Ascent reports fall in net income but gain in adjusted earnings


 Ascent Resources Utica Holdings, LLC of Oklahoma City reported its third quarter 2023 operating and financial results and issued updated full-year 2023 guidance. It recorded improved EBITDAX, the accounting method that excludes exploration costs. But overall net income was lower compared to the previous quarter.

With focused efforts in the the Utica Shale of Ohio, the company reported third quarter net income of $17 million, Adjusted Net Income of $59 million and Adjusted EBITDAX of $295 million. Ascent incurred $251 million of total capital expenditures in the third quarter of 2023 consisting of $206 million of D&C costs, $36 million of land and leasehold costs, and $9 million of capitalized interest.

The company had $250 million in net income in the second quarter along with adjusted net income of $60 million. It also generated $285 million in net cash from its operating activities and adjusted EBITDAX of $285 million.

“The third quarter was a continuation of the excellent operational performance and execution that was achieved in the first half of the year,” stated Ascent’s Chairman and Chief Executive Officer, Jeff Fisher.

Ascent’s prospects have never been brighter as we create lasting value for our stakeholders while delivering clean and affordable energy to a world in need.”

Ascent saw improved third quarter net production that averaged 2,165 mmcfe a day compared to 2,085 mmcfe per day in the second quarter. The third quarter production included 1,977 mmcf a day of natural gas, 9,109 bbls a day of oil and 22,217 bbls a day of natural gas liquids.

For the nine months ended September 30, 2023, Ascent reported net income of $1.4 billion, Adjusted Net Income of $231 million and Adjusted EBITDAX of $931 million. Ascent incurred a total of $784 million of capital expenditures during the nine months ended September 30, 2023 consisting of $666 million of D&C costs, $90 million of land and leasehold costs, and $28 million for capitalized interest.

At the end of September, Ascent’s total debt amounted to nearly $2.5 billion with $745 million of borrowings. Liquidity was $1.1 billion.

During the third quarter of 2023, we spud 19 operated wells, hydraulically fractured 24 wells, and turned-in-line 20 wells with an average lateral length of approximately 12,500 feet. As of September 30, 2023, Ascent had 863 gross operated producing Utica wells.

Ascent has significant hedges in place in order to reduce exposure to the volatility in commodity prices, as well as to protect our expected operating cash flow. As of October 18, 2023, Ascent had hedged 1,472,000 mmbtu per day of natural gas production in 2023 at an average downside price of $3.19 per mmbtu, and 1,410,000 mmbtu per day in 2024 at an average downside price of $3.55 per mmbtu.

This 2024 downside hedge price is reflective of the restructuring of a portion of our hedge book carried out in October, post quarter-end. Additionally, Ascent has also hedged 6,000 bbls per day of crude oil production at an average price of $72.30 per bbl in 2023, and 10,000 bbls per day in 2024 at an average price of $75.39.