What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2022-02-16 compared with 2021-02-17 · 8 added, 150 removed, 23 unchanged (87% of the section changed)

12 unchanged sentences

December 1, 2021 - December 31, 2021

(1) The total number of shares purchased includes 13,550 shares repurchased in October 2020, representing shares of our common stock transferred to us in order to satisfy tax withholding obligations incurred upon the vesting of restricted stock and restricted stock units held by our employees.

(1) The total number of shares purchased represent shares of our common stock transferred to us in order to satisfy tax withholding obligations incurred upon the vesting of restricted stock and RSUs held by our employees .

(2) As of December 31, 2021, we did not have an authorized share repurchase program.

Capital Return Program

On February 15, 2022, our Board of Directors authorized a share repurchase program to opportunistically repurchase up to $1.0 billion of shares of our outstanding common stock.

The shares may be repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws.

The timing, as well as the number and value of shares repurchased under the program, will be determined by us at our discretion and will depend on a variety of factors, including the market price of our common stock, general market and economic conditions and applicable legal requirements.

The exact number of shares to be repurchased by us is not guaranteed and the program may be suspended, modified or discontinued at any time without prior notice.

Dividend Restrictions

Our ability to pay dividends is governed by (i) the provisions of Delaware general corporation law, (ii) our Certificate of Incorporation and Bylaws, (iii) indentures related to our 5.125% senior notes due 2022, 5.625% senior notes due 2023, 5.00% senior notes due 2025, 8.375% senior notes due 2026, 7.625% senior notes due 2029 and 4.25% convertible senior notes due 2026 and (iv) the Credit Facility.

Our ability to pay dividends is governed by (i) the provisions of Delaware general corporation law, (ii) our Certificate of Incorporation and Bylaws, (iii) the indentures relating to our 5.00% senior notes due 2025, 8.375% senior notes due 2026, 7.625% senior notes due 2029, 5.375% senior notes due 2030 and 4.25% convertible senior notes due 2026 and (iv) the Credit Facility.

We have not paid or declared any dividends on our common stock.

7 unchanged sentences

The information in this Form 10-K appearing under the heading “Stock Performance Graph” is being “furnished” pursuant to Item 2.01(e) of Regulation S-K under the Securities Act and shall not be deemed to be “soliciting material” or “filed” with the SEC or subject to Regulation 14A or 14C, other than as provided in Item 2.01(e) of Regulation S-K, or to the liabilities of Section 18 of the Exchange Act and shall not be deemed incorporated by reference into any filing under the Securities Act of the Exchange Act except to the extent that we specifically request that it be treated as such.

SELECTED FINANCIAL DATA

The following table shows our selected historical consolidated financial data, for the periods ended and as of the dates indicated, for Antero Resources Corporation and its consolidated subsidiaries, including Antero Midstream Partners through March 12, 2019.

Effective March 13, 2019, we no longer consolidate Antero Midstream Partners and account for our interest in Antero Midstream using the equity method of accounting.

See Note 6—Equity Method Investments to the consolidated financial statements for further discussion of our equity method investments.

The selected statement of operations data and statement of cash flows data for the years ended December 31, 2018, 2019 and 2020 and the balance sheet data as of December 31, 2019 and 2020 are derived from our audited consolidated financial statements included in Item 8 of this Annual Report on Form 10- K.

T he selected statement of operations data and statement of cash flows data for the years ended December 31, 2016 and 2017 and the balance sheet data as of December 31, 2016, 2017 and 2018 are derived from our audited consolidated financial statements not included in Item 8 of this Annual Report on Form 10-K.

The balance sheet data for the year ended December 31, 2016 has been recast to present the effects of the adoption of Accounting Standards Update (“ASU”) No.

2015-03, Simplifying the Presentation of Debt Issuance Costs, in 2016, which requires that debt issuance costs related to a recognized debt liability be presented on the balance sheet as a direct deduction from the carrying amount of that liability.

Our historical results of operations for the years ended December 31, 2016 and 2017 reflect a U.S.

federal corporate tax rate of 35%.

Effective January 1, 2018, the U.S.

federal corporate tax rate was reduced from 35% to 21%.

Accordingly, our historical results of operations prior to this change reflect a higher U.S.

federal corporate tax rate when compared to subsequent period financial results.

The selected financial data presented below are qualified in their entirety by reference to, and should be read in conjunction with, “Item 7.

Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our consolidated financial statements and related notes included elsewhere in this Annual Report on Form 10-K.

Year Ended December 31,

(in thousands, except per share amounts)

Statement of operations data:

Operating revenues and other:

Natural gas sales

Commodity derivative fair value gains (losses)

Gathering, compression, and water handling and treatment

Marketing derivative fair value gains (losses)

Amortization of deferred revenue, VPP

Gain on sale of assets

Total operating revenues and other

Operating expenses:

Lease operating

Gathering, compression, processing, and transportation

Production and ad valorem taxes

Impairment of oil and gas properties

Impairment of midstream assets

Depletion, depreciation, and amortization

Loss on sale of assets

Accretion of asset retirement obligations

General and administrative (including equity-based compensation expense of $102,421, $103,445, $70,413, $23,559 and $23,317 in 2016, 2017, 2018, 2019 and 2020, respectively)

Contract termination and rig stacking

Total operating expenses

Operating income (loss)

Other Expenses:

Water earnout

Loss on the sale of equity method investment shares

Equity in earnings (loss) of unconsolidated affiliate

Impairment of equity method investment

Gain on deconsolidation of Antero Midstream Partners LP

Transaction expense

Interest expense, net

Gain (loss) on early extinguishment of debt

Total other income (expenses)

Income (loss) before income taxes and discontinued operations

Income tax benefit

Net income (loss) and comprehensive income (loss) including noncontrolling interest

Net income and comprehensive income attributable to noncontrolling interest

Net income (loss) attributable to Antero Resources Corporation

Earnings (loss) per common share—basic

Earnings (loss) per common share—dilutive

Year Ended December 31,

(in thousands)

Balance sheet data (at period end):

Cash and cash equivalents

Other current assets

Total current assets

Natural gas properties, at cost (successful efforts method):

Unproved properties

Producing properties

Water handling and treatment systems

Gathering systems and facilities

Other property and equipment

Less accumulated depletion, depreciation, and amortization

Property and equipment, net

Current liabilities

Long-term indebtedness

Other long-term liabilities

Total liabilities and equity

Other financial data:

Net cash provided by operating activities

Net cash used in investing activities

Net cash provided by (used in) financing activities

Capital expenditures

Adjusted EBITDAX

Adjusted EBITDAX is a non-GAAP financial measure that we define as net income (loss), including noncontrolling interests, before interest expense, interest income, gains or losses from commodity derivatives and marketing derivatives, amortization of deferred revenue but including net cash receipts or payments on derivative instruments included in derivative gains or losses other than proceeds from derivative monetizations, income taxes, impairments, depletion, depreciation, amortization, and accretion, exploration expense, equity-based compensation, gain or loss on early extinguishment of debt, contract termination and rig stacking costs, loss on sale of the equity method investment shares, equity in earnings or loss of unconsolidated affiliates, water earnout, simplification transaction fees, gain or loss on sale of assets, Antero Midstream Partners related adjustments and Martica related adjustments.

Through March 12, 2019, the financial results of Antero Midstream Partners were included in our consolidated results.

Effective March 13, 2019, we no longer consolidate Antero Midstream Partners and account for our interest in Antero Midstream using the equity method of accounting.

See Note 6—Equity Method Investments to the consolidated financial statements for more information on our equity method investments.

Adjusted EBITDAX includes distributions received with respect to limited partner interests in Antero Midstream Partners common units through March 12, 2019.

Adjusted EBITDAX as used and defined by us, may not be comparable to similarly titled measures employed by other companies and is not a measure of performance calculated in accordance with GAAP.

Adjusted EBITDAX should not be considered in isolation or as a substitute for operating income or loss, net income or loss, cash flows provided by operating, investing, and financing activities, or other income or cash flow statement data prepared in accordance with GAAP.

Adjusted EBITDAX provides no information regarding our capital structure, borrowings, interest costs, capital expenditures, working capital movement, or tax position.

Adjusted EBITDAX does not represent funds available for discretionary use because those funds may be required for debt service, capital expenditures, working capital, income taxes, exploration expenses, and other commitments and obligations.

However, our management team believes Adjusted EBITDAX is useful to an investor in evaluating our financial performance because this measure:

● is widely used by investors in the oil and natural gas industry to measure operating performance without regard to items excluded from the calculation of such term, which may vary substantially from company to company depending upon accounting methods and the book value of assets, capital structure and the method by which assets were acquired, among other factors;

● helps investors to more meaningfully evaluate and compare the results of our operations from period to period by removing the effect of our capital and legal structure from our operating structure;

● is used by our management team for various purposes, including as a measure of our operating performance, in presentations to our Board of Directors, and as a basis for strategic planning and forecasting;

● is used by our Board of Directors as a performance measure in determining executive compensation.

There are significant limitations to using Adjusted EBITDAX as a measure of performance, including the inability to analyze the effects of certain recurring and non-recurring items that materially affect our net income or loss, the lack of comparability of results of operations of different companies, and the different methods of calculating Adjusted EBITDAX reported by different companies.

The following table represents a reconciliation of our net income (loss), including noncontrolling interest, to Adjusted EBITDAX and a reconciliation of our Adjusted EBITDAX to net cash provided by operating activities per our consolidated statements of cash flows, in each case, for the periods presented.

Adjusted EBITDAX also excludes the results of Antero Midstream Partners to provide comparability with the current structure of Antero Resources because effective March 13, 2019, we no longer consolidate Antero Midstream Partners’ results.

These adjustments are disclosed in the table below as Antero Midstream Partners related adjustments.

Year ended December 31,

(in thousands)

Reconciliation of net income (loss) to Adjusted EBITDAX:

Net income (loss) and comprehensive income (loss) attributable to Antero Resources Corporation

Net income (loss) and comprehensive income (loss) attributable to noncontrolling interests

Unrealized commodity derivative gains (losses)

Gains (losses) on settled marketing derivatives

Marketing derivative fair value gains

Proceeds from derivative monetizations

Amortization of deferred revenue, VPP

(Gain) loss on sale of assets

Gain on deconsolidation of Antero Midstream Partners LP

Interest expense, net

(Gain) loss on early extinguishment of debt

Provision for income tax benefit

Depletion, depreciation, amortization, and accretion

Impairment of oil and gas properties

Impairment of midstream assets

Impairment of equity method investment

Exploration expense

Equity-based compensation expense

Equity in (earnings) loss of unconsolidated affiliates

Distributions/dividends from unconsolidated affiliates

State franchise taxes

Loss on the sale of equity method investment shares

Contract termination and rig stacking

Water earnout

Simplification transaction fees

Transaction expense

Antero Midstream Partners related adjustments (1)

Martica related adjustments (2)

Adjusted EBITDAX

Reconciliation of our Adjusted EBITDAX to net cash provided by operating activities:

Adjusted EBITDAX

Antero Midstream Partners related adjustments (1)

Martica related adjustments (2)

Interest expense, net

Exploration expense

Changes in current assets and liabilities

State franchise taxes

Simplification transaction fees

Transaction expense

Proceeds from derivative monetizations

Premium paid on derivative contracts

Net cash provided by operating activities

(1) Amounts reflected are net of any elimination adjustments for intercompany activity and include activity related to Antero Midstream Partners through March 12, 2019.

Effective March 13, 2019, Antero accounts for its unconsolidated investment in Antero Midstream Corporation using the equity method of accounting.

See Note 6—Equity Method Investments to the consolidated financial statements for further discussion on equity method investments.

(2) Adjustments reflect noncontrolling interests in Martica not otherwise adjusted in amounts above.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity