National Fuel Gas Company (“National Fuel” or the “Company”) (NYSE:NFG)
today announced consolidated results for the second quarter of its 2016
fiscal year and for the six months ended March 31, 2016.
FISCAL 2016 SECOND QUARTER EARNINGS SUMMARY
-
Consolidated net loss of $147.7 million, or $1.74 per share
-
Operating results, excluding items impacting comparability, of $82.8
million, or $0.97 per share
-
Impairment of oil and gas properties, after-tax, of $230.5 million, or
$2.72 per share
-
Consolidated adjusted EBITDA $224.4 million (see non-GAAP
reconciliation on page 24)
-
Production of 39.2 Bcfe, a 9.7% increase from prior year and 3.0%
increase from the first quarter
-
Price-related production curtailments of 9.1 Bcf in Appalachia, a 5.5
Bcf decrease from the first quarter
-
Average natural gas and crude oil prices after hedging of $2.99 per
Mcf and $53.01 per Bbl, respectively
-
Weather 12% warmer than normal and more than 26% warmer than the prior
year contributes to $6.9 million, or $0.08 per share, reduction in
Utility segment earnings
|
OPERATING RESULTS
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
(in thousands except per share amounts)
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Reported GAAP earnings (loss)
|
|
$
|
(147,687
|
)
|
|
$
|
16,669
|
|
|
$
|
(336,796
|
)
|
|
$
|
101,409
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
Impairment of oil and gas properties (E&P)
|
|
230,517
|
|
|
69,474
|
|
|
483,080
|
|
|
69,474
|
Joint development agreement professional fees (E&P)
|
|
|
|
|
|
3,043
|
|
|
|
Operating Results
|
|
$
|
82,830
|
|
|
$
|
86,143
|
|
|
$
|
149,327
|
|
|
$
|
170,883
|
|
|
|
|
|
|
|
|
|
Reported GAAP earnings (loss) per share
|
|
$
|
(1.74
|
)
|
|
$
|
0.20
|
|
|
$
|
(3.97
|
)
|
|
$
|
1.19
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
Impairment of oil and gas properties (E&P)
|
|
2.72
|
|
|
0.82
|
|
|
5.70
|
|
|
0.82
|
Joint development agreement professional fees (E&P)
|
|
|
|
|
|
0.04
|
|
|
|
Earnings per share impact of dilutive shares (All segments)
|
|
(0.01
|
)
|
|
|
|
(0.02
|
)
|
|
|
Operating Results per share
|
|
$
|
0.97
|
|
|
$
|
1.02
|
|
|
$
|
1.75
|
|
|
$
|
2.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MANAGEMENT COMMENTS
Ronald J. Tanski, President and Chief Executive Officer of National Fuel
Gas Company, stated: "Weather was more than 26 percent warmer than last
year’s second quarter across our service territory, and commodity prices
were approximately 18 percent lower than last year. Each of these
factors had their expected result, lowering the Company’s earnings for
the quarter. Additionally, as low commodity prices continue to weigh on
all energy companies, we were required to make another adjustment to the
balance sheet value of our oil and natural gas reserves.
"Each of our business segments, however, delivered excellent operational
results. We have reduced Seneca’s drilling activities by moving to a
one-rig drilling program. That will help us to live within cash flow,
and more closely align our natural gas production levels with the
capacity of our Northern Access project, which has a targeted in-service
date of November 2017.
"While near-term commodity market prices remain low, we are well hedged
at acceptable prices for the remainder of this year and next fiscal
year. We have also seen a firming of prices for our 2018 to 2020 fiscal
years, reflecting the expectation that supply and demand will come into
balance. We have taken advantage of these pricing signals and have begun
to layer in hedges for those future years that lock in acceptable
economics for our drilling program.
"Our plans remain on track to add value for our shareholders and grow
the Company through the continued development of strategic pipeline
infrastructure projects and the ongoing prudent development and
production of natural gas from our large acreage holdings.”
DISCUSSION OF SECOND QUARTER RESULTS BY SEGMENT
The following discussion of the earnings of each segment is summarized
in a tabular form on pages 8 through 11 of this report. It may be
helpful to refer to those tables while reviewing this discussion.
Upstream Business
Exploration and Production Segment
The Exploration and Production segment operations are carried out by
Seneca Resources Corporation ("Seneca"). Seneca explores for, develops
and produces natural gas and oil reserves, primarily in Pennsylvania and
California.
|
|
|
|
|
|
|
(in thousands except per share amounts)
|
|
Quarter Ended March 31, 2016
|
|
Quarter Ended March 31, 2015
|
|
Variance
|
Net Income / (Loss)
|
|
$
|
(213,335
|
)
|
|
$
|
(53,562
|
)
|
|
$
|
(159,773
|
)
|
Net Income / (Loss) Per Share
|
|
$
|
(2.52
|
)
|
|
$
|
(0.63
|
)
|
|
$
|
(1.89
|
)
|
Adjusted EBITDA
|
|
$
|
79,608
|
|
|
$
|
95,615
|
|
|
$
|
(16,007
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The quarter over quarter variance is mainly due to a non-cash, after-tax
charge of $230.5 million to write down the value of Seneca’s oil and
natural gas reserves under the full cost method of accounting. This
accounting method requires that Seneca perform a quarterly “ceiling
test” to compare the present value of future revenues from its oil and
natural gas reserves based on an unweighted arithmetic average of the
first day of the month oil and gas prices for each month within the
12-month period prior to the end of the reporting period (“the ceiling”)
with the book value of those reserves at the balance sheet date. If the
book value of the reserves exceeds the ceiling, a non-cash impairment
charge must be recorded in order to reduce the book value of the
reserves to the calculated ceiling. Unless oil and gas prices improve
significantly, Seneca expects to incur additional impairment charges
during the remainder of the fiscal year ending September 30, 2016. An
impairment is also possible in the first quarter of fiscal 2017.
Excluding this item, Operating Results in the Exploration and Production
segment in the current year’s second quarter were $17.2 million, or
$0.20 per share, compared to $15.9 million, or $0.19 per share, in the
prior year’s second quarter, an increase of $1.3 million or $0.01 per
share. The increase in Operating Results is mainly due to higher natural
gas production and lower per unit lease operating expense ("LOE") and
depreciation, depletion and amortization ("DD&A") expense, offset
partially by lower realized natural gas and crude oil prices after
hedging.
Seneca's total net second quarter fiscal 2016 production was 39.2
billion cubic feet equivalent ("Bcfe"), an increase of 3.5 Bcfe, or 9.7
percent, from the prior fiscal year's second quarter, and an increase of
1.2 Bcfe, or 3.0 percent, versus the first quarter of fiscal 2016. Net
natural gas production for the quarter was 34.9 Bcf, an increase of 3.5
Bcf, or 11.1 percent, versus prior year due mainly to new incremental
firm transportation capacity that became available to Seneca during the
first quarter of fiscal 2016. The new transportation capacity allows
Seneca to deliver and sell a portion of its Marcellus Shale production
under long-term firm sales contracts at the premium-priced Dawn market
index in Ontario, Canada. Seneca voluntarily curtailed approximately 9.1
Bcf of net natural gas production during the quarter, down 5.5 Bcf from
the estimated 14.6 Bcf of net production curtailed during the first
quarter. Crude oil production for the quarter was approximately 723
thousand barrels ("Mbbl"), relatively flat when compared to the prior
year.
Seneca's average realized natural gas price, after the impact of
hedging, for the second quarter was $2.99 per thousand cubic feet
("Mcf"), reflecting $1.12 per Mcf of uplift from financial hedges
settled during the quarter. Seneca's average realized oil price, after
the impact of hedging, for the second quarter was $53.01 per barrel
("Bbl"), reflecting a $25.95 per Bbl uplift from financial hedges
settled during the quarter. Seneca's remaining fiscal 2016 natural gas
production is now 80 percent hedged at the midpoint of production
guidance, with nearly 67 million Million British thermal units ("MMBtu")
(64.3 Bcf) of production hedged at an average price of $3.41 per MMBtu.
In California, Seneca's remaining fiscal 2016 oil production is now 55
percent hedged at an average hedge price of $81.10 per Bbl. For fiscal
2017, Seneca has over 115 million MMBtu (110.8 Bcf) of natural gas
production hedged at an average hedge price of $3.34 per MMBtu and
nearly 700,000 Bbls of oil production hedged at $75.14 per Bbl.
LOE decreased by $3.8 million versus the prior year second quarter. On a
per unit basis, LOE for the second quarter decreased by $0.20 per Mcf
equivalent ("Mcfe") to $0.96 per Mcfe. The decrease is largely due to a
reduction in steam fuel costs in Seneca's California division and lower
salt water disposal and maintenance costs in Seneca's Appalachian
division, offset slightly by higher average gathering and compression
rates on Appalachian production.
DD&A expense decreased $20.2 million versus the prior year second
quarter due to lower per unit DD&A, offset partially by the impact of
higher production. On a per unit basis, DD&A decreased $0.66 per Mcfe to
$0.95 per Mcfe due primarily to the ceiling test impairment charges
recorded during the prior four quarters and higher natural gas reserve
balances at September 30, 2015.
The increase in interest expense is the result of a new long-term debt
issuance that occurred during the quarter ended June 30, 2015.
Midstream Businesses
Pipeline and Storage Segment
The Pipeline and Storage segment’s operations are carried out by
National Fuel Gas Supply Corporation (“Supply Corporation”) and Empire
Pipeline, Inc. (“Empire”). The Pipeline and Storage segment provides
natural gas transportation and storage services to affiliated and
non-affiliated companies through an integrated system of pipelines and
underground natural gas storage fields in western New York and
Pennsylvania.
|
|
|
|
|
|
|
(in thousands except per share amounts)
|
|
Quarter Ended March 31, 2016
|
|
Quarter Ended March 31, 2015
|
|
Variance
|
Net Income / (Loss)
|
|
$
|
21,194
|
|
|
$
|
23,377
|
|
|
$
|
(2,183
|
)
|
Net Income / (Loss) Per Share (Diluted)
|
|
$
|
0.25
|
|
|
$
|
0.27
|
|
|
$
|
(0.02
|
)
|
Adjusted EBITDA
|
|
$
|
53,672
|
|
|
$
|
54,415
|
|
|
$
|
(743
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The decrease in the Pipeline and Storage segment's earnings is due to
higher Operation and Maintenance ("O&M"), DD&A and interest expenses,
offset partially by higher transportation revenues from the three
expansion projects that were placed in service during the first quarter
of fiscal 2016. O&M increased $1.4 million versus prior year's second
quarter due primarily to higher post-retirement benefit costs. DD&A for
the quarter increased $1.1 million due to a higher gross plant in
service, which was largely the result of the Company's recent expansion
projects. The $1.7 million increase in interest expense is a result of
the new long-term debt issuance that occurred during the quarter ended
June 30, 2015.
Gathering Segment
The Gathering segment’s operations are carried out by National Fuel Gas
Midstream Corporation’s subsidiary limited liability companies. The
Gathering segment constructs, owns and operates natural gas pipeline
gathering facilities in the Appalachian region and currently provides
the gathering infrastructure for transporting Seneca’s Marcellus Shale
production to the interstate pipeline system.
|
|
|
|
|
|
|
(in thousands except per share amounts)
|
|
Quarter Ended March 31, 2016
|
|
Quarter Ended March 31, 2015
|
|
Variance
|
Net Income / (Loss)
|
|
$
|
7,568
|
|
|
$
|
6,405
|
|
|
$
|
1,163
|
Net Income / (Loss) Per Share (Diluted)
|
|
$
|
0.09
|
|
|
$
|
0.08
|
|
|
$
|
0.01
|
Adjusted EBITDA
|
|
$
|
18,831
|
|
|
$
|
15,165
|
|
|
$
|
3,666
|
|
|
|
|
|
|
|
|
|
|
|
|
The increase in the Gathering segment's earnings is due primarily to
higher gathering revenues, offset partially by higher O&M expense and
interest costs. Gathering revenues increased $4.2 million, or 24
percent, versus prior year's second quarter mainly due to higher
throughput on the Clermont Gathering System, a result of Seneca's
increased production volumes in Appalachia during the quarter. The $1.8
million increase in interest expense is a result of the new long-term
debt issuance that occurred during the quarter ended June 30, 2015.
Downstream Businesses
Utility Segment
The Utility segment operations are carried out by National Fuel Gas
Distribution Corporation (“Distribution”), which sells or transports
natural gas to customers located in western New York and northwestern
Pennsylvania.
|
|
|
|
|
|
|
(in thousands except per share amounts)
|
|
Quarter Ended March 31, 2016
|
|
Quarter Ended March 31, 2015
|
|
Variance
|
Net Income / (Loss)
|
|
$
|
31,960
|
|
|
$
|
38,238
|
|
|
$
|
(6,278
|
)
|
Net Income / (Loss) Per Share (Diluted)
|
|
$
|
0.38
|
|
|
$
|
0.45
|
|
|
$
|
(0.07
|
)
|
Adjusted EBITDA
|
|
$
|
69,467
|
|
|
$
|
80,233
|
|
|
$
|
(10,766
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The decrease in the Utility segment's earnings is largely attributable
to the impacts of warmer weather and a positive regulatory adjustment
recorded in the second quarter of fiscal 2015, partially offset by lower
O&M expense and other taxes. Weather in Distribution's New York and
Pennsylvania service territories was more than 26 percent warmer than
last year, resulting in lower retail residential and transportation
customer throughput and revenues, which decreased the Utility segment's
earnings by approximately $0.08 per share. The impact of weather
variations on earnings in Distribution's New York service territory is
largely mitigated by the New York rate jurisdiction's weather
normalization clause. In the second quarter of fiscal 2015, the Utility
segment recorded a positive $3.2 million after-tax regulatory adjustment
to recognize the under collection from customers of a New York State
regulatory assessment. A similar regulatory adjustment was not required
for the second quarter of fiscal 2016, lowering earnings by $0.04 per
share versus the prior year. The $5.4 million decrease in O&M expense is
mainly due to lower personnel and pension costs and uncollectible
customer accounts.
Energy Marketing Segment
The Energy Marketing segment's operations are carried out by National
Fuel Resources, Inc. (“NFR”). NFR markets natural gas to industrial,
wholesale, commercial, public authority and residential customers
primarily in western and central New York and northwestern Pennsylvania,
offering competitively priced natural gas to its customers.
|
|
|
|
|
|
|
(in thousands except per share amounts)
|
|
Quarter Ended March 31, 2016
|
|
Quarter Ended March 31, 2015
|
|
Variance
|
Net Income / (Loss)
|
|
$
|
3,484
|
|
|
$
|
3,373
|
|
|
$
|
111
|
Net Income / (Loss) Per Share (Diluted)
|
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
$
|
—
|
Adjusted EBITDA
|
|
$
|
5,653
|
|
|
$
|
5,444
|
|
|
$
|
209
|
|
|
|
|
|
|
|
|
|
|
|
|
The Energy Marketing segment's second quarter earnings were relatively
flat when compared to the prior year's second quarter, as the decrease
in revenues from warmer weather was largely offset by declines in
purchased gas costs.
Corporate and All Other
The Corporate and All Other category earnings of $1.4 million in the
quarter ended March 31, 2016, compares to a net loss of $1.2 million in
the prior year’s second quarter. The increase is due to lower income tax
expense.
EARNINGS GUIDANCE
The Company is updating earnings guidance for fiscal 2016 to reflect
second quarter results and revised forecast assumptions. Updated
consolidated earnings guidance and Exploration and Production segment
operational guidance are summarized in the tables below:
|
|
|
|
|
Consolidated Earnings Guidance
|
|
|
|
|
|
|
Updated FY 2016 Guidance
|
|
Previous FY 2016 Guidance
|
Consolidated Earnings per Share*
|
|
$2.80 to $2.95
|
|
$2.75 to $3.00
|
* Exclusive of ceiling test impairment charges
|
|
|
|
|
|
|
|
|
|
Capital Expenditures (Millions)
|
|
|
|
|
Exploration & Production
|
|
$150 - $200
|
|
$150 - $200
|
Pipeline & Storage
|
|
$130 - $160
|
|
$125 - $175
|
Gathering
|
|
$75 - $85
|
|
$85 - $95
|
Utility
|
|
$90 - $100
|
|
$95 - $105
|
Consolidated Capital Expenditures
|
|
$445 - $545
|
|
$455 - $575
|
|
|
|
|
|
|
Exploration & Production Segment Operational Guidance
|
|
|
|
Updated FY 2016 Guidance
|
|
Previous FY 2016 Guidance
|
NYMEX Natural Gas Price Assumption
|
|
$2.15
|
|
$2.25
|
NYMEX Crude Oil Price Assumption
|
|
$40.00
|
|
$40.00
|
Production (Bcfe)
|
|
158 to 175
|
|
150 to 180
|
Operating Costs ($/Mcfe)
|
|
|
|
|
LOE
|
|
$0.95 - $1.05
|
|
$1.00 - $1.10
|
G&A **
|
|
$0.35 - $0.40
|
|
$0.40 - $0.45
|
DD&A
|
|
$0.85 - $0.95
|
|
$0.90 - $1.00
|
** G&A per unit guidance excludes $4.7 million of joint
development agreement professional fees
|
|
While the Company currently expects to incur additional ceiling test
impairment charges in the remaining quarters of fiscal 2016, and
possibly the first quarter of fiscal 2017, the amount of these charges
is not reasonably determinable at this time. The amount of any ceiling
test charge is determined at the end of the applicable quarter and will
depend on many factors, including additions to or subtractions from
proved reserves, fluctuations in oil and gas prices, and income tax
effects related to the differences between the book and tax basis of the
Company’s oil and gas properties. Some or all of these factors are
likely to be significant. Because the amount of the expected ceiling
test impairment charges is not reasonably determinable at this time, the
Company is unable to provide earnings guidance other than on a non-GAAP
basis that excludes those charges.
EARNINGS TELECONFERENCE
The Company will host a conference call on Friday, April 29, 2016, at 11
a.m. Eastern Time to discuss this announcement. There are two ways to
access this call. For those with Internet access, visit the NFG Investor
Relations News & Events page at National Fuel’s website at investor.nationalfuelgas.com.
For those without Internet access, audio access is also provided by
dialing (toll-free) 877-706-7579, using conference ID number “84814628.”
For those unable to listen to the live conference call, an audio replay
will be available at approximately 3 p.m. Eastern Time at the same
website link and by phone at (toll-free) 855-859-2056 or 404-537-3406,
using conference ID number “84814628.” Both the webcast and telephonic
replay will be available until the close of business on Friday, May 6,
2016.
National Fuel is an integrated energy company reporting financial
results for five operating segments: Exploration and Production,
Pipeline and Storage, Gathering, Utility, and Energy Marketing.
Additional information about National Fuel is available at www.nationalfuelgas.com.
Certain statements contained herein, including statements identified by
the use of the words “anticipates,” “estimates,” “expects,” “forecasts,”
“intends,” “plans,” “predicts,” “projects,” “believes,” “seeks,” “will,”
“may” and similar expressions, and statements which are other than
statements of historical facts, are “forward-looking statements” as
defined by the Private Securities Litigation Reform Act of 1995.
Forward-looking statements involve risks and uncertainties, which could
cause actual results or outcomes to differ materially from those
expressed in the forward-looking statements. The Company’s expectations,
beliefs and projections contained herein are expressed in good faith and
are believed to have a reasonable basis, but there can be no assurance
that such expectations, beliefs or projections will result or be
achieved or accomplished. In addition to other factors, the following
are important factors that could cause actual results to differ
materially from those discussed in the forward-looking statements:
impairments under the SEC’s full cost ceiling test for natural gas and
oil reserves; changes in the price of natural gas or oil; financial and
economic conditions, including the availability of credit, and
occurrences affecting the Company’s ability to obtain financing on
acceptable terms for working capital, capital expenditures and other
investments, including any downgrades in the Company’s credit ratings
and changes in interest rates and other capital market conditions;
delays or changes in costs or plans with respect to Company projects or
related projects of other companies, including difficulties or delays in
obtaining necessary governmental approvals, permits or orders or in
obtaining the cooperation of interconnecting facility operators; factors
affecting the Company’s ability to successfully identify, drill for and
produce economically viable natural gas and oil reserves, including
among others geology, lease availability, title disputes, weather
conditions, shortages, delays or unavailability of equipment and
services required in drilling operations, insufficient gathering,
processing and transportation capacity, the need to obtain governmental
approvals and permits, and compliance with environmental laws and
regulations; changes in laws, regulations or judicial interpretations to
which the Company is subject, including those involving derivatives,
taxes, safety, employment, climate change, other environmental matters,
real property, and exploration and production activities such as
hydraulic fracturing; governmental/regulatory actions, initiatives and
proceedings, including those involving rate cases (which address, among
other things, target rates of return, rate design and retained natural
gas), environmental/safety requirements, affiliate relationships,
industry structure, and franchise renewal; changes in price
differentials between similar quantities of natural gas or oil sold at
different geographic locations, and the effect of such changes on
commodity production, revenues and demand for pipeline transportation
capacity to or from such locations; other changes in price differentials
between similar quantities of natural gas or oil having different
quality, heating value, hydrocarbon mix or delivery date; the cost and
effects of legal and administrative claims against the Company or
activist shareholder campaigns to effect changes at the Company;
uncertainty of oil and gas reserve estimates; significant differences
between the Company’s projected and actual production levels for natural
gas or oil; changes in demographic patterns and weather conditions;
changes in the availability, price or accounting treatment of derivative
financial instruments; changes in economic conditions, including global,
national or regional recessions, and their effect on the demand for, and
customers’ ability to pay for, the Company’s products and services; the
creditworthiness or performance of the Company’s key suppliers,
customers and counterparties; economic disruptions or uninsured losses
resulting from major accidents, fires, severe weather, natural
disasters, terrorist activities, acts of war, cyber attacks or pest
infestation; significant differences between the Company’s projected and
actual capital expenditures and operating expenses; changes in laws,
actuarial assumptions, the interest rate environment and the return on
plan/trust assets related to the Company’s pension and other
post-retirement benefits, which can affect future funding obligations
and costs and plan liabilities; increasing health care costs and the
resulting effect on health insurance premiums and on the obligation to
provide other post-retirement benefits; or increasing costs of
insurance, changes in coverage and the ability to obtain insurance. The
Company disclaims any obligation to update any forward-looking
statements to reflect events or circumstances after the date thereof.
|
NATIONAL FUEL GAS COMPANY
|
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
|
QUARTER ENDED MARCH 31, 2016
|
(Unaudited)
|
|
|
|
Upstream
|
|
Midstream Businesses
|
|
Downstream Businesses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration &
|
|
Pipeline &
|
|
|
|
|
|
Energy
|
|
Corporate/
|
|
|
(Thousands of Dollars)
|
|
Production
|
|
Storage
|
|
Gathering
|
|
Utility
|
|
Marketing
|
|
All Other
|
|
Consolidated*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second quarter 2015 GAAP earnings
|
|
$
|
(53,562
|
)
|
|
$
|
23,377
|
|
|
$
|
6,405
|
|
|
$
|
38,238
|
|
|
$
|
3,373
|
|
|
$
|
(1,162
|
)
|
|
$
|
16,669
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
69,474
|
|
|
|
|
|
|
|
|
|
|
|
|
69,474
|
|
Second quarter 2015 operating results
|
|
15,912
|
|
|
23,377
|
|
|
6,405
|
|
|
38,238
|
|
|
3,373
|
|
|
(1,162
|
)
|
|
86,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Drivers of operating results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) crude oil prices
|
|
(6,636
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(6,636
|
)
|
Higher (lower) natural gas prices
|
|
(14,873
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(14,873
|
)
|
Higher (lower) natural gas production
|
|
8,275
|
|
|
|
|
|
|
|
|
|
|
|
|
8,275
|
|
Higher (lower) crude oil production
|
|
(155
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(155
|
)
|
Derivative mark to market adjustments
|
|
(934
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(934
|
)
|
Lower (higher) lease operating and transportation expenses
|
|
2,503
|
|
|
|
|
|
|
|
|
|
|
|
|
2,503
|
|
Lower (higher) depreciation / depletion
|
|
13,105
|
|
|
(706
|
)
|
|
|
|
|
|
|
|
|
|
12,399
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) transportation revenues
|
|
|
|
740
|
|
|
|
|
|
|
|
|
|
|
740
|
|
Higher (lower) gathering and processing revenues
|
|
|
|
|
|
2,733
|
|
|
|
|
|
|
|
|
2,733
|
|
Lower (higher) operating expenses
|
|
|
|
(921
|
)
|
|
|
|
2,581
|
|
|
|
|
|
|
1,660
|
|
Lower (higher) property, franchise and other taxes
|
|
1,512
|
|
|
|
|
|
|
|
|
|
|
|
|
1,512
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory true-up adjustments
|
|
|
|
|
|
|
|
(3,214
|
)
|
|
|
|
|
|
(3,214
|
)
|
Warmer weather
|
|
|
|
|
|
|
|
(6,919
|
)
|
|
|
|
|
|
(6,919
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) margins
|
|
|
|
|
|
|
|
|
|
125
|
|
|
|
|
125
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) interest expense
|
|
(1,621
|
)
|
|
(1,080
|
)
|
|
(1,161
|
)
|
|
|
|
|
|
|
|
(3,862
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) income tax expense / effective tax rate
|
|
|
|
|
|
|
|
692
|
|
|
|
|
1,121
|
|
|
1,813
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other / rounding
|
|
94
|
|
|
(216
|
)
|
|
(409
|
)
|
|
582
|
|
|
(14
|
)
|
|
1,483
|
|
|
1,520
|
|
Second quarter 2016 operating results
|
|
17,182
|
|
|
21,194
|
|
|
7,568
|
|
|
31,960
|
|
|
3,484
|
|
|
1,442
|
|
|
82,830
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
(230,517
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(230,517
|
)
|
Second quarter 2016 GAAP earnings
|
|
$
|
(213,335
|
)
|
|
$
|
21,194
|
|
|
$
|
7,568
|
|
|
$
|
31,960
|
|
|
$
|
3,484
|
|
|
$
|
1,442
|
|
|
$
|
(147,687
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Amounts do not reflect intercompany eliminations
|
|
|
NATIONAL FUEL GAS COMPANY
|
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
|
QUARTER ENDED MARCH 31, 2016
|
(Unaudited)
|
|
|
|
Upstream
|
|
Midstream Businesses
|
|
Downstream Businesses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration &
|
|
Pipeline &
|
|
|
|
|
|
Energy
|
|
Corporate/
|
|
|
|
|
Production
|
|
Storage
|
|
Gathering
|
|
Utility
|
|
Marketing
|
|
All Other
|
|
Consolidated*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Second quarter 2015 GAAP earnings
|
|
$
|
(0.63
|
)
|
|
$
|
0.27
|
|
|
$
|
0.08
|
|
|
$
|
0.45
|
|
|
$
|
0.04
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.20
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
0.82
|
|
|
|
|
|
|
|
|
|
|
|
|
0.82
|
|
Second quarter 2015 operating results
|
|
0.19
|
|
|
0.27
|
|
|
0.08
|
|
|
0.45
|
|
|
0.04
|
|
|
(0.01
|
)
|
|
1.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Drivers of operating results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) crude oil prices
|
|
(0.08
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.08
|
)
|
Higher (lower) natural gas prices
|
|
(0.17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.17
|
)
|
Higher (lower) natural gas production
|
|
0.10
|
|
|
|
|
|
|
|
|
|
|
|
|
0.10
|
|
Higher (lower) crude oil production
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
Derivative mark to market adjustments
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.01
|
)
|
Lower (higher) lease operating and transportation expenses
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
|
|
0.03
|
|
Lower (higher) depreciation / depletion
|
|
0.15
|
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
0.14
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) transportation revenues
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
0.01
|
|
Higher (lower) gathering and processing revenues
|
|
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
0.03
|
|
Lower (higher) operating expenses
|
|
|
|
(0.01
|
)
|
|
|
|
0.03
|
|
|
|
|
|
|
0.02
|
|
Lower (higher) property, franchise and other taxes
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory true-up adjustments
|
|
|
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
(0.04
|
)
|
Warmer weather
|
|
|
|
|
|
|
|
(0.08
|
)
|
|
|
|
|
|
(0.08
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) margins
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) interest expense
|
|
(0.02
|
)
|
|
(0.01
|
)
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) income tax expense / effective tax rate
|
|
|
|
|
|
|
|
0.01
|
|
|
|
|
0.01
|
|
|
0.02
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other / rounding
|
|
(0.01
|
)
|
|
—
|
|
|
(0.01
|
)
|
|
0.01
|
|
|
—
|
|
|
0.01
|
|
|
—
|
|
Second quarter 2016 operating results
|
|
0.20
|
|
|
0.25
|
|
|
0.09
|
|
|
0.38
|
|
|
0.04
|
|
|
0.01
|
|
|
0.97
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
(2.72
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(2.72
|
)
|
Earnings per share impact of diluted shares
|
|
|
|
|
|
|
|
|
|
|
|
0.01
|
|
|
0.01
|
|
Second quarter 2016 GAAP earnings
|
|
$
|
(2.52
|
)
|
|
$
|
0.25
|
|
|
$
|
0.09
|
|
|
$
|
0.38
|
|
|
$
|
0.04
|
|
|
$
|
0.02
|
|
|
$
|
(1.74
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Amounts do not reflect intercompany eliminations
|
|
|
NATIONAL FUEL GAS COMPANY
|
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS
|
SIX MONTHS ENDED MARCH 31, 2016
|
(Unaudited)
|
|
|
Upstream
|
|
Midstream Businesses
|
|
Downstream Businesses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration &
|
|
Pipeline &
|
|
|
|
|
|
Energy
|
|
Corporate/
|
|
|
(Thousands of Dollars)
|
Production
|
|
Storage
|
|
Gathering
|
|
Utility
|
|
Marketing
|
|
All Other
|
|
Consolidated*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended March 31, 2015 GAAP earnings
|
$
|
(26,842
|
)
|
|
$
|
44,155
|
|
|
$
|
18,028
|
|
|
$
|
60,831
|
|
|
$
|
6,199
|
|
|
$
|
(962
|
)
|
|
$
|
101,409
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
69,474
|
|
|
|
|
|
|
|
|
|
|
|
|
69,474
|
|
Six months ended March 31, 2015 operating results
|
42,632
|
|
|
44,155
|
|
|
18,028
|
|
|
60,831
|
|
|
6,199
|
|
|
(962
|
)
|
|
170,883
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Drivers of operating results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) crude oil prices
|
(15,613
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(15,613
|
)
|
Higher (lower) natural gas prices
|
(15,199
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(15,199
|
)
|
Higher (lower) natural gas production
|
(14,463
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(14,463
|
)
|
Higher (lower) crude oil production
|
(1,210
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(1,210
|
)
|
Derivative mark to market adjustments
|
(1,795
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(1,795
|
)
|
Lower (higher) lease operating and transportation expenses
|
7,562
|
|
|
|
|
|
|
|
|
|
|
|
|
7,562
|
|
Lower (higher) depreciation / depletion
|
36,527
|
|
|
(1,500
|
)
|
|
(1,261
|
)
|
|
|
|
|
|
|
|
33,766
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) transportation revenues
|
|
|
2,391
|
|
|
|
|
|
|
|
|
|
|
2,391
|
|
Higher (lower) gathering and processing revenues
|
|
|
|
|
(1,044
|
)
|
|
|
|
|
|
|
|
(1,044
|
)
|
Lower (higher) operating expenses
|
|
|
(733
|
)
|
|
(675
|
)
|
|
3,601
|
|
|
|
|
713
|
|
|
2,906
|
|
Lower (higher) property, franchise and other taxes
|
1,847
|
|
|
(460
|
)
|
|
|
|
|
|
|
|
|
|
1,387
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory true-up adjustments
|
|
|
|
|
|
|
(3,671
|
)
|
|
|
|
|
|
(3,671
|
)
|
Warmer weather
|
|
|
|
|
|
|
(12,839
|
)
|
|
|
|
|
|
(12,839
|
)
|
Higher (lower) usage
|
|
|
|
|
|
|
1,130
|
|
|
|
|
|
|
1,130
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) margins
|
|
|
|
|
|
|
|
|
(1,546
|
)
|
|
|
|
(1,546
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) AFUDC**
|
|
|
1,108
|
|
|
|
|
|
|
|
|
|
|
1,108
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) interest expense
|
(4,399
|
)
|
|
(2,053
|
)
|
|
(2,962
|
)
|
|
|
|
|
|
|
|
(9,414
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) income tax expense / effective tax rate
|
|
|
|
|
|
|
1,973
|
|
|
|
|
2,141
|
|
|
4,114
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other / rounding
|
(187
|
)
|
|
(438
|
)
|
|
404
|
|
|
(459
|
)
|
|
54
|
|
|
1,500
|
|
|
874
|
|
Six months ended March 31, 2016 operating results
|
35,702
|
|
|
42,470
|
|
|
12,490
|
|
|
50,566
|
|
|
4,707
|
|
|
3,392
|
|
|
149,327
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
(483,080
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(483,080
|
)
|
Joint development agreement professional fees
|
(3,043
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(3,043
|
)
|
Six months ended March 31, 2016 GAAP earnings
|
$
|
(450,421
|
)
|
|
$
|
42,470
|
|
|
$
|
12,490
|
|
|
$
|
50,566
|
|
|
$
|
4,707
|
|
|
$
|
3,392
|
|
|
$
|
(336,796
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Amounts do not reflect intercompany eliminations
|
** AFUDC = Allowance for Funds Used During Construction
|
|
|
NATIONAL FUEL GAS COMPANY
|
RECONCILIATION OF CURRENT AND PRIOR YEAR GAAP EARNINGS PER SHARE
|
SIX MONTHS ENDED MARCH 31, 2016
|
(Unaudited)
|
|
|
|
Upstream
|
|
Midstream Businesses
|
|
Downstream Businesses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration &
|
|
Pipeline &
|
|
|
|
|
|
Energy
|
|
Corporate/
|
|
|
|
|
Production
|
|
Storage
|
|
Gathering
|
|
Utility
|
|
Marketing
|
|
All Other
|
|
Consolidated*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended March 31, 2015 GAAP earnings
|
|
$
|
(0.32
|
)
|
|
$
|
0.52
|
|
|
$
|
0.21
|
|
|
$
|
0.71
|
|
|
$
|
0.07
|
|
|
$
|
—
|
|
|
$
|
1.19
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
0.82
|
|
|
|
|
|
|
|
|
|
|
|
|
0.82
|
|
Six months ended March 31, 2015 operating results
|
|
0.50
|
|
|
0.52
|
|
|
0.21
|
|
|
0.71
|
|
|
0.07
|
|
|
—
|
|
|
2.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Drivers of operating results
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) crude oil prices
|
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.18
|
)
|
Higher (lower) natural gas prices
|
|
(0.18
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.18
|
)
|
Higher (lower) natural gas production
|
|
(0.17
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.17
|
)
|
Higher (lower) crude oil production
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.01
|
)
|
Derivative mark to market adjustments
|
|
(0.02
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.02
|
)
|
Lower (higher) lease operating and transportation expenses
|
|
0.09
|
|
|
|
|
|
|
|
|
|
|
|
|
0.09
|
|
Lower (higher) depreciation / depletion
|
|
0.43
|
|
|
(0.02
|
)
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
0.40
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) transportation revenues
|
|
|
|
0.03
|
|
|
|
|
|
|
|
|
|
|
0.03
|
|
Higher (lower) gathering and processing revenues
|
|
|
|
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
(0.01
|
)
|
Lower (higher) operating expenses
|
|
|
|
(0.01
|
)
|
|
(0.01
|
)
|
|
0.04
|
|
|
|
|
0.01
|
|
|
0.03
|
|
Lower (higher) property, franchise and other taxes
|
|
0.02
|
|
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Regulatory true-up adjustments
|
|
|
|
|
|
|
|
(0.04
|
)
|
|
|
|
|
|
(0.04
|
)
|
Warmer weather
|
|
|
|
|
|
|
|
(0.15
|
)
|
|
|
|
|
|
(0.15
|
)
|
Higher (lower) usage
|
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) margins
|
|
|
|
|
|
|
|
|
|
(0.02
|
)
|
|
|
|
(0.02
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Higher (lower) AFUDC**
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
0.01
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) interest expense
|
|
(0.05
|
)
|
|
(0.02
|
)
|
|
(0.03
|
)
|
|
|
|
|
|
|
|
(0.10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Lower (higher) income tax expense / effective tax rate
|
|
|
|
|
|
|
|
0.02
|
|
|
|
|
0.03
|
|
|
0.05
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other / rounding
|
|
(0.01
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
Six months ended March 31, 2016 operating results
|
|
0.42
|
|
|
0.50
|
|
|
0.15
|
|
|
0.59
|
|
|
0.05
|
|
|
0.04
|
|
|
1.75
|
|
Items impacting comparability:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Impairment of oil and gas producing properties
|
|
(5.70
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(5.70
|
)
|
Joint development agreement professional fees
|
|
(0.04
|
)
|
|
|
|
|
|
|
|
|
|
|
|
(0.04
|
)
|
Earnings per share impact of diluted shares
|
|
|
|
|
|
|
|
0.01
|
|
|
0.01
|
|
|
|
|
0.02
|
|
Six months ended March 31, 2016 GAAP earnings
|
|
$
|
(5.32
|
)
|
|
$
|
0.50
|
|
|
$
|
0.15
|
|
|
$
|
0.60
|
|
|
$
|
0.06
|
|
|
$
|
0.04
|
|
|
$
|
(3.97
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
* Amounts do not reflect intercompany eliminations
|
** AFUDC = Allowance for Funds Used During Construction
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
|
|
|
|
|
|
|
|
(Thousands of Dollars, except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
SUMMARY OF OPERATIONS
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Operating Revenues:
|
|
|
|
|
|
|
|
|
Utility and Energy Marketing Revenues
|
|
$
|
248,173
|
|
|
$
|
374,141
|
|
|
$
|
417,005
|
|
|
$
|
640,380
|
|
Exploration and Production and Other Revenues
|
|
144,570
|
|
|
166,139
|
|
|
297,454
|
|
|
371,917
|
|
Pipeline and Storage and Gathering Revenues
|
|
56,389
|
|
|
55,847
|
|
|
109,868
|
|
|
107,739
|
|
|
|
449,132
|
|
|
596,127
|
|
|
824,327
|
|
|
1,120,036
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
Purchased Gas
|
|
81,623
|
|
|
190,600
|
|
|
123,691
|
|
|
317,690
|
|
Operation and Maintenance:
|
|
|
|
|
|
|
|
|
Utility and Energy Marketing
|
|
57,309
|
|
|
62,764
|
|
|
104,858
|
|
|
112,461
|
|
Exploration and Production and Other
|
|
42,964
|
|
|
50,906
|
|
|
88,539
|
|
|
94,401
|
|
Pipeline and Storage and Gathering
|
|
21,541
|
|
|
19,575
|
|
|
41,109
|
|
|
38,965
|
|
Property, Franchise and Other Taxes
|
|
21,305
|
|
|
24,916
|
|
|
41,662
|
|
|
45,845
|
|
Depreciation, Depletion and Amortization
|
|
63,947
|
|
|
82,687
|
|
|
134,498
|
|
|
185,433
|
|
Impairment of Oil and Gas Producing Properties
|
|
397,443
|
|
|
120,348
|
|
|
832,894
|
|
|
120,348
|
|
|
|
686,132
|
|
|
551,796
|
|
|
1,367,251
|
|
|
915,143
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss)
|
|
(237,000
|
)
|
|
44,331
|
|
|
(542,924
|
)
|
|
204,893
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
Interest Income
|
|
278
|
|
|
46
|
|
|
2,077
|
|
|
1,303
|
|
Other Income
|
|
3,236
|
|
|
1,388
|
|
|
5,654
|
|
|
2,571
|
|
Interest Expense on Long-Term Debt
|
|
(28,994
|
)
|
|
(22,376
|
)
|
|
(59,366
|
)
|
|
(44,687
|
)
|
Other Interest Expense
|
|
(1,237
|
)
|
|
(1,584
|
)
|
|
(2,617
|
)
|
|
(2,375
|
)
|
|
|
|
|
|
|
|
|
|
Income (Loss) Before Income Taxes
|
|
(263,717
|
)
|
|
21,805
|
|
|
(597,176
|
)
|
|
161,705
|
|
|
|
|
|
|
|
|
|
|
Income Tax Expense (Benefit)
|
|
(116,030
|
)
|
|
5,136
|
|
|
(260,380
|
)
|
|
60,296
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) Available for Common Stock
|
|
$
|
(147,687
|
)
|
|
$
|
16,669
|
|
|
$
|
(336,796
|
)
|
|
$
|
101,409
|
|
|
|
|
|
|
|
|
|
|
Earnings (Loss) Per Common Share:
|
|
|
|
|
|
|
|
|
Basic
|
|
$
|
(1.74
|
)
|
|
$
|
0.20
|
|
|
$
|
(3.97
|
)
|
|
$
|
1.20
|
|
Diluted
|
|
$
|
(1.74
|
)
|
|
$
|
0.20
|
|
|
$
|
(3.97
|
)
|
|
$
|
1.19
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares:
|
|
|
|
|
|
|
|
|
Used in Basic Calculation
|
|
84,806,982
|
|
84,317,508
|
|
84,728,680
|
|
84,262,471
|
Used in Diluted Calculation
|
|
84,806,982
|
|
85,133,142
|
|
84,728,680
|
|
85,175,961
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
CONSOLIDATED BALANCE SHEETS
|
(Unaudited)
|
|
|
|
|
|
March 31,
|
|
September 30,
|
(Thousands of Dollars)
|
|
2016
|
|
2015
|
|
|
|
|
|
ASSETS
|
|
|
|
|
Property, Plant and Equipment
|
|
$
|
9,451,538
|
|
|
$
|
9,261,323
|
Less - Accumulated Depreciation, Depletion and Amortization
|
|
|
4,879,363
|
|
|
|
3,929,428
|
Net Property, Plant and Equipment
|
|
|
4,572,175
|
|
|
|
5,331,895
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
Cash and Temporary Cash Investments
|
|
|
93,700
|
|
|
|
113,596
|
Hedging Collateral Deposits
|
|
|
9,963
|
|
|
|
11,124
|
Receivables - Net
|
|
|
137,718
|
|
|
|
105,004
|
Unbilled Revenue
|
|
|
35,140
|
|
|
|
20,746
|
Gas Stored Underground
|
|
|
8,599
|
|
|
|
34,252
|
Materials and Supplies - at average cost
|
|
|
33,430
|
|
|
|
30,414
|
Unrecovered Purchased Gas Costs
|
|
|
1,245
|
|
|
|
—
|
Other Current Assets
|
|
|
56,714
|
|
|
|
60,665
|
Total Current Assets
|
|
|
376,509
|
|
|
|
375,801
|
|
|
|
|
|
Other Assets:
|
|
|
|
|
Recoverable Future Taxes
|
|
|
172,417
|
|
|
|
168,214
|
Unamortized Debt Expense
|
|
|
1,953
|
|
|
|
2,218
|
Other Regulatory Assets
|
|
|
270,941
|
|
|
|
278,227
|
Deferred Charges
|
|
|
17,063
|
|
|
|
15,129
|
Other Investments
|
|
|
104,273
|
|
|
|
92,990
|
Goodwill
|
|
|
5,476
|
|
|
|
5,476
|
Prepaid Post-Retirement Benefit Costs
|
|
|
26,344
|
|
|
|
24,459
|
Fair Value of Derivative Financial Instruments
|
|
|
253,716
|
|
|
|
270,363
|
Other
|
|
|
157
|
|
|
|
167
|
Total Other Assets
|
|
|
852,340
|
|
|
|
857,243
|
Total Assets
|
|
$
|
5,801,024
|
|
|
$
|
6,564,939
|
|
|
|
|
|
CAPITALIZATION AND LIABILITIES
|
|
|
|
|
Capitalization:
|
|
|
|
|
Comprehensive Shareholders' Equity
|
|
|
|
|
Common Stock, $1 Par Value Authorized - 200,000,000
|
|
|
|
|
Shares; Issued and Outstanding - 84,892,747 Shares
|
|
|
|
|
and 84,594,383 Shares, Respectively
|
|
$
|
84,893
|
|
|
$
|
84,594
|
Paid in Capital
|
|
|
756,001
|
|
|
|
744,274
|
Earnings Reinvested in the Business
|
|
|
699,399
|
|
|
|
1,103,200
|
Accumulated Other Comprehensive Income
|
|
|
82,186
|
|
|
|
93,372
|
Total Comprehensive Shareholders' Equity
|
|
|
1,622,479
|
|
|
|
2,025,440
|
Long-Term Debt, Net of Unamortized Discount and Debt Issuance Costs
|
|
|
2,085,123
|
|
|
|
2,084,009
|
Total Capitalization
|
|
|
3,707,602
|
|
|
|
4,109,449
|
|
|
|
|
|
Current and Accrued Liabilities:
|
|
|
|
|
Notes Payable to Banks and Commercial Paper
|
|
|
—
|
|
|
|
—
|
Current Portion of Long-Term Debt
|
|
|
—
|
|
|
|
—
|
Accounts Payable
|
|
|
111,054
|
|
|
|
180,388
|
Amounts Payable to Customers
|
|
|
42,217
|
|
|
|
56,778
|
Dividends Payable
|
|
|
33,533
|
|
|
|
33,415
|
Interest Payable on Long-Term Debt
|
|
|
34,900
|
|
|
|
36,200
|
Customer Advances
|
|
|
33
|
|
|
|
16,236
|
Customer Security Deposits
|
|
|
16,101
|
|
|
|
16,490
|
Other Accruals and Current Liabilities
|
|
|
104,925
|
|
|
|
96,557
|
Fair Value of Derivative Financial Instruments
|
|
|
9,864
|
|
|
|
10,076
|
Total Current and Accrued Liabilities
|
|
|
352,627
|
|
|
|
446,140
|
|
|
|
|
|
Deferred Credits:
|
|
|
|
|
Deferred Income Taxes
|
|
|
844,916
|
|
|
|
1,137,962
|
Taxes Refundable to Customers
|
|
|
93,674
|
|
|
|
89,448
|
Unamortized Investment Tax Credit
|
|
|
557
|
|
|
|
731
|
Cost of Removal Regulatory Liability
|
|
|
189,421
|
|
|
|
184,907
|
Other Regulatory Liabilities
|
|
|
101,104
|
|
|
|
108,617
|
Pension and Other Post-Retirement Liabilities
|
|
|
216,852
|
|
|
|
202,807
|
Asset Retirement Obligations
|
|
|
171,991
|
|
|
|
156,805
|
Other Deferred Credits
|
|
|
122,280
|
|
|
|
128,073
|
Total Deferred Credits
|
|
|
1,740,795
|
|
|
|
2,009,350
|
Commitments and Contingencies
|
|
|
—
|
|
|
|
—
|
Total Capitalization and Liabilities
|
|
$
|
5,801,024
|
|
|
$
|
6,564,939
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
(Unaudited)
|
|
|
|
Six Months Ended
|
|
|
March 31,
|
(Thousands of Dollars)
|
|
2016
|
|
2015
|
|
|
|
|
|
Operating Activities:
|
|
|
|
|
Net Income (Loss) Available for Common Stock
|
|
$
|
(336,796
|
)
|
|
$
|
101,409
|
|
Adjustments to Reconcile Net Income (Loss) to Net Cash Provided
by Operating Activities:
|
|
|
|
|
Impairment of Oil and Gas Producing Properties
|
|
832,894
|
|
|
120,348
|
|
Depreciation, Depletion and Amortization
|
|
134,498
|
|
|
185,433
|
|
Deferred Income Taxes
|
|
(283,912
|
)
|
|
10,351
|
|
Excess Tax Benefits Associated with Stock-Based Compensation Awards
|
|
(226
|
)
|
|
(9,024
|
)
|
Stock-Based Compensation
|
|
2,518
|
|
|
5,985
|
|
Other
|
|
6,106
|
|
|
4,709
|
|
Change in:
|
|
|
|
|
Hedging Collateral Deposits
|
|
1,161
|
|
|
(12,992
|
)
|
Receivables and Unbilled Revenue
|
|
(28,211
|
)
|
|
(88,339
|
)
|
Gas Stored Underground and Materials and Supplies
|
|
22,637
|
|
|
29,085
|
|
Unrecovered Purchased Gas Costs
|
|
(1,245
|
)
|
|
—
|
|
Other Current Assets
|
|
4,177
|
|
|
4,184
|
|
Accounts Payable
|
|
(31,786
|
)
|
|
62,832
|
|
Amounts Payable to Customers
|
|
(14,561
|
)
|
|
11,051
|
|
Customer Advances
|
|
(16,203
|
)
|
|
(18,735
|
)
|
Customer Security Deposits
|
|
(389
|
)
|
|
2,702
|
|
Other Accruals and Current Liabilities
|
|
22,420
|
|
|
53,491
|
|
Other Assets
|
|
3,754
|
|
|
1,826
|
|
Other Liabilities
|
|
(4,073
|
)
|
|
43,186
|
|
Net Cash Provided by Operating Activities
|
|
$
|
312,763
|
|
|
$
|
507,502
|
|
|
|
|
|
|
Investing Activities:
|
|
|
|
|
Capital Expenditures
|
|
$
|
(358,981
|
)
|
|
$
|
(493,341
|
)
|
Net Proceeds from Sale of Oil and Gas Producing Properties
|
|
104,938
|
|
|
—
|
|
Other
|
|
(18,249
|
)
|
|
(1,262
|
)
|
Net Cash Used in Investing Activities
|
|
$
|
(272,292
|
)
|
|
$
|
(494,603
|
)
|
|
|
|
|
|
Financing Activities:
|
|
|
|
|
Changes in Notes Payable to Banks and Commercial Paper
|
|
$
|
—
|
|
|
$
|
71,900
|
|
Excess Tax Benefits Associated with Stock-Based Compensation Awards
|
|
226
|
|
|
9,024
|
|
Dividends Paid on Common Stock
|
|
(66,887
|
)
|
|
(64,842
|
)
|
Net Proceeds From Issuance of Common Stock
|
|
6,294
|
|
|
3,574
|
|
Net Cash (Used in) Provided by Financing Activities
|
|
$
|
(60,367
|
)
|
|
$
|
19,656
|
|
|
|
|
|
|
Net Increase (Decrease) in Cash and Temporary Cash Investments
|
|
(19,896
|
)
|
|
32,555
|
|
Cash and Temporary Cash Investments at Beginning of Period
|
|
113,596
|
|
|
36,886
|
|
Cash and Temporary Cash Investments at March 31
|
|
$
|
93,700
|
|
|
$
|
69,441
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
SEGMENT OPERATING RESULTS AND STATISTICS
|
(UNAUDITED)
|
|
UPSTREAM BUSINESS
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
(Thousands of Dollars, except per share amounts)
|
|
March 31,
|
|
March 31,
|
EXPLORATION AND PRODUCTION SEGMENT
|
|
2016
|
|
2015
|
|
Variance
|
|
2016
|
2015
|
Variance
|
Total Operating Revenues
|
|
$
|
143,783
|
|
|
$
|
165,521
|
|
|
$
|
(21,738
|
)
|
|
$
|
295,749
|
|
$
|
370,186
|
|
$
|
(74,437
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
Operation and Maintenance:
|
|
|
|
|
|
|
|
|
|
|
General and Administrative Expense
|
|
19,143
|
|
|
18,042
|
|
|
1,101
|
|
|
39,099
|
|
33,727
|
|
5,372
|
|
Lease Operating and Transportation Expense
|
|
37,568
|
|
|
41,417
|
|
|
(3,849
|
)
|
|
76,590
|
|
88,224
|
|
(11,634
|
)
|
All Other Operation and Maintenance Expense
|
|
4,247
|
|
|
4,905
|
|
|
(658
|
)
|
|
7,391
|
|
7,748
|
|
(357
|
)
|
Property, Franchise and Other Taxes
|
|
3,217
|
|
|
5,542
|
|
|
(2,325
|
)
|
|
6,602
|
|
9,443
|
|
(2,841
|
)
|
Depreciation, Depletion and Amortization
|
|
37,274
|
|
|
57,436
|
|
|
(20,162
|
)
|
|
81,307
|
|
137,503
|
|
(56,196
|
)
|
Impairment of Oil and Gas Producing Properties
|
|
397,443
|
|
|
120,348
|
|
|
277,095
|
|
|
832,894
|
|
120,348
|
|
712,546
|
|
|
|
498,892
|
|
|
247,690
|
|
|
251,202
|
|
|
1,043,883
|
|
396,993
|
|
646,890
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
(355,109
|
)
|
|
(82,169)
|
|
(272,940
|
)
|
|
(748,134
|
)
|
(26,807)
|
(721,327
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
27
|
|
|
663
|
|
|
(636
|
)
|
|
693
|
|
1,173
|
|
(480
|
)
|
Interest Expense
|
|
(13,546
|
)
|
|
(11,053
|
)
|
|
(2,493)
|
|
(28,128
|
)
|
(21,360
|
)
|
(6,768
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Loss Before Income Taxes
|
|
(368,628
|
)
|
|
(92,559
|
)
|
|
(276,069
|
)
|
|
(775,569
|
)
|
(46,994
|
)
|
(728,575
|
)
|
Income Tax Benefit
|
|
(155,293
|
)
|
|
(38,997
|
)
|
|
(116,296
|
)
|
|
(325,148
|
)
|
(20,152
|
)
|
(304,996
|
)
|
Net Loss
|
|
$
|
(213,335
|
)
|
|
$
|
(53,562
|
)
|
|
$
|
(159,773
|
)
|
|
$
|
(450,421
|
)
|
$
|
(26,842
|
)
|
$
|
(423,579
|
)
|
|
|
|
|
|
|
|
|
|
|
|
Net Loss Per Share (Diluted)
|
|
$
|
(2.52
|
)
|
|
$
|
(0.63
|
)
|
|
$
|
(1.89
|
)
|
|
$
|
(5.32
|
)
|
$
|
(0.32
|
)
|
$
|
(5.00
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
SEGMENT OPERATING RESULTS AND STATISTICS
|
(UNAUDITED)
|
|
MIDSTREAM BUSINESSES
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
(Thousands of Dollars, except per share amounts)
|
|
March 31,
|
|
March 31,
|
PIPELINE AND STORAGE SEGMENT
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Revenues from External Customers
|
|
$
|
56,276
|
|
|
$
|
55,758
|
|
|
$
|
518
|
|
|
$
|
109,630
|
|
$
|
107,504
|
|
$
|
2,126
|
|
Intersegment Revenues
|
|
23,292
|
|
|
23,054
|
|
|
238
|
|
|
45,477
|
|
44,515
|
|
962
|
|
Total Operating Revenues
|
|
79,568
|
|
|
78,812
|
|
|
756
|
|
|
155,107
|
|
152,019
|
|
3,088
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased Gas
|
|
245
|
|
|
289
|
|
|
(44
|
)
|
|
703
|
|
555
|
|
148
|
|
Operation and Maintenance
|
|
19,060
|
|
|
17,642
|
|
|
1,418
|
|
|
36,653
|
|
35,526
|
|
1,127
|
|
Property, Franchise and Other Taxes
|
|
6,591
|
|
|
6,466
|
|
|
125
|
|
|
13,336
|
|
12,629
|
|
707
|
|
Depreciation, Depletion and Amortization
|
|
10,865
|
|
|
9,778
|
|
|
1,087
|
|
|
21,121
|
|
18,813
|
|
2,308
|
|
|
|
36,761
|
|
|
34,175
|
|
|
2,586
|
|
|
71,813
|
|
67,523
|
|
4,290
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
42,807
|
|
|
44,637
|
|
|
(1,830
|
)
|
|
83,294
|
|
84,496
|
|
(1,202
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
179
|
|
|
122
|
|
|
57
|
|
|
290
|
|
207
|
|
83
|
|
Other Income
|
|
413
|
|
|
332
|
|
|
81
|
|
|
1,994
|
|
889
|
|
1,105
|
|
Interest Expense
|
|
(8,453
|
)
|
|
(6,793
|
)
|
|
(1,660
|
)
|
|
(16,491
|
)
|
(13,333
|
)
|
(3,158
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
34,946
|
|
|
38,298
|
|
|
(3,352
|
)
|
|
69,087
|
|
72,259
|
|
(3,172
|
)
|
Income Tax Expense
|
|
13,752
|
|
|
14,921
|
|
|
(1,169
|
)
|
|
26,617
|
|
28,104
|
|
(1,487
|
)
|
Net Income
|
|
$
|
21,194
|
|
|
$
|
23,377
|
|
|
$
|
(2,183
|
)
|
|
$
|
42,470
|
|
$
|
44,155
|
|
$
|
(1,685
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
0.25
|
|
|
$
|
0.27
|
|
|
$
|
(0.02
|
)
|
|
$
|
0.50
|
|
$
|
0.52
|
|
$
|
(0.02
|
)
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
GATHERING SEGMENT
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Revenues from External Customers
|
|
$
|
113
|
|
|
$
|
89
|
|
|
$
|
24
|
|
|
$
|
238
|
|
$
|
235
|
|
$
|
3
|
|
Intersegment Revenues
|
|
21,545
|
|
|
17,365
|
|
|
4,180
|
|
|
40,184
|
|
41,793
|
|
(1,609
|
)
|
Total Operating Revenues
|
|
21,658
|
|
|
17,454
|
|
|
4,204
|
|
|
40,422
|
|
42,028
|
|
(1,606
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operation and Maintenance
|
|
2,775
|
|
|
2,232
|
|
|
543
|
|
|
5,047
|
|
4,008
|
|
1,039
|
|
Property, Franchise and Other Taxes
|
|
52
|
|
|
57
|
|
|
(5
|
)
|
|
85
|
|
92
|
|
(7
|
)
|
Depreciation, Depletion and Amortization
|
|
3,589
|
|
|
3,798
|
|
|
(209
|
)
|
|
7,799
|
|
5,858
|
|
1,941
|
|
|
|
6,416
|
|
|
6,087
|
|
|
329
|
|
|
12,931
|
|
9,958
|
|
2,973
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
15,242
|
|
|
11,367
|
|
|
3,875
|
|
|
27,491
|
|
32,070
|
|
(4,579
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
68
|
|
|
32
|
|
|
36
|
|
|
101
|
|
58
|
|
43
|
|
Other Income
|
|
1
|
|
|
1
|
|
|
—
|
|
|
2
|
|
2
|
|
—
|
|
Interest Expense
|
|
(1,918
|
)
|
|
(132
|
)
|
|
(1,786
|
)
|
|
(4,987
|
)
|
(430
|
)
|
(4,557
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
13,393
|
|
|
11,268
|
|
|
2,125
|
|
|
22,607
|
|
31,700
|
|
(9,093
|
)
|
Income Tax Expense
|
|
5,825
|
|
|
4,863
|
|
|
962
|
|
|
10,117
|
|
13,672
|
|
(3,555
|
)
|
Net Income
|
|
$
|
7,568
|
|
|
$
|
6,405
|
|
|
$
|
1,163
|
|
|
$
|
12,490
|
|
$
|
18,028
|
|
$
|
(5,538
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
0.09
|
|
|
$
|
0.08
|
|
|
$
|
0.01
|
|
|
$
|
0.15
|
|
$
|
0.21
|
|
$
|
(0.06
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
SEGMENT OPERATING RESULTS AND STATISTICS
|
(UNAUDITED)
|
|
DOWNSTREAM BUSINESSES
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
(Thousands of Dollars, except per share amounts)
|
|
March 31,
|
|
March 31,
|
UTILITY SEGMENT
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Revenues from External Customers
|
|
$
|
212,737
|
|
|
$
|
309,974
|
|
|
$
|
(97,237
|
)
|
|
$
|
356,585
|
|
$
|
520,047
|
|
$
|
(163,462
|
)
|
Intersegment Revenues
|
|
5,364
|
|
|
6,521
|
|
|
(1,157
|
)
|
|
9,028
|
|
11,055
|
|
(2,027
|
)
|
Total Operating Revenues
|
|
218,101
|
|
|
316,495
|
|
|
(98,394
|
)
|
|
365,613
|
|
531,102
|
|
(165,489
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased Gas
|
|
81,181
|
|
|
161,966
|
|
|
(80,785
|
)
|
|
126,250
|
|
263,677
|
|
(137,427
|
)
|
Operation and Maintenance
|
|
56,293
|
|
|
61,732
|
|
|
(5,439
|
)
|
|
102,893
|
|
110,638
|
|
(7,745
|
)
|
Property, Franchise and Other Taxes
|
|
11,160
|
|
|
12,564
|
|
|
(1,404
|
)
|
|
21,088
|
|
23,122
|
|
(2,034
|
)
|
Depreciation, Depletion and Amortization
|
|
11,659
|
|
|
11,333
|
|
|
326
|
|
|
23,277
|
|
22,484
|
|
793
|
|
|
|
160,293
|
|
|
247,595
|
|
|
(87,302
|
)
|
|
273,508
|
|
419,921
|
|
(146,413
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
57,808
|
|
|
68,900
|
|
|
(11,092
|
)
|
|
92,105
|
|
111,181
|
|
(19,076
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
122
|
|
|
7
|
|
|
115
|
|
|
207
|
|
25
|
|
182
|
|
Other Income
|
|
706
|
|
|
497
|
|
|
209
|
|
|
1,404
|
|
995
|
|
409
|
|
Interest Expense
|
|
(7,158
|
)
|
|
(7,204
|
)
|
|
46
|
|
|
(14,491
|
)
|
(14,148
|
)
|
(343
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
51,478
|
|
|
62,200
|
|
|
(10,722
|
)
|
|
79,225
|
|
98,053
|
|
(18,828
|
)
|
Income Tax Expense
|
|
19,518
|
|
|
23,962
|
|
|
(4,444
|
)
|
|
28,659
|
|
37,222
|
|
(8,563
|
)
|
Net Income
|
|
$
|
31,960
|
|
|
$
|
38,238
|
|
|
$
|
(6,278
|
)
|
|
$
|
50,566
|
|
$
|
60,831
|
|
$
|
(10,265
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
0.38
|
|
|
$
|
0.45
|
|
|
$
|
(0.07
|
)
|
|
$
|
0.60
|
|
$
|
0.71
|
|
$
|
(0.11
|
)
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
ENERGY MARKETING SEGMENT
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Revenues from External Customers
|
|
$
|
35,436
|
|
|
$
|
64,167
|
|
|
$
|
(28,731
|
)
|
|
$
|
60,420
|
|
$
|
120,333
|
|
$
|
(59,913
|
)
|
Intersegment Revenues
|
|
312
|
|
|
211
|
|
|
101
|
|
|
624
|
|
417
|
|
207
|
|
Total Operating Revenues
|
|
35,748
|
|
|
64,378
|
|
|
(28,630
|
)
|
|
61,044
|
|
120,750
|
|
(59,706
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased Gas
|
|
28,321
|
|
|
57,142
|
|
|
(28,821
|
)
|
|
50,044
|
|
107,371
|
|
(57,327
|
)
|
Operation and Maintenance
|
|
1,773
|
|
|
1,790
|
|
|
(17
|
)
|
|
3,496
|
|
3,289
|
|
207
|
|
Property, Franchise and Other Taxes
|
|
1
|
|
|
2
|
|
|
(1
|
)
|
|
4
|
|
5
|
|
(1
|
)
|
Depreciation, Depletion and Amortization
|
|
69
|
|
|
51
|
|
|
18
|
|
|
139
|
|
101
|
|
38
|
|
|
|
30,164
|
|
|
58,985
|
|
|
(28,821
|
)
|
|
53,683
|
|
110,766
|
|
(57,083
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
5,584
|
|
|
5,393
|
|
|
191
|
|
|
7,361
|
|
9,984
|
|
(2,623
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
91
|
|
|
44
|
|
|
47
|
|
|
141
|
|
82
|
|
59
|
|
Other Income
|
|
15
|
|
|
43
|
|
|
(28
|
)
|
|
24
|
|
67
|
|
(43
|
)
|
Interest Expense
|
|
(7
|
)
|
|
(12
|
)
|
|
5
|
|
|
(25
|
)
|
(15
|
)
|
(10
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Income Taxes
|
|
5,683
|
|
|
5,468
|
|
|
215
|
|
|
7,501
|
|
10,118
|
|
(2,617
|
)
|
Income Tax Expense
|
|
2,199
|
|
|
2,095
|
|
|
104
|
|
|
2,794
|
|
3,919
|
|
(1,125
|
)
|
Net Income
|
|
$
|
3,484
|
|
|
$
|
3,373
|
|
|
$
|
111
|
|
|
$
|
4,707
|
|
$
|
6,199
|
|
$
|
(1,492
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
0.04
|
|
|
$
|
0.04
|
|
|
$
|
—
|
|
|
$
|
0.06
|
|
$
|
0.07
|
|
$
|
(0.01
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
SEGMENT OPERATING RESULTS AND STATISTICS
|
(UNAUDITED)
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
(Thousands of Dollars, except per share amounts)
|
|
March 31,
|
|
March 31,
|
ALL OTHER
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Total Operating Revenues
|
|
$
|
561
|
|
|
$
|
388
|
|
|
$
|
173
|
|
|
$
|
1,266
|
|
$
|
1,271
|
|
$
|
(5
|
)
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operation and Maintenance
|
|
164
|
|
|
(47
|
)
|
|
211
|
|
|
239
|
|
482
|
|
(243
|
)
|
Property, Franchise and Other Taxes
|
|
161
|
|
|
158
|
|
|
3
|
|
|
304
|
|
307
|
|
(3
|
)
|
Depreciation, Depletion and Amortization
|
|
306
|
|
|
124
|
|
|
182
|
|
|
488
|
|
340
|
|
148
|
|
|
|
631
|
|
|
235
|
|
|
396
|
|
|
1,031
|
|
1,129
|
|
(98
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income (Loss)
|
|
(70
|
)
|
|
153
|
|
|
(223
|
)
|
|
235
|
|
142
|
|
93
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
31
|
|
|
17
|
|
|
14
|
|
|
50
|
|
30
|
|
20
|
|
Other Income
|
|
—
|
|
|
1
|
|
|
(1
|
)
|
|
—
|
|
2
|
|
(2
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income (Loss) Before Income Taxes
|
|
(39
|
)
|
|
171
|
|
|
(210
|
)
|
|
285
|
|
174
|
|
111
|
|
Income Tax Expense (Benefit)
|
|
(16
|
)
|
|
73
|
|
|
(89
|
)
|
|
119
|
|
81
|
|
38
|
|
Net Income (Loss)
|
|
$
|
(23
|
)
|
|
$
|
98
|
|
|
$
|
(121
|
)
|
|
$
|
166
|
|
$
|
93
|
|
$
|
73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income (Loss) Per Share (Diluted)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
CORPORATE
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Revenues from External Customers
|
|
$
|
226
|
|
|
$
|
230
|
|
|
$
|
(4
|
)
|
|
$
|
439
|
|
$
|
460
|
|
$
|
(21
|
)
|
Intersegment Revenues
|
|
967
|
|
|
953
|
|
|
14
|
|
|
1,933
|
|
1,839
|
|
94
|
|
Total Operating Revenues
|
|
1,193
|
|
|
1,183
|
|
|
10
|
|
|
2,372
|
|
2,299
|
|
73
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operation and Maintenance
|
|
4,147
|
|
|
4,839
|
|
|
(692
|
)
|
|
7,038
|
|
7,891
|
|
(853
|
)
|
Property, Franchise and Other Taxes
|
|
123
|
|
|
127
|
|
|
(4
|
)
|
|
243
|
|
247
|
|
(4
|
)
|
Depreciation, Depletion and Amortization
|
|
185
|
|
|
167
|
|
|
18
|
|
|
367
|
|
334
|
|
33
|
|
|
|
4,455
|
|
|
5,133
|
|
|
(678
|
)
|
|
7,648
|
|
8,472
|
|
(824
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Loss
|
|
(3,262
|
)
|
|
(3,950
|
)
|
|
688
|
|
|
(5,276
|
)
|
(6,173
|
)
|
897
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
30,339
|
|
|
24,188
|
|
|
6,151
|
|
|
62,083
|
|
49,488
|
|
12,595
|
|
Other Income
|
|
2,101
|
|
|
514
|
|
|
1,587
|
|
|
2,230
|
|
616
|
|
1,614
|
|
Interest Expense on Long-Term Debt
|
|
(28,994
|
)
|
|
(22,376
|
)
|
|
(6,618
|
)
|
|
(59,366
|
)
|
(44,687
|
)
|
(14,679
|
)
|
Other Interest Expense
|
|
(734
|
)
|
|
(1,417
|
)
|
|
683
|
|
|
17
|
|
(2,849
|
)
|
2,866
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss Before Income Taxes
|
|
(550
|
)
|
|
(3,041
|
)
|
|
2,491
|
|
|
(312
|
)
|
(3,605
|
)
|
3,293
|
|
Income Tax Benefit
|
|
(2,015
|
)
|
|
(1,781
|
)
|
|
(234
|
)
|
|
(3,538
|
)
|
(2,550
|
)
|
(988
|
)
|
Net Income
|
|
$
|
1,465
|
|
|
$
|
(1,260
|
)
|
|
$
|
2,725
|
|
|
$
|
3,226
|
|
$
|
(1,055
|
)
|
$
|
4,281
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
0.02
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.03
|
|
|
$
|
0.04
|
|
$
|
—
|
|
$
|
0.04
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
INTERSEGMENT ELIMINATIONS
|
|
2016
|
|
|
2015
|
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
Intersegment Revenues
|
|
$
|
(51,480
|
)
|
|
$
|
(48,104
|
)
|
|
$
|
(3,376
|
)
|
|
$
|
(97,246
|
)
|
$
|
(99,619
|
)
|
$
|
2,373
|
|
Operating Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Purchased Gas
|
|
(28,124
|
)
|
|
(28,797
|
)
|
|
673
|
|
|
(53,306
|
)
|
(53,913
|
)
|
607
|
|
Operation and Maintenance
|
|
(23,356
|
)
|
|
(19,307
|
)
|
|
(4,049
|
)
|
|
(43,940
|
)
|
(45,706
|
)
|
1,766
|
|
|
|
(51,480
|
)
|
|
(48,104
|
)
|
|
(3,376
|
)
|
|
(97,246
|
)
|
(99,619
|
)
|
2,373
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating Income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest Income
|
|
(30,579
|
)
|
|
(25,027
|
)
|
|
(5,552
|
)
|
|
(61,488
|
)
|
(49,760
|
)
|
(11,728
|
)
|
Interest Expense
|
|
30,579
|
|
|
25,027
|
|
|
5,552
|
|
|
61,488
|
|
49,760
|
|
11,728
|
|
Net Income
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net Income Per Share (Diluted)
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
SEGMENT INFORMATION (Continued)
|
(Thousands of Dollars)
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
(Unaudited)
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Expenditures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exploration and Production
|
|
$
|
79,530
|
|
(1)
|
|
$
|
143,364
|
|
(3)
|
|
$
|
(63,834
|
)
|
|
$
|
167,654
|
|
(1)(2)
|
|
$
|
301,076
|
|
(3)(4)
|
|
$
|
(133,422
|
)
|
Pipeline and Storage
|
|
26,075
|
|
(1)
|
|
41,643
|
|
(3)
|
|
(15,568
|
)
|
|
57,695
|
|
(1)(2)
|
|
57,671
|
|
(3)(4)
|
|
24
|
|
Gathering
|
|
12,778
|
|
(1)
|
|
35,601
|
|
(3)
|
|
(22,823
|
)
|
|
34,523
|
|
(1)(2)
|
|
50,549
|
|
(3)(4)
|
|
(16,026
|
)
|
Utility
|
|
26,091
|
|
(1)
|
|
20,566
|
|
(3)
|
|
5,525
|
|
|
46,008
|
|
(1)(2)
|
|
41,740
|
|
(3)(4)
|
|
4,268
|
|
Energy Marketing
|
|
2
|
|
|
|
17
|
|
|
|
(15
|
)
|
|
9
|
|
|
|
92
|
|
|
|
(83
|
)
|
Total Reportable Segments
|
|
144,476
|
|
|
|
241,191
|
|
|
|
(96,715
|
)
|
|
305,889
|
|
|
|
451,128
|
|
|
|
(145,239
|
)
|
All Other
|
|
37
|
|
|
|
—
|
|
|
|
37
|
|
|
37
|
|
|
|
—
|
|
|
|
37
|
|
Corporate
|
|
106
|
|
|
|
43
|
|
|
|
63
|
|
|
155
|
|
|
|
68
|
|
|
|
87
|
|
Total Capital Expenditures
|
|
$
|
144,619
|
|
|
|
$
|
241,234
|
|
|
|
$
|
(96,615
|
)
|
|
$
|
306,081
|
|
|
|
$
|
451,196
|
|
|
|
$
|
(145,115
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Capital expenditures for the quarter and six months ended
March 31, 2016, include accounts payable and accrued liabilities
related to capital expenditures of $34.0 million, $10.2 million,
$12.6 million, and $9.3 million in the Exploration and Production
segment, Pipeline and Storage segment, Gathering segment and
Utility segment, respectively. These amounts have been excluded
from the Consolidated Statement of Cash Flows at March 31, 2016,
since they represent non-cash investing activities at that date.
|
|
|
|
(2)
|
|
Capital expenditures for the six months ended March 31, 2016,
exclude capital expenditures of $46.2 million, $33.9 million,
$22.4 million and $16.5 million in the Exploration and Production
segment, Pipeline and Storage segment, Gathering segment and
Utility segment, respectively. These amounts were in
accounts payable and accrued liabilities at September 30, 2015 and
paid during the six months ended March 31, 2016. These
amounts were excluded from the Consolidated Statement of Cash
Flows at September 30, 2015, since they represented non-cash
investing activities at that date. These amounts have
been included in the Consolidated Statement of Cash Flows at March
31, 2016.
|
|
|
|
(3)
|
|
Capital expenditures for the quarter and six months ended
March 31, 2015, include accounts payable and accrued liabilities
related to capital expenditures of $63.5 million, $8.2 million,
$14.1 million, and $8.7 million in the Exploration and Production
segment, Pipeline and Storage segment, Gathering segment and
Utility segment, respectively. These amounts have been
excluded from the Consolidated Statement of Cash Flows at March
31, 2015, since they represent non-cash investing activities at
that date.
|
|
|
|
(4)
|
|
Capital expenditures for the six months ended March 31, 2015,
exclude capital expenditures of $80.1 million, $28.1 million,
$20.1 million and $8.3 million in the Exploration and Production
segment, Pipeline and Storage segment, Gathering segment and
Utility segment, respectively. These amounts were in
accounts payable and accrued liabilities at September 30, 2014 and
paid during the six months ended March 31, 2015. These
amounts were excluded from the Consolidated Statements of Cash
Flows at September 30, 2014, since they represented non-cash
investing activities at that date. These amounts have
been included in the Consolidated Statement of Cash Flows at March
31, 2015.
|
|
|
|
|
DEGREE DAYS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Percent Colder
|
|
|
|
|
|
|
|
|
(Warmer) Than:
|
Three Months Ended March 31
|
|
Normal
|
|
2016
|
|
2015
|
|
Normal (1)
|
|
Last Year (1)
|
|
|
|
|
|
|
|
|
|
|
|
Buffalo, NY
|
|
3,326
|
|
2,963
|
|
3,984
|
|
(10.9)
|
|
(25.6)
|
Erie, PA
|
|
3,142
|
|
2,739
|
|
3,815
|
|
(12.8)
|
|
(28.2)
|
|
|
|
|
|
|
|
|
|
|
|
Six Months Ended March 31
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Buffalo, NY
|
|
5,579
|
|
4,640
|
|
6,120
|
|
(16.8)
|
|
(24.2)
|
Erie, PA
|
|
5,186
|
|
4,223
|
|
5,806
|
|
(18.6)
|
|
(27.3)
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Percents compare actual 2016 degree days to normal degree
days and actual 2016 degree days to actual 2015 degree days.
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
EXPLORATION AND PRODUCTION INFORMATION
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
Increase
|
|
|
2016
|
|
2015
|
|
(Decrease)
|
|
2016
|
|
2015
|
|
(Decrease)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gas Production/Prices:
|
|
|
|
|
|
|
|
|
|
|
|
|
Production (MMcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
Appalachia
|
|
34,113
|
|
|
30,592
|
|
|
3,521
|
|
|
66,900
|
|
|
73,391
|
|
|
(6,491
|
)
|
West Coast
|
|
764
|
|
|
795
|
|
|
(31
|
)
|
|
1,547
|
|
|
1,567
|
|
|
(20
|
)
|
Total Production
|
|
34,877
|
|
|
31,387
|
|
|
3,490
|
|
|
68,447
|
|
|
74,958
|
|
|
(6,511
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Prices (Per Mcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
Appalachia
|
|
$
|
1.85
|
|
|
$
|
2.46
|
|
|
$
|
(0.61
|
)
|
|
$
|
1.91
|
|
|
$
|
2.75
|
|
|
$
|
(0.84
|
)
|
West Coast
|
|
2.87
|
|
|
3.81
|
|
|
(0.94
|
)
|
|
3.27
|
|
|
4.70
|
|
|
(1.43
|
)
|
Weighted Average
|
|
1.87
|
|
|
2.50
|
|
|
(0.63
|
)
|
|
1.94
|
|
|
2.79
|
|
|
(0.85
|
)
|
Weighted Average after Hedging
|
|
2.99
|
|
|
3.65
|
|
|
(0.66
|
)
|
|
3.08
|
|
|
3.42
|
|
|
(0.34
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Oil Production/Prices:
|
|
|
|
|
|
|
|
|
|
|
|
|
Production (Thousands of Barrels)
|
|
|
|
|
|
|
|
|
|
|
|
|
Appalachia
|
|
5
|
|
5
|
|
—
|
|
|
11
|
|
15
|
|
(4)
|
West Coast
|
|
718
|
|
721
|
|
(3)
|
|
1,460
|
|
1,482
|
|
(22)
|
Total Production
|
|
723
|
|
726
|
|
(3)
|
|
1,471
|
|
1,497
|
|
(26)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average Prices (Per Barrel)
|
|
|
|
|
|
|
|
|
|
|
|
|
Appalachia
|
|
$
|
32.81
|
|
|
$
|
46.18
|
|
|
$
|
(13.37
|
)
|
|
$
|
36.74
|
|
|
$
|
65.09
|
|
|
$
|
(28.35
|
)
|
West Coast
|
|
27.02
|
|
|
43.93
|
|
|
(16.91
|
)
|
|
31.61
|
|
|
55.71
|
|
|
(24.10
|
)
|
Weighted Average
|
|
27.06
|
|
|
43.95
|
|
|
(16.89
|
)
|
|
31.65
|
|
|
55.80
|
|
|
(24.15
|
)
|
Weighted Average after Hedging
|
|
53.01
|
|
|
67.14
|
|
|
(14.13
|
)
|
|
56.45
|
|
|
72.78
|
|
|
(16.33
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Production (Mmcfe)
|
|
39,215
|
|
35,743
|
|
3,472
|
|
77,273
|
|
83,940
|
|
(6,667)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected Operating Performance Statistics:
|
|
|
|
|
|
|
|
|
|
|
|
|
General & Administrative Expense per Mcfe (1)
|
|
$
|
0.49
|
|
|
$
|
0.50
|
|
|
$
|
(0.01
|
)
|
|
$
|
0.51
|
|
|
$
|
0.40
|
|
|
$
|
0.11
|
|
Lease Operating and Transportation Expense per Mcfe (1)(2)
|
|
$
|
0.96
|
|
|
$
|
1.16
|
|
|
$
|
(0.20
|
)
|
|
$
|
0.99
|
|
|
$
|
1.05
|
|
|
$
|
(0.06
|
)
|
Depreciation, Depletion & Amortization per Mcfe (1)
|
|
$
|
0.95
|
|
|
$
|
1.61
|
|
|
$
|
(0.66
|
)
|
|
$
|
1.05
|
|
|
$
|
1.64
|
|
|
$
|
(0.59
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Refer to page 15 for the General and Administrative Expense,
Lease Operating Expense and Depreciation, Depletion, and
Amortization Expense for the Exploration and Production segment.
|
|
|
|
(2)
|
|
Amounts include transportation expense of $0.51 and $0.52 per
Mcfe for the three months ended March 31, 2016 and March 31, 2015,
respectively. Amounts include transportation expense of $0.51 and
$0.52 per Mcfe for the six months ended March 31, 2016 and March
31, 2015, respectively.
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
EXPLORATION AND PRODUCTION INFORMATION
|
|
Hedging Summary for the Remaining Six Months of Fiscal 2016
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Oil Swaps
|
|
|
|
|
|
|
|
|
Brent
|
|
102,000
|
|
BBL
|
|
|
|
$
|
94.06 / BBL
|
NYMEX
|
|
719,000
|
|
BBL
|
|
|
|
$
|
79.27 / BBL
|
Total
|
|
821,000
|
|
BBL
|
|
|
|
$
|
81.10 / BBL
|
|
|
|
|
|
|
|
|
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
18,960,000
|
|
MMBTU
|
|
|
|
$
|
3.92 / MMBTU
|
Dominion Transmission Appalachian (DOM)
|
|
9,420,000
|
|
MMBTU
|
|
|
|
$
|
3.78 / MMBTU
|
Michigan Consolidated City Gate (Mich Con)
|
|
6,000,000
|
|
MMBTU
|
|
|
|
$
|
4.10 / MMBTU
|
Dawn Ontario (DAWN)
|
|
8,160,000
|
|
MMBTU
|
|
|
|
$
|
3.82 / MMBTU
|
Fixed Price Physical Sales
|
|
24,221,925
|
|
MMBTU
|
|
|
|
$
|
2.55 / MMBTU
|
Total
|
|
66,761,925
|
|
MMBTU
|
|
|
|
$
|
3.41 / MMBTU
|
|
|
|
|
|
|
|
|
|
Hedging Summary for Fiscal 2017
|
|
|
|
|
|
|
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Oil Swaps
|
|
|
|
|
|
|
|
|
Brent
|
|
123,000
|
|
BBL
|
|
|
|
$
|
92.27 / BBL
|
NYMEX
|
|
573,000
|
|
BBL
|
|
|
|
$
|
71.47 / BBL
|
Total
|
|
696,000
|
|
BBL
|
|
|
|
$
|
75.14 / BBL
|
|
|
|
|
|
|
|
|
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
29,530,000
|
|
MMBTU
|
|
|
|
$
|
4.20 / MMBTU
|
DOM
|
|
12,720,000
|
|
MMBTU
|
|
|
|
$
|
3.87 / MMBTU
|
Mich Con
|
|
3,000,000
|
|
MMBTU
|
|
|
|
$
|
4.10 / MMBTU
|
DAWN
|
|
19,100,000
|
|
MMBTU
|
|
|
|
$
|
3.70 / MMBTU
|
Fixed Price Physical Sales
|
|
50,660,170
|
|
MMBTU
|
|
|
|
$
|
2.52 / MMBTU
|
Total
|
|
115,010,170
|
|
MMBTU
|
|
|
|
$
|
3.34 / MMBTU
|
|
|
|
|
|
|
|
|
|
Hedging Summary for Fiscal 2018
|
|
|
|
|
|
|
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Oil Swaps
|
|
|
|
|
|
|
|
|
Brent
|
|
24,000
|
|
BBL
|
|
|
|
$
|
91.00 / BBL
|
NYMEX
|
|
51,000
|
|
BBL
|
|
|
|
$
|
90.62 / BBL
|
Total
|
|
75,000
|
|
BBL
|
|
|
|
$
|
90.74 / BBL
|
|
|
|
|
|
|
|
|
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
26,070,000
|
|
MMBTU
|
|
|
|
$
|
3.49 / MMBTU
|
DAWN
|
|
8,400,000
|
|
MMBTU
|
|
|
|
$
|
3.08 / MMBTU
|
Fixed Price Physical Sales
|
|
13,366,255
|
|
MMBTU
|
|
|
|
$
|
2.69 / MMBTU
|
Total
|
|
47,836,255
|
|
MMBTU
|
|
|
|
$
|
3.19 / MMBTU
|
|
|
|
|
|
|
|
|
|
Hedging Summary for Fiscal 2019
|
|
|
|
|
|
|
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
25,560,000
|
|
MMBTU
|
|
|
|
$
|
3.18 / MMBTU
|
DAWN
|
|
7,200,000
|
|
MMBTU
|
|
|
|
$
|
3.00 / MMBTU
|
Fixed Price Physical Sales
|
|
6,931,100
|
|
MMBTU
|
|
|
|
$
|
3.19 / MMBTU
|
Total
|
|
39,691,100
|
|
MMBTU
|
|
|
|
$
|
3.15 / MMBTU
|
|
|
|
|
|
|
|
|
|
Hedging Summary for Fiscal 2020
|
|
|
|
|
|
|
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
16,880,000
|
|
MMBTU
|
|
|
|
$
|
3.07 / MMBTU
|
DAWN
|
|
7,200,000
|
|
MMBTU
|
|
|
|
$
|
3.00 / MMBTU
|
Fixed Price Physical Sales
|
|
3,378,180
|
|
MMBTU
|
|
|
|
$
|
3.25 / MMBTU
|
Total
|
|
27,458,180
|
|
MMBTU
|
|
|
|
$
|
3.07 / MMBTU
|
|
|
|
|
|
|
|
|
|
Hedging Summary for Fiscal 2021
|
|
|
|
|
|
|
|
|
|
|
Volume
|
|
|
|
|
Average Hedge Price
|
Gas Swaps
|
|
|
|
|
|
|
|
|
NYMEX
|
|
4,840,000
|
|
MMBTU
|
|
|
|
$
|
3.01 / MMBTU
|
DAWN
|
|
600,000
|
|
MMBTU
|
|
|
|
$
|
3.00 / MMBTU
|
Total
|
|
5,440,000
|
|
MMBTU
|
|
|
|
$
|
3.01 / MMBTU
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
EXPLORATION AND PRODUCTION INFORMATION
|
|
|
|
|
|
|
|
|
|
Gross Wells in Process of Drilling
|
|
|
|
|
|
|
|
|
Six Months Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
East
|
|
|
West
|
|
|
Company
|
Wells in Process - Beginning of Period
|
|
|
|
|
|
|
|
|
Exploratory
|
|
4.000
|
(1)
|
|
0.000
|
|
|
4.000
|
Developmental
|
|
96.000
|
(1)
|
|
0.000
|
|
|
96.000
|
Wells Commenced
|
|
|
|
|
|
|
|
|
Exploratory
|
|
1.000
|
|
|
0.000
|
|
|
1.000
|
Developmental
|
|
37.000
|
|
|
25.000
|
|
|
62.000
|
Wells Completed
|
|
|
|
|
|
|
|
|
Exploratory
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Developmental
|
|
26.000
|
|
|
25.000
|
|
|
51.000
|
Wells Plugged & Abandoned
|
|
|
|
|
|
|
|
|
Exploratory
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Developmental
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Wells in Process - End of Period
|
|
|
|
|
|
|
|
|
Exploratory
|
|
5.000
|
|
|
0.000
|
|
|
5.000
|
Developmental
|
|
107.000
|
|
|
0.000
|
|
|
107.000
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Gross exploratory wells were increased by 4 and developmental
wells were decreased by 4.
|
|
Net Wells in Process of Drilling
|
|
|
|
|
|
|
|
|
Six Months Ended March 31, 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
|
|
|
East
|
|
|
West
|
|
|
Company
|
Wells in Process - Beginning of Period
|
|
|
|
|
|
|
|
|
Exploratory
|
|
4.000
|
(1)
|
|
0.000
|
|
|
4.000
|
Developmental
|
|
81.500
|
(1)
|
|
0.000
|
|
|
81.500
|
Wells Commenced
|
|
|
|
|
|
|
|
|
Exploratory
|
|
1.000
|
|
|
0.000
|
|
|
1.000
|
Developmental
|
|
37.000
|
|
|
25.000
|
|
|
62.000
|
Wells Completed
|
|
|
|
|
|
|
|
|
Exploratory
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Developmental
|
|
19.600
|
|
|
25.000
|
|
|
44.600
|
Wells Plugged & Abandoned
|
|
|
|
|
|
|
|
|
Exploratory
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Developmental
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Well Interest Sold (2)
|
|
|
|
|
|
|
|
|
Exploratory
|
|
0.000
|
|
|
0.000
|
|
|
0.000
|
Developmental
|
|
10.400
|
|
|
0.000
|
|
|
10.400
|
Wells in Process - End of Period
|
|
|
|
|
|
|
|
|
Exploratory
|
|
5.000
|
|
|
0.000
|
|
|
5.000
|
Developmental
|
|
88.500
|
(2)
|
|
0.000
|
|
|
88.500
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
Net exploratory wells were increased by 4 and developmental
wells were decreased by 4.
|
|
|
|
(2)
|
|
Seneca's East Division sold an 80% working interest in 13 of
the existing developmental wells in process to IOG during the six
months ended March 31, 2016.
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
Pipeline & Storage Throughput - (millions of cubic feet - MMcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
Firm Transportation - Affiliated
|
|
42,624
|
|
|
50,777
|
|
|
(8,153
|
)
|
|
67,333
|
|
|
79,863
|
|
|
(12,530
|
)
|
Firm Transportation - Non-Affiliated
|
|
166,326
|
|
|
179,534
|
|
|
(13,208
|
)
|
|
317,448
|
|
|
336,770
|
|
|
(19,322
|
)
|
Interruptible Transportation
|
|
6,483
|
|
|
3,627
|
|
|
2,856
|
|
|
12,115
|
|
|
5,729
|
|
|
6,386
|
|
|
|
215,433
|
|
|
233,938
|
|
|
(18,505
|
)
|
|
396,896
|
|
|
422,362
|
|
|
(25,466
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gathering Volume - (MMcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
Gathered Volume - Affiliated
|
|
39,195
|
|
|
31,175
|
|
|
8,020
|
|
|
72,995
|
|
|
76,047
|
|
|
(3,052
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utility Throughput - (MMcf)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
Retail Sales:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential Sales
|
|
24,486
|
|
|
31,561
|
|
|
(7,075
|
)
|
|
37,619
|
|
|
48,029
|
|
|
(10,410
|
)
|
Commercial Sales
|
|
3,688
|
|
|
4,813
|
|
|
(1,125
|
)
|
|
5,515
|
|
|
7,097
|
|
|
(1,582
|
)
|
Industrial Sales
|
|
167
|
|
|
194
|
|
|
(27
|
)
|
|
233
|
|
|
282
|
|
|
(49
|
)
|
|
|
28,341
|
|
|
36,568
|
|
|
(8,227
|
)
|
|
43,367
|
|
|
55,408
|
|
|
(12,041
|
)
|
Off-System Sales
|
|
1,243
|
|
|
2,118
|
|
|
(875
|
)
|
|
1,243
|
|
|
3,787
|
|
|
(2,544
|
)
|
Transportation
|
|
27,297
|
|
|
33,567
|
|
|
(6,270
|
)
|
|
44,913
|
|
|
54,516
|
|
|
(9,603
|
)
|
|
|
56,881
|
|
|
72,253
|
|
|
(15,372
|
)
|
|
89,523
|
|
|
113,711
|
|
|
(24,188
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Energy Marketing Volume
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
|
|
Increase
|
|
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
2016
|
|
|
2015
|
|
|
(Decrease)
|
|
Natural Gas (MMcf)
|
|
15,165
|
|
|
19,337
|
|
|
(4,172
|
)
|
|
25,263
|
|
|
31,926
|
|
|
(6,663
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
In addition to financial measures calculated in accordance with
generally accepted accounting principles (GAAP), this press release
contains information regarding Operating Results and Adjusted EBITDA,
which are non-GAAP financial measures. The Company believes that these
non-GAAP financial measures are useful to investors because they provide
an alternative method for assessing the Company's ongoing operating
results, for measuring the Company’s cash flow and liquidity, and for
comparing the Company’s financial performance to other companies. The
Company's management uses these non-GAAP financial measures for the same
purpose, and for planning and forecasting purposes. The presentation of
non-GAAP financial measures is not meant to be a substitute for
financial measures in accordance with GAAP.
Management defines Operating Results as reported GAAP earnings before
items impacting comparability. The table at page 1 of this report
reconciles National Fuel's reported GAAP earnings to Operating Results
for the three and six months ended March 31, 2016 and 2015.
Management defines Adjusted EBITDA as reported GAAP earnings before the
following items: interest expense, depreciation, depletion and
amortization, interest and other income, impairments, items impacting
comparability and income taxes.
The following tables reconcile National Fuel's reported GAAP earnings to
Adjusted EBITDA for the three and six months ended March 31, 2016 and
2015:
|
|
|
Three Months Ended
|
|
Six Months Ended
|
|
|
March 31,
|
|
March 31,
|
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
(in thousands)
|
|
|
|
|
|
|
|
|
Reported GAAP Earnings
|
|
$
|
(147,687
|
)
|
|
$
|
16,669
|
|
|
$
|
(336,796
|
)
|
|
$
|
101,409
|
|
Depreciation, Depletion and Amortization
|
|
63,947
|
|
|
82,687
|
|
|
134,498
|
|
|
185,433
|
|
Interest and Other Income
|
|
(3,514
|
)
|
|
(1,434
|
)
|
|
(7,731
|
)
|
|
(3,874
|
)
|
Interest Expense
|
|
30,231
|
|
|
23,960
|
|
|
61,983
|
|
|
47,062
|
|
Income Taxes
|
|
(116,030
|
)
|
|
5,136
|
|
|
(260,380
|
)
|
|
60,296
|
|
Impairment of Oil and Gas Producing
Properties
|
|
397,443
|
|
|
120,348
|
|
|
832,894
|
|
|
120,348
|
|
Joint Development Agreement Professional
Fees
|
|
—
|
|
|
—
|
|
|
4,682
|
|
|
—
|
|
Adjusted EBITDA
|
|
$
|
224,390
|
|
|
$
|
247,366
|
|
|
$
|
429,150
|
|
|
$
|
510,674
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA by Segment
|
|
|
|
|
|
|
|
|
Pipeline and Storage Adjusted EBITDA
|
|
$
|
53,672
|
|
|
$
|
54,415
|
|
|
$
|
104,415
|
|
|
$
|
103,309
|
|
Gathering Adjusted EBITDA
|
|
18,831
|
|
|
15,165
|
|
|
35,290
|
|
|
37,928
|
|
Total Midstream Businesses Adjusted EBITDA
|
|
72,503
|
|
|
69,580
|
|
|
139,705
|
|
|
141,237
|
|
Exploration and Production Adjusted EBITDA
|
|
79,608
|
|
|
95,615
|
|
|
170,749
|
|
|
231,044
|
|
Utility Adjusted EBITDA
|
|
69,467
|
|
|
80,233
|
|
|
115,382
|
|
|
133,665
|
|
Energy Marketing Adjusted EBITDA
|
|
5,653
|
|
|
5,444
|
|
|
7,500
|
|
|
10,085
|
|
Corporate and All Other Adjusted EBITDA
|
|
(2,841
|
)
|
|
(3,506
|
)
|
|
(4,186
|
)
|
|
(5,357
|
)
|
Total Adjusted EBITDA
|
|
$
|
224,390
|
|
|
$
|
247,366
|
|
|
$
|
429,150
|
|
|
$
|
510,674
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NATIONAL FUEL GAS COMPANY
|
AND SUBSIDIARIES
|
|
|
|
|
|
Quarter Ended March 31 (unaudited)
|
|
2016
|
|
2015
|
|
|
|
|
|
Operating Revenues
|
|
$
|
449,132,000
|
|
|
$
|
596,127,000
|
|
|
|
|
|
Net Income (Loss) Available for Common Stock
|
|
$
|
(147,687,000
|
)
|
|
$
|
16,669,000
|
|
|
|
|
|
Earnings (Loss) Per Common Share:
|
|
|
|
|
Basic
|
|
$
|
(1.74
|
)
|
|
$
|
0.20
|
Diluted
|
|
$
|
(1.74
|
)
|
|
$
|
0.20
|
|
|
|
|
|
Weighted Average Common Shares:
|
|
|
|
|
Used in Basic Calculation
|
|
84,806,982
|
|
|
84,317,508
|
Used in Diluted Calculation
|
|
84,806,982
|
|
|
85,133,142
|
|
|
|
|
|
Six Months Ended March 31 (unaudited)
|
|
|
|
|
|
|
|
|
|
Operating Revenues
|
|
$
|
824,327,000
|
|
|
$
|
1,120,036,000
|
|
|
|
|
|
Net Income (Loss) Available for Common Stock
|
|
$
|
(336,796,000
|
)
|
|
$
|
101,409,000
|
|
|
|
|
|
Earnings (Loss) Per Common Share:
|
|
|
|
|
Basic
|
|
$
|
(3.97
|
)
|
|
$
|
1.20
|
Diluted
|
|
$
|
(3.97
|
)
|
|
$
|
1.19
|
|
|
|
|
|
Weighted Average Common Shares:
|
|
|
|
|
Used in Basic Calculation
|
|
84,728,680
|
|
|
84,262,471
|
Used in Diluted Calculation
|
|
84,728,680
|
|
|
85,175,961
|
|
|
|
|
|
Twelve Months Ended March 31 (unaudited)
|
|
|
|
|
|
|
|
|
|
Operating Revenues
|
|
$
|
1,465,204,000
|
|
|
$
|
1,926,803,000
|
|
|
|
|
|
Net Income (Loss) Available for Common Stock
|
|
$
|
(817,633,000
|
)
|
|
$
|
223,360,000
|
|
|
|
|
|
Earnings (Loss) Per Common Share:
|
|
|
|
|
Basic
|
|
$
|
(9.66
|
)
|
|
$
|
2.65
|
Diluted
|
|
$
|
(9.66
|
)
|
|
$
|
2.62
|
|
|
|
|
|
Weighted Average Common Shares:
|
|
|
|
|
Used in Basic Calculation
|
|
84,620,502
|
|
|
84,170,033
|
Used in Diluted Calculation
|
|
84,620,502
|
|
|
85,102,075
|
View source version on businesswire.com: http://www.businesswire.com/news/home/20160428007001/en/
Copyright Business Wire 2016