What changed in this filing

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Item 2. Management’s Discussion and Analysis

2025-05-01 compared with 2024-10-31 · 72 added, 87 removed, 135 unchanged (54% of the section changed)

28 unchanged sentences

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and NGL reserves that operates in one reportable segment located in the United States.

The Company’s oil and natural gas properties are located primarily in the Karnes and Giddings areas in South Texas, where the Company targets the Eagle Ford Shale and the Austin Chalk formations.

Magnolia’s objective is to generate stock market value over the long term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

The Company’s allocation of capital prioritizes reinvesting in its business to achieve moderate and predictable annual volume growth and remains balanced with returning capital to its shareholders through dividends and share repurchases.

The Company’s oil and natural gas properties are located primarily in the Karnes and Giddings areas in South Texas, where the Company primarily targets the Eagle Ford Shale and the Austin Chalk formations.

Magnolia’s objective is to generate stock market value over the long term through steady organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

The Company’s allocation of capital prioritizes reinvesting in its business to achieve moderate and predictable annual volume growth balanced with returning capital to its shareholders through dividends and share repurchases.

Magnolia’s business model prioritizes prudent and disciplined capital allocation, free cash flow, and financial stability.

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Commodity prices experienced significant volatility in recent years, impacted by the Russia-Ukraine war, actions taken by OPEC, and the continued instability and conflict in the Middle East.

Global conflict and supply chain disruptions drove high oil and natural gas prices in 2022.

Beginning in 2023, due to the easing of global geopolitically driven supply fears along with record high US production, natural gas and NGL prices significantly declined and oil prices weakened.

While material and labor costs have flattened, this decline in prices has resulted in lower operating margins.

In 2024, despite continued commodity price volatility, lower well costs combined with improved operating efficiencies are allowing for more wells to be drilled, completed, and turned in line helping to support Magnolia's overall high-margin growth from a disciplined capital program.

In 2024, despite the price volatility, lower well costs combined with improved operating efficiencies allowed for more wells to be drilled, completed, and turned in line helping to support Magnolia’s overall high-margin growth from a disciplined capital program.

In 2025, the macroeconomic and geopolitical outlook remains complex and continues to evolve amid persistent inflationary pressures, high interest rates, and escalating trade tensions, including recently imposed tariffs.

Magnolia will continue to monitor changes in international trade relations and trade policy, including those related to tariffs, which could adversely impact results.

Business Overview

As of September 30, 2024, Magnolia’s assets in South Texas included 77,278 gross (55,286 net) acres in the Karnes area, and 748,547 gross (554,871 net) acres in the Giddings area.

As of September 30, 2024, Magnolia held an interest in approximately 2,647 gross (1,798 net) wells, with total production of 90.7 thousand and 88.6 thousand barrels of oil equivalent per day for the three and nine months ended September 30, 2024, respectively.

Magnolia recognized net income attributable to Class A Common Stock of $99.8 million and $280.4 million, or $0.52 and $1.50 per diluted common share, for the three and nine months ended September 30, 2024, respectively.

Magnolia recognized net income of $105.9 million and $308.6 million, which includes a noncontrolling interest of $6.1 million and $28.2 million related to the Magnolia LLC Units (and corresponding shares of Class B Common Stock) held by certain affiliates of EnerVest, for the three and nine months ended September 30, 2024, respectively.

During the nine months ended September 30, 2024, the Company declared cash dividends to holders of its Class A Common Stock totaling $72.5 million.

As of September 30, 2024, the Company’s board of directors had authorized a share repurchase program of up to 40.0 million shares of Class A Common Stock.

As of March 31, 2025, Magnolia’s assets in South Texas included 79,067 gross (54,936 net) acres in the Karnes area, and 739,943 gross (549,967 net) acres in the Giddings area.

As of March 31, 2025, Magnolia held an interest in approximately 2,684 gross (1,818 net) wells, with total production of 96.5 thousand barrels of oil equivalent per day for the three months ended March 31, 2025.

Magnolia recognized net income attributable to Class A Common Stock of $102.9 million, or $0.54 per diluted common share, for the three months ended March 31, 2025.

Magnolia recognized net income of $106.6 million, which includes noncontrolling interest of $3.7 million related to the Magnolia LLC Units (and corresponding shares of Class B Common Stock) held by certain affiliates of EnerVest, for the three months ended March 31, 2025.

During the three months ended March 31, 2025, the Company declared cash dividends to holders of its Class A Common Stock totaling $28.9 million.

As of March 31, 2025, the Company’s board of directors had authorized a share repurchase program of up to 50.0 million shares of Class A Common Stock.

The program does not require purchases to be made within a particular time frame.

The Company had repurchased 36.1 million shares under the program at a cost of $652.0 million and had 3.9 million shares of Class A Common Stock remaining under its share repurchase authorization as of September 30, 2024.

As of September 30, 2024, Magnolia owned approximately 97.2% of the interest in Magnolia LLC and the noncontrolling interest was approximately 2.8%.

The Company had repurchased 40.4 million shares under the program at a cost of $759.8 million and had 9.6 million shares of Class A Common Stock remaining under its share repurchase authorization as of March 31, 2025.

As of March 31, 2025, Magnolia owned approximately 97.1% of the interest in Magnolia LLC and the noncontrolling interest was approximately 2.9%.

Results of Operations

Factors Affecting the Comparability of the Historical Financial Results

Magnolia’s historical financial condition and results of operations for the periods presented may not be comparable, either from period to period or going forward, as a result of the Company’s acquisition in November 2023 of certain oil and gas producing properties including leasehold and mineral interests in the Giddings area for approximately $264.1 million, subject to customary purchase price adjustments, and an additional contingent cash consideration of up to $40.0 million through January 2026 based on future commodity prices.

As a result of the factors listed above, the historical results of operations and period-to-period comparisons of these results and certain financial data may not be comparable or indicative of future results.

Three and Nine Months Ended September 30, 2024 Compared to the Three and Nine Months Ended September 30, 2023

Magnolia’s historical financial condition and results of operations for the periods presented may not be comparable, either from period to period or going forward, as a result of the Company’s redemption of its 2026 Senior Notes that bore interest at 6.0% per annum and its issuance of the 2032 Senior Notes that bear interest at 6.875% per annum, both of which occurred in November 2024.

As a result, the historical results of operations and period-to-period comparisons of these results and certain financial data may not be comparable or indicative of future results.

Three Months Ended March 31, 2025 Compared to the Three Months Ended March 31, 2024

Oil, Natural Gas and NGL Sales Revenues

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This ratio may not be reflective of the current price ratio between the two products.

Three Months Ended Nine Months Ended

(In thousands, except per unit data) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Three Months Ended

(In thousands, except per unit data) March 31, 2025 March 31, 2024

Oil (MBbls) 3,517 3,415

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NGLs (per barrel) 22.03 19.49

Oil revenues for the three months ended September 30, 2024 were $22.1 million higher than for the three months ended September 30, 2023 caused by an 18% increase in oil production that increased revenues by $41.2 million, partially offset by an 8% decrease in average prices that decreased revenues by $19.1 million.

Oil revenues for the nine months ended September 30, 2024 were $94.3 million higher than for the nine months ended September 30, 2023 caused by a 12% increase in oil production that increased revenues by $84.4 million and a 1% increase in average prices that increased revenues by $9.9 million.

Natural gas revenues for the three months ended September 30, 2024 were $4.9 million lower than the three months ended September 30, 2023 caused by a 19% decrease in average prices that decreased revenues by $5.3 million, partially offset by a 2% increase in natural gas production which increased revenues by $0.4 million.

Natural gas revenues for the nine months ended September 30, 2024 were $13.8 million lower than the nine months ended September 30, 2023 caused by a 23% decrease in average prices that decreased revenues by $17.4 million, partially offset by a 6% increase in natural gas production which increased revenues by $3.6 million.

The realized revenue pricing included the impact of gas plant fees that were netted from revenue.

NGL revenues for the three months ended September 30, 2024 were $0.2 million higher than the three months ended September 30, 2023 caused by a 7% increase in NGL production that increased revenues by $2.8 million, partially offset by a 6% decrease in average prices that decreased revenues by $2.6 million.

NGL revenues for the nine months ended September 30, 2024 were $4.4 million higher than the nine months ended September 30, 2023 caused by a 9% increase in NGL production which increased revenues by $10.6 million, partially offset by a 5% decrease in average prices that decreased revenues by $6.2 million.

Operating Expenses and Other Income (Expense).

The following table summarizes the Company’s operating expenses and other income (expense) for the periods indicated.

Three Months Ended Nine Months Ended

(In thousands, except per unit data) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Oil revenues for the three months ended March 31, 2025 were $13.6 million lower than for the three months ended March 31, 2024.

An 8% decrease in average price decreased first quarter 2025 revenues by $20.7 million compared to the same period in the prior year, while a 3% increase in oil production increased revenues by $7.1 million.

Natural gas revenues for the three months ended March 31, 2025 were $30.3 million higher than the three months ended March 31, 2024.

A 103% increase in average price increased first quarter 2025 revenues by $21.7 million compared to the same period in the prior year, and a 20% increase in natural gas production increased revenues by $8.6 million.

NGL revenues for the three months ended March 31, 2025 were $14.3 million higher than the three months ended March 31, 2024.

A 13% increase in average price increased first quarter 2025 revenues by $5.1 million compared to the same period in the prior year, and a 21% increase in NGL production increased revenues by $9.2 million.

Operating Expenses and Other Expense

The following table summarizes the Company’s operating expenses and other expense for the periods indicated.

Three Months Ended

(In thousands, except per unit data) March 31, 2025 March 31, 2024

Operating Expenses:

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Depreciation, depletion and amortization 105,853 97,076

Impairment of oil and natural gas properties — — — 15,735

General and administrative expenses 24,588 23,555

Total operating expenses $ 214,478 $ 194,859

Other Income (Expense):

Interest income (expense), net $ (3,856) $ 1,034 $ (9,683) $ 372

Other Expense:

Interest expense, net $ (5,252) $ (2,312)

Other income (expense), net 1,215 (4,313)

Total other income (expense), net $ 3,430 $ 555 $ (5,665) $ 8,015

Total other expense, net $ (4,037) $ (6,625)

Average Operating Costs per boe:

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Depreciation, depletion and amortization 12.18 12.58

Impairment of oil and natural gas properties — — — 0.71

General and administrative expenses 2.83 3.05

Lease operating expenses are costs incurred in the operation of producing properties, including expenses for utilities, direct labor, water disposal, workover rigs, workover expenses, materials, and supplies.

Lease operating expenses for the three months ended September 30, 2024 were $8.6 million, or $0.61 per boe, higher compared to the corresponding 2023 period.

Lease operating expenses for the nine months ended September 30, 2024 were $19.9 million, or $0.38 per boe, higher compared to the corresponding 2023

The increases in both periods were due to an increase in chemicals, compression, operating and maintenance costs and payroll expense associated with higher well count and higher workover activity.

Gathering, transportation and processing costs are costs incurred to deliver oil, natural gas, and NGLs to the market.

Lease operating expenses for the three months ended March 31, 2025 were $0.9 million higher, and $0.56 per boe lower, compared to the three months ended March 31, 2024, with the overall increase due to higher production and well count.

The per boe decrease was the result of a broad cost reduction initiative in 2024 resulting in cost improvements in most expense categories including surface repair and maintenance, contract labor, equipment rentals, and fluid hauling.

Gathering, transportation and processing (“GTP”) costs are costs incurred to deliver oil, natural gas, and NGLs to the market.

These expenses can vary based on the volume of oil, natural gas, and NGLs produced as well as the cost of commodity processing.

The Company is also party to a number of percent-of-proceeds arrangements that track closely to natural gas and NGL pricing and affect the cost of commodity processing.

The gathering, transportation and processing costs for the three months ended September 30, 2024 were $0.4 million higher, but $0.07 per boe lower, than the three months ended September 30, 2023.

Gathering, transportation and processing costs for the nine months ended September 30, 2024 were $5.8 million, or $0.37 per boe, lower than the nine months ended September 30, 2023.

The changes in both periods were primarily due to a change in volumes sold under a percent-of-proceeds arrangement, lower natural gas and NGL pricing, and other contractual changes.

Costs decreased on a per boe basis due to increased production.

The GTP costs for the three months ended March 31, 2025 were $6.4 million, and $0.61 per boe, higher than the three months ended March 31, 2024, primarily due to higher production and natural gas and NGL prices.

In addition, as a result of changes to certain processing contracts, a higher portion of Magnolia’s GTP costs is recognized as expense as compared to a reduction to Magnolia’s natural gas and NGL revenues between periods.

Taxes other than income include production, ad valorem, and franchise taxes.

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Ad valorem taxes are based on the fair market value of the mineral interests or business assets.

Taxes other than income for the three months ended September 30, 2024 were $3.4 million, or $0.24 per boe, higher compared to the three months ended September 30, 2023.

Taxes other than income for the nine months ended September 30, 2024 were $6.7 million, or $0.09 per boe, higher compared to the nine months ended September 30, 2023.

The increase in both periods was primarily due to an increase in production taxes as a result of the increase in oil and NGL revenues, which was partially offset by the decrease in natural gas revenues.

Depreciation, depletion and amortization (“DD&A”) during the three months ended September 30, 2024 was $26.2 million, or $2.19 per boe, higher compared to the three months ended September 30, 2023.

DD&A for the nine months ended September 30, 2024 was $80.3 million, or $2.43 per boe, higher compared to the nine months ended September 30, 2023.

The increase in both periods was due to increased production and a higher depreciable cost basis.

General and administrative expenses during the three months ended September 30, 2024 were $1.8 million higher, but $0.01 per boe lower, compared to the three months ended September 30, 2023.

General and administrative expenses during the nine months ended September 30, 2024 were $9.7 million, or $0.17 per boe, higher when compared to the nine months ended September 30, 2023.

The increase in both periods was primarily driven by increased corporate payroll expenses and other non-recurring costs.

The Company recognized interest expense, net, during the three and nine months ended September 30, 2024 as compared to interest income, net during the three and nine months ended September 30, 2023.

The change from interest income, net to interest expense, net, for both periods was driven by lower interest income realized during 2024 as a result of lower cash balances.

Other income, net, during the three months ended September 30, 2024 was $7.3 million compared to other expense, net, of $0.5 million during the three months ended September 30, 2023.

The other income in 2024 was due to a gain on revaluation of the contingent consideration liability associated with the acquisition of certain oil and gas properties in the Giddings area acquired during 2023.

Other income, net, during the nine months ended September 30, 2024 was $3.6 million lower than the nine months ended September 30, 2023, primarily driven by the gain on sale of the Company’s 84.7% interest in Highlander and an earnout payment associated with the sale of the Company’s 35% membership interest in Ironwood Eagle Ford Midstream LLC in the prior year.

Taxes other than income for the three months ended March 31, 2025 were $2.2 million higher, and $0.01 per boe lower, compared to the three months ended March 31, 2024, primarily due to an increase in production taxes as a result of the increase in natural gas and NGL revenues.

Depreciation, depletion and amortization (“DD&A”) during the three months ended March 31, 2025 was $8.8 million higher, and $0.40 per boe lower, than the three months ended March 31, 2024.

Increased production increased overall DD&A, and an increase in oil and natural gas reserves decreased DD&A per boe.

General and administrative expenses (“G&A”) during the three months ended March 31, 2025 were $1.0 million higher, and $0.22 per boe lower, than the three months ended March 31, 2024.

G&A increased due to an increase in fees, licenses, and overall labor costs, including changes from the modification of stock based compensation awards in 2025.

The increases to G&A were partially offset by lower professional services and one-time costs incurred in 2024.

G&A per boe decreased due to higher production.

Interest expense, net, during the three months ended March 31, 2025 was $2.9 million higher than the three months ended March 31, 2024, primarily driven by lower interest income realized during 2025 as a result of lower interest rates and cash balances.

Other income, net, during the three months ended March 31, 2025 was $1.2 million compared to other expense, net of $4.3 million during the three months ended March 31, 2024.

The change year-over-year is primarily comprised of the revaluation of the contingent consideration liability associated with the acquisition of certain oil and gas producing properties in the Giddings area in the fourth quarter of 2023.

Income Tax Expense

The following table summarizes the Company’s income tax expense for the periods indicated.

Three Months Ended Nine Months Ended

(In thousands) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Current income tax expense (benefit) $ (480) $ 19,262 $ 21,676 $ 27,450

Three Months Ended

(In thousands) March 31, 2025 March 31, 2024

Current income tax expense $ 12,795 $ 11,628

Deferred income tax expense 12,342 8,708

Income tax expense $ 25,137 $ 20,336

Income tax expense during the three and nine months ended September 30, 2024 was $4.7 million and $2.0 million lower than the three and nine months ended September 30, 2023, respectively.

The decrease in tax expense was primarily a result of a decrease in income before income taxes, and additional tax credits, partially offset by an increase in controlling interest.

For the three months ended March 31, 2025, income tax expense was $4.8 million higher than the three months ended March 31, 2024, comprised of movements in both current and deferred income taxes.

This was driven by a $1.2 million increase in current income tax expense and a $3.6 million increase in deferred income tax expense, primarily due to an increase in income before income taxes, an increased controlling interest, and the statutory reduction in accelerated depreciation of capital expenditures.

See Note 9— Income Taxes in the notes to the Company’s consolidated financial statements included in this Quarterly Report on Form 10-Q for further detail.

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The Company’s primary uses of cash have been for development of the Company’s oil and natural gas properties, returning capital to shareholders, bolt-on acquisitions of oil and natural gas properties, and general working capital needs.

The Company may also utilize borrowings under other various financing sources available to it, including its RBL Facility and the issuance of equity or debt securities through public offerings or private placements, to fund Magnolia’s acquisitions and long-term liquidity needs.

Magnolia’s ability to complete future offerings of equity or debt securities and the timing of these offerings will depend upon various factors, including prevailing market conditions and the Company’s financial condition.

The Company may also utilize borrowings under other various financing sources available to Magnolia, including the RBL Facility and the issuance of equity or debt securities through public offerings or private placements, to fund Magnolia’s acquisitions and long-term liquidity needs.

Magnolia’s ability to complete future offerings of equity and debt securities and the timing of these offerings will depend upon various factors, including prevailing market conditions and the Company’s financial condition.

The Company anticipates its current cash balance, cash flows from operations, and its available sources of liquidity to be sufficient to meet the Company’s cash requirements.

As of September 30, 2024, the Company had $400.0 million of principal debt related to the 2026 Senior Notes outstanding and no outstanding borrowings related to the RBL Facility.

As of September 30, 2024, the Company had $726.1 million of liquidity comprised of the $450.0 million of borrowing base capacity of the RBL Facility, and $276.1 million of cash and cash equivalents.

As of March 31, 2025, the Company had $400.0 million of principal debt related to the 2032 Senior Notes outstanding and no outstanding borrowings related to the RBL Facility.

As of March 31, 2025, the Company had $697.6 million of liquidity comprised of the $450.0 million of borrowing capacity under the RBL Facility, and $247.6 million of cash and cash equivalents.

Cash and Cash Equivalents

At September 30, 2024, Magnolia had $276.1 million of cash and cash equivalents.

At March 31, 2025, Magnolia had $247.6 million of cash and cash equivalents.

The Company’s cash and cash equivalents are maintained with various financial institutions in the United States.

Deposits with these institutions may exceed the amount of insurance provided on such deposits.

However, the Company regularly monitors the financial stability of such financial institutions and believes that the Company is not exposed to any significant default risk.

However, the Company regularly monitors the financial stability of its financial institutions and believes that the Company is not exposed to any significant default risk.

Sources and Uses of Cash and Cash Equivalents

The following table presents the sources and uses of the Company’s cash and cash equivalents for the periods presented:

Nine Months Ended

(In thousands) September 30, 2024 September 30, 2023

Three Months Ended

(In thousands) March 31, 2025 March 31, 2024

SOURCES OF CASH AND CASH EQUIVALENTS

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Class A Common Stock repurchases (52,393) (51,201)

Class B Common Stock purchases and cancellations (89,670) —

Dividends paid (28,911) (24,010)

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The factors that determine operating cash flows are largely the same as those that affect net earnings, with the exception of certain non-cash expenses such as DD&A, stock based compensation, amortization of deferred financing costs, revaluation of contingent consideration, impairment of oil and natural gas properties, asset retirement obligations accretion, and deferred taxes.

Net cash provided by operating activities totaled $698.2 million and $608.9 million for the nine months ended September 30, 2024 and 2023, respectively.

During the nine months ended September 30, 2024, cash provided by operating activities was positively impacted by the timing of collections and an increase in production and realized oil prices, partially offset by a decrease in realized natural gas and NGL prices.

Net cash provided by operating activities totaled $224.5 million and $210.9 million for the three months ended March 31, 2025 and 2024, respectively.

During the three months ended March 31, 2025, cash provided by operating activities was positively impacted by increased production and an increase in realized natural gas and NGL prices, partially offset by the timing of receipts and payments and a decrease in realized oil prices.

Uses of Cash and Cash Equivalents

During the nine months ended September 30, 2024, the Company paid $165.0 million for acquisitions, primarily comprised of a $125.0 million acquisition in the Giddings area.

The acquisitions were funded with cash on hand.

The Company made individually insignificant bolt-on acquisitions during each of the three months ended March 31, 2025 and 2024.

In addition, during the three months ended March 31, 2024, Magnolia paid $13.2 million in deposits for acquisitions that closed in the second quarter of 2024.

Additions to Oil and Natural Gas Properties

The following table sets forth the Company’s capital expenditures for the periods presented:

Three Months Ended Nine Months Ended

(In thousands) September 30, 2024 September 30, 2023 September 30, 2024 September 30, 2023

Three Months Ended

(In thousands) March 31, 2025 March 31, 2024

Drilling and completion $ 130,439 $ 118,979

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Total capital expenditures $ 131,168 $ 120,986

During the third quarter of 2024, Magnolia was running a two-rig program.

During the first quarter of 2025, Magnolia operated two rigs.

The number of operated drilling rigs is largely dependent on commodity prices and the Company’s strategy of maintaining spending to accommodate the Company’s business model.

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Capital Requirements

As of September 30, 2024 the Company’s board of directors had authorized a share repurchase program of up to 40.0 million shares of Class A Common Stock.

As of March 31, 2025 the Company’s board of directors had authorized a share repurchase program of up to 50.0 million shares of Class A Common Stock.

The program does not require purchases to be made within a particular time frame and whether the Company undertakes these additional repurchases is ultimately subject to numerous considerations, market conditions, and other factors.

During the nine months ended September 30, 2024 and 2023, the Company repurchased 5.3 million and 7.1 million shares for a total cost of approximately $127.0 million and $152.9 million, respectively.

During the nine months ended September 30, 2024, Magnolia LLC repurchased and subsequently canceled 3.5 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $89.7 million of cash consideration.

As of September 30, 2024, Magnolia owned approximately 97.2% of the interest in Magnolia LLC and the noncontrolling interest was approximately 2.8%.

During the nine months ended September 30, 2024, the Company declared and paid cash dividends to holders of its Class A Common Stock totaling $72.5 million.

During each of the three months ended March 31, 2025 and 2024, the Company repurchased 2.2 million and 2.4 million shares for a total cost of approximately $52.0 million and $52.4 million, respectively.

As of March 31, 2025, Magnolia owned approximately 97.1% of the interest in Magnolia LLC and the noncontrolling interest was approximately 2.9%.

During the three months ended March 31, 2025, the Company declared and paid cash dividends to holders of its Class A Common Stock totaling $28.9 million.

Additionally, $0.8 million was distributed to the Magnolia LLC Unit Holders.

During the nine months ended September 30, 2023, the Company declared cash dividends to holders of its Class A Common Stock totaling $66.3 million.

During the same time period, cash paid for dividends was $66.5 million, inclusive of dividends on vested non-participating securities.

During the three months ended March 31, 2024, the Company declared and paid cash dividends to holders of its Class A Common Stock totaling $24.0 million.

Additionally, $2.8 million was distributed to the Magnolia LLC Unit Holders.

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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-Q

Item 2. Management’s Discussion and Analysis