Range Resources Corp . (NYSE:RRC), a Texas-based oil and natural gas producer, reported a derivative fair value income of $47.1 million for the third quarter ended September 30, 2024, according to a filing with the Securities and Exchange Commission today.
Despite the positive headline number, the company experienced a total non-cash fair value loss of $65.1 million, driven by significant losses in natural gas derivatives which amounted to $75.0 million. However, this was partially offset by gains in natural gas liquid (NGLs) and oil derivatives, which contributed $4.3 million and $5.6 million, respectively.
On the cash flow side, Range Resources saw a net cash receipt on derivative settlements totaling $112.3 million. This included a substantial income of $107.9 million related to settled NYMEX natural gas derivatives, despite a loss of $4.7 million from settled natural gas basis derivatives.
The mixed results highlight the volatility in the derivatives market and the impact it can have on energy companies' financials. The company's detailed derivative income and losses provide a clear picture of the financial movements within this period.
The 8-K filing specifies that the information reported should not be considered as filed for purposes of Section 18 of the Securities and Exchange Act of 1934, nor incorporated by reference into any registration statement or other filing under the Securities Act of 1933, except as expressly stated in such a filing.
Range Resources Corp., formerly known as LOMAK Petroleum Inc., is headquartered in Fort Worth, Texas, and operates under the organization name 01 Energy & Transportation. The company is incorporated in Delaware and has its fiscal year end on December 31.
This report is based on a press release statement and provides a snapshot of the company's financial condition as it relates to derivative fair value income and losses for the third quarter of 2024.
In other recent news, Range Resources saw significant activity with its Q2 earnings for fiscal year 2024. The company emphasized operational efficiency and cost management, which resulted in significant free cash flow and a production rate of 2.15 billion cubic feet equivalent per day.
Furthermore, Barclays upgraded Range Resources' stock from Underweight to Equalweight, citing a more attractive valuation compared to peers Antero Resources (NYSE:AR) and Chesapeake Energy (NYSE:CHK). However, Piper Sandler downgraded the company from an Overweight to a Neutral rating, primarily due to a revised long-term natural gas price forecast.
In addition, Range Resources announced the retirement of board member Steve Gray, set for October 2024. Gray's tenure since 2018 has significantly contributed to the company's resilience and efficiency. In the meantime, Rigel (NASDAQ:RIGL) Resource Acquisition Corp secured a $1.5 million interest-free loan from its sponsor, Rigel Resource Acquisition Holding LLC, to support its operational expenses and business combination efforts. These are among the recent developments for both companies.
InvestingPro Insights
Range Resources Corp.'s (NYSE:RRC) recent financial report can be further contextualized with some key metrics from InvestingPro. The company's market capitalization stands at $7.4 billion, reflecting its significant presence in the oil and natural gas sector. Despite the volatility in derivative fair values reported, RRC maintains a P/E ratio of 15.23, suggesting a reasonable valuation relative to its earnings.
InvestingPro Tips highlight that Range Resources has been profitable over the last twelve months, which aligns with the positive derivative fair value income reported for Q3 2024. Additionally, the company operates with a moderate level of debt, which could provide financial flexibility in managing market fluctuations.
It is worth noting that RRC's revenue for the last twelve months as of Q2 2024 was $2.33 billion, with a substantial gross profit margin of 41.08%. This indicates the company's ability to maintain profitability despite the challenges in the energy market.
For investors seeking more comprehensive analysis, InvestingPro offers 7 additional tips that could provide deeper insights into Range Resources' financial health and market position.
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