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Talos Energy Inc. (TALO) SEC Filing 10-Q Quarterly report for the period ending Tuesday, March 31, 2020

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TALO Quarterly Reports

Talos Energy Inc.

CIK: 1724965 Ticker: TALO

Exhibit 99.1

 

LOGO

TALOS ENERGY ANNOUNCES FIRST QUARTER 2020 FINANCIAL AND OPERATIONAL RESULTS AS WELL AS UPDATED 2020 GUIDANCE

Houston, Texas, May 6, 2020 – Talos Energy Inc. (“Talos,” or the “Company”) (NYSE: TALO) today announced its financial and operational results for the first quarter of 2020, provided an operations update and updated its 2020 guidance. Results for the first quarter of 2020 include one month of results from the Company’s recent acquisitions of affiliates of ILX Holdings, among other entities (the “Acquired Assets,” the “Acquisition,” or the “Transaction”), which closed on February 28, 2020.

Key Highlights:

 

   

Production of 58.1 thousand barrels of oil equivalent per day (“MBoe/d”), of which 70% was oil and 78% was liquids. March production, which included a full month of production from the Acquired Assets, averaged 70.3 MBoe/d.

 

   

Net Income of $157.7 million, or $2.69 earnings per share – diluted, and Adjusted Net Income(1) of $15.6 million, or $0.27 adjusted earnings per share – diluted. Net Income for the quarter includes approximately $55.3 million of non-cash income tax expenses.

 

   

Adjusted EBITDA(1) of $147.6 million. Adjusted EBITDA Margin(1) per Boe of $27.92, or 81%.

 

   

Capital expenditures, inclusive of plugging and abandonment costs, were $73.2 million.

 

   

Free Cash Flow(1) of $48.6 million.

 

   

Average realized oil price(3) of $44.72/Bbl before hedges and net of transport and quality deductions. The Company has approximately 10.3 million barrels of oil hedged for the remainder of 2020 with a weighted average price of $47.29 per barrel WTI.

 

   

Talos closed the acquisition of affiliates of ILX Holdings, among other entities, on February 28, 2020. The Acquired Assets generated average daily production of 19.7 MBoe/d for the full first quarter of 2020.

 

   

As of March 31, 2020, liquidity position of $593.4 million. Net Debt to LTM Adjusted EBITDA(1) was 1.5x. Inclusive of eleven months of Acquired Assets contribution, Net Debt to Credit Facility LTM Adjusted EBITDA(1), as determined in accordance with the Company’s credit agreement, would have been 1.2x.

 

  (1)

Adjusted Net Income, Adjusted Earnings per Share, Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Credit Facility LTM Adjusted EBITDA and Net Debt to LTM Adjusted EBITDA are non-GAAP financial measures. See “Supplemental Non-GAAP Information” below for additional detail and reconciliations of GAAP to non-GAAP measures.

President and Chief Executive Officer Timothy S. Duncan commented: “Talos generated strong results in the first quarter of 2020, with solid production, healthy margins and material free cash flow. We’ve expanded our asset base and are beginning to realize the benefits of our recently-closed acquisition in March. However, the end of the quarter also brought unforeseen and unprecedented challenges to our industry, from the COVID-19 virus, the impact of a sudden and historic drop in global oil demand and concerns from Saudi Arabia and Russia oversupply in the early moments of the crisis. Despite these challenges, I’m proud of how we have responded and how we are maintaining the health of our Company.”

“First and foremost, we have kept our workforce safe with robust onboard screening and social distancing measures for our offshore workers while also having our corporate employees work from home. Second, we instituted cost cutting measures that provide material reductions from our initial 2020 guidance and our pro forma 2019 cost structure. We have reduced our 2020 capital program by approximately 40% and our operating and overhead cost structure by approximately 15% compared to pro forma 2019 levels, and we expect those levels to continue to improve throughout the year. We also increased the size of our hedge book, with approximately 80% of the mid-point of our updated 2020 oil production guidance hedged over the full year at a weighted average price for the remainder of the year of $47.29/bbl. The projects remaining in our capital program this year aim to utilize our infrastructure to continue to generate attractive economics even in the current commodity environment, continue to lower our unit operating cost structure and add collateral value as we move into the second half of the year.”

Duncan continued: “Although we expect the second quarter to be difficult for everyone in the oil and gas sector, we are positioning Talos to have a strong second half of 2020 and beyond. We will be prepared for whichever direction the commodity market turns, and we believe we will have positive free cash flow in 2020, inclusive of our hedges, in the current commodity price environment. I remain confident in our ability to create value during uncertain times.”

 

TALOS ENERGY INC.    333 Clay St., Suite 3300, Houston, TX 77002


The following information was filed by Talos Energy Inc. (TALO) on Thursday, May 7, 2020 as an 8K 2.02 statement, which is an earnings press release pertaining to results of operations and financial condition. It may be helpful to assess the quality of management by comparing the information in the press release to the information in the accompanying 10-Q Quarterly Report statement of earnings and operation as management may choose to highlight particular information in the press release.

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Financial Statements, Disclosures and Schedules

Inside this 10-Q Quarterly Report

Document And Entity Information
Condensed Consolidated Balance Sheets
Condensed Consolidated Balance Sheets (Parenthetical)
Condensed Consolidated Statements Of Cash Flows
Condensed Consolidated Statements Of Changes In Stockholders' Equity
Condensed Consolidated Statements Of Operations
Acquisitions
Acquisitions (Tables)
Acquisitions - Asset Acquisitions - Additional Information (Details)
Acquisitions - Asset Acquisitions - Summary Of Allocation Of Purchase Price To Assets Acquired And Liabilities Assumed (Details)
Acquisitions - Business Combination - Additional Information (Details)
Acquisitions - Business Combination - Summary Of Allocation Of Purchase Price To Assets Acquired And Liabilities Assumed (Details)
Acquisitions - Business Combination - Summary Of Allocation Of Purchase Price To Assets Acquired And Liabilities Assumed (Parenthetical) (Details)
Acquisitions - Business Combination - Summary Of Revenue And Net Income Attributable To Assets Acquired (Details)
Acquisitions - Business Combination - Summary Of Supplemental Proforma Information (Details)
Acquisitions - Summary Of Purchase Price, Subject To Customary Post-Closing Adjustments (Details)
Commitments And Contingencies
Commitments And Contingencies - Additional Information (Details)
Condensed Consolidating Financial Information
Condensed Consolidating Financial Information (Tables)
Condensed Consolidating Financial Information - Additional Information (Details)
Condensed Consolidating Financial Information - Summary Of Condensed Consolidating Cash Flows (Details)
Condensed Consolidating Financial Information - Summary Of Condensed Consolidating Financial Position (Details)
Condensed Consolidating Financial Information - Summary Of Condensed Consolidating Results Of Operations (Details)
Debt
Debt (Tables)
Debt - Additional Information (Details)
Debt - Summary Of Detail Comprising Debt And Related Book Values (Details)
Debt - Summary Of Detail Comprising Debt And Related Book Values (Parenthetical) (Details)
Employee Benefits Plans And Share-Based Compensation
Employee Benefits Plans And Share-Based Compensation (Tables)
Employee Benefits Plans And Share-Based Compensation - Additional Information (Details)
Employee Benefits Plans And Share-Based Compensation - Schedule Of Recognized Share Based Compensation Expense, Net (Details)
Employee Benefits Plans And Share-Based Compensation - Schedule Of Restricted Stock And Performance Share Units Activity (Details)
Employee Benefits Plans And Share-Based Compensation - Summary Of Assumptions Used To Calculate The Grant Date Fair Value (Details)
Financial Instruments
Financial Instruments (Tables)
Financial Instruments - Additional Information (Details)
Financial Instruments - Schedule Of Carrying Amounts And Estimated Fair Values Of Financial Instruments (Details)
Financial Instruments - Schedule Of Carrying Amounts And Estimated Fair Values Of Financial Instruments (Parenthetical) (Details)
Financial Instruments - Schedule Of Contracted Volumes And Weighted Average Prices And Will Receive Under The Terms Of Derivative Contracts (Details)
Financial Instruments - Schedule Of Fair Value Of Derivative Financial Instruments (Details)
Financial Instruments - Schedule Of Impact That Derivatives Not Qualifying As Hedging Instruments In Condensed Consolidated Statements Of Operations (Details)
Financial Instruments - Summary Of Additional Information Related To Financial Instruments Measured At Fair Value On Recurring Basis (Details)
Formation And Basis Of Presentation
Formation And Basis Of Presentation (Policies)
Formation And Basis Of Presentation - Additional Information (Details)
Income (Loss) Per Share
Income (Loss) Per Share (Tables)
Income (Loss) Per Share - Summary Of Computation Of Basic And Diluted Income (Loss) Per Share (Details)
Income Taxes
Income Taxes - Additional Information (Details)
Leases
Leases (Tables)
Leases - Components Of Lease Costs (Details)
Leases - Schedule Of Lease Maturity (Details)
Leases - Schedule Of Right-Of-Use Asset And Liability, Adjusted For Initial Direct Costs And Incentives (Details)
Leases - Schedule Of Weighted Average Remaining Lease Term And Discount Rate (Details)
Leases - Supplemental Cash Flow Information Related To Leases (Details)
Property, Plant And Equipment
Property, Plant And Equipment (Tables)
Property, Plant And Equipment - Additional Information (Details)
Property, Plant And Equipment - Schedule Of Asset Retirement Obligations (Details)
Property, Plant And Equipment - Schedule Of Asset Retirement Obligations (Parenthetical) (Details)
Related Party Transactions
Related Party Transactions - Additional Information (Details)
Subsequent Events

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Talos Energy Inc. provided additional information to their SEC Filing as exhibits

Ticker: TALO
CIK: 1724965
Form Type: 10-Q Quarterly Report
Accession Number: 0001564590-20-022083
Submitted to the SEC: Wed May 06 2020 5:47:11 PM EST
Accepted by the SEC: Thu May 07 2020
Period: Tuesday, March 31, 2020
Industry: Crude Petroleum And Natural Gas

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