Concho Resources Inc. Reports Third Quarter 2012 Financial and Operating Results, Provides 2013 Capital Budget Detail and

  Concho Resources Inc. Reports Third Quarter 2012 Financial and Operating
  Results, Provides 2013 Capital Budget Detail and Guidance and Agrees to Sell
  Non-Core Assets

Business Wire

MIDLAND, Texas -- November 07, 2012

Concho Resources Inc. (NYSE: CXO) (“Concho” or the “Company”) today reported
financial and operating results for the three and nine months ended September
30, 2012. Highlights for the three and nine months ended September 30, 2012
include:

  *Production of 7.8 million barrels of oil equivalent (“MMBoe”) for the
    third quarter of 2012, a 24% increase over the third quarter of 2011 and a
    14% increase over the second quarter of 2012
  *Net income of $6.0 million, or $0.06 per diluted share, for the third
    quarter of 2012, as compared to net income of $356.2 million, or $3.44 per
    diluted share, in the third quarter of 2011
  *Adjusted net income^1 (non-GAAP) of $99.8 million, or $0.96 per diluted
    share, for the third quarter of 2012, as compared to $117.8 million, or
    $1.14 per diluted share, for the third quarter of 2011
  *EBITDAX^2 (non-GAAP) of $387.2 million for the third quarter of 2012, an
    11% increase over the third quarter of 2011

^1 Adjusted net income (non-GAAP) is comparable to securities analyst
estimates. For an explanation of how we calculate adjusted net income
(non-GAAP) and a reconciliation of net income (GAAP) to adjusted net income
(non-GAAP), please see "Supplemental Non-GAAP Financial Measures" below.

^2 For an explanation of how we calculate and use EBITDAX (non-GAAP) and a
reconciliation of net income (GAAP) to EBITDAX (non-GAAP), please see
"Supplemental Non-GAAP Financial Measures" below.

Third Quarter 2012 Financial Results

Production for the third quarter of 2012 totaled 7.8 MMBoe (4.6 million
barrels of oil (“MMBbls”) and 19.1 billion cubic feet of natural gas (“Bcf”)),
an increase of 24% as compared to 6.3 MMBoe (3.9 MMBbls and 14.7 Bcf) produced
in the third quarter of 2011.

Tim Leach, Concho's Chairman, CEO and President, commented, “The third quarter
was another record quarter in terms of production and cash flow. It also
marked a shift for Concho to a drilling program that is now primarily
horizontal. The operational and capital efficiencies realized through our
horizontal program are real and have expanded our access to new high
rate-of-return drilling opportunities. Nowhere is this more evident than in
the Delaware Basin, where our results continue to improve. Looking forward to
2013, we are planning to allocate over half of our capital budget to the
Delaware Basin and expect this core area to provide a significant source of
organic growth. Lastly, we have signed a definitive agreement to sell non-core
assets, which will help streamline our business and reduce our overall
leverage.”

For the third quarter of 2012, the Company reported net income of $6.0
million, or $0.06 per diluted share, as compared to net income of $356.2
million, or $3.44 per diluted share, for the third quarter of 2011. The
Company’s third quarter 2012 results were impacted by several non-cash items
including: (1) a $151.6 million unrealized mark-to-market loss on commodity
derivatives and (2) $0.7 million of leasehold abandonments. Excluding these
items and their tax effects, the third quarter 2012 adjusted net income
(non-GAAP) was $99.8 million, or $0.96 per diluted share. Excluding similar
non-cash items and their tax impact, adjusted net income (non-GAAP) for the
third quarter of 2011 was $117.8 million, or $1.14 per diluted share. For a
description and a reconciliation of net income (GAAP) to adjusted net income
(non-GAAP), please see “Supplemental Non-GAAP Financial Measures” below.

EBITDAX was $387.2 million in the third quarter of 2012, an increase of 11%
from $349.6 million reported in the third quarter of 2011. For a description
and a reconciliation of net income (GAAP) to EBITDAX (non-GAAP), please see
“Supplemental Non-GAAP Financial Measures” below.

Oil and natural gas sales for the third quarter of 2012 increased 9% when
compared to the third quarter of 2011. This increase was attributable to a 3%
increase in the Company’s unhedged realized oil price and a 24% increase in
production in the third quarter of 2012 compared to the third quarter of 2011,
which was partially offset by a 43% decrease in the Company’s unhedged
realized natural gas price.

Oil and natural gas production expense for the third quarter of 2012,
including oil and natural gas taxes, totaled $96.7 million, or $12.39 per
barrel of oil equivalent (“Boe”), a 7% decrease per Boe from the third quarter
of 2011. This decrease was due primarily to lower lease operating expenses and
workover costs, which averaged $7.15 per Boe in the third quarter of 2012 as
compared to $7.42 per Boe in the third quarter of 2011 and to lower oil and
natural gas taxes, which averaged $5.24 per Boe in the third quarter of 2012
as compared to $5.90 per Boe in the third quarter of 2011. The decrease in
lease operating expenses per Boe over the third quarter 2011 is primarily due
to the third quarter of 2011 including the effects of a $1.50 per Boe of costs
from prior periods.

Depreciation, depletion and amortization expense (“DD&A”) for the third
quarter of 2012 totaled $157.6 million, or $20.19 per Boe, a 10% increase per
Boe from the third quarter of 2011.

General and administrative expense (“G&A”) for the third quarter of 2012
totaled $34.9 million, or $4.47 per Boe, as compared to $22.9 million, or
$3.62 per Boe, in the third quarter of 2011. Cash G&A for the third quarter of
2012 totaled $26.9 million and stock-based compensation (non-cash) totaled
$8.0 million. The increase in per Boe expense for the third quarter of 2012
over the third quarter of 2011 was primarily due to a 52% increase in absolute
G&A expenses reflecting increased staffing across the Company, and was
partially offset by a 24% increase in production.

The Company’s cash flow from operating activities (GAAP) was $845.6 million
for the first nine months of 2012, as compared to $779.0 million for the first
nine months of 2011, an increase of 9%. Adjusted cash flows (non-GAAP), which
are cash flows from operating activities (GAAP) adjusted for settlements paid
on derivatives not designated as hedges, were $838.2 million for the first
nine months of 2012, as compared to $701.2 million for the first nine months
of 2011, an increase of 20%. For a description of the use of adjusted cash
flows (non-GAAP) and for a reconciliation of cash flows from operating
activities (GAAP) to adjusted cash flows (non-GAAP), please see “Supplemental
Non-GAAP Financial Measures” below.

In the third quarter of 2012, the Company collected net cash receipts on
derivatives not designated as hedges of $16.1 million and the non-cash
unrealized mark-to-market loss on derivatives not designated as hedges was
$151.6 million. In comparison, the Company made net cash payments of $1.8
million on derivatives not designated as hedges and reported a $387.0 million
non-cash unrealized mark-to-market gain on derivatives not designated as
hedges in the third quarter of 2011. To better understand the impact of the
Company’s derivative positions and their impact on the statements of
operations, please see the “Summary Production and Operating Data” and
“Derivatives Information” tables at the end of this press release.

Operations

For the quarter ended September 30, 2012, the Company commenced the drilling
of or participated in a total of 213 gross wells (164 operated), 55 of which
had been completed as producers, 156 of which were in progress at September
30, 2012 and 2 of which were plugged and abandoned. In addition, during the
third quarter of 2012, the Company completed 133 wells that were drilled prior
to the third quarter of 2012.

Currently, the Company is operating 28 drilling rigs; 5 of these rigs are
drilling Yeso wells on the New Mexico Shelf, 13 are drilling in the Texas
Permian and 10 are drilling in the Delaware Basin. Included in the 28 operated
rigs, the Company is currently running 14 horizontal drilling rigs, including
10 in the Delaware Basin, 1 in the Texas Permian and 3 on the New Mexico
Shelf.

New Mexico Shelf

During the third quarter of 2012, the Company drilled or participated in 88
wells (59 operated) on its New Mexico Shelf assets, which included both Yeso
and Lower Abo wells, with a 100% success rate on the 19 wells that had been
completed by September 30, 2012. In addition, during the third quarter of
2012, the Company completed 44 wells that were drilled prior to the third
quarter of 2012.

Texas Permian

During the third quarter of 2012, the Company drilled or participated in 83
wells (83 operated) on its Texas Permian assets with a 100% success rate on
the 30 wells that had been completed by September 30, 2012. In addition,
during the third quarter of 2012, the Company completed 58 wells that were
drilled prior to the third quarter of 2012.

Delaware Basin

During the third quarter of 2012, the Company drilled or participated in 42
wells (22 operated) with a 100% success rate on the 6 wells that had been
completed by September 30, 2012. Of the 42 wells drilled, all were horizontal,
which included 27 Bone Spring sand wells, 6 Avalon shale wells, 6 Wolfcamp
shale wells and 3 Delaware sands wells. In addition, during the third quarter
of 2012, the Company completed 31 wells that were drilled prior to the third
quarter of 2012. The Company’s net production in the third quarter of 2012
from horizontal Delaware Basin wells averaged approximately 16,000 barrels of
oil equivalent per day (“Boepd”), an increase of 15% over the second quarter
of 2012 and an 80% increase over the third quarter of 2011.

Non-Core Asset Sale

The Company today announced that it has signed a definitive agreement with
Legacy Reserves LP (NASDAQ: LGCY) to sell certain non-core properties located
primarily in the Permian Basin of West Texas and Southeast New Mexico for $520
million. The sale is expected to close by the end of the fourth quarter of
2012 and is subject to customary closing conditions and purchase price
adjustments.

During the third quarter of 2012, production from these divestiture properties
was approximately 5,800 Boepd (approximately 60% oil). RBC Richardson Barr
served as the Company's advisor in connection with the sale.

Credit Facility

In October 2012, the Company amended its credit facility, increasing the
borrowing base to $3.0 billion and maintaining the aggregate lender
commitments at $2.5 billion. At September 30, 2012, the Company had borrowings
outstanding under the credit facility of $804 million, and the availability
under the credit facility was approximately $1.7 billion.

2013 Capital Budget

Concho’s capital budget for 2013 is approximately $1.6 billion, which the
Company believes will yield production in the range of 32.9 to 34.3 MMBoe.
This budget contemplates operating an average of 30 drilling rigs for 2013 of
which 15 will be drilling horizontally. The Company estimates that its 2013
capital budget can substantially be funded with after-tax cash flow from
operations assuming (i) a NYMEX crude oil price of $85.00 per barrel and a
NYMEX natural gas price of $4.00 per thousand cubic feet of natural gas
(“Mcf”) for the Company’s unhedged production and (ii) that the Company
achieves the mid-point of its 2013 production guidance. The Company intends to
monitor both the direction of commodity prices and the costs of goods and
services and may adjust its capital budget, and resultant estimated production
and cash flows, as conditions warrant.

Of the approximately $1.6 billion capital budget, approximately $1.4 billion
is dedicated to the Company's drilling program – approximately 21% will be
dedicated to drilling on its New Mexico Shelf assets, approximately 54% will
be dedicated to drilling horizontal projects on its Delaware Basin assets and
approximately 25% will be dedicated to drilling its Texas Permian assets.
Approximately 67% of the Company’s drilling budget will be directed towards
horizontal drilling.

The Company expects to drill or participate in a total of 631 gross wells (487
operated), which includes 186 Yeso wells, 175 Delaware Basin wells and 236
Wolfberry wells.

The remaining capital will be allocated between leasehold acquisition,
geological and geophysical costs (“G&G”) and facilities.

2013 Guidance

Production:                                          
 Oil equivalent (MMBoe)                               32.9 - 34.3
  % Oil                                                60% - 62%
  
Price differentials to NYMEX:
  (excluding the effects of hedging)
  Oil (Bbl)                                            93% - 95%
  Natural gas (Mcf)                                    140% - 160%
                                                       
Operating costs and expenses:
  Lease operating expense:
    Direct lease operating expense ($/Boe)             $7.50 - $8.00
    Oil & natural gas taxes (% of oil and natural      8.25%
    gas revenue)
                                                       
  G&A expense:
    Cash G&A expense ($/Boe)                           $3.25 - $3.75
    Non-cash stock based compensation ($/Boe)          $1.10 - $1.20
                                                       
  DD&A expense ($/Boe)                                 $20.00 - $22.00
                                                       
  Exploration, abandonments and G&G ($/Boe)            $1.50 - $2.50
                                                       
  Cash interest rates:
    $300 million senior notes due 2017                 8.63%
    $600 million senior notes due 2021                 7.00%
    $600 million senior notes due 2022                 6.50%
    $600 million senior notes due 2022                 5.50%
    $700 million senior notes due 2023                 5.50%
    Remainder of debt                                  LIBOR + (150 - 250 bps)
  Non-cash interest expense ($ in millions)            $13.5 - $15.5
                                                       
  Income taxes:                                        38%
    Percent deferred of total taxes                    75% - 85%
                                                       
Capital expenditures ($ in billions)                   $1.6
                                                       

Management Additions

During the third quarter, the Company added two new officers to its management
team.

Ms. Mona D. Ables, Vice President of Land

Prior to joining the Company, Ms. Ables served as East Texas Land Manager for
Samson Resources Company. She began her career in 1981 with Exxon Company, USA
and later served as District Landman for Matador Petroleum Company. Ms. Ables
is a graduate of the University of Texas Permian Basin with a BBA in Petroleum
Land Management.

Mr. Ben C. Rodgers, Vice President and Treasurer

Prior to joining the Company, Mr. Rodgers served as a Vice President in the
Leveraged Finance Group in the Investment Bank at J.P. Morgan Securities and
worked in the Advisory Services division at Ernst & Young. He received a BBA
in Finance from Texas A&M University and a MBA with a concentration in Finance
from the McCombs School of Business at the University of Texas at Austin.

Derivative Update

The Company maintains an active hedging program and added to its derivative
positions in October 2012. Please see the “Derivatives Information” tables at
the end of this press release for more detailed information about the
Company’s current derivative positions.

Conference Call Information

The Company will host a conference call on Thursday, November 8, 2012 at 9:00
a.m. Central Time to discuss the third quarter 2012 financial and operating
results and the 2013 capital and budget guidance. Interested parties may
listen to the conference call via the Company’s website at www.concho.com or
by dialing (866) 713-8562 (passcode: 92214608). A replay of the conference
call will be available on the Company’s website or by dialing (888) 286-8010
(passcode: 81275071).

About Concho Resources Inc.

Concho Resources Inc. is an independent oil and natural gas company engaged in
the acquisition, development and exploration of oil and natural gas
properties. The Company's operations are focused in the Permian Basin of
Southeast New Mexico and West Texas. For more information, visit Concho’s
website at www.concho.com.

Forward-Looking Statements and Cautionary Statements

The foregoing contains forward-looking statements within the meaning of
Section 27A of the Securities Act of 1933 and Section 21E of the Securities
Exchange Act of 1934. All statements, other than statements of historical
facts, included in this press release that address activities, events or
developments that the Company expects, believes or anticipates will or may
occur in the future are forward-looking statements. Without limiting the
generality of the foregoing, forward-looking statements contained in this
press release specifically include statements, estimates and projections
regarding the Company's future financial position, operations, performance,
production growth, returns, divestitures, capital expenditure budget, the
timing and estimated proceeds of the closing of the sale of the non-core
properties, oil and natural gas reserves, number of identified drilling
locations, drilling program, derivative activities, costs and other guidance.
These statements are based on certain assumptions made by the Company based on
management's experience, expectations and perception of historical trends,
current conditions, anticipated future developments and other factors believed
to be appropriate. Forward-looking statements are not guarantees of
performance. Although the Company believes the expectations reflected in its
forward-looking statements are reasonable and are based on reasonable
assumptions, no assurance can be given that these assumptions are accurate or
that any of these expectations will be achieved (in full or at all) or will
prove to have been correct. Moreover, such statements are subject to a number
of assumptions, risks and uncertainties, many of which are beyond the control
of the Company, which may cause actual results to differ materially from those
implied or expressed by the forward-looking statements. These include the
factors discussed or referenced in the "Risk Factors" section of the Company's
most recent Form 10-K and 10-Q filings and risks relating to declines in the
prices we receive for our oil and natural gas; uncertainties about the
estimated quantities of reserves; risks related to the integration of acquired
assets; the effects of government regulation, permitting and other legal
requirements, including new legislation or regulation of hydraulic fracturing;
drilling and operating risks; the adequacy of our capital resources and
liquidity; risks related to the concentration of our operations in the Permian
Basin; the results of our hedging program; weather; litigation; shortages of
oilfield equipment, services and qualified personnel and increases in costs
for such equipment, services and personnel; uncertainties about our ability to
replace reserves and economically develop our current reserves; competition in
the oil and natural gas industry; and other important factors that could cause
actual results to differ materially from those projected.

Any forward-looking statement speaks only as of the date on which such
statement is made, and the Company undertakes no obligation to correct or
update any forward-looking statement, whether as a result of new information,
future events or otherwise, except as required by applicable law.


Concho Resources Inc.
Consolidated Balance Sheets
Unaudited

                                           September 30,   December 31,
(in thousands, except share and per share      2012          2011       
amounts)
Assets
Current assets:
  Cash and cash equivalents                    $ 291            $ 342
  Accounts receivable, net of allowance for
  doubtful accounts:
       Oil and natural gas                       212,037          213,921
       Joint operations and other                225,225          153,746
  Derivative instruments                         35,793           1,698
  Deferred income taxes                          -                28,793
  Prepaid costs and other                       23,522         12,523     
               Total current assets             496,868        411,023    
Property and equipment:
  Oil and natural gas properties, successful     9,724,422        7,347,460
  efforts method
  Accumulated depletion and depreciation        (1,542,056 )    (1,116,545 )
       Total oil and natural gas properties,     8,182,366        6,230,915
       net
  Other property and equipment, net             97,946         59,203     
       Total property and equipment, net        8,280,312      6,290,118  
Funds held in escrow                             -                17,394
Deferred loan costs, net                         80,843           65,641
Intangible asset - operating rights, net         32,263           33,425
Inventory                                        27,664           19,419
Noncurrent derivative instruments                6,560            7,944
Other assets                                    8,507          4,612      
Total assets                                   $ 8,933,017     $ 6,849,576  
Liabilities and Stockholders’ Equity
Current liabilities:
  Accounts payable:
       Trade                                   $ 18,206         $ 23,341
       Related parties                           227              11
  Bank overdrafts                                40,524           39,241
  Revenue payable                                142,388          146,061
  Accrued and prepaid drilling costs             340,245          293,919
  Derivative instruments                         2,015            56,218
  Deferred income taxes                          11,402           -
  Other current liabilities                     145,161        142,686    
               Total current liabilities        700,168        701,477    
Long-term debt                                   3,600,983        2,080,141
Deferred income taxes                            1,148,383        1,002,295
Noncurrent derivative instruments                2,141            32,254
Asset retirement obligations and other           98,904           52,670
long-term liabilities
Commitments and contingencies
Stockholders’ equity:
  Common stock, $0.001 par value;
  300,000,000 authorized; 104,666,566 and
  103,756,222
       shares issued at September 30, 2012       105              104
       and December 31, 2011, respectively
  Additional paid-in capital                     1,973,774        1,925,757
  Retained earnings                              1,415,276        1,058,874
  Treasury stock, at cost; 81,393 and 55,990
  shares at September 30, 2012 and December
  31,
       2011, respectively                       (6,717     )    (3,996     )
               Total stockholders’ equity       3,382,438      2,980,739  
Total liabilities and stockholders’ equity     $ 8,933,017     $ 6,849,576  


Concho Resources Inc.
Consolidated Statements of Operations
Unaudited
                                                       
                                                          
                    Three Months Ended           Nine Months Ended
                    September 30,                September 30,
(in thousands,
except per share    2012       2011        2012         2011      
amounts)
                                                                 
Operating
revenues:
  Oil sales         $ 407,062     $ 332,659      $ 1,182,022     $ 957,833
  Natural gas        90,485      121,809      256,126       303,707   
  sales
    Total
    operating        497,547     454,468      1,438,148     1,261,540 
    revenues
Operating costs
and expenses:
  Oil and natural     96,666        84,050         276,505         217,285
  gas production
  Exploration and     6,958         3,498          27,335          4,624
  abandonments
  Depreciation,
  depletion and       157,621       115,730        434,940         304,899
  amortization
  Accretion of
  discount on
  asset               1,420         751            3,455           2,170
  retirement
  obligations
  Impairments of
  long-lived          -             -              -               76
  assets
  General and
  administrative
  (including
  non-cash based
  compensation of
  $7,959 and
    $4,673 for
    the three
    months ended
    September 30,
    2012 and
    2011,
    respectively,
    and $21,434
    and $13,866
    for the nine
    months ended
    September 30,
    2012 and
    2011,             34,873        22,873         94,228          66,883
    respectively
  (Gain) loss on
  derivatives not    135,415     (385,222 )    (109,542  )    (296,962  )
  designated as
  hedges
    Total
    operating        432,953     (158,320 )    726,921       298,975   
    costs and
    expenses
Income from          64,594      612,788      711,227       962,565   
operations
Other income
(expense):
  Interest            (51,337 )     (32,881  )     (129,073  )     (84,201   )
  expense
  Other, net         (3,114  )    (2,503   )    (4,917    )    (4,590    )
    Total other      (54,451 )    (35,384  )    (133,990  )    (88,791   )
    expense
Income from
continuing            10,143        577,404        577,237         873,774
operations before
income taxes
  Income tax         (4,155  )    (221,199 )    (220,835  )    (334,000  )
  expense
Income from
continuing            5,988         356,205        356,402         539,774
operations
Income from
discontinued         -           -            -             91,188    
operations, net
of tax
Net income          $ 5,988      $ 356,205     $ 356,402      $ 630,962   
Basic earnings
per share:
  Income from
  continuing        $ 0.06        $ 3.47         $ 3.46          $ 5.27
  operations
  Income from
  discontinued       -           -            -             0.88      
  operations, net
  of tax
    Net income      $ 0.06       $ 3.47        $ 3.46         $ 6.15      
  Weighted
  average shares
  used in basic      103,292     102,733      103,088       102,517   
  earnings per
  share
Diluted earnings
per share:
  Income from
  continuing        $ 0.06        $ 3.44         $ 3.43          $ 5.21
  operations
  Income from
  discontinued       -           -            -             0.88      
  operations, net
  of tax
    Net income      $ 0.06       $ 3.44        $ 3.43         $ 6.09      
  Weighted
  average shares
  used in diluted    104,040     103,696      103,898       103,613   
  earnings per
  share


Concho Resources Inc.
Consolidated Statements of Cash Flows
Unaudited
                                          Nine Months Ended
                                               September 30,
(in thousands)                                 2012          2011       
CASH FLOWS FROM OPERATING ACTIVITIES:                         
  Net income                                   $ 356,402        $ 630,962
  Adjustments to reconcile net income to net
  cash provided by operating activities:
       Depreciation, depletion and               434,940          304,899
       amortization
       Impairments of long-lived assets          -                76
       Accretion of discount on asset            3,455            2,170
       retirement obligations
       Exploration and abandonments,             15,224           807
       including dry holes
       Non-cash compensation expense             21,434           13,866
       Deferred income taxes                     204,804          312,199
       Loss on sale of assets, net               285              3,129
       Gain on derivatives not designated as     (109,542   )     (296,962   )
       hedges
       Discontinued operations                   -                (82,118    )
       Other non-cash items                      9,066            309
  Changes in operating assets and
  liabilities, net of acquisitions:
              Accounts receivable                (54,752    )     (125,091   )
              Prepaid costs and other            (14,894    )     (8,420     )
              Inventory                          (8,528     )     1,204
              Accounts payable                   (4,919     )     (34,334    )
              Revenue payable                    (3,673     )     86,199
              Other current liabilities         (3,666     )    (29,909    )
                    Net cash provided by        845,636        778,986    
                    operating activities
CASH FLOWS FROM INVESTING ACTIVITIES:
  Capital expenditures on oil and natural        (2,334,246 )     (1,046,208 )
  gas properties
  Additions to other property and equipment      (47,489    )     (29,954    )
  Proceeds from the sale of assets               4,419            196,252
  Funds held in escrow                           17,394           -
  Settlements paid on derivatives not           (7,485     )    (77,835    )
  designated as hedges
                    Net cash used in            (2,367,407 )    (957,745   )
                    investing activities
CASH FLOWS FROM FINANCING ACTIVITIES:
  Proceeds from issuance of debt                 3,856,500        2,079,000
  Payments of debt                               (2,336,000 )     (1,949,500 )
  Exercise of stock options                      8,062            7,661
  Excess tax benefit from stock-based            18,522           23,222
  compensation
  Payments for loan costs                        (23,926    )     (24,466    )
  Purchase of treasury stock                     (2,721     )     (1,946     )
  Bank overdrafts                               1,283          44,578     
                    Net cash provided by        1,521,720      178,549    
                    financing activities
                    Net decrease in cash and     (51        )     (210       )
                    cash equivalents
Cash and cash equivalents at beginning of       342            384        
period
Cash and cash equivalents at end of period     $ 291           $ 174        
SUPPLEMENTAL CASH FLOWS:
  Cash paid for interest and fees, net of      $ 115,731        $ 60,752
  $73 capitalized interest in 2011
  Cash paid for income taxes                   $ 18,569         $ 15,610

                                                            
Concho Resources Inc.
Summary Production and Price Data
Unaudited


The following table sets forth summary information from our continuing and
discontinued operations
concerning our production and operating data for the periods indicated:
                                                                    
                                                                    
                         Three Months Ended           Nine Months Ended
                         September 30,                September 30,
                    2012        2011       2012       2011    
                                                                    
Production and
operating data:
  Net production
  volumes:
      Oil (MBbl)           4,619          3,869         13,053        10,618
      Natural gas          19,122         14,652        50,970        38,966
      (MMcf)
      Total (MBoe)         7,806          6,311         21,548        17,112
                                                                    
  Average daily
  production volumes:
      Oil (Bbl)            50,207         42,054        47,639        38,894
      Natural gas          207,848        159,258       186,022       142,732
      (Mcf)
      Total (Boe)          84,848         68,597        78,643        62,682
                                                                    
  Average prices:
      Oil, without
      derivatives        $ 88.13        $ 85.98       $ 90.56       $ 91.10
      (Bbl)
      Oil, with
      derivatives        $ 91.56        $ 83.90       $ 89.91       $ 82.75
      (Bbl) (a)
      Natural gas,
      without            $ 4.73         $ 8.31        $ 5.03        $ 7.80
      derivatives
      (Mcf)
      Natural gas,
      with derivatives   $ 4.75         $ 8.74        $ 5.04        $ 8.24
      (Mcf) (a)
      Total, without
      derivatives        $ 63.74        $ 72.01       $ 66.74       $ 74.28
      (Boe)
      Total, with
      derivatives        $ 65.81        $ 71.73       $ 66.39       $ 70.12
      (Boe) (a)
                                                                    
  Operating costs and
  expenses per Boe:
      Lease operating
      expenses and       $ 7.15         $ 7.42        $ 7.30        $ 6.69
      workover costs
      Oil and natural    $ 5.24         $ 5.90        $ 5.53        $ 6.10
      gas taxes
      Depreciation,
      depletion and      $ 20.19        $ 18.34       $ 20.18       $ 17.94
      amortization
      General and        $ 4.47         $ 3.62        $ 4.37        $ 3.91
      administrative
                                                        
                                                                    
      Includes the effect of cash settlements received from (paid on) commodity
  (a) derivatives not designated as hedges and reported in operating costs and
      expenses.
      The following table reflects the amounts of cash settlements received
      from (paid on) commodity derivatives not designated as hedges that were
      included in
      computing average prices with derivatives and reconciles to the amount in
      (gain) loss on derivatives not designated as hedges as reported in the
      statements of operations:
                                                          
                                                                    
                         Three Months Ended           Nine Months Ended
                         September 30,                September 30,
      (in thousands)     2012        2011       2012       2011    
                                                                    
      Gain (loss) on
      derivatives not
      designated as
      hedges:
        Cash receipts
        from (payments   $ 15,859       $ (8,051  )   $ (8,374  )   $ (88,679 )
        on) oil
        derivatives
        Cash receipts
        from natural       280            6,263         889           17,468
        gas
        derivatives
        Cash payments
        on interest        -              -             -             (6,624  )
        rate
        derivatives
        Unrealized
        mark-to-market
        gain (loss) on    (151,554 )    387,010     117,027     374,797 
        commodity and
        interest rate
        derivatives
        Gain (loss) on
        derivatives      $ (135,415 )   $ 385,222    $ 109,542    $ 296,962 
        not designated
        as hedges
      

The presentation of average prices with derivatives is a non-GAAP measure as a
result of including the cash receipts from (payments on) commodity derivatives
that are presented in gain (loss) on derivatives not designated as hedges in
the statements of operations. This presentation of average prices with
derivatives is a means by which to reflect the actual cash performance of our
commodity derivatives for the respective periods and presents oil and natural
gas prices with derivatives in a manner consistent with the presentation
generally used by the investment community.

The following table sets forth summary information from our continuing
operations concerning production and operating data for the periods indicated:

                                                            
                         Three Months Ended           Nine Months Ended
                         September 30,                September 30,
                   2012          2011         2012         2011
                                                                    
Production and
operating data:
  Net production
  volumes:
      Oil (MBbl)           4,619          3,869         13,053        10,501
      Natural gas          19,122         14,652        50,970        38,929
      (MMcf)
      Total (MBoe)         7,806          6,311         21,548        16,989
                                                                    
  Average daily
  production volumes:
      Oil (Bbl)            50,207         42,054        47,639        38,465
      Natural gas          207,848        159,258       186,022       142,596
      (Mcf)
      Total (Boe)          84,848         68,597        78,643        62,231
                                                                    
  Average prices:
      Oil, without
      derivatives        $ 88.13        $ 85.98       $ 90.56       $ 91.21
      (Bbl)
      Oil, with
      derivatives        $ 91.56        $ 83.90       $ 89.91       $ 82.77
      (Bbl) (a)
      Natural gas,
      without            $ 4.73         $ 8.31        $ 5.03        $ 7.80
      derivatives
      (Mcf)
      Natural gas,
      with derivatives   $ 4.75         $ 8.74        $ 5.04        $ 8.25
      (Mcf) (a)
      Total, without
      derivatives        $ 63.74        $ 72.01       $ 66.74       $ 74.26
      (Boe)
      Total, with
      derivatives        $ 65.81        $ 71.73       $ 66.39       $ 70.06
      (Boe) (a)
                                                                    
  Operating costs and
  expenses per Boe:
      Lease operating
      expenses and       $ 7.15         $ 7.42        $ 7.30        $ 6.72
      workover costs
      Oil and natural    $ 5.24         $ 5.90        $ 5.53        $ 6.07
      gas taxes
      Depreciation,
      depletion and      $ 20.19        $ 18.34       $ 20.18       $ 17.95
      amortization
      General and        $ 4.47         $ 3.62        $ 4.37        $ 3.94
      administrative
                                                        
                                                                    
      Includes the effect of cash settlements received from (paid on) commodity
  (a) derivatives not designated as hedges and reported in operating costs and
      expenses.
      The following table reflects the amounts of cash settlements received
      from (paid on) commodity derivatives not designated as hedges that were
      included in
      computing average prices with derivatives and reconciles to the amount in
      (gain) loss on derivatives not designated as hedges as reported in the
      statements of operations:
                                                          
                                                                    
                         Three Months Ended           Nine Months Ended
                         September 30,                September 30,
      (in thousands)     2012        2011       2012       2011    
                                                                    
      Gain (loss) on
      derivatives not
      designated as
      hedges:
        Cash receipts
        from (payments   $ 15,859       $ (8,051  )   $ (8,374  )   $ (88,679 )
        on) oil
        derivatives
        Cash receipts
        from natural       280            6,263         889           17,468
        gas
        derivatives
        Cash payments
        on interest        -              -             -             (6,624  )
        rate
        derivatives
        Unrealized
        mark-to-market
        gain (loss) on     (151,554 )     387,010       117,027       374,797
        commodity and
        interest rate
        derivatives
        Gain (loss) on
        derivatives      $ (135,415 )   $ 385,222    $ 109,542    $ 296,962 
        not designated
        as hedges
                                                          
                                                                    
      The presentation of average prices with derivatives is a non-GAAP measure
      as a result of including the cash receipts from (payments on) commodity
      derivatives that are presented in gain (loss) on derivatives not
      designated as hedges in the statements of operations. This presentation
      of average prices with derivatives is a means by which to reflect the
      actual cash performance of our commodity derivatives for the respective
      periods and presents oil and natural gas prices with derivatives in a
      manner consistent with the presentation generally used by the investment
      community.
      

                            Concho Resources Inc.
                   Supplemental Non-GAAP Financial Measures
                                  Unaudited

The following tables provide information that the Company believes may be
useful to investors who follow the practice of some industry analysts who
adjust reported company net income and cash flows from operating activities to
exclude certain non-cash items.

Adjusted Net Income

The following table provides a reconciliation of net income (GAAP) to adjusted
net income (non-GAAP) for the three and nine months ended September 30, 2012
and 2011.

                                                            
                      Three Months Ended           Nine Months Ended
                      September 30,                September 30,
(in thousands,
except per share      2012       2011        2012        2011     
amounts)
                                                                  
Net income - as       $ 5,988       $ 356,205      $ 356,402      $ 630,962
reported
                                                                  
Adjustments for
certain non-cash
items:
    Unrealized
    (gain) loss on
    commodity and       151,554       (387,010 )     (117,027 )     (374,797 )
    interest rate
    derivatives
    Impairments of
    long-lived          -             -              -              76
    assets
    Leasehold           677           639            9,234          795
    abandonments
    Discontinued
    operations:
         Gain on
         sale of        -             -              -              (141,950 )
         assets
    Tax impact (a)     (58,457 )    147,980      41,285       197,065  
Adjusted net          $ 99,762     $ 117,814     $ 289,894     $ 312,151  
income
                                                                  
Adjusted basic
earnings per
share:
    Adjusted net
    income per        $ 0.97        $ 1.15         $ 2.81         $ 3.04
    share
    Weighted
    average shares
    used in             103,292       102,733        103,088        102,517
    adjusted basic
    earnings per
    share
                                                                  
Adjusted diluted
earnings per
share:
    Adjusted net
    income per        $ 0.96        $ 1.14         $ 2.79         $ 3.01
    share
    Weighted
    average shares
    used in
    adjusted            104,040       103,696        103,898        103,613
    diluted
    earnings per
    share
                                                        
                                                                  
    The tax impact is computed utilizing the Company's adjusted statutory
(a) effective federal and state income tax rates. The income tax rates for the
    three months ended September 30, 2012 and 2011 were approximately 38.4%
    and 38.3%, respectively, and 38.3% and 38.2% for the nine months ended
    September 30, 2012 and 2011, respectively.
    

Adjusted Cash Flows

The following table provides a reconciliation of cash flows from operating
activities (GAAP) to adjusted cash flows (non-GAAP) for the nine months ended
September 30, 2012 and 2011.

                                                          
                                                     Nine Months Ended
                                                     September 30,
(in thousands)                                       2012       2011    
                                                                   
Cash flows from operating activities                 $ 845,636     $ 778,986
  Settlements paid on derivatives not designated      (7,485  )    (77,835 )
  as hedges (a)
Adjusted cash flows                                  $ 838,151    $ 701,151 
                                                         
                                                                   
(a) Amounts are presented in cash flows from investing activities for GAAP
purposes.


EBITDAX

EBITDAX (as defined below) is presented herein, and reconciled from the
generally accepted accounting principles ("GAAP") measure of net income
because of its wide acceptance by the investment community as a financial
indicator of a company's ability to internally fund exploration and
development activities.

We define EBITDAX as net income, plus (1) exploration and abandonments
expense, (2) depreciation, depletion and amortization expense, (3) accretion
expense, (4) impairments of long-lived assets, (5) non-cash stock-based
compensation expense, (6) unrealized (gain) loss on derivatives not designated
as hedges, (7) loss on sale of assets, (8) interest expense, (9) federal and
state income taxes on continuing operations and (10) similar items listed
above that are presented in discontinued operations. EBITDAX is not a measure
of net income or cash flows as determined by GAAP.

Our EBITDAX measure (which includes continuing and discontinued operations)
provides additional information which may be used to better understand our
operations. EBITDAX is one of several metrics that we use as a supplemental
financial measurement in the evaluation of our business and should not be
considered as an alternative to, or more meaningful than, net income, as an
indicator of our operating performance. Certain items excluded from EBITDAX
are significant components in understanding and assessing a company's
financial performance, such as a company's cost of capital and tax structure,
as well as the historic cost of depreciable assets, none of which are
components of EBITDAX. EBITDAX, as used by us, may not be comparable to
similarly titled measures reported by other companies. We believe that EBITDAX
is a widely followed measure of operating performance and is one of many
metrics used by our management team, and by other users, of our consolidated
financial statements. For example, EBITDAX can be used to assess our operating
performance and return on capital in comparison to other independent
exploration and production companies without regard to financial or capital
structure, and to assess the financial performance of our assets and our
company without regard to capital structure or historical cost basis.

The following table provides a reconciliation of net income to EBITDAX for the
three and nine months ended September 30, 2012 and 2011:

                                                        
                                                           
                       Three Months Ended         Nine Months Ended
                       September 30,              September 30,
(in thousands)         2012      2011        2012         2011     
                                                                  
Net income             $ 5,988     $ 356,205      $ 356,402       $ 630,962
  Exploration and        6,958       3,498          27,335          4,624
  abandonments
  Depreciation,
  depletion and          157,621     115,730        434,940         304,899
  amortization
  Accretion of
  discount on asset      1,420       751            3,455           2,170
  retirement
  obligations
  Impairments of         -           -              -               76
  long-lived assets
  Non-cash
  stock-based            7,959       4,673          21,434          13,866
  compensation
  Unrealized (gain)
  loss on
  derivatives not        151,554     (387,010 )     (117,027  )     (374,797 )
  designated as
  hedges
  Loss on sale of        217         1,674          285             3,129
  assets, net
  Interest expense       51,337      32,881         129,073         84,201
  Income tax expense
  on continuing          4,155       221,199        220,835         334,000
  operations
  Discontinued          -          -            -             (83,306  )
  operations
EBITDAX                $ 387,209   $ 349,601     $ 1,076,732    $ 919,824  
                                                                  

                                                             
Concho Resources Inc.
Costs Incurred
Unaudited

The table below provides the costs incurred for the three and nine months
ended September 30, 2012 and 2011.

Costs incurred for oil and natural gas producing activities (a)
                                                                   
                                                                   
                       Three Months Ended            Nine Months Ended
                       September 30,                 September 30,
(in thousands)        2012            2011        2012         2011
                                                                   
Property
acquisition costs:
    Proved             $  690,158       $  -         $ 855,773     $ 69,148
    Unproved              349,903          42,432      411,110       117,772
Exploration               223,569          138,170     567,065       410,089
Development              187,759         233,062    574,541      567,547
    Total costs
    incurred for       $  1,451,389     $  413,664   $ 2,408,489   $ 1,164,556
    oil and natural
    gas properties
                                                         
                                                                   
(a) The costs incurred for oil and natural gas producing activities includes
    the following amounts of asset retirement obligations:
                                                          
                                                                   
                       Three Months Ended            Nine Months Ended
                       September 30,                 September 30,
    (in thousands)    2012            2011        2012         2011
                                                                   
    Proved property
    acquisition        $  26,986        $  -         $ 29,113      $ 148
    costs
    Exploration           1,185            198         2,452         838
    costs
    Development          5,019           1,342      8,302        2,094
    costs
       Total asset
       retirement      $  33,190        $  1,540     $ 39,867      $ 3,080
       obligations

                                                                                  
Concho Resources Inc.
Derivatives Information
Unaudited

The table below provides data associated with the Company’s derivatives at November 7, 2012.
                                                                                               
                                                                                               
                Fourth
                Quarter
                 2012           2013            2014           2015           2016         2017
                                                                                               
Oil Swaps:
    Volume        4,151,500       13,330,000       7,283,000       1,076,000       429,000       168,000
    (Bbl)
    NYMEX
    price       $ 95.51         $ 95.77          $ 91.93         $ 86.69         $ 88.31       $ 87.00
    (Bbl)
    (a)
                                                                                               
Natural Gas Swaps:
    Volume        75,000          -                -               -               -             -
    (MMBtu)
    NYMEX
    price       $ 6.54            -                -               -               -             -
    (MMBtu)
    (b)
                                                                            
                                                                                               
(a) The index prices for the oil contracts are based on the NYMEX – West Texas Intermediate monthly
    average futures price.
(b) The index prices for the natural gas contracts are based on the NYMEX – Henry Hub last trading day
    of the month futures price.

Contact:

Concho Resources Inc.
Price Moncrief, 432-683-7443
Vice President of Capital Markets and Strategy
 
Press spacebar to pause and continue. Press esc to stop.