EX-99.2 3 chk-ex_992x20230331x8kxpr.htm EX-99.2 Document
Exhibit 99.2
CHESAPEAKE ENERGY CORPORATION - SUPPLEMENTAL TABLES
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CONDENSED CONSOLIDATED BALANCE SHEETS (unaudited)
($ in millions, except per share data)March 31, 2023December 31, 2022
Assets
Current assets:
Cash and cash equivalents$130 $130 
Restricted cash67 62 
Accounts receivable, net864 1,438 
Short-term derivative assets464 34 
Assets held for sale862 819 
Other current assets242 215 
Total current assets2,629 2,698 
Property and equipment:
Natural gas and oil properties, successful efforts method
Proved natural gas and oil properties10,793 11,096 
Unproved properties2,002 2,022 
Other property and equipment498 500 
Total property and equipment13,293 13,618 
Less: accumulated depreciation, depletion and amortization(2,770)(2,431)
Total property and equipment, net10,523 11,187 
Long-term derivative assets122 47 
Deferred income tax assets973 1,351 
Other long-term assets344 185 
Total assets$14,591 $15,468 
Liabilities and stockholders' equity
Current liabilities:
Accounts payable$631 $603 
Accrued interest40 42 
Short-term derivative liabilities25 432 
Other current liabilities1,202 1,627 
Total current liabilities1,898 2,704 
Long-term debt, net2,040 3,093 
Long-term derivative liabilities42 174 
Asset retirement obligations, net of current portion279 323 
Other long-term liabilities49 50 
Total liabilities4,308 6,344 
Contingencies and commitments
Stockholders' equity:
Common stock, $0.01 par value, 450,000,000 shares authorized:
  134,019,253 and 134,715,094 shares issued		1 1 
Additional paid-in capital5,729 5,724 
Retained earnings4,553 3,399 
Total stockholders' equity10,283 9,124 
Total liabilities and stockholders' equity$14,591 $15,468 
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CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited)
Three Months Ended
March 31, 2023		Three Months Ended
March 31, 2022
($ in millions, except per share data)
Revenues and other:
Natural gas, oil and NGL$1,453 $1,914 
Marketing652 867 
Natural gas and oil derivatives930 (2,125)
Gains on sales of assets335 279 
Total revenues and other3,370 935 
Operating expenses:
Production131 110 
Gathering, processing and transportation264 242 
Severance and ad valorem taxes69 63 
Exploration7 5 
Marketing651 851 
General and administrative35 26 
Depreciation, depletion and amortization390 409 
Other operating expense, net3 23 
Total operating expenses1,550 1,729 
Income (loss) from operations1,820 (794)
Other income (expense):
Interest expense(37)(32)
Other income10 16 
Total other income (expense)(27)(16)
Income (loss) before income taxes1,793 (810)
Income tax expense (benefit)404 (46)
Net income (loss) available to common stockholders$1,389 $(764)
Earnings (loss) per common share:
Basic$10.31 $(6.32)
Diluted$9.60 $(6.32)
Weighted average common shares outstanding (in thousands):
Basic134,742 120,805 
Diluted144,731 120,805 


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CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited)
($ in millions)Three Months Ended
March 31, 2023		Three Months Ended
March 31, 2022
Cash flows from operating activities:
Net income (loss)$1,389 $(764)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depreciation, depletion and amortization390 409 
Deferred income tax expense378 — 
Derivative (gains) losses, net(930)2,125 
Cash payments on derivative settlements, net(285)(568)
Share-based compensation7 4 
Gains on sales of assets(335)(279)
Exploration3 4 
Other9 (8)
Changes in assets and liabilities263 (70)
Net cash provided by operating activities889 853 
Cash flows from investing activities:
Capital expenditures(497)(344)
Business combination, net— (2,006)
Contributions to investments(39)— 
Proceeds from divestitures of property and equipment931 403 
Net cash provided by (used in) investing activities395 (1,947)
Cash flows from financing activities:
Proceeds from New Credit Facility1,000 — 
Payments on New Credit Facility(2,050)— 
Proceeds from Exit Credit Facility— 1,565 
Payments on Exit Credit Facility— (1,065)
Proceeds from warrant exercise— 1 
Cash paid to repurchase and retire common stock(54)(83)
Cash paid for common stock dividends(175)(210)
Net cash provided by (used in) financing activities(1,279)208 
Net increase (decrease) in cash, cash equivalents and restricted cash5 (886)
Cash, cash equivalents and restricted cash, beginning of period192 914 
Cash, cash equivalents and restricted cash, end of period$197 $28 
Cash and cash equivalents$130 $19 
Restricted cash67 9 
Total cash, cash equivalents and restricted cash$197 $28 


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NATURAL GAS, OIL AND NGL PRODUCTION AND AVERAGE SALES PRICES (unaudited)
Three Months Ended March 31, 2023
Natural GasOilNGLTotal
MMcf per day$/McfMBbl per day$/BblMBbl per day$/BblMMcfe per day$/Mcfe
Marcellus1,974 3.47 — — — — 1,974 3.47 
Haynesville1,549 2.88 — — — — 1,549 2.88 
Eagle Ford128 1.97 54 76.82 16 26.71 546 8.82 
Total3,651 3.17 54 76.82 16 26.71 4,069 3.97 
Average NYMEX Price3.42 76.13 
Average Realized Price
  (including realized derivatives)		2.74 66.79 26.71 3.45 
Three Months Ended March 31, 2022
Natural GasOilNGLTotal
MMcf per day$/McfMBbl per day$/BblMBbl per day$/BblMMcfe per day$/Mcfe
Marcellus1,452 4.66 — — — — 1,452 4.66 
Haynesville1,625 4.46 — — — — 1,625 4.46 
Eagle Ford129 4.04 52 95.00 16 41.09 540 11.44 
Powder River Basin41 5.45 8 95.18 3 53.96 102 10.66 
Total3,247 4.54 60 95.02 19 43.05 3,719 5.72 
Average NYMEX Price4.95 94.29 
Average Realized Price
  (including realized derivatives)		3.08 65.64 43.05 3.96 






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ADJUSTED GROSS MARGIN (unaudited)
Three Months Ended March 31, 2023Three Months Ended March 31, 2022
($ in millions, except per unit)$$/Mcfe$$/Mcfe
Marcellus
Natural gas, oil and NGL sales$617 3.47 $609 4.66 
Production expenses240.13 130.10 
Gathering, processing and transportation expenses1110.62 710.54 
Severance and ad valorem taxes50.03 40.03 
Adjusted gross margin (Non-GAAP)$477 2.69 $521 3.99 
Haynesville
Natural gas, oil and NGL sales$402 2.88 $652 4.46 
Production expenses470.34 320.22 
Gathering, processing and transportation expenses680.49 650.45 
Severance and ad valorem taxes340.24 120.09 
Adjusted gross margin (Non-GAAP)$253 1.81 $543 3.70 
Eagle Ford
Natural gas, oil and NGL sales$434 8.82 $554 11.44 
Production expenses601.23 551.15 
Gathering, processing and transportation expenses851.73 841.73 
Severance and ad valorem taxes300.60 360.75 
Adjusted gross margin (Non-GAAP)$259 5.26 $379 7.81 
Powder River Basin
Natural gas, oil and NGL sales$— — $99 10.66 
Production expenses— — 100.94 
Gathering, processing and transportation expenses— — 222.32 
Severance and ad valorem taxes— — 111.09 
Adjusted gross margin (Non-GAAP)$— — $56 6.31 



6

CAPITAL EXPENDITURES ACCRUED (unaudited)
Three Months Ended March 31, 2023Three Months Ended March 31, 2022
($ in millions)
Drilling and completion capital expenditures:
Marcellus$118 $57 
Haynesville259 183 
Eagle Ford123 43 
Powder River Basin— 22 
Total drilling and completion capital expenditures500 305 
Non-drilling and completion - field24 12 
Non-drilling and completion - corporate20 22 
Total capital expenditures$544 $339 




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NON-GAAP FINANCIAL MEASURES

As a supplement to the financial results prepared in accordance with U.S. GAAP, Chesapeake’s quarterly earnings releases contain certain financial measures that are not prepared or presented in accordance with U.S. GAAP. These non-GAAP financial measures include Adjusted Net Income, Adjusted EBITDAX, Adjusted Gross Margin, Adjusted Free Cash Flow and Net Debt. A reconciliation of each financial measure to its most directly comparable GAAP financial measure is included in the tables below.

These financial measures are non-GAAP and should not be considered as an alternative to, or more meaningful than, net income (loss), earnings (loss) per common share, gross margin or cash flow provided by operating activities prepared in accordance with GAAP.

Chesapeake believes that the non-GAAP measures presented, when viewed in combination with its financial measures prepared in accordance with GAAP, provide useful information as they exclude certain items management believes affects the comparability of operating results. Management believes these adjusted financial measures are a meaningful adjunct to earnings and cash flows calculated in accordance with GAAP because (a) management uses these financial measures to evaluate the company’s trends and performance relative to other natural gas and oil producing companies, (b) these financial measures are comparable to estimates provided by securities analysts, and (c) items excluded generally are one-time items or items whose timing or amount cannot be reasonably estimated. Accordingly, any guidance provide by the company generally excludes information regarding these types of items.

Because not all companies use identical calculations, Chesapeake’s non-GAAP measures may not be comparable to similar titled measures of other companies.

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RECONCILIATION OF NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS TO ADJUSTED NET INCOME (unaudited)

Three Months Ended March 31, 2023Three Months Ended March 31, 2022
($ in millions, except per share data)$$/Share$$/Share
Net income (loss) available to common stockholders (GAAP)$1,389 $10.31 $(764)$(6.32)
Effect of dilutive securities— (0.71)— — 
Diluted income (loss) available to common stockholders (GAAP)$1,389 $9.60 $(764)$(6.32)
Adjustments:
Unrealized (gains) losses on natural gas and oil derivatives(1,119)(7.73)1,538 12.73 
Gains on sales of assets(335)(2.32)(279)(2.31)
Other operating expense, net7 0.05 31 0.26 
Other(6)(0.04)(13)(0.11)
Tax effect of adjustments(a)
334 2.31 (77)(0.64)
Effect of dilutive securities— — — (0.52)
Adjusted net income available to common stockholders (Non-GAAP)$270 $1.87 $436 $3.09 
(a)
The 2023 First Quarter and 2022 First Quarter include a tax effect attributed to the reconciling adjustments using a statutory tax rate of 23% and an estimated annual effective tax rate of 6%, respectively.
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RECONCILIATION OF NET INCOME (LOSS) TO ADJUSTED EBITDAX (unaudited)
Three Months Ended March 31, 2023Three Months Ended March 31, 2022
($ in millions)
Net income (loss) (GAAP)$1,389 $(764)
Adjustments:
Interest expense37 32 
Income tax expense (benefit)404 (46)
Depreciation, depletion and amortization390 409 
Exploration7 5 
Unrealized (gains) losses on natural gas and oil derivatives(1,119)1,538 
Gains on sales of assets(335)(279)
Other operating expense, net7 31 
Other(6)(13)
Adjusted EBITDAX (Non-GAAP)$774 $913 



RECONCILIATION OF GROSS MARGIN TO ADJUSTED GROSS MARGIN (unaudited)

Three Months Ended
March 31, 2023		Three Months Ended
March 31, 2022
($ in millions)
Gross margin (GAAP)
Natural gas, oil and NGL sales$1,453 $1,914 
Less:
Production expenses(131)(110)
Gathering, processing and transportation expenses(264)(242)
Severance and ad valorem taxes(69)(63)
Depreciation, depletion and amortization(390)(409)
Gross margin (GAAP)599 1,090 
Add back: Depreciation, depletion and amortization390 409 
Adjusted gross margin (Non-GAAP)$989 $1,499 


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RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW (unaudited)
Three Months Ended March 31, 2023Three Months Ended March 31, 2022
($ in millions)
Net cash provided by operating activities (GAAP)$889 $853 
Cash capital expenditures(497)(344)
Free cash flow (Non-GAAP)392 509 
Cash paid for acquisition costs— 23 
Cash contributions to investments(39)— 
Free cash flow associated with assets under contract and divested assets(112)— 
Adjusted free cash flow (Non-GAAP)$241 $532 


RECONCILIATION OF TOTAL DEBT TO NET DEBT (unaudited)
($ in millions)March 31, 2023
Total debt (GAAP)$2,040 
Premiums and issuance costs on debt(90)
Principal amount of debt1,950 
Cash and cash equivalents(130)
Net debt (Non-GAAP)$1,820 
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