8-KEarnings & Results

Diamondback Energy, Inc. 8-K Report, Financial Results (Jul 11, 2023)

Filed July 11, 2023For Securities:FANG

Summary

Diamondback Energy, Inc. (FANG) filed an 8-K on July 11, 2023, providing an update on its second quarter 2023 operational and financial metrics, specifically focusing on realized commodity prices, derivative activities, and share counts. The filing reveals that for the quarter ended June 30, 2023, the company experienced unhedged realized prices of $71.33 per barrel of oil and $46.31 per BOE overall, while hedged prices were slightly lower at $70.41 per barrel of oil and $45.94 per BOE. This indicates a slight benefit from hedging at the aggregate level, though oil prices were marginally higher on an unhedged basis. The company also reported a significant net loss on derivative instruments, totaling $189 million, comprising $152 million from commodity contracts and $37 million from interest rate swaps. The cash impact of these settlements was $39 million. The number of outstanding shares remained stable, with basic and diluted weighted average shares outstanding both at approximately 180.4 million for the quarter.

Key Highlights

  • 1Second quarter 2023 unhedged realized oil price was $71.33 per barrel, with a combined unhedged equivalent price of $46.31 per BOE.
  • 2Second quarter 2023 hedged realized oil price was $70.41 per barrel, with a combined hedged equivalent price of $45.94 per BOE.
  • 3Total net loss on derivative instruments for Q2 2023 was $189 million, including $152 million from commodity contracts and $37 million from interest rate swaps.
  • 4Cash paid on settlement of derivative instruments for Q2 2023 amounted to $39 million.
  • 5Weighted average basic and diluted shares outstanding remained consistent at 180,373,000 for the three months ended June 30, 2023.
  • 6The filing provides updated realized pricing and derivative activity, offering insights into the impact of commodity price fluctuations and hedging strategies on the company's financial performance for the most recent quarter.

Frequently Asked Questions

For the second quarter of 2023, Diamondback reported unhedged realized prices of $71.33 per barrel of oil, $0.94 per Mcf of natural gas, and $16.42 per barrel of NGLs, resulting in a total equivalent unhedged price of $46.31 per BOE. Hedged prices were slightly lower overall, with oil at $70.41 per barrel and a combined equivalent of $45.94 per BOE.

Diamondback experienced a net loss on derivative instruments totaling $189 million in the second quarter of 2023. This loss was comprised of $152 million from commodity contracts and $37 million from interest rate swaps. The cash outflow related to these settlements was $39 million.

The number of outstanding shares remained stable. The weighted average basic and diluted shares outstanding for the three months ended June 30, 2023, were both reported as 180,373,000.

The 'unhedged' prices represent the company's realized sales prices before considering the impact of derivative financial instruments. The 'hedged' prices reflect the actual realized prices after accounting for the gains and losses from settled commodity derivative contracts. The difference illustrates the effectiveness and financial impact of Diamondback's hedging strategy in managing commodity price volatility.