SandRidge Energy, Inc. (NYSE:SD) Q3 2018 Earnings Conference Call Transcript

Nov 08, 2018 • 09:00 am ET


SandRidge Energy, Inc. (NYSE:SD) Q3 2018 Earnings Conference Call Transcript


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Good morning. My name is Heidi, and I will be your conference operator today. At this time, I would like to welcome everyone to the SandRidge Energy Third Quarter 2018 Earnings Conference Call. (Operator Instructions) Thank you.

Johna Robinson, you may begin your conference.

Johna Robinson

Thank you, and welcome, everyone, to the conference call. With me today are Bill Griffin, President and CEO; Mike Johnson, CFO; and John Suter, COO.

We would like to remind you that in conjunction with our earnings release and conference call, we have posted slides on our website under the Investor Relations tab that we will be referencing during the call. (Forward-Looking Cautionary Statements)

We will also like to reference -- we will make reference to adjusted G&A and other non-GAAP financial measures. Reconciliations of these measures can be found on our website. Finally, you will see us file our 10-Q later this afternoon.

Now let me turn the call over to Bill.

William Griffin

Thank you, Johna, and good morning, everyone. I appreciate you taking time today to join us for this review of SandRidge Energy's 2018 third quarter performance results and go-forward outlook. Today's conversation will be referencing the third quarter investor presentation posted on our website earlier this morning. As Johna mentioned, joining me today are John Suter, our COO, who will be discussing a number of exciting updates later in the call; along with Mike Johnson, our CFO, who will be speaking to our financial results.

So please turn to Slide 3. This was a significant quarter for SandRidge as we delivered tangible positive results and accelerated our forward progress, both strategically and operationally. We announced in September the conclusion of a long and thorough assessment process that highlighted the significant disconnect between the intrinsic value of the Company and current market perception. The Board's decision was to move forward with the Company's asset development plan, further expand efforts on efficiency and margin improvements and the pursuit of additional opportunities to create value and change market perceptions. Notwithstanding the formal conclusion of our strategic review process, the Company remains committed to serious consideration of any transaction that provides meaningful relative value to the shareholders.

It was also announced that the Board has formed a committee and has commenced the search for the best long-term CEO candidate to lead this continued transition and evolution of SandRidge. I have no additional details to provide at this time as we move forward with this very important process.

Operationally, this quarter was a step-function improvement for us. We achieved an important milestone with the realized growth in production from the previous quarter. This meaningful step ended in an extended period of continual quarterly declines. This overall production increase was driven by record production levels in North Park, resulting in a quarter-on-quarter uplift of 20% -- excuse me, 27% to total Company oil volumes. Increasing oil production is a critical component of the ongoing strategy to drive meaningful, relative growth in EBITDA, with an increasing mix of higher-margin oil. The