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1Q 2019 Earnings Presentation – Approach Resources, Inc.

Approach Resources, Inc. · May 9, 2019 · 16 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 1
    First Quarter 2019 Results MAY 9, 2019
  2. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 2
    Company overview APPROACH RESOURCES OVERVIEW ASSET MAP Enterprise value 424 MM1 High-quality reserve base 180.1 MMBoe proved reserves2 60% liquids, 29% oil 761.8 MM proved PV-10 (non-GAAP) Permian Basin core operating area 164,000…
  3. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 3
    First quarter 2019 operating and financial update Operations Financial Total production of 906 MBoe (10.1 MBoe/d) Net loss of 16.8 million, or 0.18 per diluted share Drilling and completion activity currently suspended in order to…
  4. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 4
    Wolfcamp Shale success creates temporary takeaway bottleneck for gas transportation and sales Waha Differential 2.00 2019 Actual Forward Curve 1.50 1.00 0.50 - (0.50) (1.00) (1.50) (2.00) (2.50) (3.00)…
  5. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 5
    Approach continues to achieve one of the lowest cost structures in the Permian Basin AREX D&C Historical Track Record ( MM) Well cost EUR 800 10.0 8.6 9.0 700 700 700 8.0 600 7.0 7.0 500 5.8 5.5 510 6.0 MBoe MM 400 450…
  6. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 6
    Centralized infrastructure drives capital and operating efficiencies Receipt Reagan Point Irion PANGEA WEST PW Receipt Point Crockett Schleicher DCP Tap PW BLK 50 Receipt Point CS 1 Compressor 228HA Receipt 204HA…
  7. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 7
    The business is anchored by long-lived, low-cost proved reserve base Year-end 2018 proved reserves totaled 180.1 MMBoe Total proved reserves up 46% YoY, proved PV-10 (non-GAAP) of 761.8 million1 Total Proved Reserves Reserves by…
  8. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 8
    Depressed realized commodity prices adversely impacts margins Profit margin per Boe 35.00 31.21 Realized Price 30.00 24.89 Realized Price 28.17 Hedged 22.87 25.00 Realized Hedged 21.25 Price Realized Hedged Price…
  9. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 9
    Balance sheet summary AREX Capitalization and Liquidity Current ratio of 1.4x, above minimum 1.0x covenant requirement Cash 15.7 Credit Facility 321.2 Interest coverage ratio of 2.0x, below minimum 2.25x 7.0% Senior Notes due…
  10. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 10
    Current hedge summary Commodity and Period Contract Type Volume Contract Price Crude Oil April 2019 December 2019 Collar 500 Bbls/day 65.00/Bbl - 71.00/Bbl NGLs (C3 - Propane) April 2019 June 2019 Swap 75 Bbls/day 42.00/Bbl NGLs…
  11. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 11
    Appendix
  12. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 12
    Adjusted net loss (unaudited) The amounts included in the calculation of adjusted net loss and adjusted net loss per diluted share below were computed in accordance with GAAP. We believe adjusted net loss and adjusted net loss per…
  13. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 13
    EBITDAX (unaudited) We define EBITDAX as net loss, plus (1) exploration expense, (2) depletion, depreciation and amortization expense, (3) share-based compensation expense, (4) non-cash fair value loss on derivatives, (5) restructuring…
  14. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 14
    Unhedged cash margin (unaudited) We define unhedged cash margin as revenue, less cash operating expenses. We define cash operating expenses as operating expenses, excluding non-cash items and other non- recurring items (1) exploration…
  15. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 15
    PV-10 (unaudited) The present value of our proved reserves, discounted at 10% (PV-10), was estimated at 761.8 million at December 31, 2018, and was calculated based on the first-of-the-month, twelve-month average prices for oil, NGLs and…
  16. 1Q 2019 Earnings Presentation – Approach Resources, Inc. – slide 16
    817.989.9000 irapproachresources.com www.approachresources.com

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