Whiting’s 2Q16 revenue
Whiting Petroleum (WLL) reported its 2Q16 earnings on July 27, 2016, after the markets closed. Whiting’s 2Q16 revenue was ~$359 million, against an estimate of $393 million. Revenue in 2Q15 was ~$677 million. In 1Q16 it was $324 million.
Whiting’s 2Q16 earnings
Whiting Petroleum’s (WLL) 2Q16 adjusted earnings per share (or EPS) was -$0.70, against Wall Street analysts’ consensus estimate of about -$0.45 EPS. Its 2Q15, EPS stood at $0.04. 1Q16 earnings came in at -$0.85 per share. As we can see in the above graph, Whiting’s earnings and revenues missed estimates.
Key 2Q16 highlights
In the previous quarter, WLL entered into a “wellbore participation agreement” in the Williston Basin with an unknown private player. Under the agreement, the private party will pay 65% of drilling and completion costs to earn a 50% working interest in 44 Williston Basin wells.
In 2Q16 Whiting signed another well-participation agreement, for 30 wells, with similar terms as the previous agreement. Following this, WLL plans to add a drilling rig in October. As a result of the new participation agreement, WLL has increased its 2016 capex by $50 million. In addition, WLL sold its North Ward Estes property in West Texas for $300 million and a “potential contingency payment of $100.”
Lastly, WLL exchanged $1.1 billion of debt into mandatory convertible debt. In its 2Q16 earnings release, the company stated that “these debt exchanges have effectively reduced Whiting’s debt by $810 million as of July 27, 2016 by conversion into stock.”