The most material change was to the natural gas liquids pricing, as not only has natural gas liquids pricing increased materially recently, but Antero’s ability to extract wider differentials has improved due to tighter end markets.

The revised guidance now shifts to a midpoint of $0.20 per million cubic feet, or mcf, from an earlier midpoint of $0.15 per mcf.

Antero continues to generate substantial free cash flow in this environment. Net debt fell by over $150 million during the quarter, due in part to free cash flow of $77 million.

Total debt now stands at $2.4 billion, and leverage at a very reasonable 1.7 times. Antero’s expectations regarding being below $2 billion in absolute debt and 1 times leverage in 2022 align with our model, and are reasonable.

Company Profile

Antero Resources, based in Denver, engages in the exploration for and production of natural gas and natural gas liquids in the United States and Canada. At the end of 2020, the company reported proven reserves of 17.6 trillion cubic feet of natural gas equivalent. Production averaged approximately 3,578 million cubic feet of equivalent a day in 2020 at a ratio of 33% liquids and 67% natural gas.

(Source: Morningstar)

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