=Chesapeake Energy (CHK) reported earnings on Thur 3 Nov 2016 (b/o)

Chesapeake Energy beats by $0.13, beats on revs; announces Q4 production guidance  :

• Reports Q3 (Sep) earnings of $0.09 per share, excluding non-recurring items, $0.13 better than the Capital IQ Consensus of ($0.04); revenues fell 32.6% year/year to $2.28 bln vs the $1.01 bln Capital IQ Consensus.
  • Chesapeake's revenues declined by 33% year over year due to a decrease in the average realized commodity prices received for its production, lower production volumes and a decrease in the volumes sold and prices received by the company's marketing affiliate on behalf of third-party producers.
  • 2016 third quarter avg production was 638,100 boe per day.
  • Fourth quarter oil production projected to be 90,000 to 95,000 barrels per day
• Total liquidity following Barnett Shale closing of approximately $3.7 bln.
• Co notes that over 60% and 50% of projected natural gas and oil production, respectively, hedged in 2017.
• As of Sept 30, 2016, Chesapeake's debt principal balance was ~$8.7 bln, including approximately $240 mln of borrowings outstanding on the company's revolving credit facility, compared to $9.7 bln as of Dec 31, 2015, and $11.7 bln as of Sept 30, 2015.
• Production guidance:
  • Chesapeake currently expects its exit rate production to grow significantly over the next two years. The company is currently projecting an exit-to-exit increase in total production from the fourth quarter of 2016 to the fourth quarter of 2017 of approximately 7%, adjusted for asset sales. More importantly, the company is projecting an exit-to-exit increase in its oil production from the fourth quarter of 2016 to the fourth quarter of 2017 of approximately 10%. For 2018, the company is currently projecting an increase in its total production from the fourth quarter of 2017 to the fourth quarter of 2018 of approximately 15%, primarily driven by an exit-to-exit increase in its oil production from the fourth quarter of 2017 to the fourth quarter of 2018 of approximately 20%. Chesapeake's projected growth rates are preliminary and its flexible capital expenditure program will be adjusted based on prevailing market conditions and are subject to final capital allocation decisions for 2017 and 2018.