2024 Q1 Form 10-K Financial Statement

#000155837024001162 Filed on February 14, 2024

View on sec.gov

Income Statement

Concept 2024 Q1 2023 Q4 2023
Revenue $1.122B $1.194B $4.682B
YoY Change -20.31% -42.73% -34.41%
Cost Of Revenue $337.5M $312.8M $1.296B
YoY Change -1.46% -13.04% -14.22%
Gross Profit $784.8M $881.3M $3.386B
YoY Change -26.37% -48.93% -39.83%
Gross Profit Margin 69.93% 73.8% 72.31%
Selling, General & Admin $537.7M $539.4M $2.133B
YoY Change 3.43% 0.4% -2.4%
% of Gross Profit 68.52% 61.2% 62.99%
Research & Development $602.0K $603.0K $2.700M
YoY Change -21.1% -71.85% -63.56%
% of Gross Profit 0.08% 0.07% 0.08%
Depreciation & Amortization $173.8M $175.0M $690.0M
YoY Change 3.73% 2.97% 1.38%
% of Gross Profit 22.15% 19.86% 20.38%
Operating Expenses $712.2M $714.9M $2.829B
YoY Change 3.31% 0.79% -1.7%
Operating Profit $72.58M $166.4M $453.1M
YoY Change -78.11% -83.63% -82.4%
Interest Expense -$6.840M -$8.642M -$34.92M
YoY Change -14.7% 12.88% -34.17%
% of Operating Profit -9.42% -5.19% -7.71%
Other Income/Expense, Net -$6.840M -$35.29M
YoY Change -15.61% -64.44%
Pretax Income $58.32M $145.9M $417.8M
YoY Change -81.97% -84.39% -83.12%
Income Tax $10.03M $29.98M $75.99M
% Of Pretax Income 17.2% 20.55% 18.19%
Net Earnings $36.35M $94.76M $341.8M
YoY Change -86.09% -87.02% -83.13%
Net Earnings / Revenue 3.24% 7.94% 7.3%
Basic Earnings Per Share $0.12 $0.81
Diluted Earnings Per Share $0.12 $0.30 $0.78
COMMON SHARES
Basic Shares Outstanding 303.6M 300.5M 299.8M
Diluted Shares Outstanding 312.5M 311.6M

Balance Sheet

Concept 2024 Q1 2023 Q4 2023
SHORT-TERM ASSETS
Cash & Short-Term Investments
YoY Change
Cash & Equivalents $0.00 $0.00
Short-Term Investments
Other Short-Term Assets $36.37M $14.19M $32.27M
YoY Change 29.45% -68.0% -27.25%
Inventory
Prepaid Expenses $12.33M $12.90M
Receivables $366.3M $42.62M $443.4M
Other Receivables $0.00 $0.00 $0.00
Total Short-Term Assets $402.7M $475.7M $475.7M
YoY Change -7.98% -39.6% -39.6%
LONG-TERM ASSETS
Property, Plant & Equipment $12.89B $12.89B $12.89B
YoY Change -2.29% -1.47% -1.47%
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments $226.0M $222.3M $222.3M
YoY Change 2.97% 0.83% 0.83%
Other Assets $33.76M $25.38M $30.95M
YoY Change 107.7% 48.34% 14.82%
Total Long-Term Assets $13.15B $13.14B $13.14B
YoY Change -2.14% -1.4% -1.4%
TOTAL ASSETS
Total Short-Term Assets $402.7M $475.7M $475.7M
Total Long-Term Assets $13.15B $13.14B $13.14B
Total Assets $13.55B $13.62B $13.62B
YoY Change -2.33% -3.53% -3.53%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $131.8M $125.3M $125.3M
YoY Change 57.48% 61.56% -20.84%
Accrued Expenses $849.4M $381.3M $920.3M
YoY Change 167.04% -17.42% -6.61%
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00 $0.00
YoY Change
Long-Term Debt Due $1.154M $1.106M $1.106M
YoY Change 58.95% 121.64% 121.64%
Total Short-Term Liabilities $1.383B $1.452B $1.452B
YoY Change -7.66% -18.19% -18.19%
LONG-TERM LIABILITIES
Long-Term Debt $1.512B $1.538B $1.540B
YoY Change 15.28% 29.92% 29.96%
Other Long-Term Liabilities $2.537B $59.43M $2.579B
YoY Change 4082.56% -0.44% -23.73%
Total Long-Term Liabilities $4.049B $1.597B $4.119B
YoY Change 195.0% 28.46% -9.79%
TOTAL LIABILITIES
Total Short-Term Liabilities $1.383B $1.452B $1.452B
Total Long-Term Liabilities $4.049B $1.597B $4.119B
Total Liabilities $6.498B $6.405B $6.638B
YoY Change -3.03% -9.8% -9.85%
SHAREHOLDERS EQUITY
Retained Earnings $1.168B $1.132B
YoY Change 5.97% 23.85%
Common Stock $3.102M $3.035M
YoY Change 3.64% 2.05%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $7.051B $6.981B $6.981B
YoY Change
Total Liabilities & Shareholders Equity $13.55B $13.62B $13.62B
YoY Change -2.33% -3.53% -3.53%

Cashflow Statement

Concept 2024 Q1 2023 Q4 2023
OPERATING ACTIVITIES
Net Income $36.35M $94.76M $341.8M
YoY Change -86.09% -87.02% -83.13%
Depreciation, Depletion And Amortization $173.8M $175.0M $690.0M
YoY Change 3.73% 2.97% 1.38%
Cash From Operating Activities $261.6M $312.2M $994.7M
YoY Change -23.93% -34.31% -67.4%
INVESTING ACTIVITIES
Capital Expenditures $222.4M $219.9M $1.132B
YoY Change -36.68% -1.21% 19.9%
Acquisitions
YoY Change
Other Investing Activities -$4.361M -$6.804M -$8.904M
YoY Change -958.46% 152.19% -2580.22%
Cash From Investing Activities -$226.8M -$226.7M -$1.141B
YoY Change -35.35% 0.63% 20.89%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $75.36M
YoY Change -91.38%
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -34.80M -85.55M 146.0M
YoY Change -604.2% -65.78% -106.93%
NET CHANGE
Cash From Operating Activities 261.6M 312.2M 994.7M
Cash From Investing Activities -226.8M -226.7M -1.141B
Cash From Financing Activities -34.80M -85.55M 146.0M
Net Change In Cash 0.000 0.000 0.000
YoY Change -100.0%
FREE CASH FLOW
Cash From Operating Activities $261.6M $312.2M $994.7M
Capital Expenditures $222.4M $219.9M $1.132B
Free Cash Flow $39.16M $92.36M -$137.1M
YoY Change -628.49% -63.46% -106.51%

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CY2023 us-gaap Use Of Estimates
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<table style="border-collapse:collapse;border:0;"><tr><td style="vertical-align:text-top;white-space:nowrap;width:18pt;padding:0pt;"><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin-bottom:10pt;margin-top:0pt;"><span style="font-style:italic;font-weight:bold;"> (c)</span></p></td><td style="padding:0pt;"><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin-bottom:10pt;margin-top:0pt;"><span style="font-style:italic;font-weight:bold;">Use of Estimates</span></p></td></tr></table><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect revenues, expenses, assets, liabilities and the disclosure of contingent assets and liabilities. Changes in facts and circumstances or discovery of new information may result in revised estimates, and actual results could differ from those estimates.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The Company’s consolidated financial statements are based on a number of significant estimates, including estimates of natural gas, NGLs and oil reserve quantities, which are the basis for the calculation of depletion and impairment of oil and gas properties. Reserve estimates, by their nature, are inherently imprecise. Other items in the Company’s consolidated financial statements that involve the use of significant estimates include derivative assets and liabilities, accrued revenue, deferred and current income taxes, asset retirement obligations and commitments and contingencies.</span></p>
CY2021 ar Impairment Of Oil And Gas Unproved Properties
ImpairmentOfOilAndGasUnprovedProperties
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CY2022 ar Impairment Of Oil And Gas Unproved Properties
ImpairmentOfOilAndGasUnprovedProperties
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CY2023 ar Impairment Of Oil And Gas Unproved Properties
ImpairmentOfOilAndGasUnprovedProperties
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CY2021 us-gaap Results Of Operations Depreciation Depletion Amortization And Accretion
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CY2022 us-gaap Results Of Operations Depreciation Depletion Amortization And Accretion
ResultsOfOperationsDepreciationDepletionAmortizationAndAccretion
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CY2023 us-gaap Results Of Operations Depreciation Depletion Amortization And Accretion
ResultsOfOperationsDepreciationDepletionAmortizationAndAccretion
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CY2022 ar Impairment Of Long Lived Assets Other Than Properties Oil And Gas Properties
ImpairmentOfLongLivedAssetsOtherThanPropertiesOilAndGasProperties
48000000
CY2021 ar Impairment Of Long Lived Assets Other Than Properties Oil And Gas Properties
ImpairmentOfLongLivedAssetsOtherThanPropertiesOilAndGasProperties
0
CY2023 ar Impairment Of Long Lived Assets Other Than Properties Oil And Gas Properties
ImpairmentOfLongLivedAssetsOtherThanPropertiesOilAndGasProperties
0
CY2021 us-gaap Amortization Of Financing Costs
AmortizationOfFinancingCosts
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CY2022 us-gaap Amortization Of Financing Costs
AmortizationOfFinancingCosts
4000000
CY2023 us-gaap Amortization Of Financing Costs
AmortizationOfFinancingCosts
4000000
CY2023 us-gaap Concentration Risk Credit Risk
ConcentrationRiskCreditRisk
<table style="border-collapse:collapse;border:0;"><tr><td style="vertical-align:text-top;white-space:nowrap;width:18pt;padding:0pt;"><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin-bottom:10pt;margin-top:0pt;"><span style="font-style:italic;font-weight:bold;">(p)</span></p></td><td style="padding:0pt;"><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin-bottom:10pt;margin-top:0pt;"><span style="font-style:italic;font-weight:bold;">Concentrations of Credit Risk</span></p></td></tr></table><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The Company’s revenues are derived principally from uncollateralized sales to purchasers in the oil and gas industry or the utilities industry. The concentration of credit risk in two related industries affects the Company’s overall exposure to credit risk because purchasers may be similarly affected by changes in economic and other conditions. The Company has not experienced significant credit losses on its receivables. The Company’s sales to Six One Commodities LLC accounted for </span>10% and 12%<span style="white-space:pre-wrap;"> of total sales for the years ended December 31, 2021 and 2022, respectively. No customer accounted for more than 10% of the Company’s sales for the year ended December 31, 2023.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The Company is also exposed to credit risk on its commodity derivative portfolio. Any default by the counterparties to these derivative contracts when they become due could have a material adverse effect on the Company’s financial condition and results of operations. The Company has economic hedges in place with </span>three<span style="white-space:pre-wrap;"> different counterparties. As of December </span><span style="white-space:pre-wrap;">31, 2023, the Company did not have any commodity derivative assets with bank counterparties under our Credit Facility. The estimated fair value of commodity derivative assets has been risk-adjusted using a discount rate based upon the respective published credit default swap rates (if available, or if not available, a discount rate based on the applicable Reuters bond rating) as of December </span><span style="white-space:pre-wrap;">31, 2023 for the counterparty. The Company believes that the counterparty currently is an acceptable credit risk.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;">The Company, at times, may have cash in banks in excess of federally insured amounts.</p>
CY2023Q4 ar Number Of Counterparties
NumberOfCounterparties
3
CY2022 ar Increase Decrease In Deferred Income Tax Liabilities Change In Enacted Tax Rate Net Of Company State Apportionment
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CY2021 us-gaap Net Income Loss Available To Common Stockholders Basic
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CY2022 us-gaap Net Income Loss Available To Common Stockholders Basic
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InterestOnConvertibleDebtGross
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CY2023 ar Interest On Convertible Debt Gross
InterestOnConvertibleDebtGross
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CY2022 ar Interest On Convertible Debt Tax Amount
InterestOnConvertibleDebtTaxAmount
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CY2023 ar Interest On Convertible Debt Tax Amount
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CY2022 us-gaap Net Income Loss Available To Common Stockholders Diluted
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CY2023 us-gaap Net Income Loss Available To Common Stockholders Diluted
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CY2021 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
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CY2022 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
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CY2023 us-gaap Earnings Per Share Basic
EarningsPerShareBasic
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EarningsPerShareDiluted
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CY2022 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
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CY2023 us-gaap Earnings Per Share Diluted
EarningsPerShareDiluted
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CY2022 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2023 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2023 us-gaap Weighted Average Number Of Shares Outstanding Basic
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CY2021 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2022 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2023Q4 us-gaap Share Based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Exercisable Number
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AccruedCapitalExpendituresCurrent
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CY2023Q4 ar Accrued Capital Expenditures Current
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CY2022Q4 ar Accrued Gathering Compression Processing And Transportation Expenses Current
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CY2022Q4 us-gaap Accrued Marketing Costs Current
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CY2022Q4 us-gaap Interest Payable Current
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CY2023Q4 us-gaap Interest Payable Current
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CY2022Q4 ar Accrued Production And Ad Valorem Taxes
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CY2023Q4 ar Accrued Production And Ad Valorem Taxes
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CY2022Q4 us-gaap Asset Retirement Obligations Noncurrent
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CY2023 us-gaap Lessee Operating Lease Existence Of Option To Extend
LesseeOperatingLeaseExistenceOfOptionToExtend
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CY2023Q4 us-gaap Finance Lease Liability
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CY2023Q4 ar Finance Leases Accumulated Amortization
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CY2022 ar Finance Lease Cost
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CY2023 ar Finance Lease Cost
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CY2023Q4 us-gaap Lessee Operating Lease Liability Payments Due
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<p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin:0pt 0pt 10pt 0pt;"><b style="font-weight:bold;white-space:pre-wrap;">(15) Contingencies</b></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;padding-left:18pt;text-indent:-18pt;margin:0pt 0pt 10pt 0pt;"><span style="font-style:italic;font-weight:bold;">Environmental</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">In June 2018, the Company received a Notice of Violation (“NOV”) from the EPA Region III for alleged violations of the federal Clean Air Act and the West Virginia State Implementation Plan. The NOV alleges that combustion devices at these facilities did not meet applicable air permitting requirements. Separately, in June 2018, the Company received an information request from the EPA Region III pursuant to Section 114(a) of the Clean Air Act relating to the facilities that were inspected in September 2017 as well as additional Antero Resources facilities for the purpose of determining if the additional facilities have the same alleged compliance issues that were identified during the September 2017 inspections. Subsequently, the West Virginia Department of Environmental Protection (“WVDEP”) and the EPA Region V (covering Ohio facilities) each conducted its own inspections, and the Company has separately received NOVs from WVDEP and EPA Region V related to similar issues being investigated by the EPA Region III. The Company continues to negotiate with the EPA and WVDEP to resolve the issues alleged in the NOVs and the information request. The Company’s operations at these facilities are not suspended, and management does not expect these matters to have a material adverse effect on the Company’s financial condition, results of operations or cash flows.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin:0pt 0pt 10pt 0pt;"><span style="font-style:italic;font-weight:bold;">WGL</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The Company and Washington Gas Light Company and WGL Midstream, Inc. (collectively, “WGL”) were involved in multiple contractual disputes involving firm gas sales contracts executed June 20, 2014 (the “Contracts”) that the Company began delivering gas under in January 2016. In late 2015, WGL asserted that the natural gas index price specified in the Contracts was no longer appropriate and sought to invoke an alternative index clause in the Contracts. This dispute was referred to arbitration. In January 2017, the arbitration panel ruled in the Company’s favor and found that the natural gas index price specified in the Contracts should remain.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;">In March of 2017, WGL filed a lawsuit against the Company in Colorado district court claiming that the Company breached contractual obligations by failing to deliver “TCO pool” gas, ultimately seeking damages of more than $40<span style="white-space:pre-wrap;"> million. Subsequently, after WGL failed to take certain volumes of gas required under the Contracts, the Company filed a separate lawsuit against WGL to recover damages that WGL refused to pay. These </span>two<span style="white-space:pre-wrap;"> lawsuits were consolidated and tried in June 2019. On June 20, 2019, the Company was awarded a jury verdict of approximately </span>$96<span style="white-space:pre-wrap;"> million in damages against WGL. In addition, the jury rejected WGL’s claim against the Company, finding that the Company did not breach the Contracts. On December 10, 2020, the Colorado Court of Appeals affirmed the judgment of the trial court in favor of the Company. In February 2021, the Company and its royalty owners received a gross payment of approximately </span>$107 million from WGL, which was in full satisfaction and discharge of the June 2019 judgment entered in favor of the Company.</p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;margin:0pt 0pt 10pt 0pt;"><span style="font-style:italic;font-weight:bold;">Other</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">The Company is party to various other legal proceedings and claims in the ordinary course of its business. The Company believes that certain of these matters will be covered by insurance and that the outcome of other matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows.</span></p><p style="font-family:'Times New Roman','Times','serif';font-size:10pt;text-indent:36pt;margin:0pt 0pt 10pt 0pt;"><span style="white-space:pre-wrap;">In addition, pending litigation against the Company and other similarly situated peer operators could have an impact on the methods for determining the amount of permitted post-production costs and types of costs that have been, and may be, deducted from royalty payments, among other things. While the amounts claimed could be material, we are unable to predict with certainty the ultimate outcome of such claims and proceedings. Rulings were recently received in two cases to which the Company is a party, and where the plaintiffs alleged, and the court found, that certain post-production costs may not be deducted: a non-class action lawsuit in West Virginia and a class action lawsuit in Ohio. In each case, the alleged damages were not material. The Company will continue to challenge the legal conclusions reached in each of these cases with respect to deductibility of post-production costs, and continues to analyze how these decisions may impact other cases to which the Company is a party. At this time, the Company cannot predict how these issues may ultimately be resolved, and therefore is also unable to estimate any potential damages, if any, that may result. The Company accrues for litigation, claims and proceedings when liability is both probable and the amount can be reasonably estimated, and does not currently have any material amounts accrued with respect to its pending litigation matters.</span></p>
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