10-K/APeriod: FY2018

EQT Corp Annual Report (Amendment), Year Ended Dec 31, 2018

Filed April 29, 2019For Securities:EQT

Summary

EQT Corporation's Form 10-K/A for the year ended December 31, 2018, highlights a pivotal year characterized by significant corporate transformation. The company successfully executed the spin-off of its midstream business, establishing itself as a pure-play upstream natural gas producer with a strong asset base in the Appalachia region. This strategic move aimed to unlock shareholder value by creating a more focused and financially robust entity. The report also details leadership changes, including the appointment of Robert J. McNally as President and Chief Executive Officer, and board refreshment with new independent directors. The company emphasizes its commitment to operational excellence, safety, and community engagement, while aligning executive compensation with performance and shareholder interests.

Financial Highlights

53 data points
Beta

Revenue

$4.71B

64.0% Gross Margin

Net Income

-$2.24B

-47.7% Net Margin

EPS (Diluted)

$-8.60

Total Assets

$20.72B

Cash & Equivalents

$3.49M

Free Cash Flow

-$22.78M

Financial Statements
Beta
Revenue$4.71B
Cost of Revenue$1.70B
Gross Profit$3.01B
SG&A Expenses$232.54M
Operating Expenses$7.34B
Operating Income-$2.78B
Interest Expense$228.96M
Net Income-$2.24B
EPS (Basic)$-8.60
EPS (Diluted)$-8.60
Shares Outstanding (Basic)260.93M
Shares Outstanding (Diluted)260.93M

Key Highlights

  • 1EQT Corporation completed the spin-off of its midstream business, transitioning into a pure-play upstream natural gas producer.
  • 2Robert J. McNally was appointed as President and Chief Executive Officer, driving a vision for efficiency and free cash flow generation.
  • 3The company achieved record annual sales volumes of 1,488 Bcfe in 2018.
  • 4Divestitures of non-core assets in the Huron Play and Permian Basin were completed, focusing operations on core areas.
  • 5Proved reserves saw a 2% increase, or 11% when adjusted for divestitures.
  • 6Significant efforts were made to enhance safety, with a 39% drop in OSHA recordable incident rate compared to 2017.
  • 7EQT joined the ONE Future Coalition to reduce methane emissions, underscoring its commitment to environmental stewardship.

Frequently Asked Questions

The most significant strategic change was the spin-off of EQT's midstream business into a separate, publicly traded company. This transformation aimed to establish EQT as a pure-play upstream natural gas producer, simplifying its structure and focusing on its core Appalachian assets.

Robert J. McNally was appointed President and Chief Executive Officer in November 2018. His vision focuses on unlocking the value of EQT's asset base through increased operational efficiency, cost reduction, and maximizing free cash flow generation, all while maintaining high standards for safety and environmental sustainability.

EQT made substantial efforts in safety, launching initiatives like the 'Zero is Possible – Today' program, which led to a 39% reduction in its OSHA recordable incident rate compared to 2017. Environmentally, the company became a founding partner of the Center for Responsible Shale Development and joined the ONE Future Coalition, focusing on reducing methane emissions.

Executive compensation was heavily weighted towards performance-based, 'at-risk' components, including annual and long-term incentives. The Management Development and Compensation Committee reviewed compensation against a defined peer group, aiming for competitive market positioning. Compensation decisions were influenced by company performance, including the successful completion of the midstream spin-off and operational results, with downward adjustments made in instances where performance fell short of expectations.