 2019 financial and operational results along with revised full year 2019 guidance. In addition, the Company will be posting an updated investor presentation to its corporate website.

Third Quarter 2019 Highlights:

  • Average net daily production was 621.7 MMcfe per day, above the high end of the Company’s previously issued guidance range and above analyst consensus expectations
  • Average natural gas equivalent realized price was $2.88 per Mcfe, including cash settled derivatives and excluding firm transportation expenses
  • Per unit cash production costs (including lease operating, transportation, gathering and compression, production and ad valorem taxes) were $1.23 per Mcfe, with the per unit cash production costs outperforming the midpoint of the Company’s previously issued guidance by 9% and analyst consensus expectations
  • Net income was $4.3 million; Income from continuing operations before income taxes was $5.5 million; Adjusted net income1 was $19.3 million; and Adjusted EBITDAX1 was $83.6 million, above analyst consensus expectations
  • Capital expenditures were $65.4 million, approximately 17% better than analyst consensus expectations
  • The Company remains in a strong liquidity position with the recent 25% increase in its borrowing base to $500 million, ending the third quarter with $355 million in liquidity

1

Non-GAAP measure. See reconciliation for details

John Reinhart, President and CEO, commented on the Company’s third quarter 2019 results, “During the third quarter, we continued to demonstrate superior operational execution and prudent financial decision making as we exhibit a strong track record of what we believe are repeatable results that differentiate our performance from others in the Appalachian basin and our small-cap upstream peers. The quarter-over-quarter reduction in capital spending driven by a decrease in year to date cycle times of approximately 34% from the 2018 program helps to illustrate our improved capital efficiency. The drilling team routinely drills a mile a day in dry gas laterals and exceeds this pace in the Marcellus while completions activity is averaging approximately nine stages for the quarter. Our per unit cash production costs are 16% lower as compared to the third quarter of 2018 and we expect to exceed our targeted general and administrative expense synergies from the merger between Eclipse Resources and Blue Ridge Mountain Resources (excluding merger-related costs) in 2019. These top-tier operating efficiencies, in addition to outstanding well results, contributed to the third quarter production outperformance and, when coupled with cash production costs per unit outperforming expectations, delivers cash operating margins that we believe are among the best in the Appalachian Basin.

For the third quarter of 2019, the Company generated revenue of $163 million, a 25% increase over the third quarter of 2018, while also recognizing a 25% increase in Adjusted EBITDAX1 over the third quarter of 2018, despite the weaker commodity price environment. From a top-line revenue perspective, we believe Montage is differentiated amongst other Appalachian peers as crude oil provided approximately 28% of our revenue for the third quarter and we will continue to focus on the development of our highest returning liquids-rich locations. Our third quarter results further highlight the strength of our cash operating margins, which have expanded to 51% from 48%, or $1.47 per Mcfe, as compared to the second quarter 2019 despite an approximate 16% decline in natural gas pricing quarter over quarter. In addition, the Company is pleased to announce we have updated our production guidance for the full year 2019 to between 545 and 552 MMcfe per day and decreased our cash production costs guidance range to between $1.30 to $1.35 per Mcfe.

As we have previously highlighted, we are committed to maintaining operational flexibility in a dynamic business environment and will continue to run one gross operated rig through the remainder of 2019 and into 2020, while continuing to unlock value with our increased capital efficiency. Our focus remains on balancing disciplined growth and cash flow generation while maintaining low leverage and ample liquidity. The natural gas macro environment we are currently experiencing reinforces the importance of being a low-cost producer with high quality assets, maintaining a top performing execution team, and having limited commitments. I believe we have managed our Company prudently and responsibly with the third quarter results demonstrating the effectiveness of our development strategy, the strength of our business, the focus of our team and the fundamental belief in the long-term prospects for Montage Resources.”

1

Non-GAAP measure. See reconciliation for details

Operational Discussion

The Company’s production for the three and nine months ended September 30, 2019 and 2018 is set forth in the following table:

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

 

 

2019

 

 

2018

 

2019

 

 

2018

Production:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas (MMcf)

 

 

43,289.9

 

 

 

22,979.7

 

 

109,613.9

 

 

 

63,308.4

NGLs (Mbbls)

 

 

1,401.1

 

 

 

906.4

 

 

3,414.9

 

 

 

2,492.6

Oil (Mbbls)

 

 

916.2

 

 

 

574.8

 

 

2,083.3

 

 

 

1,629.4

Total (MMcfe)

 

 

57,193.7

 

 

 

31,866.9

 

 

142,603.1

 

 

 

88,040.4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average daily production volume:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas (Mcf/d)

 

 

470,542

 

 

 

249,779

 

 

401,516

 

 

 

231,899

NGLs (Bbls/d)

 

 

15,229

 

 

 

9,852

 

 

12,509

 

 

 

9,130

Oil (Bbls/d)

 

 

9,959

 

 

 

6,248

 

 

7,631

 

 

 

5,968

Total (MMcfe/d)

 

 

621.7

 

 

 

346.4

 

 

522.4

 

 

 

322.5

Financial Discussion

Revenue for the three months ended September 30, 2019 totaled $163.3 million, compared to $130.1 million for the three months ended September 30, 2018. Adjusted Revenue2, which includes the impact of cash settled derivatives and excludes brokered natural gas and marketing revenue, totaled $164.8 million for the three months ended September 30, 2019 compared to $121.8 million for the three months ended September 30, 2018. Net Income (Loss) for the three months ended September 30, 2019 was $4.3 million, or $0.12 per share, compared to $4.0 million, or $0.20 per share3, for the three months ended September 30, 2018. Adjusted Net Income2 for the three months ended September 30, 2019 was $19.3 million, or $0.54 per share, compared to $14.1 million, or $0.70 per share3, for the three months ended September 30, 2018. Adjusted EBITDAX2 was $83.6 million for the three months ended September 30, 2019 compared to $66.8 million for the three months ended September 30, 2018.

2

Adjusted Revenue, Adjusted Net Income (Loss) and Adjusted EBITDAX are non-GAAP financial measures. Tables reconciling Adjusted Revenue, Adjusted Net Income (Loss) and Adjusted EBITDAX to the most directly comparable GAAP measures can be found at the end of the financial statements included in this press release.

3

Retroactively reflects the 15-to-1 reverse stock split that took place at the close of the merger with Blue Ridge Mountain Resources, Inc. on February 28, 2019.

Average realized price calculations for the three and nine months ended September 30, 2019 and 2018 are set forth in the table below:

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

Average realized price (excluding cash settled derivatives and firm transportation)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas ($/Mcf)

 

$

2.03

 

 

$

2.86

 

 

$

2.41

 

 

$

2.82

NGLs ($/Bbl)

 

 

14.42

 

 

 

27.66

 

 

 

17.82

 

 

 

25.48

Oil ($/Bbl)

 

 

49.09

 

 

 

63.24

 

 

 

49.64

 

 

 

60.42

Total average prices ($/Mcfe)

 

 

2.68

 

 

 

3.99

 

 

 

3.00

 

 

 

3.87

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average realized price (including cash settled derivatives, excluding firm transportation)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas ($/Mcf)

 

$

2.28

 

 

$

2.89

 

 

$

2.49

 

 

$

2.92

NGLs ($/Bbl)

 

 

14.92

 

 

 

27.66

 

 

 

18.19

 

 

 

25.11

Oil ($/Bbl)

 

 

49.53

 

 

 

52.67

 

 

 

50.15

 

 

 

52.32

Total average prices ($/Mcfe)

 

 

2.88

 

 

 

3.82

 

 

 

3.08

 

 

 

3.78

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average realized price (including firm transportation, excluding cash settled derivatives)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas ($/Mcf)

 

$

1.60

 

 

$

2.19

 

 

$

1.94

 

 

$

2.28

NGLs ($/Bbl)

 

 

14.42

 

 

 

27.66

 

 

 

17.82

 

 

 

25.48

Oil ($/Bbl)

 

 

49.09

 

 

 

63.24

 

 

 

49.64

 

 

 

60.42

Total average prices ($/Mcfe)

 

 

2.35

 

 

 

3.51

 

 

 

2.64

 

 

 

3.48

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average realized price (including cash settled derivatives and firm transportation)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas ($/Mcf)

 

$

1.85

 

 

$

2.22

 

 

$

2.02

 

 

$

2.38

NGLs ($/Bbl)

 

 

14.92

 

 

 

27.66

 

 

 

18.19

 

 

 

25.11

Oil ($/Bbl)

 

 

49.53

 

 

 

52.67

 

 

 

50.15

 

 

 

52.32

Total average prices ($/Mcfe)

 

 

2.56

 

 

 

3.34

 

 

 

2.72

 

 

 

3.39

*rounded to the nearest penny

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Per unit cash production costs, which include $0.32 per Mcfe of firm transportation expense, were $1.23 per Mcfe for the third quarter of 2019, a decrease of approximately 16% compared to the third quarter of 2018. The Company’s cash production costs (which include lease operating, transportation, gathering and compression, production and ad valorem taxes) are shown in the table below.

General and administrative expense (including one-time merger-related expenses) was $14.6 million and $12.9 million for the three months ended September 30, 2019 and 2018, respectively, and is shown in the table below. Cash general and administrative expense4 (excluding merger-related expenses and stock-based compensation expense) was $10.2 million and $7.8 million for the three months ended September 30, 2019 and 2018 respectively. General and administrative expense per Mcfe (including one-time merger-related expenses) was $0.25 in the three months ended September 30, 2019 compared to $0.41 in the three months ended September 30, 2018. Cash general and administrative expense4 per Mcfe (excluding merger-related expenses and stock-based compensation expense) declined 25% to $0.18 in the three months ended September 30, 2019 compared to $0.24 in the three months ended September 30, 2018.

4

Cash general and administrative expense is a non-GAAP financial measure. A table reconciling cash general and administrative expense to the most directly comparable GAAP measure can be found under “Cash General and Administrative Expense” in this press release.

 

 

Three Months Ended
September 30,

 

 

Nine Months Ended
September 30,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

Operating expenses (in thousands):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating

 

$

11,986

 

 

$

5,312

 

 

$

29,651

 

 

$

22,026

Transportation, gathering and compression

 

 

57,027

 

 

 

39,066

 

 

 

150,065

 

 

 

98,126

Production and ad valorem taxes

 

 

1,660

 

 

 

2,604

 

 

 

8,519

 

 

 

7,226

Total cash production costs

 

$

70,673

 

 

$

46,982

 

 

$

188,235

 

 

$

127,378

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion, amortization and accretion

 

 

45,456

 

 

 

34,439

 

 

 

113,950

 

 

 

98,672

General and administrative1

 

 

14,580

 

 

 

12,937

 

 

 

57,074

 

 

 

33,391

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses per Mcfe:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating

 

$

0.21

 

 

$

0.17

 

 

$

0.21

 

 

$

0.25

Transportation, gathering and compression

 

 

0.99

 

 

 

1.21

 

 

 

1.04

 

 

 

1.11

Production and ad valorem taxes

 

 

0.03

 

 

 

0.08

 

 

 

0.06

 

 

 

0.08

Total cash production costs

 

$

1.23

 

 

$

1.46

 

 

$

1.31

 

 

$

1.44

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation, depletion, amortization and accretion

 

 

0.79

 

 

 

1.08

 

 

 

0.80

 

 

 

1.12

General and administrative2

 

 

0.25

 

 

 

0.41

 

 

 

0.40

 

 

 

0.38

1

Includes stock-based compensation and merger-related expenses of $ 4.4 million and $ 5.2 million for the three months ended September 30, 2019 and 2018, respectively, and $ 29.4 million and $ 9.1 million for the nine months ended September 30, 2019 and 2018, respectively

2

Includes stock-based compensation and merger-related expenses of $ 0.07 per Mcfe and $ 0.16 per Mcfe for the three months ended September 30, 2019 and 2018, respectively, and $ 0.20 per Mcfe and $ 0.10 per Mcfe for the nine months ended September 30, 2019 and 2018, respectively

Cash Margins

The Company’s cash margins are detailed in the table below:

 

 

Three Months Ended

 

Three Months
Ended

 

 

September 30, 2019

 

September 30, 2018

 

June 30,
2019

(per Mcfe)

 

 

 

 

 

 

 

 

 

 

 

 

Average realized price (including cash settled derivatives, excluding

firm transportation)

 

$

2.88

 

 

$

3.82

 

 

$

2.99

 

Total cash production costs1

 

 

1.23

 

 

 

1.46

 

 

 

1.35

 

Cash production margin

 

$

1.65

 

 

$

2.36

 

 

$

1.64

 

Cash production margin %

 

 

57

%

 

 

62

%

 

 

55

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash production margin

 

$

1.65

 

 

$

2.36

 

 

$

1.64

 

Cash general and administrative expenses2

 

 

0.18

 

 

 

0.24

 

 

 

0.19

 

Cash operating margin

 

$

1.47

 

 

$

2.12

 

 

$

1.45

 

Cash operating margin %

 

 

51

%

 

 

55

%

 

 

48

%

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash operating margin

 

$

1.47

 

 

$

2.12

 

 

$

1.45

 

Interest expense

 

 

0.27

 

 

 

0.44

 

 

 

0.31

 

Corporate cash operating margin3

 

$

1.20

 

 

$

1.68

 

 

$

1.14

 

Corporate cash operating margin %

 

 

42

%

 

 

44

%

 

 

38

%

1

Includes lease operating, transportation, gathering and compression, production and ad valorem taxes

2

Cash general & administrative expense is a Non-GAAP financial measure which excludes non-cash compensation and merger related expenses, see reconciliation to the most comparable GAAP measure under “Cash General and Administrative Expense” in this press release

3

Includes lease operating, transportation, gathering and compression, production and ad valorem taxes, Cash general & administrative expense and interest expense. Cash general & administrative expense is a Non-GAAP financial measure which excludes non-cash compensation and merger related expenses, see reconciliation to the most comparable GAAP measure under “Cash General and Administrative Expense” in this press release

Capital Expenditures

Third quarter 2019 capital expenditures were $65.4 million, including $63.6 million for drilling and completions, $1.4 million for land-related expenditures, and $0.4 million for corporate-related expenditures.

During the third quarter of 2019, the Company commenced drilling 4 gross (3.3 net) operated wells, commenced completions of 7 gross (5.2 net) operated wells and turned to sales 16 gross (13.9 net) operated wells.

Financial Position and Liquidity

As of September 30, 2019, the Company’s liquidity was $354.8 million, consisting of $11.5 million in cash and cash equivalents and $343.3 million in available borrowing capacity under the Company’s revolving credit facility (after giving effect to outstanding letters of credit issued by the Company of $29.2 million and $127.5 million in outstanding borrowings).

Michael Hodges, Executive Vice President and Chief Financial Officer, commented, “We remain highly focused on maintaining the strength of our balance sheet. With no debt maturities for almost four years, a current leverage ratio of approximately 1.7 times5 and with the recent increase of our borrowing base providing liquidity of approximately $355 million, we believe our superior financial condition positions us to dynamically respond to changes in the commodity price environment while still achieving our goal of generating free cash flow by the end of 2019. From a gas marketing perspective, the Company has continued to endeavor to maximize realized pricing through our access to both in basin and out of basin markets and the optimization of the “commitment free” equity gas we produce. Finally, we believe our strong hedge book for the remainder of 2019 and into 2020 provides cash flow support for the foreseeable future as we execute our development plans. The benefits of the merger consummated earlier this year have positioned Montage for success, and we believe the unique combination of ample liquidity, low leverage, limited operational commitments and the peer-leading EBITDAX margins leave the Company well positioned to deliver value to its stakeholders in 2019 and beyond.”

5

Based upon net debt to pro forma last twelve months EBITDAX

Commodity Derivatives

The Company engages in a number of different commodity trading program strategies as a risk management tool to attempt to mitigate the potential negative impact on cash flows caused by price fluctuations in natural gas, NGL and oil prices. Below is a table that illustrates the Company’s hedging activities as of September 30, 2019:

Natural Gas Derivatives:

Description

 

Volume
(MMBtu/d)

 

 

Production Period

 

Weighted Average
Price ($/MMBtu)

Natural Gas Swaps:

 

 

 

 

 

 

 

 

 

 

 

 

 

120,000

 

 

October 2019 – December 2019

 

$

2.80

 

 

 

 

50,000

 

 

January 2020 – December 2020

 

$

2.67

 

 

 

 

20,000

 

 

January 2020 – March 2020

 

$

2.80

 

 

 

 

50,000

 

 

January 2020 – June 2020

 

$

2.70

 

 

 

 

20,000

 

 

April 2020 – June 2020

 

$

2.75

 

 

 

 

30,000

 

 

July 2020 – December 2020

 

$

2.60

 

Natural Gas Collars:

 

 

 

 

 

 

 

 

 

 

Floor purchase price (put)

 

 

95,000

 

 

October 2019 – December 2019

 

$

2.60

 

Ceiling sold price (call)

 

 

95,000

 

 

October 2019 – December 2019

 

$

2.91

 

Floor purchase price (put)

 

 

50,000

 

 

January 2020 – December 2020

 

$

2.49

 

Ceiling sold price (call)

 

 

50,000

 

 

January 2020 – December 2020

 

$

2.88

 

Floor purchase price (put)

 

 

30,000

 

 

January 2020 – March 2020

 

$

2.65

 

Ceiling sold price (call)

 

 

30,000

 

 

January 2020 – March 2020

 

$

2.98

 

Floor purchase price (put)

 

 

15,000

 

 

April 2020 – June 2020

 

$

2.50

 

Ceiling sold price (call)

 

 

15,000

 

 

April 2020 – June 2020

 

$

2.80

 

Natural Gas Three-way Collars:

 

 

 

 

 

 

 

 

 

 

Floor purchase price (put)

 

 

77,500

 

 

October 2019 – December 2019

 

$

2.72

 

Floor sold price (put)

 

 

77,500

 

 

October 2019 – December 2019

 

$

2.30

 

Ceiling sold price (call)

 

 

77,500

 

 

October 2019 – December 2019

 

$

3.04

 

Floor purchase price (put)

 

 

30,000

 

 

January 2020 – December 2020

 

$

2.70

 

Floor sold price (put)

 

 

30,000

 

 

January 2020 – December 2020

 

$

2.40

 

Ceiling sold price (call)

 

 

30,000

 

 

January 2020 – December 2020

 

$

3.05

 

Floor purchase price (put)

 

 

30,000

 

 

January 2020 – March 2020

 

$

2.72

 

Floor sold price (put)

 

 

30,000

 

 

January 2020 – March 2020

 

$

2.25

 

Ceiling sold price (call)

 

 

30,000

 

 

January 2020 – March 2020

 

$

3.15

 

Floor purchase price (put)

 

 

20,000

 

 

January 2020 – June 2020

 

$

2.70

 

Floor sold price (put)

 

 

20,000

 

 

January 2020 – June 2020

 

$

2.25

 

Ceiling sold price (call)

 

 

20,000

 

 

January 2020 – June 2020

 

$

3.05

 

Floor purchase price (put)

 

 

30,000

 

 

October 2019 – June 2020

 

$

2.90

 

Floor sold price (put)

 

 

30,000

 

 

October 2019 – June 2020

 

$

2.50

 

Ceiling sold price (call)

 

 

30,000

 

 

October 2019 – June 2020

 

$

3.15

 

Natural Gas Call/Put Options:

 

 

 

 

 

 

 

 

 

 

Ceiling sold price (call)

 

 

40,000

 

 

October 2019 – December 2019

 

$

3.44

 

Floor sold price (put)

 

 

50,000

 

 

January 2020 – December 2020

 

$

2.30

 

Floor sold price (put)

 

 

50,000

 

 

January 2020 – June 2020

 

$

2.25

 

Swaption sold price (call)

 

 

50,000

 

 

January 2021 – December 2021

 

$

2.75

 

Swaption sold price (call)

 

 

50,000

 

 

January 2022 – December 2022

 

$

3.00

 

Basis Swaps:

 

 

 

 

 

 

 

 

 

 

Appalachia - Dominion

 

 

12,500

 

 

October 2019

 

$

(0.52

)

Appalachia - Dominion

 

 

12,500

 

 

April 2020 – October 2020

 

$

(0.52

)

Appalachia - Dominion

 

 

20,000

 

 

January 2020 – December 2020

 

$

(0.59

)

Appalachia - Dominion

 

 

20,000

 

 

October 2019 – March 2020

 

$

(0.39

)

Appalachia - Dominion

 

 

17,500

 

 

October 2019 – December 2019

 

$

(0.50

)

Oil Derivatives:

Description

 

Volume
(Bbls/d)

 

 

Production Period

 

Weighted Average
Price ($/Bbl)

Oil Swaps:

 

 

 

 

 

 

 

 

 

 

 

 

1,500

 

 

October 2019 – December 2019

 

$

59.18

 

 

 

1,000

 

 

January 2020 – December 2020

 

$

58.60

 

 

 

1,000

 

 

July 2020 – December 2020

 

$

56.53

Oil Collars:

 

 

 

 

 

 

 

 

 

Floor purchase price (put)

 

 

1,500

 

 

October 2019 – December 2019

 

$

51.67

Ceiling sold price (call)

 

 

1,500

 

 

October 2019 – December 2019

 

$

65.92

Floor purchase price (put)

 

 

1,000

 

 

January 2020 – December 2020

 

$

51.50

Ceiling sold price (call)

 

 

1,000

 

 

January 2020 – December 2020

 

$

64.25

Floor purchase price (put)

 

 

500

 

 

July 2020 – December 2020

 

$

52.00

Ceiling sold price (call)

 

 

500

 

 

July 2020 – December 2020

 

$

60.00

Floor purchase price (put)

 

 

500

 

 

October 2019 – March 2020

 

$

60.00

Ceiling sold price (call)

 

 

500

 

 

October 2019 – March 2020

 

$

67.00

Oil Three-way Collars:

 

 

 

 

 

 

 

 

 

Floor purchase price (put)

 

 

2,000

 

 

October 2019 – December 2019

 

$

50.00

Floor sold price (put)

 

 

2,000

 

 

October 2019 – December 2019

 

$

40.00

Ceiling sold price (call)

 

 

2,000

 

 

October 2019 – December 2019

 

$

60.56

Floor purchase price (put)

 

 

2,000

 

 

January 2020 – June 2020

 

$

62.50

Floor sold price (put)

 

 

2,000

 

 

January 2020 – June 2020

 

$

55.00

Ceiling sold price (call)

 

 

2,000

 

 

January 2020 – June 2020

 

$

74.00

Oil Call/Put Options:

 

 

 

 

 

 

 

 

 

Swaption sold price (call)

 

 

500

 

 

January 2021 – December 2021

 

$

56.80

NGL Derivatives:

Description

 

Volume
(Bbls/d)

 

 

Production Period

 

Weighted Average
Price ($/Bbl)

Propane Swaps:

 

 

 

 

 

 

 

 

 

 

 

 

350

 

 

October 2019 – December 2019

 

$

39.90

Subsequent to the End of the Third Quarter:

The below table illustrates the Company’s hedging activities subsequent to the end of the third quarter 2019:

Natural Gas Derivatives:

Description

 

Volume
(MMBtu/d)

 

 

Production Period

 

Weighted Average
Price ($/MMBtu)

Natural Gas Swaps:

 

 

 

 

 

 

 

 

 

 

 

 

30,000

 

 

January 2020 – June 2020

 

$

2.62

 

 

 

25,000

 

 

January 2020 – March 2021

 

$

2.60

 

 

 

20,000

 

 

July 2020 – March 2021

 

$

2.58

Natural Gas Three-way Collars:

 

 

 

 

 

 

 

 

 

Floor purchase price (put)

 

 

45,000

 

 

January 2021 – December 2021

 

$

2.55

Floor sold price (put)

 

 

45,000

 

 

January 2021 – December 2021

 

$

2.25

Ceiling sold price (call)

 

 

45,000

 

 

January 2021 – December 2021

 

$

2.81

Oil Derivatives:

Description

 

Volume
(Bbls/d)

 

 

Production Period

 

Weighted Average
Price ($/Bbl)

Oil Swaps:

 

 

 

 

 

 

 

 

 

 

 

 

500

 

 

January 2020 – December 2020

 

$

54.00

 

 

 

250

 

 

July 2020 – March 2021

 

$

53.20

 

 

 

250

 

 

January 2021 – March 2021

 

$

53.00

Oil Call/Put Options:

 

 

 

 

 

 

 

 

 

Floor sold price (put)

 

 

500

 

 

January 2020 – December 2020

 

$

53.00

Ceiling sold price (call)

 

 

500

 

 

January 2020 – December 2020

 

$

64.50

Floor sold price (put)

 

 

500

 

 

July 2020 – December 2020

 

$

45.00

Guidance

The Company is announcing updated full year 2019 guidance (changes in italics) as set forth in the table below:

 

 

FY 2019

Production MMcfe/d

 

545 - 552

% Gas

 

74% - 78%

% NGL

 

12% - 15%

% Oil

 

9% - 11%

Gas Price Differential ($/Mcf)1,2

 

$(0.20) - $(0.30)

Oil Differential ($/Bbl)1

 

$(7.25) - $(7.75)

NGL Prices (% of WTI)1

 

30% - 35%

Cash Production Costs ($/Mcfe)3

 

$1.30 - $1.35

Cash G&A ($mm)4

 

$36 - $38

CAPEX ($mm)

 

$345 - $370

1

Excludes impact of hedges

2

Excludes the cost of firm transportation

3

Includes lease operating, transportation, gathering and compression, production and ad valorem taxes

4

 

Non-GAAP financial measure which excludes non-cash compensation and merger related expenses, see reconciliation to the most comparable GAAP measure under “Cash General and Administrative Expense” in this press release

Conference Call

A conference call to review the Company’s third quarter financial and operational results is scheduled for Friday, November 8, 2019 at 10:00 a.m. Eastern Time. To participate in the call, please dial 877-709-8150 or 201-689-8354 for international callers and reference Montage Resources Third Quarter 2019 Earnings Call. A replay of the call will be available through January 8, 2020. To access the phone replay, dial 877-660-6853 or 201-612-7415 for international callers. The conference ID is 13695725. A live webcast of the call may be accessed through the Investor Center on the Company’s website at www.montageresources.com. The webcast will be archived for replay on the Company’s website for six months.

MONTAGE RESOURCES CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except share and per share amounts)

(Unaudited)

 

 

September 30,
2019

 

December 31,
2018

ASSETS

 

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

11,531

 

 

$

5,959

 

Accounts receivable

 

 

77,154

 

 

 

119,332

 

Assets held for sale

 

 

1,485

 

 

 

 

Other current assets

 

 

35,239

 

 

 

8,639

 

Total current assets

 

 

125,409

 

 

 

133,930

 

 

 

 

 

 

 

 

 

 

PROPERTY AND EQUIPMENT

 

 

 

 

 

 

 

 

Oil and natural gas properties, successful efforts method:

 

 

 

 

 

 

 

 

Unproved properties

 

 

520,941

 

 

 

482,475

 

Proved oil and gas properties, net

 

 

1,210,876

 

 

 

807,583

 

Other property and equipment, net

 

 

12,349

 

 

 

6,300

 

Total property and equipment, net

 

 

1,744,166

 

 

 

1,296,358

 

 

 

 

 

 

 

 

 

 

OTHER NONCURRENT ASSETS

 

 

 

 

 

 

 

 

Other assets

 

 

9,278

 

 

 

3,481

 

Operating lease right-of-use assets

 

 

42,936

 

 

 

 

Assets held for sale

 

 

8,724

 

 

 

 

TOTAL ASSETS

 

$

1,930,513

 

 

$

1,433,769

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

 

Accounts payable

 

$

122,141

 

 

$

116,735

 

Accrued capital expenditures

 

 

51,785

 

 

 

12,979

 

Accrued liabilities

 

 

52,081

 

 

 

56,909

 

Accrued interest payable

 

 

11,137

 

 

 

21,661

 

Liabilities associated with assets held for sale

 

 

4,568

 

 

 

 

Operating lease liability

 

 

12,889

 

 

 

 

Total current liabilities

 

 

254,601

 

 

 

208,284

 

 

 

 

 

 

 

 

 

 

NONCURRENT LIABILITIES

 

 

 

 

 

 

 

 

Debt, net of unamortized discount and debt issuance costs

 

 

499,848

 

 

 

497,778

 

Revolving credit facility

 

 

127,500

 

 

 

32,500

 

Asset retirement obligations

 

 

27,169

 

 

 

7,110

 

Other liabilities

 

 

2,296

 

 

 

611

 

Operating lease liability

 

 

30,185

 

 

 

 

Liabilities associated with assets held for sale

 

 

6,900

 

 

 

 

Total liabilities

 

 

948,499

 

 

 

746,283

 

COMMITMENTS AND CONTINGENCIES

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Preferred stock, 50,000,000 authorized, no shares issued and outstanding

 

 

 

 

 

 

Common stock, $0.01 par value, 1,000,000,000 authorized, 35,756,088

and 20,169,063 shares issued and outstanding, respectively

 

 

382

 

 

 

3,043

 

Additional paid in capital

 

 

2,350,072

 

 

 

2,065,119

 

Treasury stock, shares at cost; 2,488,525 and 1,747,624 shares, respectively

 

 

(8,819

)

 

 

(3,357

)

Accumulated deficit

 

 

(1,359,621

)

 

 

(1,377,319

)

Total stockholders’ equity

 

 

982,014

 

 

 

687,486

 

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

 

$

1,930,513

 

 

$

1,433,769

 

MONTAGE RESOURCES CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

(In thousands, except per share data)

(Unaudited)

 

 

For the Three Months Ended
September 30,

 

 

For the Nine Months Ended
September 30,

 

 

2019

 

 

2018

 

 

2019

 

 

2018

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Natural gas, oil and natural gas liquids sales

 

$

153,021

 

 

$

127,179

 

 

$

428,278

 

 

$

340,620

 

Brokered natural gas and marketing revenue

 

 

10,228

 

 

 

2,944

 

 

 

31,747

 

 

 

3,318

 

Other revenue

 

 

46

 

 

 

 

 

 

307

 

 

 

 

Total revenues

 

 

163,295

 

 

 

130,123

 

 

 

460,332

 

 

 

343,938

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATING EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Lease operating

 

 

11,986

 

 

 

5,312

 

 

 

29,651

 

 

 

22,026

 

Transportation, gathering and compression

 

 

57,027

 

 

 

39,066

 

 

 

150,065

 

 

 

98,126

 

Production and ad valorem taxes

 

 

1,660

 

 

 

2,604

 

 

 

8,519

 

 

 

7,226

 

Brokered natural gas and marketing expense

 

 

10,574

 

 

 

3,237

 

 

 

32,017

 

 

 

3,715

 

Depreciation, depletion, amortization and accretion

 

 

45,456

 

 

 

34,439

 

 

 

113,950

 

 

 

98,672

 

Exploration

 

 

16,621

 

 

 

11,328

 

 

 

48,602

 

 

 

36,227

 

General and administrative

 

 

14,580

 

 

 

12,937

 

 

 

57,074

 

 

 

33,391

 

Rig termination and standby

 

 

1,221

 

 

 

 

 

 

1,221

 

 

 

 

(Gain) loss on sale of assets

 

 

(733

)

 

 

6

 

 

 

(731

)

 

 

(1,814

)

Other expense

 

 

2

 

 

 

 

 

 

40

 

 

 

 

Total operating expenses

 

 

158,394

 

 

 

108,929

 

 

 

440,408

 

 

 

297,569

 

OPERATING INCOME

 

 

4,901

 

 

 

21,194

 

 

 

19,924

 

 

 

46,369

 

OTHER INCOME (EXPENSE)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain (loss) on derivative instruments

 

 

15,812

 

 

 

(3,263

)

 

 

40,620

 

 

 

(24,055

)

Interest expense, net

 

 

(15,192

)

 

 

(13,932

)

 

 

(44,140

)

 

 

(39,975

)

Other income (expense)

 

 

 

 

 

(1

)

 

 

8

 

 

 

(1

)

Total other income (expense), net

 

 

620

 

 

 

(17,196

)

 

 

(3,512

)

 

 

(64,031

)

INCOME (LOSS) FROM CONTINUING OPERATIONS

BEFORE INCOME TAXES

 

 

5,521

 

 

 

3,998

 

 

 

16,412

 

 

 

(17,662

)

Income tax benefit (expense)

 

 

 

 

 

 

 

 

 

 

 

 

INCOME (LOSS) FROM CONTINUING OPERATIONS

 

 

5,521

 

 

 

3,998

 

 

 

16,412

 

 

 

(17,662

)

Income (loss) from discontinued operations, net of income tax

 

 

(1,237

)

 

 

 

 

 

1,286

 

 

 

 

NET INCOME (LOSS)

 

$

4,284

 

 

$

3,998

 

 

$

17,698

 

 

$

(17,662

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EARNINGS (LOSS) PER SHARE OF COMMON STOCK

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common stock outstanding

 

 

35,684

 

 

 

20,144

 

 

 

32,343

 

 

 

19,947

 

Income (loss) from continuing operations

 

$

0.15

 

 

$

0.20

 

 

$

0.51

 

 

$

(0.89

)

Income (loss) from discontinued operations

 

 

(0.03

)

 

 

 

 

 

0.04

 

 

 

 

Net income (loss)

 

$

0.12

 

 

$

0.20

 

 

$

0.55

 

 

$

(0.89

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common stock outstanding

 

 

35,697

 

 

 

20,170

 

 

 

32,471

 

 

 

19,947

 

Income (loss) from continuing operations

 

$

0.15

 

 

$

0.20

 

 

$

0.51

 

 

$

(0.89

)

Income (loss) from discontinued operations

 

 

(0.03

)

 

 

 

 

 

0.04

 

 

 

 

Net income (loss)

 

$

0.12

 

 

$

0.20

 

 

$

0.55

 

 

$

(0.89

)

Adjusted Revenue

Adjusted revenue is a non-GAAP financial measure. The Company defines adjusted revenue as follows: total revenues plus or minus net cash receipts or payments on settled derivative instruments less brokered natural gas and marketing revenue and other revenue. The Company believes adjusted revenue provides investors with helpful information with respect to the performance of the Company’s operations and management uses adjusted revenue to evaluate its ongoing operations and for internal planning and forecasting purposes. See the table below, which reconciles adjusted revenue and total revenues for the three and nine months ended September 30, 2019 and 2018.

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

$ thousands

 

2019

 

2018

 

2019

 

2018

Total revenues

 

$

163,295

 

 

$

130,123

 

 

$

460,332

 

 

$

343,938

 

Net cash receipts (payments) on derivative instruments

 

 

11,818

 

 

 

(5,377

)

 

 

11,072

 

 

 

(7,724

)

Brokered natural gas and marketing revenue

 

 

(10,228

)

 

 

(2,944

)

 

 

(31,747

)

 

 

(3,318

)

Other revenue

 

 

(46

)

 

 

 

 

 

(307

)

 

 

 

Adjusted revenue

 

$

164,839

 

 

$

121,802

 

 

$

439,350

 

 

$

332,896

 

Adjusted Net Income (Loss)

Adjusted net income (loss) represents income (loss) from continuing operations before income taxes adjusted for certain non-cash items as set forth in the table below. We believe adjusted net income (loss) is used by many investors and published research in making investment decisions and evaluating operational trends of the Company and its performance relative to other oil and gas producing companies. Adjusted net income (loss) is not a measure of net income (loss) from continuing operations as determined by GAAP. See the table below for a reconciliation of adjusted net income (loss) and net income (loss) from continuing operations, which retroactively reflects the 15-to-1 reverse stock split that took place at the close of the merger with Blue Ridge on February 28, 2019 for the three and nine months ended September 30, 2019 and 2018.

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

$ thousands

 

2019

 

2018

 

2019

 

2018

Income (loss) from continuing operations before income taxes, as

reported

 

$

5,521

 

 

$

3,998

 

 

$

16,412

 

 

$

(17,662

)

(Gain) loss on derivative instruments

 

 

(15,812

)

 

 

3,263

 

 

 

(40,620

)

 

 

24,055

 

Net cash receipts (payments) on settled derivatives

 

 

11,818

 

 

 

(5,377

)

 

 

11,072

 

 

 

(7,724

)

Dry hole and other

 

 

 

 

 

93

 

 

 

163

 

 

 

189

 

Stock-based compensation

 

 

1,061

 

 

 

2,171

 

 

 

7,614

 

 

 

6,131

 

Impairment of unproved properties

 

 

14,114

 

 

 

6,971

 

 

 

36,157

 

 

 

20,638

 

(Gain) loss on sale of assets

 

 

(733

)

 

 

6

 

 

 

(731

)

 

 

(1,814

)

Merger-related expenses

 

 

3,291

 

 

 

2,993

 

 

 

21,812

 

 

 

2,993

 

Income before income taxes, as adjusted

 

 

19,260

 

 

 

14,118

 

 

 

51,879

 

 

 

26,806

 

Adjusted net income

 

$

19,260

 

 

$

14,118

 

 

$

51,879

 

 

$

26,806

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income (loss) per Common Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.12

 

 

$

0.20

 

 

$

0.55

 

 

$

(0.89

)

Diluted

 

$

0.12

 

 

$

0.20

 

 

$

0.55

 

 

$

(0.89

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adjusted net income per Common Share

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

0.54

 

 

$

0.70

 

 

$

1.60

 

 

$

1.34

 

Diluted

 

$

0.54

 

 

$

0.70

 

 

$

1.60

 

 

$

1.34

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted Average Common Shares Outstanding

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

35,684

 

 

 

20,144

 

 

 

32,343

 

 

 

19,947

 

Diluted

 

 

35,697

 

 

 

20,170

 

 

 

32,471

 

 

 

20,030

 

Adjusted EBITDAX

Adjusted EBITDAX is a supplemental non-GAAP measure that is used by the Company to evaluate its financial results. The Company defines Adjusted EBITDAX as net income or loss before interest expense; income taxes; impairments; depreciation, depletion and amortization (“DD&A”); gain (loss) on derivative instruments; net cash receipts (payments on settled derivative instruments, and premiums (paid) received on options that settled during the period); non-cash compensation expense; gain or loss from sale of interest in gas properties; exploration expenses; and other unusual or infrequent items set forth in the table below. Adjusted EBITDAX is not a measure of net income or loss as determined by GAAP. See the table below for a reconciliation of Adjusted EBITDAX to net income or net loss.

 

 

Three Months Ended
September 30,

 

Nine Months Ended
September 30,

$ thousands

 

2019

 

2018

 

2019

 

2018

Net income (loss)

 

$

4,284

 

 

$

3,998

 

 

$

17,698

 

 

$

(17,662

)

Depreciation, depletion, amortization and accretion

 

 

45,456

 

 

 

34,439

 

 

 

113,950

 

 

 

98,672

 

Exploration expense

 

 

16,621

 

 

 

11,328

 

 

 

48,602

 

 

 

36,227

 

Rig termination and standby

 

 

1,221

 

 

 

 

 

 

1,221

 

 

 

 

Stock-based compensation

 

 

1,061

 

 

 

2,171

 

 

 

7,614

 

 

 

6,131

 

(Gain) loss on sale of assets

 

 

(733

)

 

 

6

 

 

 

(731

)

 

 

(1,814

)

(Gain) loss on derivative instruments

 

 

(15,812

)

 

 

3,263

 

 

 

(40,620

)

 

 

24,055

 

Net cash receipts (payments) on settled derivatives

 

 

11,818

 

 

 

(5,377

)

 

 

11,072

 

 

 

(7,724

)

Interest expense, net

 

 

15,192

 

 

 

13,932

 

 

 

44,140

 

 

 

39,975

 

Other income (expense)

 

 

 

 

 

1

 

 

 

(8

)

 

 

1

 

Merger-related expenses

 

 

3,291

 

 

 

2,993

 

 

 

21,812

 

 

 

2,993

 

Income (loss) from discontinued operations

 

 

1,237

 

 

 

 

 

 

(1,286

)

 

 

 

Adjusted EBITDAX

 

$

83,636

 

 

$

66,754

 

 

$

223,464

 

 

$

180,854

 

Cash General and Administrative Expenses

Cash general and administrative expenses is a non-GAAP financial measure used by the Company in the Guidance Table to provide a measure of administrative expenses used by many investors and published research in making investment decisions and evaluating operational trends of the Company. See the table below for a reconciliation of Cash General and Administrative Expenses and General and Administrative Expenses.

 

 

Three Months Ended
September 30,

 

Guidance

$ thousands

 

2019

 

2018

 

Year Ending
December 31, 2019

General and administrative expenses, estimated to be reported

 

$

14,580

 

 

$

12,937

 

 

$68,000-$76,000

Stock-based compensation

 

 

(1,061

)

 

 

(2,171

)

 

(8,000-10,000)

Cash general and administrative expenses

 

$

13,519

 

 

$

10,766

 

 

$60,000-$66,000

Merger-related expenses

 

 

(3,291

)

 

 

(2,993

)

 

(24,000-28,000)

Cash general and administrative expenses, excluding merger related expenses

 

$

10,228

 

 

$

7,773

 

 

$36,000-$38,000

About Montage Resources

Montage Resources is an exploration and production company with approximately 218,000 net effective undeveloped acres currently focused on the Utica and Marcellus Shales of southeast Ohio, West Virginia and North Central Pennsylvania. For more information, please visit the Company’s website at www.montageresources.com.

Forward-Looking Statements

This press release contains “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. All statements, other than statements of historical fact included in this press release, regarding Montage Resources’ strategy, future operations, financial position, estimated revenues and income/losses, projected costs and capital expenditures, prospects, plans and objectives of management are forward-looking statements. When used in this press release, the words “plan,” “endeavor,” “will,” “would,” ”should,” “could,” “believe,” “anticipate,” “intend,” “estimate,” “expect,” “continue,” “position,” “potential,” “committed,” “project” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These forward-looking statements are based on Montage Resources’ current expectations and assumptions about future events and are based on currently available information as to the outcome and timing of future events. When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements described under the heading “Risk Factors” in Montage Resources’ Annual Report on Form 10-K filed with the Securities and Exchange Commission on March 15, 2019 (the “2018 Annual Report”), in “Item 1A. Risk Factors” of Montage Resources’ Quarterly Reports on Form 10-Q and in Montage Resources’ other filings and reports with the Securities and Exchange Commission.

Forward-looking statements may include, but are not limited to, statements about Montage Resources’ business strategy; reserves; general economic conditions; financial strategy, liquidity and capital required for developing its properties and timing related thereto; realized natural gas, NGLs and oil prices; timing and amount of future production of natural gas, NGLs and oil; its hedging strategy and results; future drilling plans; competition and government regulations, including those related to hydraulic fracturing; the anticipated benefits under commercial agreements; marketing of natural gas, NGLs and oil; leasehold and business acquisitions; the costs, terms and availability of gathering, processing, fractionation and other midstream services; the costs, terms and availability of downstream transportation services; credit markets; uncertainty regarding future operating results, including initial production rates and liquid yields in type curve areas; and plans, objectives, expectations and intentions contained in this press release that are not historical, including, without limitation, the guidance set forth herein. Forward-looking statements also may include statements relating to the combination with Blue Ridge, including statements regarding integration and transition plans, synergies, cost savings, opportunities, anticipated future performance, benefits of the transaction and its impact on Montage Resources’ business, operations, assets, results of operations, liquidity, and financial position, and any statements of assumptions underlying any of the foregoing.

Montage Resources cautions you that all these forward-looking statements are subject to risks and uncertainties, most of which are difficult to predict and many of which are beyond the Company’s control, incident to the exploration for and development, production, gathering and sale of natural gas, NGLs and oil. These risks include, but are not limited to, legal and environmental risks, drilling and other operating risks, regulatory changes, commodity price volatility and declines in the price of natural gas, NGLs, and oil, inflation, lack of availability of drilling, production and processing equipment and services, counterparty credit risk, the uncertainty inherent in estimating natural gas, NGLs and oil reserves and in projecting future rates of production, cash flow and access to capital, the timing of development expenditures, and the other risks described under the heading “Risk Factors” in the 2018 Annual Report, in “Item 1A. Risk Factors” of Montage Resources’ Quarterly Reports on Form 10-Q and in Montage Resources’ other filings and reports with the Securities and Exchange Commission. In addition, forward-looking statements are subject to risks and uncertainties related to the combination with Blue Ridge, including, without limitation, failure to realize or delays in realizing expected synergies or other benefits of the transaction, difficulties in integrating the combined operations, disruption of management time from ongoing business operations due to the transaction, adverse effects on the ability of Montage Resources to retain and hire key personnel and maintain relationships with suppliers and customers, negative effects of consummation of the transaction on the market price of the Company’s common stock, transaction costs, unknown liabilities or unanticipated expenses.

All forward-looking statements, expressed or implied, included in this press release are expressly qualified in their entirety by this cautionary statement and are based on assumptions that Montage Resources believes to be reasonable but that may not prove to be accurate. This cautionary statement should also be considered in connection with any subsequent written or oral forward-looking statements that Montage Resources or persons acting on its behalf may issue. Except as otherwise required by applicable law, Montage Resources disclaims any duty to update any forward-looking statements to reflect new information or events or circumstances after the date of this press release. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof.

Montage Resources Corporation
Douglas Kris, Investor Relations
469-444-1736
dkris@mresources.com

Source: Montage Resources

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