EXHIBIT 99.1
BRIGHAM MINERALS, INC. REPORTS RECORD THIRD QUARTER 2022 OPERATIONAL AND FINANCIAL RESULTS
AUSTIN, Texas - (BUSINESS WIRE) - November 3, 2022 - Brigham Minerals, Inc. (NYSE: MNRL) (“Brigham Minerals,” “Brigham,” or the “Company”), a leading mineral and royalty interest acquisition company, today announced record operational and financial results for the quarter ended September 30, 2022.
RECORD THIRD QUARTER 2022 OPERATIONAL AND FINANCIAL HIGHLIGHTS AND SUBSEQUENT EVENTS
•Record daily production volumes of 15,000 Boe/d (73% liquids, 50% oil)
◦Production up 15% sequentially from Q2 2022 including a 19% increase in Permian Basin volumes
•Record royalty revenues of $92.8 million
◦Up 3% sequentially from Q2 2022 driven by 15% higher volumes offset by 12% lower realized prices
•Net income totaling $44.4 million
◦Adjusted Net Income(1) of $52.2 million, excluding $7.8 million of merger related costs
◦Record Adjusted EBITDA(1) totaling $82.1 million up 3% sequentially from Q2 2022
•Declared record Q3 2022 dividend of $0.81 per share of Class A common stock(2)
◦Base Dividend of $0.16 per share of Class A common stock
◦Variable Dividend increased 7% sequentially to $0.65 per share of Class A common stock
◦Represents 75% payout ratio of Discretionary Cash Flow ex lease bonus(1)
•10.8 net (1,786 gross) activity wells comprised of 6.7 net (929 gross) DUCs and 4.1 net (857 gross) permits
◦1.9 net DUCs converted to PDP during Q3 2022
◦207 gross wells spud during Q3 2022 (1.7 net locations)
◦Permian Basin activity wells totaling 7.0 net locations representing 65% of total activity wells
•Acquired 365 net royalty acres deploying $12.2 million in mineral acquisition capital
◦100% of capital deployed to Permian Basin comprised of 59% PDP, DUC and permitted net locations
•$33.0 million cash balance and undrawn revolver capacity of $217.0 million as of September 30, 2022
◦Conservative leverage at 0.2x last quarter annualized Adjusted EBITDA(1)
•Subsequent to quarter end, closed previously announced Midland Basin acquisition with Avant Royalties
◦Roughly 3,900 net royalty acres with 19 rigs currently running across a core, well diversified position operated by Endeavor Energy Resources, Pioneer Natural Resources, Diamondback Energy and ExxonMobil
◦0.9 net DUCs and 0.3 net permits as of close resulting in 12.0 net pro forma activity wells
(1)Non-GAAP measure. See “Non-GAAP Financial Measures” below.
(2)See "Quarterly Cash Dividend" section below regarding Board approval of future dividends.
PROPOSED MERGER WITH SITIO ROYALTIES
As previously announced, on September 6, 2022, Brigham and Sitio Royalties Corp. (“Sitio”) entered into a definitive merger agreement, pursuant to which Sitio will acquire Brigham in an all-stock transaction. Following the approval by the
EXHIBIT 99.1
Brigham stockholders and the satisfaction of certain other closing conditions, the merger is expected to close during the first quarter of 2023.
In light of the pending merger with Sitio, Brigham has discontinued providing guidance and long-term outlook information regarding its results of operations and does not intend to update the previously issued guidance and long-term outlook information, including the guidance provided in the Company’s August 4, 2022 press release announcing its second quarter 2022 financial and operational results (“the second quarter earnings release”). Accordingly, investors are cautioned not to rely on historical forward-looking statements regarding guidance and long-term outlook information, including any such information provided in the second quarter earnings release, as those forward-looking statements were the estimates of management only as of the date provided, have not and will not be updated and were subject to the specific risks and uncertainties that accompanied such forward-looking statements. As a result of the pending merger, there will not be an investor conference call.
SUBSEQUENT EVENTS
Midland Acquisition
As previously announced, on August 22, 2022, Brigham LLC entered into a definitive purchase and sale agreement (the “Purchase Agreement”) with Avant Royalties, LP, Avant Royalties II, LP and Avant Royalties II Sidecar Fund, LP (collectively, the “Sellers”), pursuant to which Brigham LLC agreed to acquire certain mineral and royalty interests from the Sellers (the “Midland Acquisition”) for $132.5 million in cash, subject to customary closing adjustments. The Midland Acquisition was completed on October 21, 2022 and has an effective date of July 1, 2022. The Company financed the Midland Acquisition through a combination of cash on hand and borrowings under the Company’s revolving credit facility.
OPERATIONAL UPDATE
Mineral and Royalty Interest Ownership Update
During the third quarter 2022, the Company executed twelve transactions acquiring approximately 365 net royalty acres (standardized to a 1/8th royalty interest) and deployed $12.2 million in capital. The Company deployed substantially all of its mineral acquisition capital in the third quarter to the Permian Basin. Third quarter acquisitions are expected to deliver near-term production and cash flow growth with the addition of 26 gross DUCs (0.1 net) and 45 gross permits (0.2 net) to inventory counts.
The table below summarizes the Company’s approximate mineral and royalty interest ownership as of the dates indicated.
| Delaware | Midland | Anadarko | DJ | Williston | Total | |||||||||||||||||||||||||||||||||
| Net Royalty Acres | ||||||||||||||||||||||||||||||||||||||
September 30, 2022 | 30,150 | 9,235 | 9,850 | 24,755 | 8,185 | 82,175 | ||||||||||||||||||||||||||||||||
| June 30, 2022 | 30,010 | 9,015 | 9,850 | 24,755 | 8,180 | 81,810 | ||||||||||||||||||||||||||||||||
| Acres Added and (Sold) Q/Q | 140 | 220 | — | — | 5 | 365 | ||||||||||||||||||||||||||||||||
| % Added and (Sold) Q/Q | —% | 2% | —% | —% | —% | —% | ||||||||||||||||||||||||||||||||
DUC Conversions Updates
During the third quarter 2022, the Company identified 307 gross (1.9 net) horizontal wells converted to production, which represented 30% of its net DUC inventory as of the second quarter 2022 (28% of gross DUCs). Well conversions to proved developed producing during third quarter are summarized in the table below:
Q3 2022 Wells Converted to Proved Developed Producing | ||||||||||||||
| Gross | Net | |||||||||||||
| DUCs | 307 | 1.9 | ||||||||||||
| Acquired Wells Net of Divestitures | 71 | 0.2 | ||||||||||||
| Converted Permitted and Other | 3 | (0.1) | ||||||||||||
| Total | 381 | 2.0 | ||||||||||||
EXHIBIT 99.1
Drilling Activity Update
During the third quarter 2022, the Company identified 207 gross (1.7 net) wells spud on its mineral position, which represents a 13% sequential increase from the second quarter 2022 on a net well basis. Brigham’s average quarterly gross and net wells spud from 2019 through the second quarter 2022 relative to the third quarter 2022 are summarized in the table below:
2019(1) | 2020(1) | 2021(1) | Q1 22 | Q2 22 | Q3 22 | ||||||||||||||||||||||||||||||
| Gross Wells Spud | 219 | 95 | 164 | 238 | 253 | 207 | |||||||||||||||||||||||||||||
| Net Wells Spud | 1.4 | 0.7 | 1.3 | 2.1 | 1.5 | 1.7 | |||||||||||||||||||||||||||||
(1) Amounts represent average quarterly numbers during the year.
DUC and Permit Inventory Update
The Company expects future production volumes will be driven by the continued conversion of its DUC and permit inventory. Brigham’s gross and net DUC and permit inventory as of September 30, 2022 by basin is outlined in the table below:
Development Inventory by Basin(1) | ||||||||||||||||||||||||||||||||||||||
| Delaware | Midland | Anadarko | DJ | Williston | Total | |||||||||||||||||||||||||||||||||
| Gross Inventory | ||||||||||||||||||||||||||||||||||||||
| DUCs | 207 | 368 | 18 | 166 | 170 | 929 | ||||||||||||||||||||||||||||||||
| Permits | 355 | 149 | 5 | 149 | 199 | 857 | ||||||||||||||||||||||||||||||||
| Net Inventory | ||||||||||||||||||||||||||||||||||||||
| DUCs | 2.5 | 1.8 | 0.1 | 2.0 | 0.4 | 6.7 | ||||||||||||||||||||||||||||||||
| Permits | 2.0 | 0.7 | — | 0.9 | 0.4 | 4.1 | ||||||||||||||||||||||||||||||||
(1) Individual amounts may not add to totals due to rounding.
EXHIBIT 99.1
FINANCIAL UPDATE
For the three months ended September 30, 2022, crude oil, natural gas and NGL production volumes increased 15% to 15,000 Boe/d as compared to the three months ended June 30, 2022 and increased 65% as compared to the same prior-year period. During the three months ended September 30, 2022, we collected revenues attributable to first payments received on production from numerous new wells turned-in-line at high initial flow rates on high-interest acreage in the Delaware and Midland basins. We typically receive first payment from an operator several months or longer after initial production,which typically covers multiple months of production, and as such, high-interest wells or wells with robust initial production rates can have a significant impact on revenues for the period in which first payments are collected.
For the three months ended September 30, 2022, average realized prices were $97.20 per barrel of oil, $7.09 per Mcf of natural gas, and $30.70 per barrel of NGL, for a total equivalent price of $67.21 per Boe. This represents a 12% decrease relative to the three months ended June 30, 2022 and a 39% increase relative to the same prior-year period.
The Company's net income for the three months ended September 30, 2022 was $44.4 million, inclusive of $7.8 million of merger related costs. Adjusted Net Income for three months ended September 30, 2022 was $52.2 million, excluding $7.8 million of merger related costs, up 4% from the three months ended June 30, 2022 and up 176% relative to the same prior-year period. Adjusted EBITDA was $82.1 million for the three months ended September 30, 2022, up 3% from the three months ended June 30, 2022 and up 135% relative to the same prior-year period. Adjusted EBITDA ex lease bonus was $80.7 million for the three months ended September 30, 2022, up 2% from the three months ended June 30, 2022 and up 141% from the same prior-year period. Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA ex lease bonus are Non-GAAP financial measures. For a definition of Adjusted Net Income, Adjusted EBITDA and Adjusted EBITDA ex lease bonus and a reconciliation to our most directly comparable measure calculated and presented in accordance with GAAP, please read "Non-GAAP Financial Measures” below.
As of September 30, 2022, the Company had a cash balance of $33.0 million and $217.0 million of undrawn revolver capacity under its credit facility, providing the Company with total liquidity of $250.0 million.
EXHIBIT 99.1
Results of Operations
| Unaudited Financial and Operational Results | Three Months Ended | Nine Months Ended | ||||||||||||||||||||||||
($ in thousands, except for realized prices and unit expenses) | September 30, 2022 | June 30, 2022 | September 30, 2022 | September 30, 2021 | ||||||||||||||||||||||
| Operating Revenues | ||||||||||||||||||||||||||
| Oil sales | $ | 67,132 | $ | 66,415 | $ | 184,235 | $ | 78,022 | ||||||||||||||||||
| Natural gas sales | 16,016 | 13,968 | 40,296 | 19,450 | ||||||||||||||||||||||
| NGL sales | 9,602 | 10,020 | 28,617 | 12,182 | ||||||||||||||||||||||
| Total mineral and royalty revenue | $ | 92,750 | $ | 90,403 | $ | 253,148 | $ | 109,654 | ||||||||||||||||||
| Lease bonus and other revenue | 1,456 | 476 | 3,365 | 3,894 | ||||||||||||||||||||||
| Total Revenues | $ | 94,206 | $ | 90,879 | $ | 256,513 | $ | 113,548 | ||||||||||||||||||
| Production | ||||||||||||||||||||||||||
| Oil (MBbls) | 691 | 612 | 1,855 | 1,245 | ||||||||||||||||||||||
| Natural gas (MMcf) | 2,259 | 2,011 | 6,138 | 4,441 | ||||||||||||||||||||||
| NGLs (MBbls) | 312 | 237 | 769 | 471 | ||||||||||||||||||||||
| Equivalents (MBoe) | 1,379 | 1,185 | 3,647 | 2,456 | ||||||||||||||||||||||
| Equivalents per day (Boe/d) | 15,000 | 13,019 | 13,361 | 8,996 | ||||||||||||||||||||||
| Realized Prices ($/Boe) | ||||||||||||||||||||||||||
| Oil ($/Bbl) | $ | 97.20 | $ | 108.37 | $ | 99.32 | $ | 62.68 | ||||||||||||||||||
| Natural gas ($/Mcf) | 7.09 | 6.95 | 6.56 | 4.38 | ||||||||||||||||||||||
| NGLs ($/Bbl) | 30.70 | 42.31 | 37.19 | 25.87 | ||||||||||||||||||||||
| Average Realized Price | $ | 67.21 | $ | 76.31 | $ | 69.40 | $ | 44.65 | ||||||||||||||||||
| Operating Expenses | ||||||||||||||||||||||||||
| Gathering, transportation and marketing | $ | 2,962 | $ | 2,246 | $ | 7,211 | $ | 4,967 | ||||||||||||||||||
| Severance and ad valorem taxes | 5,972 | 5,361 | 15,664 | 6,505 | ||||||||||||||||||||||
| Depreciation, depletion, and amortization | 14,964 | 13,449 | 40,726 | 27,129 | ||||||||||||||||||||||
| General and administrative (before share-based compensation) | 10,914 | 3,587 | 18,929 | 9,331 | ||||||||||||||||||||||
| Total operating expenses (before share-based compensation) | $ | 34,812 | $ | 24,643 | $ | 82,530 | $ | 47,932 | ||||||||||||||||||
| General and administrative, share-based compensation | 1,961 | 1,959 | 5,401 | 7,537 | ||||||||||||||||||||||
| Total Operating Expenses | $ | 36,773 | $ | 26,602 | $ | 87,931 | $ | 55,469 | ||||||||||||||||||
| Income from Operations | $ | 57,433 | $ | 64,277 | $ | 168,582 | $ | 58,079 | ||||||||||||||||||
| Other expenses: | ||||||||||||||||||||||||||
| Interest expense, net | (1,046) | (1,154) | (3,114) | (1,105) | ||||||||||||||||||||||
| Other income, net | 6 | 14 | 40 | 51 | ||||||||||||||||||||||
| Income Before Taxes | $ | 56,393 | $ | 63,137 | $ | 165,508 | $ | 57,025 | ||||||||||||||||||
| Income tax expense | 11,950 | 12,957 | 31,820 | 10,717 | ||||||||||||||||||||||
| Net Income | $ | 44,443 | $ | 50,180 | $ | 133,688 | $ | 46,308 | ||||||||||||||||||
| Less: Net income attributable to non-controlling interest | (5,984) | (7,931) | (21,998) | (12,311) | ||||||||||||||||||||||
| Net income attributable to Brigham Minerals, Inc. stockholders | $ | 38,459 | $ | 42,249 | $ | 111,690 | $ | 33,997 | ||||||||||||||||||
EXHIBIT 99.1
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||
| Unit Expenses ($/Boe) | September 30, 2022 | June 30, 2022 | September 30, 2022 | September 30, 2021 | ||||||||||||||||||||||
| Gathering, transportation and marketing | $ | 2.15 | $ | 1.90 | $ | 1.98 | $ | 2.02 | ||||||||||||||||||
| Severance and ad valorem taxes | 4.33 | 4.52 | 4.29 | 2.65 | ||||||||||||||||||||||
| Depreciation, depletion and amortization | 10.84 | 11.35 | 11.17 | 11.05 | ||||||||||||||||||||||
| General and administrative (before share-based compensation) (1) | 7.91 | 3.03 | 5.19 | 3.80 | ||||||||||||||||||||||
| General and administrative, share-based compensation | 1.42 | 1.65 | 1.48 | 3.07 | ||||||||||||||||||||||
| Interest expense, net | 0.76 | 0.97 | 0.85 | 0.45 | ||||||||||||||||||||||
(1)General and administrative expenses (before share-based compensation) for the three months ended September 30, 2022 include costs related to the Mergers of $7.8 million, or $5.63 per Boe. General and administrative expenses (before share-based compensation) for the nine months ended September 30, 2022 include costs related to the Mergers of $7.8 million, or $2.13 per Boe.
Quarterly Cash Dividend
The Company’s Board of Directors (the “Board”) has declared a quarterly cash dividend incorporating results for the third quarter 2022 of $0.81 per share of Class A common stock at a 75% payout ratio. This represents a 5% increase compared to the dividend declared for the second quarter of 2022. The third quarter dividend represents a base dividend of $0.16 per share and a variable dividend of $0.65 per share and will be paid on November 25, 2022 to holders of record as of November 18, 2022. An amount equal to the cash dividend per share will also be set aside for each outstanding award granted under the long-term incentive plan for payment upon the vesting of such awards in accordance with their terms.
Future declarations of dividends are subject to approval by the Board and to the Board’s continuing determination that the declarations of dividends are in the best interests of the Company and its shareholders. Future dividends may be adjusted at the Board’s discretion based on market conditions and capital availability.
Non-GAAP Financial Measures
Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Adjusted EBITDA Margin, Discretionary Cash Flow, Discretionary Cash Flow ex lease bonus, and Net Debt are non-GAAP supplemental financial measures used by our management and by external users of our financial statements such as investors, research analysts and others to assess the financial performance of our assets and their ability to sustain dividends over the long term without regard to financing methods, capital structure or historical cost basis.
We define Adjusted Net Income as net income excluding the impacts of merger related costs. We define Adjusted EBITDA as Adjusted Net Income before depreciation, depletion and amortization, share-based compensation expense, interest expense, and income tax expense, less other income. We define Adjusted EBITDA ex lease bonus as Adjusted EBITDA further adjusted to eliminate the impacts of lease bonus and other revenues we receive due to the unpredictability of timing of the revenue. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue. We define Discretionary Cash Flow as Adjusted EBITDA, less cash interest expense and cash taxes. We define Discretionary Cash Flow ex lease bonus as Discretionary Cash Flow further adjusted to eliminate the impacts of lease bonus and other revenues. We define Net Debt as total debt less cash and cash equivalents.
Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Adjusted EBITDA Margin, Discretionary Cash Flow, Discretionary Cash Flow ex lease bonus, and Net Debt do not represent and should not be considered alternatives to, or more meaningful than, net income or any other measure of financial performance presented in accordance with GAAP as measures of our financial performance. Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Adjusted EBITDA Margin, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus have important limitations as analytical tools because they exclude some but not all items that affect net income, the most directly comparable GAAP financial measure. Net Debt should not be considered an alternative to, or more meaningful than, total debt, the most directly comparable GAAP measure. Our computation of Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Adjusted EBITDA Margin, Discretionary Cash Flow, Discretionary Cash Flow ex lease bonus, and Net Debt may differ from computations of similarly titled measures of other companies.
EXHIBIT 99.1
The following tables present a reconciliation of Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Adjusted EBITDA Margin, Discretionary Cash Flow, Discretionary Cash Flow ex lease bonus, and Net Debt to the most directly comparable GAAP financial measure for the periods indicated.
SUPPLEMENTAL SCHEDULES
Reconciliation of Adjusted Net Income, Adjusted EBITDA, Adjusted EBITDA ex Lease Bonus and Adjusted EBITDA Margin
| Three Months Ended | Nine Months Ended | |||||||||||||||||||||||||||||||
| ($ In thousands) | September 30, 2022 | June 30, 2022 | September 30, 2021 | September 30, 2022 | September 30, 2021 | |||||||||||||||||||||||||||
| Net Income | $ | 44,443 | $ | 50,180 | $ | 18,911 | $ | 133,688 | $ | 46,308 | ||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||||||||
| Merger-related costs | 7,769 | — | — | 7,769 | — | |||||||||||||||||||||||||||
| Adjusted Net Income | $ | 52,212 | $ | 50,180 | $ | 18,911 | $ | 141,457 | $ | 46,308 | ||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||||||||
| Depreciation, depletion, and amortization | 14,964 | 13,449 | 8,682 | 40,726 | 27,129 | |||||||||||||||||||||||||||
| Share-based compensation expense | 1,961 | 1,959 | 2,682 | 5,401 | 7,537 | |||||||||||||||||||||||||||
| Interest expense, net | 1,046 | 1,154 | 451 | 3,114 | 1,105 | |||||||||||||||||||||||||||
| Income tax expense | 11,950 | 12,957 | 4,214 | 31,820 | 10,717 | |||||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||
| Other income, net | 6 | 14 | 36 | 40 | 51 | |||||||||||||||||||||||||||
| Adjusted EBITDA | $ | 82,127 | $ | 79,685 | $ | 34,904 | $ | 222,478 | $ | 92,745 | ||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||||||||
| Lease bonus and other revenue | 1,456 | 476 | 1,491 | 3,365 | 3,894 | |||||||||||||||||||||||||||
| Adjusted EBITDA ex Lease Bonus | $ | 80,671 | $ | 79,209 | $ | 33,413 | $ | 219,113 | $ | 88,851 | ||||||||||||||||||||||
| Memo: Adjusted EBITDA Margin | ||||||||||||||||||||||||||||||||
| Revenue | $ | 94,206 | $ | 90,879 | $ | 41,964 | $ | 256,513 | $ | 113,548 | ||||||||||||||||||||||
| Adjusted EBITDA | $ | 82,127 | $ | 79,685 | $ | 34,904 | $ | 222,478 | $ | 92,745 | ||||||||||||||||||||||
| Adjusted EBITDA Margin | 87 | % | 88 | % | 83 | % | 87 | % | 82 | % | ||||||||||||||||||||||
EXHIBIT 99.1
Reconciliation of Discretionary Cash Flow and Discretionary Cash Flow ex Lease Bonus
| Three Months Ended | ||||||||||||||||||||
| ($ In thousands, except per share amounts) | September 30, 2022 | June 30, 2022 | September 30, 2021 | |||||||||||||||||
Adjusted EBITDA(1) | $ | 82,127 | $ | 79,685 | $ | 34,904 | ||||||||||||||
| Less: | ||||||||||||||||||||
| Adjusted EBITDA attributable to non-controlling interest | (8,517) | (8,869) | (7,094) | |||||||||||||||||
| Adjusted EBITDA attributable to Class A common stock | $ | 73,610 | $ | 70,816 | $ | 27,810 | ||||||||||||||
| Less: | ||||||||||||||||||||
| Cash interest expense | 782 | 989 | 368 | |||||||||||||||||
| Cash taxes | 12,091 | 13,500 | 3,238 | |||||||||||||||||
| Dividend equivalent rights | 1,119 | 887 | 645 | |||||||||||||||||
| Discretionary cash flow to Class A common stock | $ | 59,618 | $ | 55,440 | $ | 23,559 | ||||||||||||||
| Less: | ||||||||||||||||||||
| Lease bonus | 1,305 | 423 | 1,188 | |||||||||||||||||
| Discretionary cash flow ex lease bonus to Class A common stock | $ | 58,313 | $ | 55,017 | $ | 22,371 | ||||||||||||||
| Payout Ratio: | 75 | % | 75 | % | 80 | % | ||||||||||||||
| Distributed cash flow to Class A common stock | $ | 43,735 | $ | 41,263 | $ | 17,897 | ||||||||||||||
| Shares of Class A common stock | 54,175 | 53,721 | 45,245 | |||||||||||||||||
| Distributed cash flow per share of Class A common stock — Dividend | $ | 0.81 | $ | 0.77 | $ | 0.40 | ||||||||||||||
(1) Refer to Reconciliation of Adjusted EBITDA from Net Income above.
Reconciliation of Net Debt
| ($ In thousands) | September 30, 2022 | June 30, 2022 | December 31, 2021 | |||||||||||||||||
| Total Debt | $ | 73,000 | $ | 73,000 | $ | 93,000 | ||||||||||||||
| Less: Cash and Cash Equivalents | 32,995 | 24,103 | 20,819 | |||||||||||||||||
| Net Debt | $ | 40,005 | $ | 48,897 | $ | 72,181 | ||||||||||||||
EXHIBIT 99.1
Condensed Consolidated Balance Sheets
| September 30, | December 31, | |||||||||||||
| (In thousands, except share amounts) | 2022 | 2021 | ||||||||||||
| ASSETS | (Unaudited) | |||||||||||||
| Current assets: | ||||||||||||||
| Cash and cash equivalents | $ | 32,995 | $ | 20,819 | ||||||||||
| Restricted cash | 6,629 | 200 | ||||||||||||
| Accounts receivable | 63,317 | 30,539 | ||||||||||||
| Prepaid expenses and other | 3,196 | 3,145 | ||||||||||||
| Total current assets | 106,137 | 54,703 | ||||||||||||
| Oil and gas properties, at cost, using the full cost method of accounting: | ||||||||||||||
| Unevaluated property | 310,783 | 338,613 | ||||||||||||
| Evaluated property | 754,418 | 633,138 | ||||||||||||
| Less accumulated depreciation, depletion, and amortization | (354,361) | (239,612) | ||||||||||||
| Oil and gas properties, net | 710,840 | 732,139 | ||||||||||||
| Other property and equipment | 3,559 | 2,060 | ||||||||||||
| Less accumulated depreciation | (1,629) | (1,280) | ||||||||||||
| Other property and equipment, net | 1,930 | 780 | ||||||||||||
| Operating lease right-of-use asset | 5,883 | 6,764 | ||||||||||||
| Deferred tax asset | 39,485 | 25,308 | ||||||||||||
| Other assets, net | 1,202 | 1,183 | ||||||||||||
| Total assets | $ | 865,477 | $ | 820,877 | ||||||||||
| LIABILITIES AND EQUITY | ||||||||||||||
| Current liabilities: | ||||||||||||||
| Accounts payable and accrued liabilities | $ | 21,923 | $ | 20,473 | ||||||||||
| Current operating lease liability | 1,211 | 1,178 | ||||||||||||
| Total current liabilities | 23,134 | 21,651 | ||||||||||||
| Long-term bank debt | 73,000 | 93,000 | ||||||||||||
| Non-current operating lease liability | 4,831 | 5,742 | ||||||||||||
| Other non-current liabilities | 2,427 | 810 | ||||||||||||
| Equity: | ||||||||||||||
| Preferred stock, $0.01 par value; 50,000,000 authorized; no shares issued and outstanding at September 30, 2022 and December 31, 2021 | — | — | ||||||||||||
| Class A common stock, $0.01 par value; 400,000,000 authorized, 54,734,157 shares issued and 54,175,458 shares outstanding at September 30, 2022; 400,000,000 authorized, 48,796,518 shares issued and 48,359,888 shares outstanding at December 31, 2021 | 547 | 488 | ||||||||||||
| Class B common stock, $0.01 par value; 150,000,000 authorized, 6,270,684 shares issued and outstanding at September 30, 2022; 150,000,000 authorized, 11,371,517 shares issued and outstanding at December 31, 2021 | — | — | ||||||||||||
| Additional paid-in capital | 760,879 | 634,564 | ||||||||||||
| Accumulated deficit | (91,218) | (105,096) | ||||||||||||
| Treasury stock, at cost; 558,699 shares at September 30, 2022 and 436,630 shares at December 31, 2021 | (6,338) | (3,527) | ||||||||||||
| Total equity attributable to Brigham Minerals, Inc. | 663,870 | 526,429 | ||||||||||||
| Non-controlling interests | 98,215 | 173,245 | ||||||||||||
| Total equity | $ | 762,085 | $ | 699,674 | ||||||||||
| Total liabilities and equity | $ | 865,477 | $ | 820,877 | ||||||||||
EXHIBIT 99.1
Unaudited Condensed Consolidated Statements of Operations
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||||||||||||
| (In thousands, except per share data) | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||||
| REVENUES | ||||||||||||||||||||||||||
| Mineral and royalty revenues | $ | 92,750 | $ | 40,473 | $ | 253,148 | $ | 109,654 | ||||||||||||||||||
| Lease bonus and other revenues | 1,456 | 1,491 | 3,365 | 3,894 | ||||||||||||||||||||||
| Total revenues | 94,206 | 41,964 | 256,513 | 113,548 | ||||||||||||||||||||||
| OPERATING EXPENSES | ||||||||||||||||||||||||||
| Gathering, transportation and marketing | 2,962 | 1,641 | 7,211 | 4,967 | ||||||||||||||||||||||
| Severance and ad valorem taxes | 5,972 | 2,372 | 15,664 | 6,505 | ||||||||||||||||||||||
| Depreciation, depletion, and amortization | 14,964 | 8,682 | 40,726 | 27,129 | ||||||||||||||||||||||
| General and administrative | 12,875 | 5,729 | 24,330 | 16,868 | ||||||||||||||||||||||
| Total operating expenses | 36,773 | 18,424 | 87,931 | 55,469 | ||||||||||||||||||||||
| INCOME FROM OPERATIONS | 57,433 | 23,540 | 168,582 | 58,079 | ||||||||||||||||||||||
| Interest expense, net | (1,046) | (451) | (3,114) | (1,105) | ||||||||||||||||||||||
| Other income, net | 6 | 36 | 40 | 51 | ||||||||||||||||||||||
| Income before income taxes | 56,393 | 23,125 | 165,508 | 57,025 | ||||||||||||||||||||||
| Income tax expense | 11,950 | 4,214 | 31,820 | 10,717 | ||||||||||||||||||||||
| NET INCOME | $ | 44,443 | $ | 18,911 | $ | 133,688 | $ | 46,308 | ||||||||||||||||||
| Less: Net income attributable to non-controlling interest | (5,984) | (4,698) | (21,998) | (12,311) | ||||||||||||||||||||||
| Net income attributable to Brigham Minerals, Inc. stockholders | $ | 38,459 | $ | 14,213 | $ | 111,690 | $ | 33,997 | ||||||||||||||||||
| NET INCOME PER COMMON SHARE | ||||||||||||||||||||||||||
Basic | $ | 0.71 | $ | 0.31 | $ | 2.16 | $ | 0.77 | ||||||||||||||||||
Diluted | $ | 0.69 | $ | 0.31 | $ | 2.09 | $ | 0.75 | ||||||||||||||||||
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | ||||||||||||||||||||||||||
Basic | 53,943 | 45,198 | 51,663 | 44,216 | ||||||||||||||||||||||
Diluted | 55,942 | 45,888 | 53,463 | 45,056 | ||||||||||||||||||||||
EXHIBIT 99.1
Unaudited Condensed Consolidated Statement of Cash Flows
| Nine Months Ended September 30, | ||||||||||||||
| (In thousands) | 2022 | 2021 | ||||||||||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||||||||
| Net income | $ | 133,688 | $ | 46,308 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
| Depreciation, depletion and amortization | 40,726 | 27,129 | ||||||||||||
| Share-based compensation expense | 5,401 | 7,537 | ||||||||||||
| Amortization of debt issuance costs | 467 | 217 | ||||||||||||
| Deferred income tax expense | 2,499 | 2,794 | ||||||||||||
| Credit losses | 274 | 144 | ||||||||||||
| Changes in operating assets and liabilities: | ||||||||||||||
| (Increase) in accounts receivable | (33,052) | (10,999) | ||||||||||||
| (Increase) in other current assets | (49) | (1,753) | ||||||||||||
| Increase in accounts payable and accrued liabilities | 12,773 | 968 | ||||||||||||
| Increase in other long-term liabilities | — | 20 | ||||||||||||
| Net cash provided by operating activities | $ | 162,727 | $ | 72,365 | ||||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||||||||
| Additions to oil and gas properties | (71,748) | (49,203) | ||||||||||||
| Additions to other fixed assets | (1,373) | (28) | ||||||||||||
| Proceeds from sale of oil and gas properties, net | 74,370 | 4,441 | ||||||||||||
| Net cash provided by (used in) investing activities | $ | 1,249 | $ | (44,790) | ||||||||||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||||||||
| Payments of long-term debt | (70,000) | (4,000) | ||||||||||||
| Borrowing of long-term debt | 50,000 | 37,000 | ||||||||||||
| Offering costs of Class A common stock | (78) | — | ||||||||||||
| Dividends paid | (97,574) | (41,374) | ||||||||||||
| Distribution to holders of non-controlling interest | (17,490) | (12,668) | ||||||||||||
| Debt issuance costs | (486) | (247) | ||||||||||||
| Payment of employee tax withholding for settlement of equity compensation awards | (9,743) | (1,136) | ||||||||||||
| Net cash used in financing activities | $ | (145,371) | $ | (22,425) | ||||||||||
| Change in cash and cash equivalents and restricted cash | 18,605 | 5,150 | ||||||||||||
| Cash and cash equivalents and restricted cash, beginning of period | 21,019 | 9,144 | ||||||||||||
| Cash and cash equivalents and restricted cash, end of period | $ | 39,624 | $ | 14,294 | ||||||||||
| Supplemental disclosure of non-cash activity: | ||||||||||||||
| Accrued capital expenditures | $ | 284 | $ | 36 | ||||||||||
| Capitalized share-based compensation cost | $ | 4,476 | $ | 5,475 | ||||||||||
| Issuance of Class A common stock for acquisitions of oil and gas properties, net | $ | 17,629 | $ | — | ||||||||||
| Temporary equity cumulative adjustment to carrying value | $ | — | $ | 54,294 | ||||||||||
| Supplemental cash flow information: | ||||||||||||||
| Cash payments for loan commitment fees and interest | $ | (2,789) | $ | (898) | ||||||||||
| Tax payments, net of refunds | $ | (23,655) | $ | (6,481) | ||||||||||
EXHIBIT 99.1
ABOUT BRIGHAM MINERALS, INC.
Brigham Minerals is an Austin, Texas, based company that acquires and actively manages a portfolio of mineral and royalty interests in the core of some of the most active, highly economic, liquids-rich resource basins across the continental United States. Brigham Minerals’ assets are located in the Delaware and Midland Basins in West Texas and New Mexico, the Anadarko Basin of Oklahoma, the DJ Basin in Colorado and Wyoming, and the Williston Basin in North Dakota. The Company’s primary business objective is to maximize risk-adjusted total return to its shareholders by both capturing organic growth in its existing assets as well as leveraging its highly experienced technical evaluation team to continue acquiring minerals.
Cautionary Statement Concerning Forward-Looking Statements
This press release contains forward-looking statements. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include statements pertaining to our pending merger with Sitio and the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including production and other guidance within this press release. These statements are based on certain assumptions made by the Company based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, operator capital discipline and inflation impacts on their cash flows, the Company’s ability to integrate acquisitions into its existing business, changes in oil, natural gas and NGL prices, weather and environmental conditions, the timing of planned capital expenditures, availability of and competition for acquisitions, operational factors affecting the commencement or maintenance of producing wells on the Company’s properties, the condition of the capital markets generally, as well as the Company’s ability to access them, economic and competitive conditions, including those resulting from the current conflict between Russia and Ukraine and elevated inflation levels resulting from global supply and demand imbalances, the proximity to and capacity of transportation, uncertainties regarding environmental regulations or litigation, global or national health events, such as the COVID-19 pandemic, potential future pandemics, the actions of the Organization of Petroleum Exporting Countries and other significant producers and governments and the ability of such producers to agree to and maintain oil price and production controls and other legal or regulatory developments affecting the Company’s business and other important factors. These and other applicable uncertainties, factors and risks are described more fully in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2021, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the Company’s actual results and plans could differ materially from those expressed in any forward-looking statements.
Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise except as required by applicable law.
Contacts
At the Company:
Brigham Minerals, Inc.
Blake C. Williams
Chief Financial Officer
(512) 220-1500
InvestorRelations@brighamminerals.com
SOURCE Brigham Minerals, Inc.