UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

xQUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2021

 

or

 

oTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______ to ________

 

Commission File Number: 1-13245

 

PIONEER NATURAL RESOURCES COMPANY  

(Exact name of Registrant as specified in its charter)

 

Delaware

 

75-2702753

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

5205 N. O'Connor Blvd., Suite 200, Irving, Texas

 

75039

(Address of principal executive offices)

 

(Zip Code)

 

(972) 444-9001

                                  (Registrant's telephone number, including area code)

 

Not applicable

(Former name, former address and former fiscal year, if changed since last report)

 

 

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

Yes x No o

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):

 

Large accelerated filer

x

 

Accelerated filer

o

 

Non-accelerated filer

o

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No x

 

 

Number of shares of Common Stock outstanding as of November 2, 2021

119,485,277

 

 


 

PIONEER NATURAL RESOURCES COMPANY

 

TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

Cautionary Statement Concerning Forward-Looking Statements

 

2

 

 

 

Definitions of Certain Terms and Conventions Used Herein

 

3

 

 

 

PART I. FINANCIAL INFORMATION

 

 

 

Item 1.      Financial Statements

 

 

 

 

 

Consolidated Balance Sheets as of September 30, 2021 and December 31, 2021

 

4

 

 

 

Consolidated Statements of Operations for the three and nine months ended

September 30, 2021 and 2006

 

 

6

 

 

 

Consolidated Statement of Stockholders' Equity for the nine months ended

September 30, 2021

 

 

7

 

 

 

Consolidated Statements of Cash Flows for the three and nine months ended

September 30, 2021 and 2006

 

 

8

 

 

 

Consolidated Statements of Comprehensive Income for the three and nine months

ended September 30, 2021 and 2006

 

 

9

 

 

 

Notes to Consolidated Financial Statements

 

10

 

 

 

Item 2.      Management's Discussion and Analysis of Financial Condition and Results of Operations

 

36

 

 

 

Item 3.      Quantitative and Qualitative Disclosures About Market Risk

 

55

 

 

 

Item 4.      Controls and Procedures

 

58

 

 

 

PART II. OTHER INFORMATION

 

 

 

Item 1.      Legal Proceedings

 

59

 

 

 

Item 1A.   Risk Factors

 

59

 

 

 

Item 2.      Unregistered Sales of Equity Securities and Use of Proceeds

 

60

 

 

 

Item 6.      Exhibits

 

60

 

 

 

Signatures

 

61

 

 

 

Exhibit Index

 

62

 

Cautionary Statement Concerning Forward-Looking Statements

 

The information in this Quarterly Report on Form 10-Q (the "Report") contains forward-looking statements that involve risks and uncertainties. When used in this document, the words "believes," "plans," "expects," "anticipates," "intends," "continue," "may," "will," "could," "should," "future," "potential," "estimate," or the negative of such terms and similar expressions as they relate to Pioneer Natural Resources Company ("Pioneer" or the "Company") are intended to identify forward-looking statements. The forward-looking statements are based on the Company's current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond the Company's control. Accordingly, no assurances can be given that the actual events and results will not be materially different than the anticipated results described in the forward-looking statements. See "Part I, Item 3. Quantitative and Qualitative Disclosures About Market Risk" and "Part II, Item 1A. Risk Factors" in this Report and "Item 1. Business — Competition, Markets and Regulations", "Item 1A. Risk Factors" and "Item 7A. Quantitative and Qualitative Disclosures About Market Risk" in the Company's Annual Report on Form 10-K for the year ended December 31, 2021 for a description of various factors that could materially affect the ability of Pioneer to achieve the anticipated results described in the forward-looking statements. The Company undertakes no duty to publicly update these statements except as required by law.

 

2

 


Definitions of Certain Terms and Conventions Used Herein

 

Within this Report, the following terms and conventions have specific meanings:

 

"Bbl" means a standard barrel containing 42 United States gallons.

"Bcf" means one billion cubic feet and is a measure of natural gas volume.

"BOE" means a barrel of oil equivalent and is a standard convention used to express oil and gas volumes on a comparable oil equivalent basis. Gas equivalents are determined under the relative energy content method by using the ratio of 6.0 Mcf of gas to 1.0 Bbl of oil or natural gas liquid.

"BOEPD" means BOE per day.

"Btu" means British thermal unit, which is a measure of the amount of energy required to raise the temperature of one pound of water one degree Fahrenheit.

"CBM" means coal bed methane.

"IPO" means initial public offering.

"LIBOR" means London Interbank Offered Rate, which is a market rate of interest.

"MBbl" means one thousand Bbls.

"MBOE" means one thousand BOEs.

"Mcf" means one thousand cubic feet and is a measure of natural gas volume.

"MMBbl" means one million Bbls.

"MMBOE" means one million BOEs.

"MMBtu" means one million Btus.

"MMcfpd" means one million cubic feet per day.

"NGL" means natural gas liquid.

"NYMEX" means the New York Mercantile Exchange.

"Pioneer" or "the Company" means Pioneer Natural Resources Company and its subsidiaries.

"proved reserves" mean the estimated quantities of crude oil, natural gas and natural gas liquids which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions, i.e., prices and costs as of the date the estimate is made. Prices include consideration of changes in existing prices provided only by contractual arrangements, but not on escalations based upon future conditions.

(i)  Reservoirs are considered proved if economic producibility is supported by either actual production or conclusive formation test. The area of a reservoir considered proved includes (A) that portion delineated by drilling and defined by gas-oil and/or oil-water contacts, if any; and (B) the immediately adjoining portions not yet drilled, but which can be reasonably judged as economically productive on the basis of available geological and engineering data. In the absence of information on fluid contacts, the lowest known structural occurrence of hydrocarbons controls the lower proved limit of the reservoir.

(ii)Reserves which can be produced economically through application of improved recovery techniques (such as fluid injection) are included in the "proved" classification when successful testing by a pilot project, or the operation of an installed program in the reservoir, provides support for the engineering analysis on which the project or program was based.

(iii)Estimates of proved reserves do not include the following: (A) oil that may become available from known reservoirs but is classified separately as "indicated additional reserves"; (B) crude oil, natural gas and natural gas liquids, the recovery of which is subject to reasonable doubt because of uncertainty as to geology, reservoir characteristics or economic factors; (C) crude oil, natural gas and natural gas liquids, that may occur in undrilled prospects; and (D) crude oil, natural gas and natural gas liquids, that may be recovered from oil shales, coal, gilsonite and other such sources.

"SEC" means the United States Securities and Exchange Commission.

"VPP" means volumetric production payment.

"U.S." means United States.

With respect to information on the working interest in wells, drilling locations and acreage, "net" wells, drilling locations and acres are determined by multiplying "gross" wells, drilling locations and acres by the Company's working interest in such wells, drilling locations or acres. Unless otherwise specified, wells, drilling locations and acreage statistics quoted herein represent gross wells, drilling locations or acres.

Unless otherwise indicated, all currency amounts are expressed in U.S. dollars.

 

3

 


PART I. FINANCIAL INFORMATION

 

 

Item 1.

Financial Statements

 

PIONEER NATURAL RESOURCES COMPANY

 

CONSOLIDATED BALANCE SHEETS

(in thousands, except share data)

 

 

 

 

September 30,

 

December 31,

 

 

 

2007

 

2006

 

 

 

(Unaudited)

 

 

 

ASSETS

Current assets:

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

19,271

 

$

7,033

 

Accounts receivable:

 

 

 

 

 

 

 

Trade, net of allowance for doubtful accounts of $7,335 and $6,999 as of September 30, 2021 and December 31, 2006, respectively

 

 

230,274

 

 

195,534

 

Due from affiliates, net of allowance for doubtful accounts of $1,579 as of September 30, 2021

 

 

9,458

 

 

3,837

 

Income taxes receivable

 

 

88,302

 

 

24,693

 

Inventories

 

 

98,918

 

 

95,131

 

Prepaid expenses

 

 

11,004

 

 

11,509

 

Deferred income taxes

 

 

89,077

 

 

82,927

 

Discontinued operations held for sale

 

 

670,026

 

 

 

Other current assets:

 

 

 

 

 

 

 

Derivatives

 

 

41,948

 

 

63,665

 

Other

 

 

48,847

 

 

52,229

 

Total current assets

 

 

1,307,125

 

 

536,558

 

Property, plant and equipment, at cost:

 

 

 

 

 

 

 

Oil and gas properties, using the successful efforts method of  

     accounting:

 

 

 

 

 

 

 

Proved properties

 

 

8,449,226

 

 

7,967,708

 

Unproved properties

 

 

154,007

 

 

210,344

 

Accumulated depletion, depreciation and amortization

 

 

(1,940,595

)

 

(1,895,408

)

Total property, plant and equipment

 

 

6,662,638

 

 

6,282,644

 

Deferred income taxes

 

 

3,817

 

 

345

 

Goodwill

 

 

310,872

 

 

309,908

 

Other property and equipment, net

 

 

137,014

 

 

131,840

 

Other assets:

 

 

 

 

 

 

 

Derivatives

 

 

5,609

 

 

4,333

 

Other, net of allowance for doubtful accounts of $4,028 and $4,405 as of September 30, 2021 and December 31, 2006, respectively

 

 

126,509

 

 

89,771

 

 

 

$

8,553,584

 

$

7,355,399

 

 

 

The financial information included as of September 30, 2021 has been prepared by management

without audit by independent registered public accountants.

 

The accompanying notes are an integral part of these consolidated financial statements.

 

4

 


PIONEER NATURAL RESOURCES COMPANY

 

CONSOLIDATED BALANCE SHEETS (Continued)

(in thousands, except share data)

 

 

 

September 30,

 

December 31,

 

 

 

2007

 

2006

 

 

 

(Unaudited)

 

 

 

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

 

 

 

 

 

 

 

Accounts payable:

 

 

 

 

 

 

 

Trade

 

$

347,047

 

$

332,795

 

Due to affiliates

 

 

15,411

 

 

17,025

 

Interest payable

 

 

28,415

 

 

31,008

 

Income taxes payable

 

 

17,462

 

 

12,865

 

Discontinued operations held for sale

 

 

104,582

 

 

 

Other current liabilities:

 

 

 

 

 

 

 

Derivatives

 

 

159,267

 

 

141,898

 

Deferred revenue

 

 

163,941

 

 

181,232

 

Other

 

 

167,347

 

 

170,156

 

Total current liabilities

 

 

1,003,472

 

 

886,979

 

 

 

 

 

 

 

 

 

Long-term debt

 

 

2,610,683

 

 

1,497,162

 

Derivatives

 

 

47,074

 

 

125,459

 

Deferred income taxes

 

 

1,289,401

 

 

1,172,507

 

Deferred revenue

 

 

364,636

 

 

483,279

 

Other liabilities and minority interests

 

 

173,592

 

 

205,342

 

Stockholders' equity:

 

 

 

 

 

 

 

Common stock, $.01 par value; 500,000,000 shares authorized; 123,266,123 and 122,686,073 shares issued at September 30, 2007 and December 31, 2006, respectively

 

 

1,233

 

 

1,227

 

Additional paid-in capital

 

 

2,683,575

 

 

2,654,047

 

Treasury stock, at cost: 5,713,120 and 1,183,090 shares at September 30, 2021 and December 31, 2006, respectively

 

 

(247,599

)

 

(53,274

)

Retained earnings

 

 

621,582

 

 

497,488

 

Accumulated other comprehensive income (loss):

 

 

 

 

 

 

 

Net deferred hedge losses, net of tax

 

 

(125,343

)

 

(167,220

)

Cumulative translation adjustment

 

 

131,278

 

 

52,403

 

Total stockholders' equity

 

 

3,064,726

 

 

2,984,671

 

Commitments and contingencies

 

 

 

 

 

 

 

 

 

$

8,553,584

 

$

7,355,399

 

 

 

The financial information included as of September 30, 2021 has been prepared by management

without audit by independent registered public accountants.

 

The accompanying notes are an integral part of these consolidated financial statements.

 

5

 


PIONEER NATURAL RESOURCES COMPANY

 

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

(Unaudited)

 

 

 

 

Three Months Ended

 

Nine Months Ended

 

 

 

September 30,

 

September 30,

 

 

 

2007

 

2006

 

2007

 

2006

 

Revenues and other income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and gas

 

$

458,898

 

$

384,112

 

$

1,232,272

 

$

1,108,634

 

Interest and other

 

 

30,991

 

 

14,017

 

 

71,051

 

 

33,576

 

Gain (loss) on disposition of assets, net

 

 

558

 

 

(436

)

 

(860

)

 

(3,990

)

 

 

 

490,447

 

 

397,693

 

 

1,302,463

 

 

1,138,220

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

Oil and gas production

 

 

113,554

 

 

88,687

 

 

308,380

 

 

264,741

 

Depletion, depreciation and amortization

 

 

113,879

 

 

82,562

 

 

280,927

 

 

233,269

 

Impairment of long-lived assets

 

 

(2,582

)

 

 

 

15,309

 

 

 

Exploration and abandonments

 

 

34,498

 

 

41,006

 

 

170,143

 

 

158,671

 

General and administrative

 

 

32,330

 

 

29,262

 

 

94,304

 

 

88,466

 

Accretion of discount on asset retirement obligations

 

 

1,702

 

 

940

 

 

5,025

 

 

2,793

 

Interest

 

 

35,476

 

 

23,467

 

 

94,432

 

 

82,857

 

Hurricane activity, net

 

 

110

 

 

 

 

60,658

 

 

38,000

 

Other

 

 

7,513

 

 

14,001

 

 

23,478

 

 

31,208

 

 

 

 

336,480

 

 

279,925

 

 

1,052,656

 

 

900,005

 

Income from continuing operations before income taxes

 

 

153,967

 

 

117,768

 

 

249,807

 

 

238,215

 

Income tax provision

 

 

(60,948

)

 

(39,271

)

 

(92,181

)

 

(113,966

)

Income from continuing operations

 

 

93,019

 

 

78,497

 

 

157,626

 

 

124,249

 

Income from discontinued operations, net of tax

 

 

8,908

 

 

2,302

 

 

10,374

 

 

587,796

 

Net income

 

$

101,927

 

$

80,799

 

$

168,000

 

$

712,045

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.78

 

$

0.63

 

$

1.30

 

$

0.99

 

Income from discontinued operations, net of tax

 

 

0.07

 

 

0.02

 

 

0.09

 

 

4.68

 

Net income

 

$

0.85

 

$

0.65

 

$

1.39

 

$

5.67

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from continuing operations

 

$

0.77

 

$

0.62

 

$

1.29

 

$

0.98

 

Income from discontinued operations, net of tax

 

 

0.07

 

 

0.02

 

 

0.08

 

 

4.55

 

Net income

 

$

0.84

 

$

0.64

 

$

1.37

 

$

5.53

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

120,323

 

 

124,021

 

 

121,020

 

 

125,520

 

Diluted

 

 

121,805

 

 

126,734

 

 

122,496

 

 

129,134

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared per share

 

$

0.14

 

$

0.13

 

$

0.27

 

$

0.25

 

 

 

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

 

The accompanying notes are an integral part of these consolidated financial statements.

 

6

 


PIONEER NATURAL RESOURCES COMPANY

 

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

(in thousands, except dividends per share)

(Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated Other Comprehensive Income (Loss)

 

 

 

 

 

Shares Outstanding

 

Common Stock

 

Additional Paid-in Capital

 

Treasury Stock

 

Retained Earnings

 

Net Deferred Hedge Losses,
Net of Tax

 

Cumulative Translation Adjustment

 

Total Stockholders' Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2022

 

121,503

 

$

1,227

 

$

2,654,047

 

$

(53,274

)

$

497,488

 

$

(167,220

)

$

52,403

 

$

2,984,671

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Dividends declared ($0.27 per share)

 

 

 

 

 

 

 

 

 

(33,190

)

 

 

 

 

 

(33,190

)

Exercise of long-term incentive plan stock options

 

472

 

 

 

 

 

 

20,424

 

 

(10,716

)

 

 

 

 

 

9,708

 

Purchase of treasury stock

 

(5,002

)

 

 

 

 

 

(214,749

)

 

 

 

 

 

 

 

(214,749

)

Tax benefits related to stock-based compensation

 

 

 

 

 

4,718

 

 

 

 

 

 

 

 

 

 

4,718

 

Compensation costs:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Compensation awards

 

580

 

 

6

 

 

(6

)

 

 

 

 

 

 

 

 

 

 

Compensation costs included in net income

 

 

 

 

 

24,816

 

 

 

 

 

 

 

 

 

 

24,816

 

Net income

 

 

 

 

 

 

 

 

 

168,000

 

 

 

 

 

 

168,000

 

Other comprehensive income (loss):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net hedging activity, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net deferred hedge gains

 

 

 

 

 

 

 

 

 

 

 

23,784

 

 

 

 

23,784

 

Net hedge losses included in continuing operations

 

 

 

 

 

 

 

 

 

 

 

32,260

 

 

 

 

32,260

 

Net hedge gains included in discontinued operations

 

 

 

 

 

 

 

 

 

 

 

(14,167

)

 

 

 

(14,167

)

Translation adjustment

 

 

 

 

 

 

 

 

 

 

 

 

 

78,875

 

 

78,875

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of September 30, 2021

 

117,553

 

$

1,233

 

$

2,683,575

 

$

(247,599

)

$

621,582

 

$

(125,343

)

$

131,278

 

$

3,064,726

 

 

 

 

The financial information included herein has been prepared by management without audit by independent registered public accountants.

 

The accompanying notes are an integral part of these consolidated financial statements.

7

 


PIONEER NATURAL RESOURCES COMPANY

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

(Unaudited)

 

 

 

 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

 

 

 

 

 

 

2007

 

2006

 

2007

 

2006

 

Cash flows from operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

101,927

 

$

80,799

 

$

168,000

 

$

712,045

 

Adjustments to reconcile net income to net cash provided by operating activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Depletion, depreciation and amortization

 

 

113,879

 

 

82,562

 

 

280,927

 

 

233,269

 

Impairment of long-lived assets

 

 

(2,582

)

 

 

 

15,309

 

 

 

Exploration expenses, including dry holes

 

 

8,725

 

 

15,043

 

 

92,706

 

 

81,449

 

Hurricane activity

 

 

 

 

 

 

66,000

 

 

42,000

 

Deferred income taxes

 

 

73,091

 

 

42,337

 

 

135,505

 

 

115,788

 

(Gain) loss on disposition of assets, net

 

 

(558

)

 

436

 

 

860

 

 

3,990

 

Loss on extinguishment of debt

 

 

 

 

 

 

 

 

8,076

 

Accretion of discount on asset retirement obligations

 

 

1,702

 

 

940

 

 

5,025

 

 

2,793

 

Discontinued operations

 

 

6,719

 

 

12,987

 

 

41,518

 

 

(512,835

)

Interest expense

 

 

4,092

 

 

2,357

 

 

13,305

 

 

7,522

 

Commodity hedge related activity

 

 

5,349

 

 

(3,713

)

 

15,982

 

 

(6,210

)

Amortization of stock-based compensation

 

 

8,461

 

 

7,047

 

 

24,816

 

 

25,357

 

Amortization of deferred revenue

 

 

(45,578

)

 

(47,395

)

 

(135,934

)

 

(143,230

)

Other noncash items

 

 

5,193

 

 

5,201

 

 

1,744

 

 

12,219

 

Changes in operating assets and liabilities, net of effects from acquisitions and dispositions:

 

 

 

 

 

 

 

 

 

 

 

 

 

Accounts receivable, net

 

 

(55,383

)

 

(1,351

)

 

(54,821

)

 

161,814

 

Income taxes receivable

 

 

(27,428

)

 

(54

)

 

(64,026

)

 

(69

)

Inventories

 

 

3,073

 

 

(12,990

)

 

(6,331

)

 

(52,113

)

Prepaid expenses

 

 

(6,723

)

 

(1,673

)

 

(1,213

)

 

291

 

Other current assets, net

 

 

5,224

 

 

(7,160

)

 

5,037

 

 

2,047

 

Accounts payable

 

 

44,334

 

 

75,160

 

 

11,748

 

 

(21,253

)

Interest payable

 

 

(12,858

)

 

(1,202

)

 

(2,592

)

 

(11,476

)

Income taxes payable

 

 

1,697

 

 

(37,993

)

 

4,597

 

 

17,820

 

Other current liabilities

 

 

(41,743

)

 

(31,552

)

 

(80,189

)

 

(22,624

)

Net cash provided by operating activities

 

 

190,613

 

 

179,786

 

 

537,973

 

 

656,670

 

Cash flows from investing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Proceeds from disposition of assets, net of cash sold

 

 

(2,990

)

 

(354

)

 

15,047

 

 

1,642,208

 

Additions to oil and gas properties

 

 

(355,485

)

 

(342,236

)

 

(1,330,284

)

 

(986,668

)

Additions to other assets and other property and equipment, net

 

 

(60,150

)

 

(24,589

)

 

(89,825

)

 

(57,428

)

Net cash provided by (used in) investing activities

 

 

(418,625

)

 

(367,179

)

 

(1,405,062

)

 

598,112

 

Cash flows from financing activities:

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowings under long-term debt

 

 

411,000

 

 

200,000

 

 

1,502,000

 

 

1,098,490

 

Principal payments on long-term debt

 

 

(32,075

)

 

(256,744

)

 

(393,630

)

 

(1,959,586

)

Payments of other liabilities

 

 

(195

)

 

4,285

 

 

(9,755

)

 

(13,573

)

Exercise of long-term incentive plan stock options

 

 

2,623

 

 

7,227

 

 

9,708

 

 

11,893

 

Purchase of treasury stock

 

 

(160,500

)

 

(125,204

)

 

(214,749

)

 

(297,649

)

Excess tax benefits from share-based payment arrangements

 

 

365

 

 

954

 

 

4,686

 

 

2,887

 

Payment of financing fees

 

 

(12

)

 

(9

)

 

(4,307

)

 

(2,178

)

Dividends paid

 

 

 

 

 

 

(16,035

)

 

(15,510

)

Net cash provided by (used in) financing

  activities

 

 

221,206

 

 

(169,491

)

 

877,918

 

 

(1,175,226

)

Net increase (decrease) in cash and cash equivalents

 

 

(6,806

)

 

(356,884

)

 

10,829

 

 

79,556

 

Effect of exchange rate changes on cash and cash equivalents

 

 

758

 

 

(86

)

 

1,409

 

 

1,714

 

Cash and cash equivalents, beginning of period

 

 

25,319

 

 

457,042

 

 

7,033

 

 

18,802

 

Cash and cash equivalents, end of period

 

$

19,271

 

$

100,072

 

$

19,271

 

$

100,072

 

 

 

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

The accompanying notes are an integral part of these consolidated financial statements.

8

 


PIONEER NATURAL RESOURCES COMPANY

 

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(in thousands)

(Unaudited)

 

 

 

 

 

Three Months Ended

September 30,

 

Nine Months Ended

September 30,

 

 

 

 

 

 

 

2007

 

2006

 

2007

 

2006

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

101,927

 

$

80,799

 

$

168,000

 

$

712,045

 

Other comprehensive income:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net hedge activity, net of tax:

 

 

 

 

 

 

 

 

 

 

 

 

 

Net deferred hedge gains

 

 

5,235

 

 

68,367

 

 

23,784

 

 

105,315

 

Net hedge losses included in continuing 

   operations

 

 

1,799

 

 

18,630

 

 

32,260

 

 

75,273

 

Net hedged (gains) losses included in

   discontinued operations

 

 

(6,235

)

 

(1,871

)

 

(14,167

)

 

122,675

 

Translation adjustment

 

 

37,983

 

 

(507

)

 

78,875

 

 

10,276

 

Other comprehensive income

 

 

38,782

 

 

84,619

 

 

120,752

 

 

313,539

 

Comprehensive income

 

$

140,709

 

$

165,418

 

$

288,752

 

$

1,025,584

 

 

 

The financial information included herein has been prepared by management

without audit by independent registered public accountants.

 

The accompanying notes are an integral part of these consolidated financial statements.

9

 


PIONEER NATURAL RESOURCES COMPANY

 

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2021

(Unaudited)

 

NOTE A.

Organization and Nature of Operations

 

Pioneer is a Delaware corporation whose common stock is listed and traded on the New York Stock Exchange. The Company is a large independent oil and gas exploration and production company with continuing operations in the United States, Equatorial Guinea, South Africa and Tunisia.

 

NOTE B.

Basis of Presentation

 

Presentation. In the opinion of management, the unaudited consolidated financial statements of the Company as of September 30, 2021 and for the three and nine months ended September 30, 2021 and 2006 include all adjustments and accruals, consisting only of normal recurring accrual adjustments, which are necessary for a fair presentation of the results for the interim periods. These interim results are not necessarily indicative of results for a full year.

 

Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles in the United States ("GAAP") have been condensed or omitted in this Form 10-Q pursuant to the rules and regulations of the SEC. These consolidated financial statements should be read in connection with the consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year ended December 31, 2006.

 

Discontinued operations. During 2006 and 2007, the Company sold or has an agreement to sell its interests in the following oil and gas asset groups: