Range Announces Fourth Quarter 2021 Results, 2022 Guidance, Reinstatement of Dividend and Authorization of $500 Million Share Repurchase Program


FORT WORTH, Texas, Feb. 22, 2022 (GLOBE NEWSWIRE) -- RANGE RESOURCES CORPORATION (NYSE: RRC) today announced its fourth quarter 2021 financial results and plans for 2022.

Fourth Quarter and Full-Year 2021 Highlights –

  • Reduced net debt in 2021 by $379 million compared to year-end 2020
  • All-in 2021 capital spending was $414 million, approximately $11 million less than original budget
  • 2021 daily production averaged 2.13 Bcfe per day
  • 2021 NGL realizations averaged a premium of $1.18 per barrel above Mont Belvieu, a Company record
  • 2021 Direct Operating Expense averaged less than $0.10 per mcfe, a Company record
  • Realized maximum payout of $29.5 million from contingent derivative based on 2021 commodity prices
  • PV10 of year-end proved reserves of $12.7 billion, or approximately $40 per share net of debt, assuming NYMEX strip prices at year-end 2021

2022 Guidance and Return of Capital Highlights –

  • Annual cash dividend of $0.32 per share ($0.08 quarterly), or an approximate 1.5% dividend yield based on recent share price, expected to begin in second half 2022
  • Authorization of $500 million share repurchase program, or approximately 10% of outstanding shares based on recent market capitalization, effective immediately
  • 2022 capital budget of $460 to $480 million maintains production at 2.12 to 2.16 Bcfe per day, or approximately $0.60 per mcfe, best in Appalachia
  • 2022 well costs expected to average $625 per lateral foot or less, lowest in Appalachia
  • Free cash flow forecasted to exceed $1 billion in 2022 based on recent strip pricing
  • Leverage, defined as Net-Debt-to-EBITDAX, forecasted at approximately 1.0x at year-end 2022 based on recent strip pricing

Commenting on the results and 2022 plans, Jeff Ventura, the Company’s CEO said, “During 2021, Range generated significant free cash flow, reduced debt, refinanced near-term maturities, lowered well costs, expanded cash margins and delivered our operational plan safely and for less than budgeted.  These results reflect the organization’s continuing focus on capital discipline and further strengthening our financial position as we develop the most prolific natural gas and NGL play in North America.  In 2022, we expect to build upon these achievements, generating over $1 billion of free cash flow at recent strip pricing. Range’s improved financial positioning supports our plan to reinstate our dividend program with a yield that is competitive with the broader market, in addition to authorizing a share repurchase program. Given that our equity is currently valued at approximately one-half of proved reserve value, which excludes any value attributable to multiple decades of core inventory, we believe that share repurchases provide an excellent opportunity to create significant, long-term shareholder value. We look forward to the year ahead, as we generate significant free cash flow, further strengthen our balance sheet, return capital to shareholders and maintain our leadership position on environmental efforts.” 

Reinstatement of Cash Dividend

Range’s Board of Directors has approved the reinstatement of the Company’s regular quarterly cash dividend, with payments expected to start in the second half of 2022, at an anticipated annual dividend rate of $0.32 per share of the Company’s common stock ($0.08 per quarter). Details regarding the record and payment dates for quarterly dividends will be announced as each quarterly dividend is formally declared by the Board.

Authorization of $500 Million Share Repurchase Program

Range’s Board of Directors approved an expansion of the Company’s share repurchase program with $500 million available and effective immediately. This repurchase program, which is equivalent to approximately 10% of Range’s market capitalization, is expected to be funded with free cash flow generation.  

As deemed appropriate by Range management, Range may repurchase shares in the open market from time to time, or in privately negotiated transactions, in compliance with SEC rules and federal securities laws. The authorization under the program does not have a stated expiration date. The repurchase program does not obligate Range to acquire any particular amount of common stock and, in Range’s discretion, it may be modified or discontinued at any time.

Financial Discussion

Except for generally accepted accounting principles (“GAAP”) reported amounts, specific expense categories exclude non-cash impairments, unrealized mark-to-market adjustment on derivatives, non-cash stock compensation and other items shown separately on the attached tables. “Unit costs” as used in this release are composed of direct operating, transportation, gathering, processing and compression, production and ad valorem taxes, general and administrative, interest and depletion, depreciation and amortization costs divided by production. See “Non-GAAP Financial Measures” for a definition of each of the non-GAAP financial measures and the tables that reconcile each of the non-GAAP measures to their most directly comparable GAAP financial measure.

Capital Expenditures

Fourth quarter 2021 drilling and completions expenditures were $83.7 million and $8.6 million was invested in acreage and gathering facilities. Total 2021 capital expenditures were $414 million, including $388 million on drilling and completion, and a combined $26 million on acreage, gas gathering systems and other investments.

Financial Position

In 2021, Range reduced net debt by $379 million. As of December 31, 2021, Range had total debt outstanding of $2.95 billion and $214 million of cash on hand. This was the Company’s fourth consecutive year of debt reduction.   Range had zero borrowings under its credit facility as of year-end 2021, providing liquidity in excess of $2 billion.

In fourth quarter 2021, Range realized a total of $29.5 million in contingent derivative settlement gains related to the North Louisiana divestiture. This represents the maximum amount that Range could receive pertaining to 2021 commodity prices, and Range expects to receive the cash proceeds in the first half of 2022. Range has the potential to receive an additional $45.5 million in contingent payments based on natural gas, NGL and oil prices in 2022 and 2023. At year-end 2021, the fair value of these remaining contingent payments was approximately $26.6 million.

In January 2022, Range issued $500 million aggregate principal amount of 4.75% senior notes due 2030 and used proceeds and cash on hand to redeem all outstanding 9.25% senior notes due 2026. As a result, Range’s interest expense is expected to improve by 25% year-over-year in 2022 to an approximate $0.21 per mcfe annual midpoint average.

Fourth Quarter 2021 Results

GAAP revenues for fourth quarter 2021 totaled $1.57 billion, GAAP net cash provided from operating activities (including changes in working capital) was $318 million, and GAAP net income was $891 million ($3.47 per diluted share).  Fourth quarter earnings results include a $310 million mark-to-market derivative gain due to decreases in commodity prices.

Non-GAAP revenues for fourth quarter 2021 totaled $976 million, and cash flow from operations before changes in working capital, a non-GAAP measure, was $424 million.  Adjusted net income comparable to analysts’ estimates, a non-GAAP measure, was $242 million ($0.96 per diluted share) in fourth quarter 2021.

The following table details Range’s fourth quarter 2021 unit costs per mcfe(a):

Expenses 4Q 2021
(per mcfe)
 3Q 2021
(per mcfe)
   Increase (Decrease)
        
Direct operating $0.09 $0.10  (10%)
Transportation, gathering,
processing and compression
  1.59  1.51  5%
Production and ad valorem taxes  0.05  0.04  25%
General and administrative(a)  0.15  0.16  (6%)
Interest expense(a)  0.27  0.28  (4%)
Total cash unit costs(b)  2.14  2.08  3%
Depletion, depreciation and
amortization (DD&A)
  0.46  0.47  (2%)
Total unit costs plus DD&A(b) $ 2.59 $ 2.56  1%

(a)   Excludes stock-based compensation, legal settlements and amortization of deferred financing costs.
(b)   May not add due to rounding.

The following table details Range’s average production and realized pricing for fourth quarter 2021:

 4Q21 Production & Realized Pricing
  Natural Gas
(Mcf)
 Oil (Bbl)
 NGLs
(Bbl)
 Natural Gas
Equivalent (Mcfe)
         
         
Net production per day 1,533,609 8,674 102,126 2,198,413
         
Average NYMEX price $5.82 $77.02 $36.44  
Differential, including basis hedging (0.44) (6.95) (0.18)  
Realized prices before NYMEX hedges 5.38 70.07 36.26 $5.71
Settled NYMEX hedges (2.11) (17.51) (1.48) (1.61)
Average realized prices after hedges $ 3.27 $ 52.56 $ 34.77 $ 4.10

Fourth quarter 2021 natural gas, NGLs and oil price realizations (including the impact of cash-settled hedges and derivative settlements) averaged $4.10 per mcfe.

  • The average natural gas price, including the impact of basis hedging, was $5.38 per mcf, or a ($0.44) per mcf differential to NYMEX. This represents the highest quarterly pre-hedge natural gas realization since 2014. In addition, Range realized a contingent derivative settlement gain of $20 million related to natural gas prices in 2021.

  • Crude oil and condensate price realizations, before realized hedges, averaged $70.07 per barrel, or $6.95 below WTI (West Texas Intermediate). This represents the highest quarterly pre-hedge condensate realization since 2014. In addition, Range realized a contingent derivative settlement gain of $3.5 million related to WTI prices in 2021.

  • Pre-hedge NGL realizations were $36.26 per barrel, an improvement of $2.21 per barrel versus the third quarter of 2021 and approximately 47% of WTI. This represents the highest quarterly pre-hedge NGL realization since 2013. In addition, Range realized a contingent derivative settlement gain of $6 million related to NGL prices in 2021.

2021 Proved Reserves

Summary of Changes in Proved Reserves
(in Bcfe)
  
Balance at December 31, 2020 17,203 
  
Extensions, discoveries and additions1,603 
Performance revisions134 
Locations re-entered to development plan913 
Reclassification of PUD to unproved under SEC 5-year rule(1,323)
Price revisions23 
Production(778)
  
Balance at December 31, 2021 17,775 
  

As shown in the table below, the present value (PV10) of reserves under SEC methodology was $14.9 billion at December 31, 2021. For comparison, the PV10 using year-end 2021 NYMEX strip average prices of $3.27 per Mmbtu for natural gas and $60.76 per barrel of oil would have been $12.7 billion, assuming the same proven reserve volumes.

 2021 SEC
Reserve

Pricing(a)
Year-End
2021 Strip
Price
(b)
   
Natural Gas Price ($/Mmbtu)$3.60$3.27
WTI Oil Price ($/Bbl)$66.34$60.76
   
Proved Reserves PV10 ($ billions)$14.9$12.7


(a)Average realized prices for estimating year-end 2021 reserves and PV10 were $3.30 per mcf, $59.35 per barrel of crude oil and $28.41 per barrel of NGLs. Updated from prior press release.
(b)Average realized prices for calculating PV10, based on year-end strip pricing, were $3.09 per mcf, $53.40 per barrel of crude oil and $25.63 per barrel of NGLs. Updated from prior press release.

Year-end 2021 reserves included 7.4 Tcfe of proved undeveloped reserves from 360 wells planned to be developed within the next five years with an expected development cost of $0.29 per mcfe. Beyond the five-year reserve calculation window, Range has thousands of high-quality wells in the Marcellus, Utica and Upper Devonian horizons.

2022 Capital Program and Guidance

Range’s 2022 all-in capital budget is expected to be $460 to $480 million. The capital budget includes approximately $425 to $445 million for drilling and recompletions, and $35 million for leasehold and other investments.  The Company expects to turn to sales 54 Marcellus wells in southwest Pennsylvania and nine Marcellus wells in northeast Pennsylvania, which offer compelling returns at strip pricing, as the Company utilizes existing infrastructure. The longest laterals in Range’s 2022 program are in the liquids-rich acreage, with 56% of the lateral feet turned to sales expected in the liquids window.

The table below summarizes expected 2022 activity and 2021 regarding the number of wells to sales in each area.

  Planned Wells
TIL in 2022
 Wells TIL in
2021
SW PA Super-Rich 7 17
SW PA Wet 21 20
SW PA Dry 26 31
NE PA Dry 9 -
Total Appalachia 63 68

In 2021, Range turned to sales 68 wells across its southwest Pennsylvania acreage. This exceeded prior guidance of 60 TILs in 2021, which is the result of efficiency gains that allowed eight wells to be pulled into late December 2021 that were originally planned for early 2022.

The development plan for 2022 is consistent with 2021 as Range is targeting a maintenance program, holding 2021 production approximately flat with annual average production of 2,120 – 2,160 Mmcfe per day. Range’s production guidance incorporates planned third-party downstream maintenance that affects Range’s first half 2022 production by approximately 40 Mmcfe per day and weather-related downtime in February that affected first quarter 2022 by approximately 35 Mmcfe per day. Despite these transient delays, Range is expecting to deliver maintenance production at a capital cost of approximately $0.60 per mcfe, which is expected to be the most efficient program in Appalachia.

Based on recent strip pricing, Range expects pre-hedge NGL price realizations to increase by approximately $5 per barrel in 2022 versus the 2021 average, resulting in an increase of approximately $180 million in annual pre-hedge revenue. As previously disclosed, these higher realized NGL prices will result in slightly higher processing costs, as Range’s processing costs are based on the price received. Net of price-linked processing costs, the increase in forecasted NGL prices is expected to add approximately $140 million in cash flow versus 2021, demonstrating continued strong margin expansion with rising NGL prices. Additionally, in 2022, Range’s gathering costs are expected to improve by approximately $25 million versus 2021, driven by contractual declines in Range’s gathering fees, while contracted gathering capacity remains the same. The decline in gathering costs largely offsets the aforementioned increase in processing costs, such that Range’s 2022 GP&T expense guidance of $1.52 to $1.56 per mcfe is approximately in-line with 2021 GP&T expense per mcfe, despite higher NGL prices. Range expects an additional $25 million in gathering expense savings in 2023 and annual savings of more than $100 million by 2030 when compared to 2021 levels.

Guidance – 2022

Capital & Production Guidance

Range is targeting a maintenance program in 2022, holding production approximately flat at 2.12 – 2.16 Bcfe per day, with ~30% attributed to liquids production. Range’s 2022 all-in capital budget is $460 million - $480 million.

Full Year 2022 Expense Guidance  

Direct operating expense:$0.09 - $0.11 per mcfe
Transportation, gathering, processing and compression expense:$1.52 - $1.56 per mcfe
Production tax expense:$0.03 - $0.05 per mcfe
Exploration expense:$22 - $28 million
G&A expense:$0.15 - $0.17 per mcfe
Interest expense:$0.20 - $0.22 per mcfe
DD&A expense:$0.46 - $0.50 per mcfe
Net brokered gas marketing expense:$8 - $14 million

Full Year 2022 Price Guidance

Based on recent market indications, Range expects to average the following price differentials for its production in 2022.

Natural Gas:(1)NYMEX minus $0.35 to $0.45
Natural Gas Liquids (including ethane):(2)Mont Belvieu plus $0.00 to $2.00 per barrel
Oil/Condensate:WTI minus $6.00 to $8.00

(1) Including basis hedging
(2) Weighting based on 53% ethane, 27% propane, 7% normal butane, 4% iso-butane and 9% natural gasoline.

Hedging Status

Range hedges portions of its expected future production volumes to increase the predictability of cash flow and to help maintain a strong, flexible financial position. In aggregate, Range has approximately 50% of its expected 2022 net revenue hedged. Please see the detailed hedging schedule posted on the Range website under Investor Relations - Financial Information.

Range has also hedged Marcellus and other basis differentials for natural gas and NGL exports to limit volatility between benchmarks and regional prices. The combined fair value of the natural gas basis, NGL freight and spread hedges as of December 31, 2021 was a net gain of $16.2 million.

Conference Call Information

A conference call to review the financial results is scheduled on Wednesday, February 23 at 9:00 a.m. ET. To participate in the call, please dial (877) 928-8777 and provide conference code 7986479 about 10 minutes prior to the scheduled start time.

A simultaneous webcast of the call may be accessed at www.rangeresources.com. The webcast will be archived for replay on the Company's website until March 22.

Non-GAAP Financial Measures

Adjusted net income comparable to analysts’ estimates as set forth in this release represents income or loss from operations before income taxes adjusted for certain non-cash items (detailed in the accompanying table) less income taxes. We believe adjusted net income comparable to analysts’ estimates is calculated on the same basis as analysts’ estimates and that many investors use this published research in making investment decisions and evaluating operational trends of the Company and its performance relative to other oil and gas producing companies. Diluted earnings per share (adjusted) as set forth in this release represents adjusted net income comparable to analysts’ estimates on a diluted per share basis. A table is included which reconciles income or loss from operations to adjusted net income comparable to analysts’ estimates and diluted earnings per share (adjusted). On its website, the Company provides additional comparative information on prior periods along with non-GAAP revenue disclosures.

Cash flow from operations before changes in working capital (sometimes referred to as “adjusted cash flow”) as defined in this release represents net cash provided by operations before changes in working capital and exploration expense adjusted for certain non-cash compensation items. Cash flow from operations before changes in working capital is widely accepted by the investment community as a financial indicator of an oil and gas company’s ability to generate cash to internally fund exploration and development activities and to service debt. Cash flow from operations before changes in working capital is also useful because it is widely used by professional research analysts in valuing, comparing, rating and providing investment recommendations of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Cash flow from operations before changes in working capital is not a measure of financial performance under GAAP and should not be considered as an alternative to cash flows from operations, investing, or financing activities as an indicator of cash flows, or as a measure of liquidity. A table is included which reconciles net cash provided by operations to cash flow from operations before changes in working capital as used in this release. On its website, the Company provides additional comparative information on prior periods for cash flow, cash margins and non-GAAP earnings as used in this release.

The cash prices realized for oil and natural gas production, including the amounts realized on cash-settled derivatives and net of transportation, gathering, processing and compression expense, is a critical component in the Company’s performance tracked by investors and professional research analysts in valuing, comparing, rating and providing investment recommendations and forecasts of companies in the oil and gas exploration and production industry. In turn, many investors use this published research in making investment decisions. Due to the GAAP disclosures of various derivative transactions and third-party transportation, gathering, processing and compression expense, such information is now reported in various lines of the income statement. The Company believes that it is important to furnish a table reflecting the details of the various components of each income statement line to better inform the reader of the details of each amount and provide a summary of the realized cash-settled amounts and third-party transportation, gathering, processing and compression expense, which were historically reported as natural gas, NGLs and oil sales. This information is intended to bridge the gap between various readers’ understanding and fully disclose the information needed.

The Company discloses in this release the detailed components of many of the single line items shown in the GAAP financial statements included in the Company’s Annual Report on Form 10-K. The Company believes that it is important to furnish this detail of the various components comprising each line of the Statements of Operations to better inform the reader of the details of each amount, the changes between periods and the effect on its financial results.
  
We believe that the presentation of PV10 is relevant and useful to our investors as supplemental disclosure to the standardized measure, or after-tax amount, because it presents the discounted future net cash flows attributable to our proved reserves before taking into account future corporate income taxes and our current tax structure. While the standardized measure is dependent on the unique tax situation of each company, PV10 is based on prices and discount factors that are consistent for all companies. Because of this, PV10 can be used within the industry and by creditors and security analysts to evaluate estimated net cash flows from proved reserves on a more comparable basis.

RANGE RESOURCES CORPORATION (NYSE: RRC) is a leading U.S. independent natural gas and NGL producer with operations focused on stacked-pay projects in the Appalachian Basin. The Company is headquartered in Fort Worth, Texas.  More information about Range can be found at www.rangeresources.com.

Included within this release are certain “forward-looking statements” within the meaning of the federal securities laws, including the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, that are not limited to historical facts, but reflect Range’s current beliefs, expectations or intentions regarding future events.  Words such as “may,” “will,” “could,” “should,” “expect,” “plan,” “project,” “intend,” “anticipate,” “believe,” “outlook”, “estimate,” “predict,” “potential,” “pursue,” “target,” “continue,” and similar expressions are intended to identify such forward-looking statements.

All statements, except for statements of historical fact, made within regarding activities, events or developments the Company expects, believes or anticipates will or may occur in the future, such as those regarding future well costs, expected asset sales, well productivity, future liquidity and financial resilience, anticipated exports and related financial impact, NGL market supply and demand, improving commodity fundamentals and pricing, future capital efficiencies, future shareholder value, emerging plays, capital spending, anticipated drilling and completion activity, acreage prospectivity, expected pipeline utilization and future guidance information, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These statements are based on assumptions and estimates that management believes are reasonable based on currently available information; however, management's assumptions and Range's future performance are subject to a wide range of business risks and uncertainties and there is no assurance that these goals and projections can or will be met. Any number of factors could cause actual results to differ materially from those in the forward-looking statements. Further information on risks and uncertainties is available in Range's filings with the Securities and Exchange Commission (SEC), including its most recent Annual Report on Form 10-K. Unless required by law, Range undertakes no obligation to publicly update or revise any forward-looking statements to reflect circumstances or events after the date they are made.

The SEC permits oil and gas companies, in filings made with the SEC, to disclose proved reserves, which are estimates that geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions as well as the option to disclose probable and possible reserves. Range has elected not to disclose its probable and possible reserves in its filings with the SEC. Range uses certain broader terms such as "resource potential,” “unrisked resource potential,” "unproved resource potential" or "upside" or other descriptions of volumes of resources potentially recoverable through additional drilling or recovery techniques that may include probable and possible reserves as defined by the SEC's guidelines. Range has not attempted to distinguish probable and possible reserves from these broader classifications. The SEC’s rules prohibit us from including in filings with the SEC these broader classifications of reserves. These estimates are by their nature more speculative than estimates of proved, probable and possible reserves and accordingly are subject to substantially greater risk of actually being realized. Unproved resource potential refers to Range's internal estimates of hydrocarbon quantities that may be potentially discovered through exploratory drilling or recovered with additional drilling or recovery techniques and have not been reviewed by independent engineers. Unproved resource potential does not constitute reserves within the meaning of the Society of Petroleum Engineer's Petroleum Resource Management System and does not include proved reserves. Area wide unproven resource potential has not been fully risked by Range's management. “EUR”, or estimated ultimate recovery, refers to our management’s estimates of hydrocarbon quantities that may be recovered from a well completed as a producer in the area. These quantities may not necessarily constitute or represent reserves within the meaning of the Society of Petroleum Engineer’s Petroleum Resource Management System or the SEC’s oil and natural gas disclosure rules. Actual quantities that may be recovered from Range's interests could differ substantially. Factors affecting ultimate recovery include the scope of Range's drilling program, which will be directly affected by the availability of capital, drilling and production costs, commodity prices, availability of drilling services and equipment, drilling results, lease expirations, transportation constraints, regulatory approvals, field spacing rules, recoveries of gas in place, length of horizontal laterals, actual drilling results, including geological and mechanical factors affecting recovery rates and other factors. Estimates of resource potential may change significantly as development of our resource plays provides additional data.

In addition, our production forecasts and expectations for future periods are dependent upon many assumptions, including estimates of production decline rates from existing wells and the undertaking and outcome of future drilling activity, which may be affected by significant commodity price declines or drilling cost increases. Investors are urged to consider closely the disclosure in our most recent Annual Report on Form 10-K, available from our website at www.rangeresources.com or by written request to 100 Throckmorton Street, Suite 1200, Fort Worth, Texas 76102. You can also obtain this Form 10-K on the SEC’s website at www.sec.gov or by calling the SEC at 1-800-SEC-0330.

SOURCE: Range Resources Corporation

Range Investor Contacts:

Laith Sando, Vice President – Investor Relations
817-869-4267
lsando@rangeresources.com

Range Media Contacts:

Mark Windle, Director of Corporate Communications
724-873-3223
mwindle@rangeresources.com

RANGE RESOURCES CORPORATION

STATEMENTS OF OPERATIONS                       
Based on GAAP reported earnings with additional                       
details of items included in each line in Form 10-K                       
(Unaudited, in thousands, except per share data)                       
                        
 Three Months Ended December 31, Twelve Months Ended December 31,
  2021   2020   %   2021   2020   % 
                        
Revenues and other income:                       
Natural gas, NGLs and oil sales (a)$1,140,520  $444,806      $3,215,027  $1,607,713     
Derivative fair value income (loss) 309,566   85,529       (650,216)  187,711     
Brokered natural gas, marketing and other (b) 116,692   67,771       364,029   171,622     
ARO settlement loss (b)    (4)      (3)  (22)    
Other (b) 52   784       1,386   1,673     
Total revenues and other income 1,566,830   598,886   162%  2,930,223   1,968,697   49%
                        
Costs and expenses:                       
Direct operating 17,310   15,945       73,977   91,079     
Direct operating – stock-based compensation (c) 324   268       1,310   1,078     
Transportation, gathering, processing and compression 320,785   256,742       1,174,469   1,088,490     
Production and ad valorem taxes 9,138   3,935       29,317   24,617     
Brokered natural gas and marketing 119,656   69,053       365,494   186,900     
Brokered natural gas and marketing – stock-based compensation (c) 455   511       1,794   1,416     
Exploration 6,717   9,076       22,048   31,375     
Exploration – non-cash stock-based compensation (c) 391   388       1,507   1,279     
Abandonment and impairment of unproved properties    2,730       7,206   19,334     
General and administrative 30,708   31,307       121,008   123,859     
General and administrative – stock-based compensation (c) 11,041   8,834       39,673   32,905     
General and administrative – lawsuit settlements 510   579       8,885   2,251     
General and administrative – bad debt expense 200          200   400     
Exit and termination costs 12,104   13,739       21,661   545,244     
Exit and termination costs – stock-based compensation (c)    145          2,165     
Deferred compensation plan (d) (21,200)  2,254       68,351   12,541     
Interest expense 54,004   46,389       218,043   184,201     
Interest expense – amortization of deferred financing costs (e) 2,358   2,137       9,293   8,466     
Gain on early extinguishment of debt    25       98   (14,068)    
Depletion, depreciation and amortization 92,427   90,551       364,555   394,330     
Impairment of proved property              78,955     
Loss (gain) on sale of assets 23   1,652       (701)  (110,791)    
Total costs and expenses 656,951   556,260   18%  2,528,188   2,706,026   -7%
                        
Income (loss) before income taxes 909,879   42,626   2035%  402,035   (737,329)  155%
                        
Income tax expense (benefit):                       
Current 763   (157)      7,984   (523)    
Deferred 17,750   4,382       (17,727)  (25,029)    
  18,513   4,225       (9,743)  (25,552)    
                        
Net income (loss)$891,366  $38,401   2221% $411,778  $(711,777)  158%
                        
Net Income (Loss) Per Common Share:                       
Basic$3.57  $0.16      $1.65  $(2.95)    
Diluted$3.47  $0.15      $1.61  $(2.95)    
                        
Weighted average common shares outstanding, as reported:                       
Basic 243,369   240,174   1%  242,862   241,373   1%
Diluted 250,441   246,286   2%  249,314   241,373   3%


(a)See separate natural gas, NGLs and oil sales information table.
(b)Included in Brokered natural gas, marketing and other revenues in the 10-K.
(c)Costs associated with stock compensation and restricted stock amortization, which have been reflected in the categories associated with the direct personnel costs, which are combined with the cash costs in the 10-K.
(d)Reflects the change in market value of the vested Company stock held in the deferred compensation plan.
(e)Included in interest expense in the 10-K.


RANGE RESOURCES CORPORATION

BALANCE SHEETS       
(In thousands) December 31,   December 31, 
  2021   2020 
  (Audited)   (Audited) 
Assets       
Current assets$730,927  $266,508 
Derivative assets 44,339   40,012 
Natural gas and oil properties, successful efforts method 5,754,656   5,686,809 
Transportation and field assets 3,494   4,161 
Operating lease right-of-use assets 40,832   63,581 
Other 86,259   75,865 
 $6,660,507  $6,136,936 
        
Liabilities and Stockholders’ Equity       
Current liabilities$984,388  $673,445 
Asset retirement obligations 5,310   6,689 
Derivative liabilities 162,767   26,707 
        
Bank debt    693,123 
Senior notes 2,707,770   2,329,745 
Senior subordinated notes    17,384 
Total debt 2,707,770   3,040,252 
        
Deferred tax liability 117,642   135,267 
Derivative liabilities 8,216   9,746 
Deferred compensation liability 137,102   81,481 
Operating lease liabilities 24,861   43,155 
Asset retirement obligations and other liabilities 101,509   91,157 
Divestiture contract obligation 325,279   391,502 
        
Common stock and retained earnings 2,115,820   1,668,146 
Other comprehensive loss (150)  (479)
Common stock held in treasury stock (30,007)  (30,132)
Total stockholders’ equity 2,085,663   1,637,535 
 $6,660,507  $6,136,936 


RECONCILIATION OF TOTAL REVENUES AND
OTHER INCOME TO TOTAL REVENUE
EXCLUDING CERTAIN ITEMS, a non-GAAP measure
(Unaudited, in thousands)   
 Three Months Ended December 31, Twelve Months Ended December 31,
  2021   2020  %   2021   2020  % 
                      
Total revenues and other income, as reported$1,566,830  $598,886  162% $2,930,223  $1,968,697  49%
Adjustment for certain special items:                     
Total change in fair value related to derivatives prior to settlement (gain) loss (590,414)  (68,143)     130,203   134,918    
ARO settlement loss    4      3   22    
Total revenues, as adjusted, non-GAAP$976,416  $530,747  84% $3,060,429  $2,103,637  46%


RANGE RESOURCES CORPORATION

CASH FLOWS FROM OPERATING ACTIVITIES               
(Unaudited in thousands)               
                
  Three Months Ended December 31,   Twelve Months Ended December 31, 
  2021   2020   2021   2020 
                
Net income (loss)$891,366  $38,401  $411,778  $(711,777)
Adjustments to reconcile net cash provided from continuing operations:               
Deferred income tax expense (benefit) 17,750   4,382   (17,727)  (25,029)
Depletion, depreciation, amortization and impairment 92,427   90,551   364,555   473,285 
Exploration dry hole and impairment costs    888      888 
Abandonment and impairment of unproved properties    2,730   7,206   19,334 
Derivative fair value (income) loss (309,566)  (85,529)  650,216   (187,711)
Cash settlements on derivative financial instruments (280,848)  17,386   (520,013)  322,629 
Divestiture contract obligation, including accretion, net of gain 11,873   13,245   20,340   499,934 
Allowance for bad debts 200      200   400 
Amortization of deferred issuance costs and other 2,094   1,896   8,347   6,919 
Deferred and stock-based compensation (9,590)  10,172   110,356   48,552 
Loss (gain) on sale of assets and other 23   1,652   (701)  (110,791)
Loss (gain) on early extinguishment of debt    25   98   (14,068)
                
Changes in working capital:               
Accounts receivable (134,334)  (66,804)  (250,538)  24,539 
Other current assets 2,434   6,796   (1,140)  1,010 
Accounts payable 4,918   20,134   39,231   (32,686)
Accrued liabilities and other 28,912   33,781   (29,260)  (46,748)
Net changes in working capital (98,070)  (6,093)  (241,707)  (53,885)
Net cash provided from operating activities$317,659  $89,706  $792,948  $268,680 
                
                
                
RECONCILIATION OF NET CASH PROVIDED FROM OPERATING
ACTIVITIES, AS REPORTED, TO CASH FLOW FROM OPERATIONS
BEFORE CHANGES IN WORKING CAPITAL, a non-GAAP measure
               
(Unaudited, in thousands)               
                
  Three Months Ended December 31,   Twelve Months Ended December 31, 
  2021   2020   2021   2020 
Net cash provided from operating activities, as reported$317,659  $89,706  $792,948  $268,680 
Net changes in working capital 98,070   6,093   241,707   53,885 
Exploration expense 6,717   8,188   22,048   30,487 
Lawsuit settlements 510   579   8,885   2,251 
Exit and termination costs – severance costs only    271   394   5,908 
One-time midstream termination payment          28,500 
Accrued transportation contract release    222      10,900 
Non-cash compensation adjustment and other 1,096   2,474   4,155   4,403 
Cash flow from operations before changes in working capital – non-GAAP measure$424,052  $107,533  $1,070,137  $405,014 
                
                
                
ADJUSTED WEIGHTED AVERAGE SHARES OUTSTANDING               
(Unaudited, in thousands)               
                
  Three Months Ended December 31,   Twelve Months Ended December 31, 
  2021   2020   2021   2020 
Basic:               
Weighted average shares outstanding 249,794   246,320   249,400   247,050 
Stock held by deferred compensation plan (6,425)  (6,146)  (6,538)  (5,677)
Adjusted basic 243,369   240,174   242,862   241,373 
                
Dilutive:               
Weighted average shares outstanding 249,794   246,320   249,400   247,050 
Dilutive stock options under treasury method 647   (34)  (86)  (5,677)
Adjusted dilutive 250,441   246,286   249,314   241,373 
                


RANGE RESOURCES CORPORATION

RECONCILIATION OF NATURAL GAS, NGLs AND OIL SALES
AND DERIVATIVE FAIR VALUE INCOME (LOSS) TO
CALCULATED CASH REALIZED NATURAL GAS, NGLs AND
OIL PRICES WITH AND WITHOUT THIRD PARTY
TRANSPORTATION, GATHERING AND COMPRESSION FEES,
a non-GAAP measure
(Unaudited, in thousands, except per unit data)     
 Three Months Ended December 31,  Twelve Months Ended December 31, 
  2021   2020  %   2021   2020  % 
Natural gas, NGL and oil sales components:                     
Natural gas sales$743,948  $264,646     $1,896,231  $943,740    
NGL sales 340,653   161,569      1,135,826   578,454    
Oil sales 55,919   18,591      182,970   85,519    
Total oil and gas sales, as reported$1,140,520  $444,806  156% $3,215,027  $1,607,713  100%
                      
Derivative fair value income (loss), as reported:$309,566  $85,529     $(650,216) $187,711    
Cash settlements on derivative financial instruments – loss (gain):                     
Natural gas 282,434   (13,753)     415,228   (258,797)   
NGLs 13,939   4,745      91,838   (11,288)   
Crude Oil 13,975   (8,378)     42,447   (52,544)   
Contingent consideration - divestiture (29,500)        (29,500)      
Total change in fair value related to commodity derivatives prior to settlement, a non-GAAP measure$590,414  $68,143     $(130,203) $(134,918)   
                      
Transportation, gathering, processing and compression components:                     
Natural gas$175,828  $155,766     $661,990  $650,071    
NGLs 144,920   100,986      511,568   437,474    
Oil 37   (7)     911   945    
Total transportation, gathering, processing and compression, as reported$320,785  $256,745     $1,174,469  $1,088,490    
                      
Natural gas, NGL and oil sales, including cash-settled derivatives: (c)                     
Natural gas sales$461,514  $278,399     $1,481,003  $1,202,537    
NGL sales 326,714   156,824      1,043,988   589,742    
Oil sales 41,944   26,969      140,523   138,063    
Total$830,172  $462,192  80% $2,665,514  $1,930,342  38%
                      
Production of oil and gas during the periods: (a)                     
Natural gas (mcf) 141,092,053   134,764,765  5%  541,021,442   574,529,290  -6%
NGL (bbl) 9,395,605   8,965,697  5%  36,372,862   37,491,546  -3%
Oil (bbl) 798,054   584,754  36%  3,044,026   2,829,495  8%
Gas equivalent (mcfe) (b) 202,254,009   192,067,471  5%  777,522,772   816,455,536  -5%
                      
Production of oil and gas – average per day: (a)                     
Natural gas (mcf) 1,533,609   1,464,834  5%  1,482,251   1,569,752  -6%
NGL (bbl) 102,126   97,453  5%  99,652   102,436  -3%
Oil (bbl) 8,674   6,356  36%  8,340   7,731  8%
Gas equivalent (mcfe) (b) 2,198,413   2,087,690  5%  2,130,199   2,230,753  -5%
                      
Average prices, excluding derivative settlements and before third party transportation costs:                     
Natural gas (mcf)$5.27  $1.96  169% $3.50  $1.64  113%
NGL (bbl)$36.26  $18.02  101% $31.23  $15.43  102%
Oil (bbl)$70.07  $31.79  120% $60.11  $30.22  99%
Gas equivalent (mcfe) (b)$5.64  $2.32  143% $4.13  $1.97  110%
                      
Average prices, including derivative settlements before third party transportation costs: (c)                     
Natural gas (mcf)$3.27  $2.07  58% $2.74  $2.09  31%
NGL (bbl)$34.77  $17.49  99% $28.70  $15.73  82%
Oil (bbl)$52.56  $46.12  14% $46.16  $48.79  -5%
Gas equivalent (mcfe) (b)$4.10  $2.41  71% $3.43  $2.36  45%
                      
Average prices, including derivative settlements and after third party transportation costs: (d)                     
Natural gas (mcf)$2.02  $0.91  123% $1.51  $0.96  57%
NGL (bbl)$19.35  $6.23  211% $14.64  $4.06  260%
Oil (bbl)$52.51  $46.13  14% $45.86  $48.46  -5%
Gas equivalent (mcfe) (b)$2.52  $1.07  134% $1.92  $1.03  86%
                      
Transportation, gathering and compression expense per mcfe$1.59  $1.34  19% $1.51  $1.33  13%


(a)Represents volumes sold regardless of when produced.
(b)Oil and NGLs are converted at the rate of one barrel equals six mcfe based upon the approximate relative energy content of oil to natural gas, which is not necessarily indicative of the relationship of oil and natural gas prices.
(c)Excluding third party transportation, gathering and compression costs.
(d)Net of transportation, gathering, processing and compression costs.


RANGE RESOURCES CORPORATION

RECONCILIATION OF INCOME BEFORE INCOME TAXES
AS REPORTED TO INCOME BEFORE INCOME TAXES
EXCLUDING CERTAIN ITEMS, a non-GAAP measure
(Unaudited, in thousands, except per share data)
 
 Three Months Ended
December 31,
 Twelve Months Ended
December 31,
  2021   2020   2021   2020 
                
Income (loss) from operations before income taxes, as reported$909,879  $42,626  $402,035  $(737,329)
Adjustment for certain special items:               
Loss (gain) on sale of assets 23   1,652   (701)  (110,791)
Loss (gain) on ARO settlements    4   3   22 
Change in fair value related to derivatives prior to settlement (590,414)  (68,143)  130,203   134,918 
Abandonment and impairment of unproved properties    2,730   7,206   19,334 
Loss (gain) on early extinguishment of debt    25   98   (14,068)
Impairment of proved property and other assets          78,955 
Lawsuit settlements 510   579   8,885   2,251 
Exit and termination costs 12,104   13,739   21,661   545,244 
Exit and termination costs – non-cash stock-based compensation    145      2,165 
Brokered natural gas and marketing – non-cash stock-based compensation 455   511   1,794   1,416 
Direct operating – non-cash stock-based compensation 324   268   1,310   1,078 
Exploration expenses – non-cash stock-based compensation 391   388   1,507   1,279 
General & administrative – non-cash stock-based compensation 11,041   8,834   39,673   32,905 
Deferred compensation plan – non-cash adjustment (21,200)  2,254   68,351   12,541 
                
Income (loss) before income taxes, as adjusted 323,113   5,612   682,025   (30,080)
                
Income tax expense (benefit), as adjusted               
Current 763   (157)  7,984   (523)
Deferred (a) 80,778   1,403   170,506   (7,520)
Net income (loss) excluding certain items, a non-GAAP measure$241,572  $4,366  $503,535  $(22,037)
                
Non-GAAP income (loss) per common share               
Basic$0.99  $0.02  $2.07  $(0.09)
Diluted$0.96  $0.02  $2.02  $(0.09)
                
Non-GAAP diluted shares outstanding, if dilutive 250,441   246,286   249,314   241,373 
                
(a)  Deferred taxes are estimated to be approximately 25% for 2021 and 2020.     


RANGE RESOURCES CORPORATION

RECONCILIATION OF NET INCOME (LOSS), EXCLUDING
CERTAIN ITEMS AND ADJUSTED EARNINGS PER SHARE, non-GAAP measures
               
(In thousands, except per share data)               
                
 Three Months Ended
December 31,
 Twelve Months Ended
December 31,
 2021  2020  2021  2020 
                
Net income (loss), as reported$891,366  $38,401  $411,778  $(711,777)
Adjustment for certain special items:               
Loss (gain) on sale of assets 23   1,652   (701)  (110,791)
Loss (gain) on ARO settlements    4   3   22 
Loss (gain) on early extinguishment of debt    25   98   (14,068)
Change in fair value related to derivatives prior to settlement (590,414)  (68,143)  130,203   134,918 
Impairment of proved property          78,955 
Abandonment and impairment of unproved properties    2,730   7,206   19,334 
Lawsuit settlements 510   579   8,885   2,251 
Exit and termination costs 12,104   13,739   21,661   545,244 
Non-cash stock-based compensation 12,211   10,146   44,284   38,843 
Deferred compensation plan (21,200)  2,254   68,351   12,541 
Tax Impact (63,028)  2,979   (188,233)  (17,509)
                
Net income (loss) excluding certain items, a non-GAAP measure$241,572  $4,366  $503,535  $(22,037)
                
Net income (loss) per diluted share, as reported$3.47  $0.15  $1.61  $(2.95)
Adjustment for certain special items per diluted share:               
Loss (gain) on sale of assets 0.00   0.01   (0.00)  (0.46)
Loss (gain) on ARO settlements    0.00   0.00   0.00 
Loss (gain) on early extinguishment of debt    0.00   0.00   (0.06)
Change in fair value related to derivatives prior to settlement (2.36)  (0.28)  0.52   0.56 
Impairment of proved property and other assets          0.33 
Abandonment and impairment of unproved properties    0.01   0.03   0.08 
Lawsuit settlements 0.00   0.00   0.04   0.01 
Exit and termination costs 0.05   0.06   0.09   2.26 
Non-cash stock-based compensation 0.05   0.04   0.18   0.16 
Deferred compensation plan (0.08)  0.01   0.27   0.05 
Adjustment for rounding differences           
Tax Impact (0.25)  0.01   (0.76)  (0.07)
Dilutive impact of participating securities (rabbi trust) 0.08      0.04    
                
Net income (loss) per diluted share, excluding certain items, a non-GAAP measure$0.96  $0.01  $2.02  $(0.09)
                
Adjusted earnings per share, a non-GAAP measure:               
Basic$0.99  $0.01  $2.07  $(0.09)
Diluted$0.96  $0.01  $2.02  $(0.09)
                


RANGE RESOURCES CORPORATION

RECONCILIATION OF CASH MARGIN PER MCFE, a non-
GAAP measure
               
(Unaudited, in thousands, except per unit data)               
 Three Months Ended
December 31,
  Twelve Months Ended
December 31,
 
 2021  2020  2021  2020 
                
Revenues               
Natural gas, NGL and oil sales, as reported$1,140,520  $444,806  $3,215,027  $1,607,713 
Derivative fair value income (loss), as reported 309,566   85,529   (650,216)  187,711 
Less non-cash fair value (gain) loss (590,414)  (68,143)  130,203   134,918 
Brokered natural gas and marketing and other, as reported 116,744   68,551   365,412   173,273 
Less ARO settlement and other (gains) losses (52)  (780)  (1,383)  (1,651)
Cash revenue applicable to production 976,364   529,963   3,059,043   2,101,964 
                
Expenses               
Direct operating, as reported 17,634   16,213   75,287   92,157 
Less direct operating stock-based compensation (324)  (268)  (1,310)  (1,078)
Transportation, gathering and compression, as reported 320,785   256,742   1,174,469   1,088,490 
Production and ad valorem taxes, as reported 9,138   3,935   29,317   24,617 
Brokered natural gas and marketing, as reported 120,111   69,564   367,288   188,316 
Less brokered natural gas and marketing stock-based compensation (455)  (511)  (1,794)  (1,416)
General and administrative, as reported 42,459   40,720   169,766   159,415 
Less G&A stock-based compensation (11,041)  (8,834)  (39,673)  (32,905)
Less lawsuit settlements (510)  (579)  (8,885)  (2,251)
Interest expense, as reported 56,362   48,526   227,336   192,667 
Less amortization of deferred financing costs (2,358)  (2,137)  (9,293)  (8,466)
Cash expenses 551,801   423,371   1,982,508   1,699,546 
                
Cash margin, a non-GAAP measure$424,563  $106,592  $1,076,535  $402,418 
                
Mmcfe produced during period 202,254   192,067   777,523   816,456 
                
Cash margin per mcfe$2.10  $0.55  $1.38  $0.49 
                
                
RECONCILIATION OF INCOME (LOSS) BEFORE INCOME
TAXES TO CASH MARGIN
               
(Unaudited, in thousands, except per unit data)               
 Three Months Ended
December 31,
  Twelve Months Ended
December 31,
 
 2021  2020  2021  2020 
                
Income (loss) before income taxes, as reported$909,879  $42,626  $402,035  $(737,329)
Adjustments to reconcile income (loss) before income taxes to cash margin:               
ARO settlements and other gains (52)  (780)  (1,383)  (1,651)
Derivative fair value (income) loss (309,566)  (85,529)  650,216   (187,711)
Net cash (payments) receipts on derivative settlements (280,848)  17,386   (520,013)  322,629 
Exploration expense 6,717   9,076   22,048   31,375 
Lawsuit settlements 510   579   8,885   2,251 
Exit and termination costs 12,104   13,739   21,661   545,244 
Deferred compensation plan (21,200)  2,254   68,351   12,541 
Stock-based compensation (direct operating, brokered natural gas
and marketing, general and administrative and termination costs)
 12,211   10,146   44,284   38,843 
Interest – amortization of deferred financing costs 2,358   2,137   9,293   8,466 
Depletion, depreciation and amortization 92,427   90,551   364,555   394,330 
Loss (gain) loss on sale of assets 23   1,652   (701)  (110,791)
Loss (gain) on early extinguishment of debt    25   98   (14,068)
Impairment of proved property          78,955 
Abandonment and impairment of unproved properties    2,730   7,206   19,334 
Cash margin, a non-GAAP measure$424,563  $106,592  $1,076,535  $402,418