Unit Corporation Reports Year End and Fourth Quarter Results

On March 14, 2024, Unit Corporation (OTCQX: UNTC) (Company) filed consolidated financial statements for the twelve months ended December 31, 2023 with OTC Markets Group Inc. (OTC). The Company’s current, quarterly, and annual reports may be accessed on the OTC’s website at https://www.otcmarkets.com/stock/UNTC/disclosure, as well as the Company’s website at https://unitcorp.com/investor-relations/otc-sec-filings/.

Fourth Quarter and Year End Results

Net income attributable to Unit Corporation for the three months ended December 31, 2023 was $57.4 million, or $5.79 per diluted share, compared to $59.3 million, or $6.07 per diluted share, for the three months ended December 31, 2022. Total revenues for the three months ended December 31, 2023 was $74.6 million, compared to $102.3 million for the three months ended December 31, 2022.

For the twelve months ended December 31, 2023, net income attributable to Unit Corporation was $248.9 million, or $25.32 per diluted share, compared to $148.4 million, or $14.78 per diluted share, for the twelve months ended December 31, 2022. Total revenues for the twelve months ended December 31, 2023 was $327.3 million, compared to $545.5 million for the twelve months ended December 31, 2022.

“This was an important year for Unit as we paid a total of $37.50 per share in cash dividends during 2023, returning cash to shareholders that had been generated from our past operations as well as from divestitures of certain non-core assets,” stated Phil Frohlich, the Company’s Chief Executive Officer. “Looking forward, we expect to continue to return value to shareholders through future quarterly cash dividends, as well as through additional future special cash dividends if deemed appropriate based on future results and circumstances."

The Company announced on March 7, 2024 that a quarterly cash dividend of $1.25 per share had been declared for the first quarter of 2024, to be paid on March 28, 2024 to shareholders of record as of the close of business on March 18, 2024. The Company also announced that it plans on approving a quarterly cash dividend of $1.25 per share for the second, third, and fourth quarters of 2024.

Operational highlights for the oil and natural gas and contract drilling segments during the twelve months ended December 31, 2023 and 2022 include:

	Three Months Ended December 31,									Twelve Months Ended December 31,
	2023			2022			% Change			2023			2022			% Change
Oil and Natural Gas:
Avg. oil price ($/Bbl)	$	57.12		$	56.31		1	%		$	60.61		$	57.48		5	%
Avg. oil price excl. derivatives ($/Bbl)	$	76.98		$	82.48		(7	)%		$	75.57		$	94.28		(20	)%
Avg. NGLs price ($/Bbl)	$	18.25		$	18.07		1	%		$	18.02		$	30.00		(40	)%
Avg. NGLs price excl. derivatives ($/Bbl)	$	18.25		$	18.07		1	%		$	18.02		$	30.00		(40	)%
Avg. natural gas price ($/Mcf)	$	1.72		$	3.42		(50	)%		$	2.28		$	3.65		(38	)%
Avg. natural gas price excl. derivatives ($/Mcf)	$	2.04		$	4.98		(59	)%		$	2.07		$	5.79		(64	)%
Oil production (MBbls)		209			290		(28	)%			984			1,281		(23	)%
NGL production (MBbls)		360			368		(2	)%			1,636			2,148		(24	)%
Natural gas production (MMcf)		4,453			5,424		(18	)%			20,195			24,211		(17	)%
Total production (Mboe)		1,310			1,562		(16	)%			5,986			7,464		(20	)%
Contract Drilling:
Drilling rigs available (end of the period)		14			18		(22	)%			14			18		(22	)%
Average drilling rigs in use		13.9			17.0		(18	)%			15.1			16.4		(8	)%
Average dayrate on daywork contracts ($/day)	$	31,245		$	27,579		13	%		$	31,225		$	23,132		35	%
BOSS rigs average dayrate ($/day)	$	31,245		$	28,385		10	%		$	31,690		$	23,963		32	%
SCR rigs average dayrate ($/day)	$	—		$	23,861		(100	)%		$	22,944		$	19,422		18	%

Common Stock Dividends

The table below presents information about the dividends paid during the periods indicated:

	Type	Dividend per share		Total Amount		Record Date	Payment Date
2023				(In thousands)
First quarter	Special	$	10.00	$	96,179	January 20, 2023	January 31, 2023
Second quarter	Quarterly	$	2.50	$	24,071	June 16, 2023	June 26, 2023
Third quarter	Quarterly	$	2.50	$	24,113	September 15, 2023	September 26, 2023
Fourth quarter	Quarterly	$	2.50	$	24,226	December 18, 2023	December 27, 2023
Fourth quarter	Special	$	15.00	$	145,353	December 18, 2023	December 27, 2023
Fourth quarter	Special	$	5.00	$	48,451	December 18, 2023	December 27, 2023

The declaration and payment of any future dividend, whether fixed, special, or variable, will remain at the full discretion of the Company’s Board of Directors and will depend upon the Company’s financial position, results of operations, cash flows, capital requirements, business conditions, future expectations, the requirements of applicable law, and other factors that the Company’s Board of Directors finds relevant at the time of considering any potential dividend declaration. Future dividends are expected to be funded by cash on the Company's balance sheet.

Oil and Natural Gas Divestiture

On December 13, 2023, the Company closed on the sale of certain non-core wells and related leases in the Texas Panhandle for cash proceeds of $50.0 million, subject to customary post-closing adjustments based on an effective date of October 1, 2023. The sale represented a significant alteration to the full cost pool as reserves in excess of 25% were divested. To determine the gain, the Company allocated the net book value of the full cost pool based on the relative fair value of the properties retained versus those divested. A gain of $37.2 million was recognized within gain on disposition of assets in the consolidated statements of operations. Proceeds from the sale were used to fund the special dividend of $5.00 per share paid December 27, 2023.

About Unit Corporation

Unit Corporation is a Tulsa-based, publicly held energy company engaged through its wholly-owned subsidiaries in oil and gas production and contract drilling. For more information about Unit Corporation, visit its website at http://www.unitcorp.com.

Forward-Looking Statements

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. All statements, other than statements of historical facts, included in this release that address activities, events, or developments that the Company expects, believes, or anticipates will or may occur are forward-looking statements. Several risks and uncertainties could cause actual results to differ materially from these statements, including changes in commodity prices, the productive capabilities of the Company’s wells, future demand for oil and natural gas, future drilling rig utilization and dayrates, projected rate of the Company’s oil and natural gas production, the amount available to the Company for borrowings, its anticipated borrowing needs under its credit agreements, the number of wells to be drilled by the Company’s oil and natural gas segment, the potential productive capability of its prospective plays, and other factors described occasionally in the Company’s publicly available OTC and SEC reports. The Company assumes no obligation to update publicly such forward-looking statements, whether because of new information, future events, or otherwise.

Unit Corporation
Selected Financial Highlights
	Three Months Ended December 31,								Twelve Months Ended December 31,
	2023				2022				2023				2022
	(In thousands except per share amounts)
Revenues:
Oil and natural gas	$	31,830			$	57,734			$	146,237			$	315,482
Contract drilling		42,797				44,590				181,056				147,370
Gas gathering and processing		—				—				—				82,673
Total revenues		74,627				102,324				327,293				545,525
Expenses:
Operating costs:
Oil and natural gas		16,528				21,021				65,739				93,350
Contract drilling		26,652				27,564				108,035				105,387
Gas gathering and processing		—				—				—				62,388
Total operating costs		43,180				48,585				173,774				261,125
Depreciation, depletion, and amortization		5,231				3,691				17,724				24,143
General and administrative		7,726				5,096				22,577				24,644
Gain on disposition of assets		(36,372	)			(1,968	)			(49,950	)			(8,367	)
Total operating expenses		19,765				55,404				164,125				301,545
Income from operations		54,862				46,920				163,168				243,980
Other income (expense):
Interest income		2,679				—				9,734				2,642
Interest expense		(43	)			—				(164	)			(447	)
Gain (loss) on derivatives, net		1,119				10,238				12,975				(63,610	)
Gain (loss) on change in fair value of warrants		—				—				—				(29,323	)
Loss on deconsolidation of Superior		—				—				—				(13,141	)
Gain on sale of Superior investment		—				—				17,812				—
Reorganization items, net		(136	)			(37	)			(299	)			(127	)
Other, net		190				(56	)			203				2,900
Total other income (expense)		3,809				12,748				40,261				(101,106	)
Income before income taxes		58,671				59,668				203,429				142,874
Income tax expense (benefit), net:
Current		694				333				1,575				333
Deferred		540				—				(47,085	)			—
Total income tax expense (benefit), net		1,234				333				(45,510	)			333
Net income		57,437				59,335				248,939				142,541
Net loss attributable to non-controlling interests		—				—				—				(5,828	)
Net income attributable to Unit Corporation	$	57,437			$	59,335			$	248,939			$	148,369
Net income attributable to Unit Corporation per common share:
Basic	$	5.89			$	6.16			$	25.68			$	15.03
Diluted	$	5.79			$	6.07			$	25.32			$	14.78

Unit Corporation
Selected Financial Highlights - Continued
	December 31, 2023			December 31, 2022
Balance Sheet Data:	(In thousands)
Cash and cash equivalents	$	60,779		$	213,975
Current assets	$	118,296		$	275,469
Total assets	$	322,720		$	469,255
Current liabilities	$	42,399		$	68,232
Long-term debt	$	—		$	—
Other long-term liabilities	$	22,803		$	33,362
Total shareholders’ equity attributable to Unit Corporation	$	254,126		$	362,626

 

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The Unit Corporation Stock at the time of publication of the news with a fall of -0,26 % to 39,55USD on Nasdaq OTC stock exchange (14. März 2024, 16:19 Uhr).