Antero Resources Reports First Quarter 2014 Financial Results

        Antero Resources Reports First Quarter 2014 Financial Results

PR Newswire

DENVER, May 7, 2014

DENVER, May 7, 2014 /PRNewswire/ -- Antero Resources Corporation (NYSE: AR)
("Antero" or the "Company") today released its first quarter 2014 financial
results. The relevant financial statements are included in Antero's Quarterly
Report on Form10-Q for the quarter ended March 31, 2014, which has been filed
with the Securities and Exchange Commission ("SEC").

Antero Resources logo.

First Quarter Highlights:

  oRecord net daily gas equivalent production averaged 786 MMcfe/d, a 105%
    increase over the prior year quarter and 16% sequentially
  oRecord net daily liquids production averaged 16,332 Bbl/d, a 583% increase
    over the prior year quarter and 46% sequentially
  oRealized natural gas price before hedging averaged $5.05 per Mcf, a 38%
    increase from the prior year quarter and an $0.11 per Mcf premium to the
    average NYMEX price for the quarter
  oRealized NGL price (C3+) averaged $61.69 per barrel for the quarter, or
    62% of NYMEX WTI
  oRealized natural gas equivalent price including NGLs, oil and hedge
    settlements averaged $5.79 per Mcfe, a 10% increase from the prior year
    quarter and 10% sequentially
  oAdjusted net income was $88 million, a 225% increase over the prior year
    quarter and 21% sequentially
  oAdjusted EBITDAX was $274million, a 130% increase over the prior year
    quarter and 27% sequentially
  oAdjusted EBITDAX margin was $3.87 per Mcfe, a 13% increase over the prior
    year quarter and 12% sequentially
  oBorrowing base increased by 50% to $3.0 billion and lender commitments
    increased by 33% to $2.0 billion

Commenting on the first quarter results, Paul Rady, Antero's Chairman of the
Board and CEO, said, "Antero's record gas equivalent and liquids production
combined with our strong realized prices and high cash flow per Mcfe
demonstrate the success of our strategy to emphasize liquids-rich production
growth, midstream infrastructure and firm takeaway capacity. Further, we have
assembled one of the largest core liquids-rich drilling inventories in
Appalachia and built the balance sheet to support our momentum for many years
to come."

Recent Developments

Senior Notes Offering

On May 6, 2014, Antero closed a private placement of $600 million of 5.125%
senior unsecured notes due December 2022 at par. Antero received net proceeds
of approximately $591.6 million, a portion of which will be used to finance
the redemption of the Company's outstanding 7.25% senior notes due 2019 and
the remaining net proceeds were used to repay a portion of the outstanding
borrowings under its credit facility.

Borrowing Base Redetermination and Financial Liquidity

On May 5, 2014, Antero entered into a $3.5 billion amended and restated credit
facility that extends the maturity until May 2019. As a result of the
significant growth in value of the Company's proved developed reserve base
since the previous borrowing base determination in August of 2013, the
borrowing base was increased by 50% to $3.0 billion. In addition, lender
commitments under the facility were increased by 33% to $2.0 billion. The
$2.0 billion commitment may be expanded to the borrowing base upon receipt of
the requisite bank approval.

As of March 31, 2014, pro forma for the senior notes offering and the
borrowing base and lender commitments increase under the Company's credit
facility, Antero had $13 million in cash, $431 million drawn under the credit
facility and $73 million in letters of credit outstanding, resulting in $1.5
billion of available liquidity and $2.5 billion of unused borrowing base
capacity.

Piedmont Lake Utica Shale Lease Acquisition

Antero recently leased 6,363 net acres under and around Piedmont Lake in
Belmont and Harrison Counties, Ohio from the Muskingum Watershed Conservancy
District ("MWCD"), Ohio's biggest water conservancy district, for $95
million. The acreage provides the Company with 29 gross 3P locations assuming
1,000' inter-lateral distance. This represents the second transaction Antero
has entered into with the MWCD. In 2013, the Company signed a lease with the
MWCD to develop 6,500 acres under and around the MWCD's Seneca Lake property
in Guernsey and Noble Counties, Ohio. Antero currently holds 115,000 net
acres in the core of the Utica Shale play in Ohio.

Marcellus Shale Processing

Antero recently committed to a sixth 200 MMcf/d cryogenic processing plant at
the Sherwood facility located in Doddridge County, West Virginia. The Company
now has committed to a total of 1.15 Bcf/d of Marcellus cryogenic processing
capacity by the second quarter of 2015, 550 MMcf/d of which is currently in
service. Ethane is currently being rejected at the processing facility and
left in the gas stream.

First Quarter 2014 Financial Results

For the three months ended March 31, 2014, Antero reported a net loss from
operations of $95 million, or $(0.36) per basic and diluted share, compared to
a net loss of $48 million, or $(0.18) per basic and diluted share, in the
first quarter of 2013. The GAAP net loss for the first quarter of 2014
included the following items:

  oNon-cash losses on unsettled hedges of $248 million ($153 million net of
    tax)
  oNon-cash stock compensation expense for profits interests awards, that are
    non-dilutive to public shareholders, of $29 million ($29 million net of
    tax)

Excluding these items, the Company's results for the first quarter of 2014
were as follows:

  oAdjusted net income of $88 million, or $0.34 per basic and diluted share,
    a 225% increase compared to $27 million, or $0.10 per basic and diluted
    share, in the first quarter of 2013
  oAdjusted EBITDAX of $274 million, a 130% increase compared to $119 million
    in the first quarter of 2013
  oAdjusted EBITDAX margin of $3.87 per Mcfe, a 13% increase compared to
    $3.44 per Mcfe in the first quarter of 2013
  oCash flow from operations before changes in working capital of $238
    million, a 179% increase compared to $85 million in the first quarter of
    2013

For reconciliations of adjusted net income, adjusted EBITDAX, adjusted EBITDAX
margin and cash flow from operations before changes in working capital to the
most comparable GAAP measures, please read "Non-GAAP Financial Measures."

Net production for the first quarter of 2014 averaged a record 786 MMcfe/d, an
increase of 105% from the first quarter of 2013 and 16% from the fourth
quarter of 2013. Net production was comprised of 688 MMcf/d of natural gas
(88%), 13,316 Bbl/d of natural gas liquids ("NGLs") (10%) and 3,016 Bbl/d of
crude oil (2%). First quarter 2014 net liquids production averaged a record
16,332 Bbl/d, an increase of 583% from the first quarter of 2013 and 46% from
the fourth quarter of 2013. The net production increase was driven by
production from 24 new Marcellus wells and 12 new Utica wells brought on line
in the first quarter of 2014.

Average natural gas price before hedging increased 38% from the prior year
quarter to $5.05 per Mcf, an $0.11 per Mcf premium to the average NYMEX price
during the quarter. This premium to NYMEX is slightly above the top end of
Antero's $0.00 to $0.10 per Mcf guidance for the year. Approximately 45% of
Antero's first quarter 2014 natural gas revenue was realized at the Columbia
Gas Transmission (TCO) index price at a $0.01 per Mcf differential to NYMEX
but at a net $0.38 per Mcf premium to NYMEX after Btu upgrade due to ethane
remaining in the natural gas stream. The Company's remaining natural gas
revenue was realized at various other index pricing points at a $0.43 per Mcf
differential to NYMEX but at a net $0.11 per Mcf differential to NYMEX after
Btu upgrade.

Average realized C3+ NGL price for the first quarter of 2014 was $61.69 per
barrel, or 62% of the NYMEX WTI oil price, and the average realized oil price
was $88.87 per barrel, a negative differential to NYMEX WTI of $9.88 per
barrel. Average natural gas equivalent price including NGLs and oil, but
excluding hedge settlements, increased 50% to $5.80 per Mcfe from the prior
year quarter.

Average natural gas equivalent price including NGLs, oil and hedge settlements
increased by 10% to $5.79 per Mcfe for the first quarter of 2014 as compared
to the first quarter of 2013. For the first quarter of 2014, Antero realized
hedging losses of $1.1 million, or $0.01 per Mcfe.

GAAP Revenue for the first quarter of 2014 was $165 million as compared to $61
million for the first quarter of 2013. Revenue for the first quarter of 2014
included a $248 million non-cash loss on unsettled hedges while the first
quarter of 2013 included a $120 million non-cash loss on unsettled hedges,
both due to rising natural gas prices during the quarter. Non-GAAP adjusted
net revenue increased 127% to $413 million compared to the first quarter of
2013 including cash-settled hedge gains and losses but excluding non-cash
unsettled hedge losses. Liquids production contributed 24% of natural gas,
NGLs and oil revenue before hedges in the first quarter of 2014 compared to 9%
during the first quarter of 2013. For a reconciliation of adjusted net
revenue to total revenue, the most comparable GAAP measure, please read
"Non-GAAP Financial Measures."

Per unit cash production expense (lease operating, gathering, compression,
processing and transportation, and production tax) for the first quarter of
2014 was $1.67 per Mcfe a 14% increase compared to $1.47 per Mcfe in the prior
year quarter. The increase was primarily driven by firm transportation costs
associated with the Enterprise ATEX ethane pipeline. Per unit cash production
expense is expected to decrease throughout the year as increased production
will reduce the per unit effect of fixed costs associated with firm
transportation costs. Per unit general and administrative expense for the
first quarter of 2014, excluding non-cash stock compensation expense, was
$0.31 per Mcfe, a 16% decrease from the first quarter of 2013. The decrease
was primarily driven by the increase in net production. Per unit
depreciation, depletion and amortization expense increased 9% from the prior
year quarter to $1.29 per Mcfe, primarily driven by higher depreciation on
gathering and fresh water distribution assets as the Company continued to
build out these systems in the rich gas areas of the Marcellus and Utica
Shale.

Capital Spending

Antero's total capital expenditures for the three months ended March 31, 2014
were $732 million, consisting of drilling and completion costs of $496
million, gathering and compression costs of $108 million, fresh water
distribution project costs of $60 million, leasehold acquisitions of $60
million and $8 million of other capital expenditures. In connection with the
recently signed lease for the Piedmont Lake acreage, Antero has increased its
2014 capital budget by approximately $100 million to $2.85 billion.

Hedge Update

As of today, Antero has hedged 1,390 Bcfe of future production using fixed
price swaps covering the period from April 1, 2014 through December 2019 at an
average index price of $4.58/MMBtu and $95.22/Bbl. Over 75% of Antero's
estimated 2014 production is hedged at an average index price of $4.60/MMBtu
and $95.22/Bbl. Approximately 50% of Antero's financial hedge portfolio is
made up of NYMEX hedges and 50% is tied to the Appalachian Basin or Gulf Coast
pricing. Antero has the ability to physically deliver a substantial portion
of its gas production through direct firm transportation to Henry, Louisiana,
the index for NYMEX pricing, which eliminates basis risk on the Company's
NYMEX hedges. Antero has 10 different counterparties to its hedge contracts,
all of which are lenders in Antero's bank credit facility.

The following table summarizes Antero's hedge positions held as of May 7,
2014:



               Natural Gas  Average     Oil     Average
Calendar Year
               MMBtu/day    Index price Bbl/day Index price
2014           720,000      $4.60       3,000   $95.22
2015           650,000      $4.80       —       —
2016           642,500      $4.71       —       —
2017           780,000      $4.33       —       —
2018           710,000      $4.60       —       —
2019           467,500      $4.41       —       —



Conference Call

A conference call is scheduled on Thursday, May 8 at 9:00 a.m. MDT. Topics of
the teleconference will include financial results, operational results, and
other matters with respect to the first quarter of 2014. A brief Q&A session
for security analysts will immediately follow the results discussion. To
participate in the call, dial in at 877-418-5260 (U.S.), 866-605-3852
(Canada), or 412-717-9589 (International) and reference passcode 10044728. A
telephone replay of the call will be available until May 19, 2014, at
877-344-7529 (U.S.) or 412-317-0088 (International) using the same passcode.

A simultaneous webcast of the call may be accessed over the internet at
www.anteroresources.com. The webcast will be archived for replay on the
Company's website until May 19, 2014.

Presentation

An updated presentation will be posted to the Company's website before the May
8 conference call. The presentation can be found at www.anteroresources.com on
the homepage. Information on the Company's website does not constitute a
portion of this press release.

Non-GAAP Financial Measures

Adjusted net revenue as set forth in this release represents total revenue
adjusted for unsettled hedge gains and losses. Antero believes that adjusted
net revenue is useful to investors in evaluating operational trends of the
Company and its performance relative to other oil and gas producing
companies. Adjusted net revenue is not a measure of financial performance
under GAAP and should not be considered in isolation or as a substitute for
total revenue as an indicator of financial performance. The following table
reconciles total revenue to adjusted net revenue:



                                             Threemonthsended
                                             March 31,
                                             2013       2014
Total revenue                                $ 61,454   $ 164,981
Hedge losses                                 71,941     248,929
Cash receipts (payments) for settled hedges  48,131     (1,071)
Adjusted net revenue                         $ 181,526  $ 412,839



Adjusted net income as set forth in this release represents net loss from
operations, adjusted for certain non-cash items. Antero believes that
adjusted net income is useful to investors in evaluating operational trends of
the Company and its performance relative to other oil and gas producing
companies. Adjusted net income is not a measure of financial performance
under GAAP and should not be considered in isolation or as a substitute for
net income (loss) from operations as an indicator of financial performance.
The following table reconciles net loss from operations to adjusted net
income:



                                                        Threemonthsended
                                                        March 31,
                                                        2013        2014
Net loss from operations                                $ (47,997)  $ (94,759)
Non-cash losses on unsettled hedges, net of tax           73,508      153,186
($120,072 and $247,858 before tax)
Impairment of unproved properties, net of tax ($1,556     1,556       863
and $1,397 before tax)
Stock compensation, net of tax ($0 and $29,137 before     —           28,966
tax)
Accretion, net of tax ($264 and $302 before tax)          162         187
Adjusted net income                                     $ 27,229    $ 88,443



Cash flow from operations before changes in working capital, as presented in
this release, represents net cash provided by operating activities before
changes in working capital. Cash flow from operations before changes in
working capital is widely accepted by the investment community as a financial
indicator of an oil and gas company's ability to generate cash to internally
fund exploration and development activities and to service debt. Cash flow
from operations before changes in working capital is also useful because it is
widely used by professional research analysts in valuing, comparing, rating
and providing investment recommendations of companies in the oil and gas
exploration and production industry. In turn, many investors use this
published research in making investment decisions. Cash flow from operations
before changes in working capital is not a measure of financial performance
under GAAP and should not be considered in isolation or as a substitute for
cash flows from operating, investing, or financing activities, as an indicator
of cash flows, or as a measure of liquidity.

The following table reconciles net cash provided by operating activities to
cash flow from operations before changes in working capital as used in this
release:



                                                          Threemonthsended
                                                          March 31,
                                                          2013       2014
Net cash provided by operating activities                 $ 110,207  $ 274,307
Net change in working capital                             (24,961)   (36,646)
Cash flow from operations before changes                  $ 85,246   $ 237,661
inworkingcapital



Adjusted EBITDAX is a non-GAAP financial measure that Antero defines as net
loss from operations after adjusting for those items shown in the table below.
Adjusted EBITDAX, as used and defined by the Company, may not be comparable
to similarly titled measures employed by other companies and is not a measure
of performance calculated in accordance with GAAP. Adjusted EBITDAX should
not be considered in isolation or as a substitute for operating income, net
income or loss, cash flows from operating, investing and financing activities,
or other income or cash flow statement data prepared in accordance with GAAP.
Adjusted EBITDAX provides no information regarding a company's capital
structure, borrowings, interest costs, capital expenditures, and working
capital movement or tax position. Adjusted EBITDAX does not represent funds
available for discretionary use because those funds may be required for debt
service, capital expenditures, working capital, income taxes, franchise taxes,
exploration expenses, and other commitments and obligations. However, Antero's
management team believes adjusted EBITDAX is useful to an investor in
evaluating the Company's financial performance because this measure:

  ois widely used by investors in the oil and gas industry to measure a
    company's operating performance without regard to items excluded from the
    calculation of such term, which can vary substantially from company to
    company depending upon accounting methods and book value of assets,
    capital structure and the method by which assets were acquired, among
    other factors;
  ohelps investors to more meaningfully evaluate and compare the results of
    Antero's operations from period to period by removing the effect of its
    capital structure from its operating structure; and
  ois used by the Company's management team for various purposes, including
    as a measure of operating performance, in presentations to its board of
    directors, as a basis for strategic planning and forecasting and by its
    lenders pursuant to covenants under its credit facility and the indentures
    governing the Company's senior notes.

There are significant limitations to using adjusted EBITDAX as a measure of
performance, including the inability to analyze the effect of certain
recurring and non-recurring items that materially affect Antero's net income
or loss, the lack of comparability of results of operations of different
companies and the different methods of calculating adjusted EBITDAX reported
by different companies. The following table represents a reconciliation of
the Company's net loss from operations to adjusted EBITDAX, a reconciliation
of adjusted EBITDAX to net cash provided by operating activities and a
reconciliation of realized price before settled hedges to adjusted EBITDAX
Margin:



                                                        Threemonthsended
                                                        March 31,
                                                        2013        2014
Net loss from operations                                $ (47,997)  $ (94,759)
Hedge fair value losses                                   71,941      248,929
Net cash receipts (payments) on settled hedges            48,131      (1,071)
Interest expense                                          29,928      31,342
Provision for income tax benefit                          (30,400)    (40,662)
Depreciation, depletion, amortization and accrFetion      40,628      91,508
Impairment of unproved properties                         1,556       1,397
Exploration expense                                       4,362       6,997
Stock compensation expense                                —           29,137
State franchise taxes                                     600         838
Adjusted EBITDAX                                          118,749     273,656
Interest expense and other                                (29,928)    (31,342)
Exploration expense                                       (4,362)     (6,997)
Changes in current assets and liabilities, net            24,961      36,646
State franchise taxes                                     (600)       (838)
Other non-cash items                                      1,387       3,182
Net cash provided by operating activities               $ 110,207   $ 274,307
                                                          Threemonthsended
                                                        March 31,
Adjusted EBITDAX margin:                                  2013        2014
Realized price before settled hedges                    $ 3.87      $ 5.80
Gathering, compression, and water distribution revenues   —           0.05
Lease operating expense                                   (0.03)      (0.07)
Gathering, compression, processing and transportation     (1.19)      (1.30)
costs
Production taxes                                          (0.25)      (0.30)
General and administrative(1)                             (0.35)      (0.30)
Adjusted EBITDAX margin before settled hedges             2.03        3.88
Cash receipts (payments) for settled hedges               1.39        (0.01)
Adjusted EBITDAX margin                                 $ 3.44      $ 3.87
(1) – excludes franchise taxes that are included
in G&A



Antero Resources is an independent oil and natural gas company engaged in the
acquisition, development and production of unconventional oil and liquids-rich
natural gas properties located in the Appalachian Basin in West Virginia, Ohio
and Pennsylvania. Our website is located at www.anteroresources.com.

This release includes "forward-looking statements". Such forward-looking
statements are subject to a number of risks and uncertainties, many of which
are beyond Antero's control. All statements, other than historical facts
included in this release, are forward-looking statements. All forward-looking
statements speak only as of the date of this release. Although Antero believes
that the plans, intentions and expectations reflected in or suggested by the
forward-looking statements are reasonable, there is no assurance that these
plans, intentions or expectations will be achieved. Therefore, actual outcomes
and results could materially differ from what is expressed, implied or
forecast in such statements.

Antero cautions you that these forward-looking statements are subject to all
of the risks and uncertainties, most of which are difficult to predict and
many of which are beyond the Company's control, incident to the exploration
for and development, production, gathering and sale of natural gas, NGLs and
oil. These risks include, but are not limited to, commodity price volatility,
inflation, lack of availability of drilling and production equipment and
services, environmental risks, drilling and other operating risks, regulatory
changes, the uncertainty inherent in estimating natural gas and oil reserves
and in projecting future rates of production, cash flow and access to capital,
the timing of development expenditures, and the other risks described under
the heading "Item 1A. Risk Factors" in Antero's Annual Report on Form 10-K for
the year ended December 31, 2013.





ANTERO RESOURCES CORPORATION
Condensed Consolidated Balance Sheets
December 31, 2013 and March 31, 2014
(In thousands, except share amounts)
Assets                                                   2013       2014
Current assets:
Cash and cash equivalents                              $ 17,487     12,580
Accounts receivable — trade, net of allowance for        30,610     27,250
doubtful accounts of $1,251 in 2013 and 2014
Notes receivable - short-term portion                    2,667      1,333
Accrued revenue                                          96,825     145,675
Derivative instruments                                   183,000    130,679
Other                                                    2,975      4,405
Total current assets                                     333,564    321,922
Property and equipment:
Oil and gas properties, at cost (successful efforts
method):
Unproved properties                                      1,513,136  1,543,118
Proved properties                                        3,621,672  4,191,186
Fresh water distribution systems                         231,684    290,132
Gathering and compression systems                        584,626    713,485
Other property and equipment                             15,757     26,731
                                                         5,966,875  6,764,652
Less accumulated depletion, depreciation, and            (407,219)  (498,425)
amortization
Property and equipment, net                              5,559,656  6,266,227
Derivative instruments                                   677,780    500,882
Other assets, net                                        42,581     45,426
Total assets                                           $ 6,613,581  7,134,457
LiabilitiesandEquity
Current liabilities:
Accounts payable                                       $ 370,640    428,938
Accrued liabilities                                      77,126     125,102
Revenue distributions payable                            96,589     136,563
Deferred income tax liability                            69,191     43,182
Derivative instruments                                   646        17,623
Other                                                    8,037      9,398
Total current liabilities                                622,229    760,806
Long-term liabilities:
Long-term debt                                           2,078,999  2,535,819
Deferred income tax liability                            278,580    263,927
Other long-term liabilities                              35,113     40,867
Total liabilities                                        3,014,921  3,601,419
Stockholders' Equity:
Common stock, $0.01 par value; authorized -
1,000,000,000 shares; issued and outstanding             2,620      2,620
262,049,659 shares
Preferred stock, $0.01 par value; authorized -           —          —
50,000,000 shares; none issued
Additional paid-in capital                               3,402,180  3,431,317
Accumulated earnings                                     193,860    99,101
Total stockholders' equity                               3,598,660  3,533,038
Total liabilities and equity                           $ 6,613,581  7,134,457





ANTERO RESOURCES CORPORATION
Condensed Consolidated Statements of Operations and Comprehensive Income
(Loss)
Three Months ended March 31, 2013 and 2014
(Unaudited)
(In thousands, except per share amounts)
                                                           2013      2014
Revenue:
Natural gas sales                                        $ 121,946   312,336
Natural gas liquids sales                                  10,572    73,928
Oil sales                                                  877       24,122
Gathering, compression, and water distribution             —         3,524
Commodity derivative fair value losses                     (71,941)  (248,929)
Total revenue                                              61,454    164,981
Operating expenses:
Lease operating                                            1,071     4,869
Gathering, compression, processing, and transportation     40,970    92,265
Production and ad valorem taxes                            8,619     21,039
Exploration                                                4,362     6,997
Impairment of unproved properties                          1,556     1,397
Depletion, depreciation, and amortization                  40,364    91,206
Accretion of asset retirement obligations                  264       302
General and administrative (including stock compensation   12,717    50,985
of $29,137 in 2014)
Total operating expenses                                   109,923   269,060
Operating loss                                             (48,469)  (104,079)
Interest expense                                           (29,928)  (31,342)
Loss before income taxes                                   (78,397)  (135,421)
Provision for income tax benefit                           30,400    40,662
Net loss and comprehensive loss                          $ (47,997)  (94,759)
Loss per common share                                    $ (0.18)    (0.36)
Loss per common share - assuming dilution                $ (0.18)    (0.36)





ANTERO RESOURCES CORPORATION
Consolidated Statements of Cash Flows
Three Months Ended March 31, 2013 and 2014
(In thousands)
                                                          2013       2014
Cash flows from operating activities:
Net loss                                                $  (47,997)  (94,759)
Adjustment to reconcile net loss to net cash provided
by operating activities:
Depletion, depreciation, amortization, and accretion      40,628     91,508
Impairment of unproved properties                         1,556      1,397
Derivative fair value losses                              71,941     248,929
Cash receipts (payments) for settled derivatives          48,131     (1,071)
Deferred income tax benefit                               (30,400)   (40,662)
Stock compensation                                        —          29,137
Other                                                     1,387      3,182
Changes in assets and liabilities:
Accounts receivable                                       (10,545)   3,360
Accrued revenue                                           (5,948)    (48,850)
Other current assets                                      11,711     (96)
Accounts payable                                          (1,584)    (5,718)
Accrued liabilities                                       24,290     47,976
Revenue distributions payable                             7,037      39,974
Net cash provided by operating activities                 110,207    274,307
Cash flows used in investing activities:
Additions to unproved properties                          (148,972)  (60,149)
Drilling and completion costs                             (334,965)  (496,221)
Additions to fresh water distribution systems             (9,020)    (60,030)
Additions to gathering and compression systems            (55,975)   (107,523)
Additions to other property and equipment                 (721)      (7,783)
Change in other assets                                    1,768      (3,807)
Net cash used in investing activities                     (547,885)  (735,513)
Cash flows from financing activities:
Issuance of senior notes                                  231,750    —
Borrowings on bank credit facility, net                   187,000    457,000
Payments of deferred financing costs                      (3,014)    (701)
Other                                                     7,759      —
Net cash provided by financing activities                 423,495    456,299
Net decrease in cash and cash equivalents                 (14,183)   (4,907)
Cash and cash equivalents, beginning of period            18,989     17,487
Cash and cash equivalents, end of period                $  4,806     12,580
Supplemental disclosure of cash flow information:
Cash paid during the period for interest                $  16,160    13,087
Supplemental disclosure of noncash investing
activities:
Changes in accounts payable for additions to property   $  88,843    64,016
and equipment





OPERATING DATA
The following table sets forth selected operating data (as recast for
discontinued operations) for the three months ended March 31, 2013 compared
to the three months ended March 31, 2014.
                    ThreeMonthsEnded            Amountof
                    March31,                     Increase
                    2013             2014         (Decrease)  PercentChange
                    (inthousands,exceptperunitandproductiondata)
Operating
revenues:
Natural gas sales   $   121,946      $  312,336   190,390     156            %
NGL sales           10,572           73,928       63,356      599            %
Oil sales           877              24,122       23,245      2,651          %
Gathering,
compression, and    —                3,524        3,524       *
water
distribution
Commodity
derivative fair     (71,941)         (248,929)    (176,988)   *
value losses
Total operating     61,454           164,981      103,527     168            %
revenues
Operating
expenses:
Lease operating     1,071            4,869        3,798       355            %
Gathering,
compression,        40,970           92,265       51,295      125            %
processing, and
transportation
Production and ad   8,619            21,039       12,420      144            %
valorem taxes
Exploration         4,362            6,997        2,635       60             %
Impairment of
unproved            1,556            1,397        (159)       (10)%
properties
Depletion,
depreciation, and   40,364           91,206       50,842      126            %
amortization
Accretion of
asset retirement    264              302          38          14             %
obligations
General and
administrative      12,717           21,848       9,131       72             %
(before stock
compensation)
Stock               —                29,137       29,137      *
compensation
Total operating     109,923          269,060      159,137     145            %
expenses
Operating loss      (48,469)         (104,079)    (55,610)    *
Interest expense    (29,928)         (31,342)     1,414       5              %
Loss before         (78,397)         (135,421)    (57,024)    *
income taxes
Income tax          30,400           40,662       10,262      34             %
benefit
Net loss            (47,997)         (94,759)     (46,762)    *
Adjusted EBITDAX    $   118,749      $  273,656   154,907     130            %
Production data:
Natural gas (Bcf)   33               62           29          86             %
NGLs (MBbl)         205              1,198        993         484            %
Oil (MBbl)          10               271          261         2,563          %
Combined (Bcfe)     34               71           37          105            %
Daily combined
production          383              786          403         105            %
(MMcfe/d)
Average prices
before effects of
hedges:
Natural gas (per    $   3.67         $  5.05      $   1.38    38             %
Mcf)
NGLs (per Bbl)      $   51.55        $  61.69     $   10.14   20             %
Oil (per Bbl)       $   86.12        $  88.87     $   2.75    3              %
Combined (per       $   3.87         $  5.80      $   1.93    50             %
Mcfe)
Average realized
prices after
effects of
hedges:
Natural gas (per    $   5.13         $  5.02      $   (0.11)  (2)%
Mcf)
NGLs (per Bbl)      $   51.55        $  61.69     $   10.14   20             %
Oil (per Bbl)       $   75.41        $  90.78     $   15.37   20             %
Combined (per       $   5.26         $  5.79      $   0.53    10             %
Mcfe)
Average Costs
(per Mcfe):
Lease operating     $   0.03         $  0.07      $   0.04    133            %
Gathering,
compression,        $   1.19         $  1.30      $   0.11    9              %
processing, and
transportation
Production and ad   $   0.25         $  0.30      $   0.05    20             %
valorem taxes
Depletion,
depreciation,       $   1.18         $  1.29      $   0.11    9              %
amortization, and
accretion
General and         $   0.37         $  0.31      $   (0.06)  (16)%
administrative



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SOURCE Antero Resources

Website: http://www.anteroresources.com
Contact: Michael Kennedy, VP Finance, (303) 357-6782 or
mkennedy@anteroresources.com.
 
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