OKLAHOMA CITY

, May 11, 2021 /PRNewswire/ — SandRidge Energy, Inc. (the “Company” or “SandRidge”) (NYSE: SD) today announced financial and operational results for the quarter ended March 31, 2021.

Results and highlights during the quarter:

• 
  Improved net cash
  
  
  ¹
  
  by
  
  $48.2 million
  
  to a net cash position of
  
  $56.5 million
  
  compared to a net cash position of
  
  $8.3 million
  
  at the end of the prior quarter, the increase was primarily due to the sale of North Park Basin
  
• 
  Adjusted EBITDA
  
  ²
  
  was
  
  $21.7 million
  
  compared to
  
  $9.1 million
  
  in the prior quarter, primarily due to commodity price increases
  
• 
  Total production was 18.2 MBoed compared to 21.1 MBoed in the prior quarter. Produced 17.5 MBoed from our Mid-Continent assets, compared to 19.0 MBoed in the prior quarter
  
• 
  Net income was
  
  $35.0 million
  
  , or
  
  $0.97
  
  per share. Adjusted net income
  
  ²
  
  was
  
  $17.4 million
  
  , or
  
  $0.48
  
  per share
  
• 
  G&A was
  
  $2.1 million
  
  , or
  
  $1.27
  
  per boe compared to
  
  $3.0 million
  
  , or
  
  $1.57
  
  per boe in the prior quarter. G&A included
  
  $0.4 million
  
  related to one time savings. Adjusted G&A
  
  ²
  
  was
  
  $1.9 million
  
  , or
  
  $1.14
  
  per boe compared to
  
  $2.8 million
  
  , or
  
  $1.44
  
  per boe in the prior quarter
  
• 
  LOE was
  
  $8.0 million
  
  or
  
  $4.85
  
  per boe compared to
  
  $11.0 million
  
  , or
  
  $5.69
  
  per boe in the prior quarter. Mid-Continent represented
  
  $7.1 million
  
  or
  
  $4.47
  
  per boe compared to
  
  $9.0 million
  
  or
  
  $5.15
  
  per boe in the prior quarter
  
• 
  Realized oil, natural gas, and natural gas liquids prices before the impact of derivatives were
  
  $53.99
  
  ,
  
  $1.85
  
  and
  
  $17.00
  
  , respectively, compared to
  
  $38.18
  
  ,
  
  $1.56
  
  and
  
  $9.12
  
  , in the prior quarter
  
• 
  Closed on the sale of North Park Basin for a purchase price of
  
  $47 million
  
  . Net proceeds were
  
  $39.7 million
  
  in cash as a result of customary effective date to closing date adjustments. The sale resulted in a
  
  $19.7 million
  
  gain.
  
• 
  Closed on the acquisition of the overriding royalty interests held by SandRidge Mississippian Royalty Trust I for a net purchase price of
  
  $3.6 million
  
  , which management believes approximates a PV-55 valuation and a 2-year cash on cash payback at early April strip pricing
  
• 
  Continued streak without a recordable Health, Safety and Environmental (“HS&E”) incident for 31 months as of the end of the quarter
  

_________________________

Financial Results

For the quarter, the Company reported a net income of

$35.0 million

, or

$0.97

per share, and net cash provided by operating activities of

$14.3 million

. After adjusting for certain items, the Company’s adjusted net income amounted to

$17.4 million

, or

$0.48

per share, operating cash flow totaled

$19.6 million

and adjusted EBITDA was

$21.7 million

for the quarter. The Company defines and reconciles adjusted net income, adjusted EBITDA and other non-GAAP financial measures to the most directly comparable GAAP measure in supporting tables at the conclusion of this press release on pages 9-12.

Operational Results and Activity

Production totaled 1,641 MBoe (18.2 MBoed, 17.6% oil, 31.7% NGLs and 50.7% natural gas) for the quarter.

Mid-Continent Assets in

Oklahoma

and

Kansas

Production in the Mid-Continent totaled 1,574 MBoe (17.5 MBoed, 14.0% oil, 33.1% NGLs and 52.9% natural gas) during the quarter.

Management believes the unaudited proved developed PV-10 reserve value of its Mid-Continent assets to be approximately

$233 million

, with an effective date of

April 1, 2021

, as routinely updated for the quarter from the Company’s engineered year-end 2020 reserves, consistent with standard industry reserve practice, including performance and commercial updates for price differentials, operating expenses and other commercials, based on the historical trailing 12 month averages ending

December 2020

, using

May 5, 2021

Nymex strip pricing, and including the subsequent acquisition of the overriding royalty interests of SandRidge Mississippian Trust I.

North Park Basin Assets in

Colorado

Net production for North Park Basin totaled 67 MBoe (0.7 MBoed, 100.0% oil) for 36 days during the quarter in which the Company owned the assets.

Overriding Royalty Interest Acquisition

On

April 22, 2021

, the Company announced the acquisition of all the overriding royalty interest assets of SandRidge Mississippian Trust I (the “Trust”). The gross purchase price is

$4.9 million

(net

$3.6 million

, given the Company’s 26.9% ownership of the Trust).

North Park Basin Sale

On

February 5, 2021

, the Company sold all of its oil and natural gas properties and related assets of the North Park Basin in

Colorado

for a purchase price of

$47 million

. The sale closed for net proceeds of

$39.7 million

in cash as a result of customary effective date to closing date adjustments.

2021 Capital Expenditures and Operational Guidance

The Company reaffirms its 2021 capital expenditures and operational guidance previously published on

March 3, 2021

.

Liquidity and Capital Structure

As of March 31, 2021, the Company’s total liquidity was

$83.9 million

, based on

$73.9 million

of cash, excluding restricted cash and

$10.0 million

available under its credit facility.

As of

May 7, 2021

, the Company’s cash on hand, excluding restricted cash, was approximately

$81

.2 million.

Conference Call Information

The Company will host a conference call to discuss these results as well as an updated investor presentation  on

Wednesday, May 12, 2021

at

10:00 am CT

. The conference call can be accessed by registering online at

http://www.directeventreg.com/registration/event/1798929

at which time registrants will receive dial-in information as well as a passcode and registrant ID. At the time of the call, participants will dial in using the numbers in the confirmation email and enter their passcode and ID, upon which they will enter the conference call. The presentation will be on the Company’s website at

http://investors.sandridgeenergy.com/Investor-Relations/

.

A live audio webcast of the conference call will also be available via SandRidge’s website,

www.sandridgeenergy.com

, under Investor Relations/Presentation & Events. The webcast will be archived for replay on the Company’s website for 30 days.

Operational and Financial Statistics

Information regarding the Company’s production, pricing, costs and earnings is presented below:

Capital Expenditures

The table below presents actual results of the Company’s capital expenditures for the three months ended March 31, 2021.

Capitalization

The Company’s capital structure as of March 31, 2021 and December 31, 2020 is presented below:

Non-GAAP Financial Measures

This press release includes non-GAAP financial measures. These non-GAAP measures are not alternatives to GAAP measures, and you should not consider these non-GAAP measures in isolation or as a substitute for analysis of our results as reported under GAAP. Below is additional disclosure regarding each of the non-GAAP measures used in this press release, including reconciliations to their most directly comparable GAAP measure.

Reconciliation of Cash Provided by Operating Activities to Operating Cash Flow

The Company defines operating cash flow as net cash provided by operating activities before changes in operating assets and liabilities as shown in the following table. Operating cash flow is a supplemental financial measure used by the Company’s management and by securities analysts, investors, lenders, rating agencies and others who follow the industry as an indicator of the Company’s ability to internally fund exploration and development activities and to service or incur additional debt. The Company also uses this measure because operating cash flow relates to the timing of cash receipts and disbursements that the Company may not control and may not relate to the period in which the operating activities occurred. Further, operating cash flow allows the Company to compare its operating performance and return on capital with those of other companies without regard to financing methods and capital structure. This measure should not be considered in isolation or as a substitute for net cash provided by operating activities prepared in accordance with GAAP.

Reconciliation of Net Income (Loss) to EBITDA and Adjusted EBITDA

The Company defines EBITDA as net income (loss) before income tax (benefit) expense, interest expense, depreciation and amortization – other and depreciation and depletion – oil and natural gas. Adjusted EBITDA, as presented herein, is EBITDA excluding items that management believes affect the comparability of operating results such as items whose timing and/or amount cannot be reasonably estimated or are non-recurring, as shown in the following tables.

Adjusted EBITDA is presented because management believes it provides useful additional information used by the Company’s management and by securities analysts, investors, lenders, ratings agencies and others who follow the industry for analysis of the Company’s financial and operating performance on a recurring basis and the Company’s ability to internally fund exploration and development and to service or incur additional debt. In addition, management believes that adjusted EBITDA is widely used by professional research analysts and others in the valuation, comparison and investment recommendations of companies in the oil and gas industry. The Company’s adjusted EBITDA may not be comparable to similarly titled measures used by other companies.

Reconciliation of Cash Provided by Operating Activities to Adjusted EBITDA

Reconciliation of Net Income (Loss) Available to Common Stockholders to Adjusted Net Income (Loss) Available to Common Stockholders

The Company defines adjusted net income (loss) as net income (loss) excluding items that management believes affect the comparability of operating results and are typically excluded from published estimates by the investment community, including items whose timing and/or amount cannot be reasonably estimated or are non-recurring, as shown in the following tables.

Management uses the supplemental measure of adjusted net income (loss) as an indicator of the Company’s operational trends and performance relative to other oil and natural gas companies and believes it is more comparable to earnings estimates provided by securities analysts. Adjusted net income (loss) is not a measure of financial performance under GAAP and should not be considered a substitute for net income (loss) available to common stockholders.

Reconciliation of G&A to Adjusted G&A

The Company reports and provides guidance on Adjusted G&A per Boe because it believes this measure is commonly used by management, analysts and investors as an indicator of cost management and operating efficiency on a comparable basis from period to period and to compare and make investment recommendations of companies in the oil and gas industry. This non-GAAP measure allows for the analysis of general and administrative spend without regard to stock-based compensation programs and other non-recurring cash items, if any, which can vary significantly between companies. Adjusted G&A per Boe is not a measure of financial performance under GAAP and should not be considered a substitute for general and administrative expense per Boe. Therefore, the Company’s Adjusted G&A per Boe may not be comparable to other companies’ similarly titled measures.

The Company defines adjusted G&A as general and administrative expense adjusted for certain non-cash stock-based compensation and other non-recurring items, if any, as shown in the following tables:

For further information, please contact:

Investor Relations

SandRidge Energy, Inc.

1 E. Sheridan Ave. Suite 500


Oklahoma City, OK

73104


[email protected]

Cautionary Note to Investors – This press release includes “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, including, but not limited to, the information appearing under the heading “Revised 2020 Operational and Capital Expenditure Guidance.” These forward-looking statements are neither historical facts nor assurances of future performance and reflect SandRidge’s current beliefs and expectations regarding future events and operating performance. The forward-looking statements include projections and estimates of the Company’s corporate strategies, future operations, development plans and appraisal programs, drilling inventory and locations,  estimated oil, natural gas and natural gas liquids production, price realizations and differentials, hedging program, projected operating, general and administrative and other costs, projected capital expenditures, tax rates,  efficiency and cost reduction initiative outcomes, liquidity and capital structure and the Company’s unaudited proved developed PV-10 reserve value of its Mid-Continent assets. We have based these forward-looking statements on our current expectations and assumptions and analyses made by us in light of our experience and our perception of historical trends, current conditions and expected future developments, as well as other factors we believe are appropriate under the circumstances. However, whether actual results and developments will conform with our expectations and predictions is subject to a number of risks and uncertainties, including the volatility of oil and natural gas prices, our success in discovering, estimating, developing and replacing oil and natural gas reserves, actual decline curves and the actual effect of adding compression to natural gas wells, the availability and terms of capital, the ability of counterparties to transactions with us to meet their obligations, our timely execution of hedge transactions, credit conditions of global capital markets, changes in economic conditions, the amount and timing of future development costs, the availability and demand for alternative energy sources, regulatory changes, including those related to carbon dioxide and greenhouse gas emissions, and other factors, many of which are beyond our control. We refer you to the discussion of risk factors in Part I, Item 1A – “Risk Factors” of our Annual Report on Form 10-K and in comparable “Risk Factor” sections of our Quarterly Reports on Form 10-Q filed after such form 10-K. All of the forward-looking statements made in this press release are qualified by these cautionary statements. The actual results or developments anticipated may not be realized or, even if substantially realized, they may not have the expected consequences to or effects on our Company or our business or operations. Such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. We undertake no obligation to update or revise any forward-looking statements.

SandRidge Energy, Inc. (NYSE: SD) is an independent oil and gas company engaged in the development and acquisition of oil and gas properties. Its primary areas of operation are the Mid-Continent in

Oklahoma

and

Kansas

. Further information can be found at

www.sandridgeenergy.com

.

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SOURCE SandRidge Energy, Inc.