On July 23, 2024, Range Resources Corp (RRC, Financial) released its 8-K filing detailing its financial performance for the second quarter of 2024. Fort Worth-based Range Resources is an independent exploration and production company focusing on operations in the Marcellus Shale in Pennsylvania. At year-end 2023, the company’s proven reserves totaled 18.1 trillion cubic feet equivalent, with net production of 2.14 billion cubic feet equivalent per day, of which 69% was natural gas.
Performance Overview
Range Resources Corp (RRC, Financial) reported GAAP revenues of $530 million for Q2 2024, falling short of the analyst estimate of $602.42 million. However, the company posted a GAAP net income of $29 million, translating to $0.12 per diluted share, which is below the estimated earnings per share (EPS) of $0.29. Despite the revenue miss, the company managed to exceed EPS expectations on an adjusted basis, reporting $0.46 per diluted share.
Financial Achievements and Challenges
Range Resources Corp (RRC, Financial) highlighted several key financial achievements for the quarter:
- Cash flow from operating activities of $149 million
- Cash flow from operations, before working capital changes, of $237 million
- Capital spending of $175 million, approximately 27% of the 2024 budget
- Repurchased ~$48 million face value of 2025 senior notes at a discount
- Repurchased 600,000 shares at an average of $33.42 per share
These achievements are crucial for maintaining liquidity and financial stability, especially in the volatile oil and gas industry. However, the company faces challenges such as lower natural gas prices and production differentials, which could impact future profitability.
Income Statement Highlights
Key details from the income statement include:
| Metric | Q2 2024 | Q2 2023 | % Change |
|---|---|---|---|
| Revenues and other income | $530,043 | $636,977 | -17% |
| Total costs and expenses | $520,033 | $592,034 | -12% |
| Net income | $28,704 | $30,231 | -5% |
Production and Pricing
Range Resources Corp (RRC, Financial) reported an average production of 2.15 Bcfe per day, with natural gas accounting for 69% of the total production. The company’s realized prices before NYMEX hedges were $1.47 per mcf for natural gas, $24.35 per barrel for NGLs, and $68.32 per barrel for oil. After hedging, the average realized prices were $2.47 per mcf for natural gas, $24.56 per barrel for NGLs, and $68.12 per barrel for oil.
Financial Position and Repurchase Activity
As of June 30, 2024, Range Resources Corp (RRC, Financial) had net debt outstanding of approximately $1.47 billion. The company repurchased $47.9 million principal amount of 4.875% senior notes due 2025 at a discount and 600,000 shares at an average price of $33.42 per share. The company has approximately $1.1 billion of availability under the share repurchase program.
Capital Expenditures and Operational Activity
Second quarter 2024 drilling and completion expenditures were $162 million, including $13 million classified as exploration drilling. The company invested approximately $14 million in acreage during the quarter. First half 2024 capital spending represented approximately 53% of Range’s total capital budget for 2024.
Guidance and Outlook
Range Resources Corp (RRC, Financial) provided updated guidance for 2024, targeting a maintenance production program with flat production at 2.12 – 2.16 Bcfe per day. The company expects annual production to be near the high end of this range, with more than 30% attributed to liquids production.
In summary, while Range Resources Corp (RRC, Financial) faced challenges in meeting revenue expectations, the company demonstrated resilience through strategic financial management and operational efficiency. Investors and stakeholders will be keen to monitor how the company navigates the volatile market conditions in the coming quarters.
Explore the complete 8-K earnings release (here) from Range Resources Corp for further details.
