DUBLIN--(BUSINESS WIRE)--The "Norway Wind Power Market Outlook to 2025" report has been added to ResearchAndMarkets.com's offering.

Even as the wind power generation technology is now relatively advanced, the industry is reaching a stage of maturity in the key markets, with some other markets still evolving.

In 2019, around 60.4 GW of new wind power capacity was added globally, making it the second-largest year in history and close to the largest year in 2015 (63.8 GW), bringing global cumulative wind power capacity up to 651 GW. The massive wind turbine installation was primarily the result of a strong year in both China and the US: the world's two largest markets ahead of the expiry of Feed-in Tariffs (FiT) for onshore in the first country and the PTC (extended until the end of 2020 in Dec 2019) in the second.

Study Coverage

The report provides comprehensive market analysis on the historical development and targets, the current state of wind power installation scenario, and its outlook. The insights in the research report: market data, policies and regulations, project data, company profiles, and competitive landscape analysis - have been derived primarily from our proprietary databases, and offerings.

The report discusses the impact of the ongoing COVID-19 pandemic on the wind power market, economic trends, and investment and financing scenario in Norway. It gives insights into the market dynamics and the challenges of wind power development in the country. It also comprises significant market development trends and highlights how the socio-economic, environmental, and political factors affect the nation's wind market.

Besides, the report looks into the current state and assesses the potential for the future growth of onshore and offshore wind power development.

Key Topics Covered

1. Executive Summary

2. Research Scope and Methodology

3. Market Analysis

3.1 Introduction

3.2 Market Dynamics

3.2.1. Drivers

3.2.2 Restraints

3.3 Market Trends & Developments

3.4 Market Opportunities

3.5 Key Projects

3.6 Government Policies and Regulations

4. Market Outlook

4.1 Annual Wind Power Installed Capacity, 2001-2025, in GW

4.2 Cumulative Wind Power Installed Capacity Forecast, 2001-2025, in GW

5. Business Activity Analysis

5.1 Supply Chain Analysis

5.2 PESTLE Analysis

6. Market Segmentation & Analysis

6.1 By Location

6.1.1 Onshore

6.1.2 Offshore

7. Competitive Landscape

7.1 List of Notable Players in the Market

7.2 M&A, JV, and Agreements

7.3 Strategies of Key Players

8. Key Company Profiles

9. Conclusions and Recommendations

Companies Mentioned

• Vestas Wind Systems A/S
• Nordex Group
• GE Renewable Energy (General Electric Company)
• Siemens Gamesa Renewable Energy (SGRE)
• Senvion
• MHI Vestas Offshore Wind A/S

For more information about this report visit https://www.researchandmarkets.com/r/gjg3wb

ResearchAndMarkets.com
Laura Wood, Senior Press Manager
This email address is being protected from spambots. You need JavaScript enabled to view it.
For E.S.T Office Hours Call 1-917-300-0470
For U.S./CAN Toll Free Call 1-800-526-8630
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BROOKLYN HEIGHTS, Ohio--(BUSINESS WIRE)--GrafTech International Ltd. (NYSE: EAF) (GrafTech or the Company) today announced financial results for the quarter ended June 30, 2020, including net income of $93 million, or $0.35 per share, and Adjusted EBITDA¹ of $151 million.

"GrafTech reported strong cash flow from operating activities totaling $148 million despite historic headwinds created by COVID-19. This cash flow allowed us to execute on our goals of reducing our debt and maintaining balance sheet liquidity, " said David Rintoul, President and Chief Executive Officer. "Our disciplined operational approach enabled us to align production with the current sales environment and resulted in reduced costs."

Second Quarter Results and Key Financial Measures

⁽¹⁾ A non-GAAP financial measure, see below for more information and a reconciliation of EBITDA and Adjusted EBITDA to Net income (loss), the most directly comparable financial measure calculated and presented in accordance with GAAP.
⁽²⁾ Earnings per share represents diluted earnings per share.

Net sales for the quarter ended June 30, 2020 were $281 million, compared to $480 million in the second quarter of 2019. Lower net sales were driven primarily by reduced sales volumes, reflecting low demand from decreased steel production levels with the impact of the COVID-19 pandemic on the economy.

Net income for the second quarter of 2020 was $93 million, or $0.35 per share, compared to $196 million, or $0.68 per share in the second quarter of 2019. Adjusted EBITDA was $151 million in the second quarter of 2020 compared to $284 million in the second quarter of 2019.

Cash flow from operating activities was $148 million in the second quarter of 2020, compared to $202 million in the comparable period of 2019. We ended the second quarter of 2020 with a strong liquidity position of approximately $435 million, consisting of cash and cash equivalents of $188 million and availability of $247 million under our revolving credit facility.

Key operating metrics

Sales volume was 31 thousand metric tons ("MT") in the second quarter of 2020 and consisted of 26 thousand MT shipped under our long-term agreements and 5 thousand MT of spot sales. Production volume was 33 thousand MT in the second quarter of 2020 compared to 48 thousand MT in the same period of 2019.

COVID-19

GrafTech is proactively managing through the COVID-19 crisis. We have quickly adapted to changing situations throughout all the regions of the world in which we operate and conduct business. Our executive-led COVID-19 response team continues to meet three times per week to monitor the situation and adapt as needed. We continue to limit travel and have employees working from home where possible. Our facilities perform temperature measurement upon entry and our team members continue to use personal protective equipment, such as masks and gloves. Daily disinfecting activities are performed and strict adherence to social distancing guidelines is required. All these activities are guided by our "COVID-Safe-Work Playbook" and "Return to Work Protocols" and are closely monitored with daily "check sheets". The result of this hard work is that we have managed to keep 99% of our employees healthy to date.

Commercial Update

GrafTech services customers at over 300 locations across the globe all of which have been impacted by COVID-19. The recovery for some customers has begun, however, each region is impacted and recovering at significantly different rates.

The commercial team worked diligently to achieve solid results in the second quarter. We delivered a total of 31,000 MT in the second quarter, of which 26,000 MT represented deliveries under our long-term agreements ("LTAs") and 5,000 MT were the result of spot sales. Our total deliveries under our LTAs were 55,000 MT for the first half of 2020 and we continue to expect deliveries under the LTAs of 100,000-115,000 MT for the full year.

As anticipated, the spot price of graphite electrodes continued to trend lower during the second quarter. Our average price for non-LTA business in Q2 was approximately $5,500 per MT and we expect further market spot price erosion in the third quarter. The needle coke market continued to soften as well.

The current market continues to challenge our customers including those with LTAs. Over the course of the COVID-19 crisis, we have received force majeure claims from approximately 35 customers. Several customers are struggling to take their committed volumes causing some delays and non-performance including a few arbitrations associated with, among other things, efforts to modify the existing contracts.

We are working hard with our valued customers to develop mutually beneficial solutions to address the current challenging environment, but we will take every measure to ensure that customers fulfill their legal obligations and commitments under these contracts. These negotiations are ongoing and have successfully resulted in modifications with some of our strategic customers to provide near-term relief while extending the term of their contracts.

Operational Update

We have been successful at keeping our plants operational through the COVID-19 crisis. We have aligned our operations to our expected sales and have maintained a 98% on-time delivery rate through these difficult times. Our Seadrift plant recently completed its scheduled maintenance outage on time and on budget.

We have eliminated discretionary spending throughout the organization and adjusted our workforce to match current production levels. We met our goal of reducing fixed production costs by 15% in the second quarter which assisted in achieving a 12% reduction year-to-date when compared to 2019 levels. We continue to manage our capital expenditures in line with our reduced target and expect approximately $35 million for the full year.

Capital Structure and Capital Allocation

During the second quarter we reduced our debt by $103 million. We will continue to prioritize balance sheet flexibility and expect to use the majority of our incremental free cash flow in 2020 to reduce debt, but will continue to examine opportunities to repurchase stock.

Outlook

The second half of 2020 will continue to be challenging as we and our customers face macro-economic headwinds. We foresee a measured recovery in the industry when the pandemic eases as customers work through inventory levels that were elevated prior to the onset of the pandemic. We expect overall demand and pricing to remain low for the remainder of 2020.

We have full confidence in the strengths of the Electric Arc Furnace and graphite electrode businesses. The environmental and economic attributes of these industries are key advantages and position them for continued growth over the longer term.

We believe GrafTech is well positioned to navigate the challenges of the current environment and the opportunities in the future recovery given our leadership position in the industry, our strong cash flows, and our advantaged cost position.

Conference Call

In conjunction with this earnings release, you are invited to listen to our earnings call being held on August 6, 2020 at 4:00 p.m. Eastern Daylight Time. The webcast and accompanying slide presentation will be available at www.GrafTech.com, in the Investors section. The earnings call dial-in number is +1 (844) 437-4785 toll-free in the U.S. and Canada or +1 (607) 598-0105 for overseas calls. A replay of the Conference Call will be available until November 6, 2020 by dialing +1 (866) 215-1112 toll-free in the U.S. and Canada or +1 (725) 223-0887 for overseas calls, conference ID: 57343. A replay of the webcast will also be available on our website until November 6, 2020, at www.GrafTech.com, in the Investors section. GrafTech also makes its complete financial reports that have been filed with the Securities and Exchange Commission (the "SEC") and other information available at www.GrafTech.com. The information in our website is not part of this release or any report we file or furnish to the SEC.

About GrafTech

GrafTech International Ltd. is a leading manufacturer of high-quality graphite electrode products essential to the production of electric arc furnace steel and other ferrous and non-ferrous metals. The Company has a competitive portfolio of low-cost graphite electrode manufacturing facilities, including three of the highest capacity facilities in the world. GrafTech is also the only large-scale graphite electrode producer that is substantially vertically integrated into petroleum needle coke, a key raw material for graphite electrode manufacturing. This unique position provides competitive advantages in product quality and cost.

Special note regarding forward-looking statements

This news release and related discussions may contain forward-looking statements that reflect our current views with respect to, among other things, future events and financial performance. You can identify these forward-looking statements by the use of forward-looking words such as “will,” “may,” “plan,” “estimate,” “project,” “believe,” “anticipate,” “expect,” “foresee”, “intend,” “should,” “would,” “could,” “target,” “goal,” “continue to,” “positioned to,” "are confident", or the negative version of those words or other comparable words. Any forward-looking statements contained in this news release are based upon our historical performance and on our current plans, estimates and expectations considering information currently available to us. The inclusion of this forward-looking information should not be regarded as a representation by us that the future plans, estimates, or expectations contemplated by us will be achieved. Our expectations and targets are not predictions of actual performance and historically our performance has deviated, often significantly, from our expectations and targets. These forward-looking statements are subject to various risks and uncertainties and assumptions relating to our operations, financial results, financial condition, business, prospects, growth strategy and liquidity. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in these statements. We believe that these factors include, but are not limited to: the ultimate impact that the COVID-19 pandemic has on our business, results of operations, financial condition and cash flows; the cyclical nature of our business and the selling prices of our products may lead to periods of reduced profitability and net losses in the future; the possibility that we may be unable to implement our business strategies, including our ability to secure and maintain longer-term customer contracts, in an effective manner; the risks and uncertainties associated with litigation, arbitration, and like disputes, including disputes related to contractual commitments; the possibility that global graphite electrode overcapacity may adversely affect graphite electrode prices; pricing for graphite electrodes has historically been cyclical and the price of graphite electrodes may continue to decline in the future; the sensitivity of our business and operating results to economic conditions and the possibility others may not be able to fulfill their obligations to us in a timely fashion or at all; our dependence on the global steel industry generally and the electric arc furnace steel industry in particular; the competitiveness of the graphite electrode industry; our dependence on the supply of petroleum needle coke; our dependence on supplies of raw materials (in addition to petroleum needle coke) and energy; the possibility that our manufacturing operations are subject to hazards; changes in, or more stringent enforcement of, health, safety and environmental regulations applicable to our manufacturing operations and facilities; the legal, compliance, economic, social and political risks associated with our substantial operations in multiple countries; the possibility that fluctuation of foreign currency exchange rates could materially harm our financial results; the possibility that our results of operations could deteriorate if our manufacturing operations were substantially disrupted for an extended period, including as a result of equipment failure, climate change, regulatory issues, natural disasters, public health crises, such as the COVID-19 pandemic, political crises or other catastrophic events; our dependence on third parties for certain construction, maintenance, engineering, transportation, warehousing and logistics services; the possibility that we are unable to recruit or retain key management and plant operating personnel or successfully negotiate with the representatives of our employees, including labor unions; the possibility that we may divest or acquire businesses, which could require significant management attention or disrupt our business; the sensitivity of goodwill on our balance sheet to changes in the market; the possibility that we are subject to information technology systems failures, cybersecurity attacks, network disruptions and breaches of data security; our dependence on protecting our intellectual property; the possibility that third parties may claim that our products or processes infringe their intellectual property rights; the possibility that significant changes in our jurisdictional earnings mix or in the tax laws of those jurisdictions could adversely affect our business; the possibility that our indebtedness could limit our financial and operating activities or that our cash flows may not be sufficient to service our indebtedness; the possibility that restrictive covenants in our financing agreements could restrict or limit our operations; the fact that borrowings under certain of our existing financing agreements subjects us to interest rate risk; the possibility of a lowering or withdrawal of the ratings assigned to our debt; the possibility that disruptions in the capital and credit markets could adversely affect our results of operations, cash flows and financial condition, or those of our customers and suppliers; the possibility that highly concentrated ownership of our common stock may prevent minority stockholders from influencing significant corporate decisions; the possibility that we may not pay cash dividends on our common stock in the future; the fact that certain of our stockholders have the right to engage or invest in the same or similar businesses as us; the possibility that the market price of our common stock could be negatively affected by sales of substantial amounts of our common stock in the public markets, including by Brookfield Asset Management Inc. and its affiliates; the fact that certain provisions of our Amended and Restated Certificate of Incorporation and our Amended and Restated By-Laws could hinder, delay or prevent a change of control; the fact that the Court of Chancery of the State of Delaware will be the exclusive forum for substantially all disputes between us and our stockholders; and our status as a "controlled company" within the meaning of the New York Stock Exchange corporate governance standards, which allows us to qualify for exemptions from certain corporate governance requirements.

These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements, including the Risk Factors section included in our Annual Report on Form 10-K, our Quarterly Report on Form 10-Q for the quarterly period March 31, 2020, and other filings with the SEC. The forward-looking statements made in this press release relate only to events as of the date on which the statements are made. We do not undertake any obligation to publicly update or review any forward-looking statement, except as required by law, whether as a result of new information, future developments or otherwise.

Non-GAAP financial measures

In addition to providing results that are determined in accordance with GAAP, we have provided certain financial measures that are not in accordance with GAAP. EBITDA and Adjusted EBITDA are non-GAAP financial measures. We define EBITDA, a non-GAAP financial measure, as net income or loss plus interest expense, minus interest income, plus income taxes, and depreciation and amortization. We define adjusted EBITDA as EBITDA plus any pension and other post-employment benefit ("OPEB") plan expenses, initial and follow-on public offering and related expenses, non-cash gains or losses from foreign currency remeasurement of non-operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S. dollar, related party Tax Receivable Agreement expense, stock-based compensation, and non-cash fixed asset write-offs. Adjusted EBITDA is the primary metric used by our management and our board of directors to establish budgets and operational goals for managing our business and evaluating our performance.

We monitor adjusted EBITDA as a supplement to our GAAP measures, and believe it is useful to present to investors, because we believe that it facilitates evaluation of our period-to-period operating performance by eliminating items that are not operational in nature, allowing comparison of our recurring core business operating results over multiple periods unaffected by differences in capital structure, capital investment cycles and fixed asset base. In addition, we believe adjusted EBITDA and similar measures are widely used by investors, securities analysts, ratings agencies, and other parties in evaluating companies in our industry as a measure of financial performance and debt-service capabilities. We also monitor the ratio of total debt to adjusted EBITDA, because we believe it is a useful and widely used way to assess our leverage.

Our use of adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

• adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;
• adjusted EBITDA does not reflect our cash expenditures for capital equipment or other contractual commitments, including any capital expenditure requirements to augment or replace our capital assets;
• adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our indebtedness;
• adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us;
• adjusted EBITDA does not reflect expenses relating to our pension and OPEB plans;
• adjusted EBITDA does not reflect the non-cash gains or losses from foreign currency remeasurement of non-operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S. dollar;
• adjusted EBITDA does not reflect initial and follow-on public offering and related expenses;
• adjusted EBITDA does not reflect related party Tax Receivable Agreement expense;
• adjusted EBITDA does not reflect stock-based compensation or the non-cash write-off of fixed assets; and
• other companies, including companies in our industry, may calculate EBITDA and adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

In evaluating EBITDA and adjusted EBITDA, you should be aware that in the future, we will incur expenses similar to the adjustments in the reconciliation presented below. Our presentations of EBITDA and adjusted EBITDA should not be construed as suggesting that our future results will be unaffected by these expenses or any unusual or non-recurring items. When evaluating our performance, you should consider EBITDA and adjusted EBITDA alongside other financial performance measures, including our net income (loss) and other GAAP measures.

Wendy Watson
216-676-2000

DUBLIN--(BUSINESS WIRE)--The "UAE Wind Power Market Outlook to 2025" report has been added to ResearchAndMarkets.com's offering.

Even as the wind power generation technology is now relatively advanced, the industry is reaching a stage of maturity in the key markets, with some other markets still evolving.

In 2019, around 60.4 GW of new wind power capacity was added globally, making it the second-largest year in history and close to the largest year in 2015 (63.8 GW), bringing global cumulative wind power capacity up to 651 GW. The massive wind turbine installation was primarily the result of a strong year in both China and the US: the world's two largest markets ahead of the expiry of Feed-in Tariffs (FiT) for onshore in the first country and the PTC (extended until the end of 2020 in Dec 2019) in the second.

Report Scope

The report provides comprehensive market analysis on the historical development and targets, the current state of wind power installation scenario, and its outlook. The insights in the research report: market data, policies and regulations, project data, company profiles, and competitive landscape analysis - have been derived primarily from our proprietary databases, and offerings.

The report discusses the impact of the ongoing COVID-19 pandemic on the wind power market, economic trends, and investment and financing scenario in the United Arab Emirates (UAE). It gives insights into the market dynamics and the challenges of wind power development in the country. It also comprises significant market development trends and highlights how the socio-economic, environmental, and political factors affect the nation's wind market.

Key Topics Covered

1. Executive Summary

2. Research Scope and Methodology

3. Market Analysis

3.1 Introduction

3.2 Market Dynamics

3.2.1. Drivers

3.2.2 Restraints

3.3 Market Trends & Developments

3.4 Analysis of COVID-19 Impact

3.5 Market Opportunities

3.6 Key Projects

3.7 Government Policies and Regulations

4. Market Outlook

4.1 Annual Wind Power Installed Capacity, 2001-2025, in GW

4.2 Cumulative Wind Power Installed Capacity Forecast, 2001-2025, in GW

5. Business Activity Analysis

5.1 Supply Chain Analysis

5.2 PESTLE Analysis

6. Competitive Landscape

6.1 List of Notable Players in the Market

6.2 M&A, JV, and Agreements

6.3 Strategies of Key Players

7. Key Company Profiles

8. Conclusions and Recommendations

Companies Mentioned

• Siemens Gamesa Renewable Energy (SGRE)
• GE Renewable Energy (General Electric Company)
• Vestas Wind Systems A/S
• MAPNA
• Nordex Group
• Dongfang Electric Corporation (DEC)

For more information about this report visit https://www.researchandmarkets.com/r/ey3q04

ResearchAndMarkets.com
Laura Wood, Senior Press Manager
This email address is being protected from spambots. You need JavaScript enabled to view it.
For E.S.T Office Hours Call 1-917-300-0470
For U.S./CAN Toll Free Call 1-800-526-8630
For GMT Office Hours Call +353-1-416-8900

PRINCETON, N.J.--(BUSINESS WIRE)--$NRG #Earnings--NRG Energy, Inc. (NYSE: NRG) today reported second quarter 2020 income from continuing operations of $313 million, or $1.27 per diluted common share and Adjusted EBITDA for the second quarter of $574 million.

“NRG delivered strong results in the first half of 2020, and our platform continues to demonstrate resilience during these critical summer months,” said Mauricio Gutierrez, NRG President and Chief Executive Officer. “We are excited by the recently announced Direct Energy acquisition and the regional diversity and expanded products and services the combination will bring to our integrated platform.”

Second quarter Income from Continuing Operations was $313 million, $124 million higher than second quarter 2019, driven by mark-to-market on hedge positions in 2020 versus 2019 from large movements in gas prices and ERCOT heat rates.

Texas: Second quarter Adjusted EBITDA was $378 million, $52 million higher than second quarter of 2019. This increase is driven by the acquisition of Stream Energy and lower supply costs resulting from reductions in power and fuel prices.

East: Second quarter Adjusted EBITDA was $138 million, $45 million higher than second quarter of 2019. This increase is driven by the acquisition of Stream Energy, lower supply costs due to reductions in power and natural gas prices and lower operating costs; partially offset by lower capacity revenues.

West/Other: Second quarter Adjusted EBITDA was $58 million, $8 million higher than second quarter of 2019, driven by higher margin from Sunrise facility due to improved availability and an increase in California resource adequacy pricing in 2020; partially offset by Canal 3 completion payment earned in 2019.

As of June 30, 2020, NRG cash was at $0.4 billion, and $1.8 billion was available under the Company’s credit facilities. Total liquidity was $2.2 billion, including restricted cash. Overall liquidity as of the end of the second quarter 2020 was $61 million higher than at the end of 2019, driven by free cash flow generated by the Company partially offset by share repurchases and the repayment of balances outstanding on NRG's revolver.

NRG Strategic Developments

Acquisition of Direct Energy

On July 24, 2020, the Company entered into a definitive purchase agreement with Centrica plc to acquire Direct Energy, a North American subsidiary of Centrica plc. Direct Energy is a leading retail provider of electricity, natural gas, and home and business energy related products and services in North America, with operations in all 50 U.S. states and 6 Canadian provinces. The acquisition will add over 3 million customers to NRG’s business and build on and complement its integrated model, enabling better matching of power generation with customer demand. It will also broaden the Company’s presence in the Northeast and into states and locales where it does not currently operate, supporting NRG’s objective to diversify its business.

The Company will pay an aggregate purchase price of $3.625 billion in cash, subject to customary purchase price adjustments. The Company expects to fund the purchase price using a combination of cash on hand, approximately $2.4 billion in newly-issued secured and unsecured corporate debt and approximately $750 million in convertible preferred stock or other equity-linked instrument. The Company also expects to increase its collateral facilities by $3.5 billion through a combination of new letter of credit facilities and an increase to its existing Revolving Credit Facility.

The acquisition is subject to approval by the shareholders of Centrica plc, as well as customary closing conditions, consents and regulatory approvals, including the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Act, and the receipt of approvals or expiration of applicable waiting periods under the Federal Power Act and the Canadian Competition Act.

Midwest Generation lease buyout

On July 22, 2020, Midwest Generation, LLC signed purchase agreements to acquire all of the ownership interests in the Powerton facility and Units 7 and 8 of the Joliet facility, which were being leased through 2034 and 2030, respectively, for approximately $260 million. The Company intends to fund the purchase with borrowings under its Revolving Credit Facility in an amount equal to the existing operating lease liability of $148 million as of June 30, 2020, and the remainder from cash-on-hand. The closing is conditioned, among other items, on the receipt of regulatory approvals from FERC and under the Hart-Scott-Rodino Act.

COVID-19

In March 2020, the World Health Organization categorized COVID-19 as a pandemic and the President of the United States declared the COVID-19 outbreak a national emergency. Electricity was deemed a 'critical and essential business operation' under various state and federal governmental COVID-19 mandates. As a result of COVID-19, there has been a reduction in load within the markets in which we operate since the President’s national emergency declaration; however, as state restrictions have been eased or lifted, loads have begun to recover. The rebound in demand has varied across the Company's market footprint, as restrictions vary regionally. The Company expects demand uncertainty to continue in the near future.

NRG had activated its Crisis Management Team ("CMT") in January 2020, which proactively began managing the Company's response to the impacts of COVID-19. The CMT implemented the business continuity plans for the Company and has taken a variety of measures to ensure the ongoing availability of the Company’s services, while maintaining the Company's commitment to its core values of health and safety. Pursuant to the Company’s Infectious Disease & Pandemic Policy, in March 2020, NRG implemented restrictions on business travel and face-to-face sales channels, instituted remote work practices and enhanced cleaning and hygiene protocols in all of its facilities. During the second quarter of 2020, the Company began to evaluate alternatives for return to normal work operations. In addition, in order to effectively serve the Company’s customers, select essential employees and contractors are continuing to report to plant and certain office locations. The Company requires pre-entry screening, including temperature checks, separation of work crews, additional personal protective equipment for employees and contractors when social distancing cannot be maintained, and a ban on all non-essential visitors. As a result of these business continuity measures, the Company has not experienced any material disruptions in its ability to continue its business operations to date.

NRG continues to remain focused on protecting the health and well-being of its employees, while supporting its customers and the communities in which it operates and assuring the continuity of its operations. On April 1, 2020, NRG committed $2 million to COVID-19 relief efforts, including funding for urgently needed safety equipment supporting first responders, as well as funds that aid local communities and teachers. The Company also allocated funding to the NRG Employee Relief Fund, which assists employees adversely impacted by natural disasters and other extraordinary

Reaffirming 2020 and 2021 Guidance

NRG is reaffirming its guidance range for 2020 and 2021 with respect to Adjusted EBITDA, Cash From Operations and Free Cash Flow before Growth Investments (FCFbG) as set forth below.

a. Non-GAAP financial measure; see Appendix Tables A-5 for GAAP Reconciliation to Net Income that excludes fair value adjustments related to derivatives. The Company is unable to provide guidance for Net Income due to the impact of such fair value adjustments related to derivatives in a given year

Capital Allocation Update

As part of the Company's long-term capital allocation policy, the return of capital to shareholders during the first half of 2020 was comprised of a quarterly dividend of $0.30 per share, or $148 million, and share repurchases of $228 million through August 6, 2020 at an average price of $33.05 per share.

The Company does not anticipate executing any further share repurchases over the remainder of 2020 and has allocated all of its remaining 2020 excess capital to fund the Direct Energy acquisition.

The Company’s common stock dividend, debt reduction and share repurchases are subject to available capital, market conditions and compliance with associated laws and regulations.

Earnings Conference Call

NRG’s July 24, 2020 business update and conference call served as its second quarter earnings call. The Company provided a comprehensive update and review of its strategy, 2020 & 2021 guidance, capital allocation and preliminary second quarter results. Today's materials and the July 24, 2020 materials and webcast can be found on NRG’s website at http://www.nrg.com and clicking on “Presentations & Webcasts” in the “Investors” section found at the top of the home page.

About NRG

At NRG, we’re bringing the power of energy to people and organizations by putting customers at the center of everything we do. We generate electricity and provide energy solutions and natural gas to more than 3.7 million residential, small business, and commercial and industrial customers through our diverse portfolio of retail brands. A Fortune 500 company, operating in the United States and Canada, NRG delivers innovative solutions while advocating for competitive energy markets and customer choice, and by working towards a sustainable energy future. More information is available at www.nrg.com. Connect with NRG on Facebook, LinkedIn and follow us on Twitter @nrgenergy, @nrginsight.

Forward-Looking Statements

In addition to historical information, the information presented in this press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act. These statements involve estimates, expectations, projections, goals, assumptions, known and unknown risks and uncertainties and can typically be identified by terminology such as “may,” “should,” “could,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “expect,” “intend,” “seek,” “plan,” “think,” “anticipate,” “estimate,” “predict,” “target,” “potential” or “continue” or the negative of these terms or other comparable terminology. Such forward-looking statements include, but are not limited to, statements about the Company’s future revenues, income, indebtedness, capital structure, plans, expectations, objectives, projected financial performance and/or business results and other future events, and views of economic and market conditions.

Although NRG believes that its expectations are reasonable, it can give no assurance that these expectations will prove to be correct, and actual results may vary materially. Factors that could cause actual results to differ materially from those contemplated herein include, among others, the potential impact of COVID-19 or any other pandemic on the Company’s operations, financial position, risk exposure and liquidity, general economic conditions, hazards customary in the power industry, weather conditions, competition in wholesale power markets, the volatility of energy and fuel prices, failure of customers to perform under contracts, changes in the wholesale power markets, changes in government regulations, the condition of capital markets generally, our ability to access capital markets, cyberterrorism and inadequate cybersecurity, unanticipated outages at our generation facilities, adverse results in current and future litigation, failure to identify, execute or successfully implement acquisitions, repowerings or asset sales, our ability to implement value enhancing improvements to plant operations and companywide processes, our ability to achieve margin enhancement under our publicly announced transformation plan, our ability to achieve our net debt targets, our ability to maintain investment grade credit metrics, our ability to proceed with projects under development or the inability to complete the construction of such projects on schedule or within budget, the inability to maintain or create successful partnering relationships, our ability to operate our business efficiently, our ability to retain retail customers, our ability to realize value through our commercial operations strategy, the ability to consummate the Direct Energy acquisition, the ability to successfully integrate businesses of acquired companies including Direct Energy, our ability to realize anticipated benefits of transactions (including expected cost savings and other synergies) or the risk that anticipated benefits may take longer to realize than expected, and our ability to execute our Capital Allocation Plan. Achieving investment grade credit metrics is not a indication of or guarantee that the Company will receive investment grade credit ratings. Debt and share repurchases may be made from time to time subject to market conditions and other factors, including as permitted by United States securities laws. Furthermore, any common stock dividend is subject to available capital and market conditions.

NRG undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. The adjusted EBITDA, free cash flow guidance and excess cash guidance are estimates as of August 6, 2020. These estimates are based on assumptions the company believed to be reasonable as of that date. NRG disclaims any current intention to update such guidance, except as required by law. The foregoing review of factors that could cause NRG’s actual results to differ materially from those contemplated in the forward-looking statements included in this press release should be considered in connection with information regarding risks and uncertainties that may affect NRG's future results included in NRG's filings with the Securities and Exchange Commission at www.sec.gov.

Media:
Candice Adams
609.524.5428

Investors:
Kevin L. Cole, CFA
609.524.4526

HOUSTON--(BUSINESS WIRE)--Murphy Oil Corporation (NYSE: MUR) today announced its financial and operating results for the second quarter ended June 30, 2020, including a net loss attributable to Murphy of $317 million, or $2.06 net loss per diluted share. Adjusted net loss, which excludes discontinued operations and other one-off items, was $110 million, or $0.71 net loss per diluted share.

Unless otherwise noted, the financial and operating highlights and metrics discussed in this commentary exclude noncontrolling interest. ¹

Significant items include:

• Produced 168 thousand barrels of oil equivalent per day, including 58 percent or 98 thousand barrels of oil per day
• Improved average lease operating expenses by 22 percent from the first quarter 2020 to less than $9 per barrel of oil equivalent in the second quarter, or approximately $7 per barrel of oil equivalent excluding workover expenses
• Received $109 million of cash crude oil hedge settlements for the quarter
• Lowered expected full year G&A by approximately 40 percent to a range of $130 million to $140 million compared to full year 2019 including the impact of the previously announced office closures, restructuring and a 30 percent office headcount reduction
• Reduced the full year 2020 capital expenditure budget an additional $40 million, to a range of $680 million to $720 million, or a more than 50 percent reduction from the original 2020 guidance
• Initiated crude oil hedge positions for 2021, resulting in a total of 15 thousand barrels of oil per day hedged at an average price of $42.93 per barrel

SECOND QUARTER 2020 FINANCIAL RESULTS

The company recorded a net loss, attributable to Murphy, of $317 million, or $2.06 net loss per diluted share, for the second quarter 2020. Adjusted net loss, which excludes both the results of discontinued operations and certain other items that affect comparability of results between periods, was $110 million, or $0.71 net loss per diluted share for the same period. The adjusted loss from continuing operations excludes the following after-tax items: a $146 million non-cash mark-to-market loss on crude oil derivative contracts, a $32 million charge for restructuring expenses, a $16 million non-cash asset impairment charge, and a $12 million non-cash mark-to-market loss on liabilities associated with future contingent consideration. Details for second quarter results can be found in the attached schedules.

Adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) from continuing operations attributable to Murphy was $125 million, or $8 per barrel of oil equivalent (BOE) sold. Adjusted earnings before interest, tax, depreciation, amortization and exploration expenses (EBITDAX) from continuing operations attributable to Murphy was $154 million, or $10 per BOE sold. Details for second quarter adjusted EBITDA and EBITDAX reconciliations can be found in the attached schedules.

Second quarter production averaged 168 thousand barrels of oil equivalent per day (MBOEPD) with 58 percent oil and 65 percent liquids. Volumes were negatively impacted by a total of 17.5 MBOEPD for the second quarter, of which approximately 16 MBOEPD were the result of shut-ins due to market prices as previously disclosed, in addition to nearly 1.6 MBOEPD as the result of Tropical Storm Cristobal in the Gulf of Mexico. Production volumes from the shut-in wells came back online in June. Details for second quarter production can be found in the attached schedules.

“The second quarter was difficult not only for our industry, but also our company. As we endured the economic fallout from the global pandemic and the unprecedented oil price collapse, we made the decision to shut in wells, primarily at a single offshore facility. Absent these shut-ins, our assets performed very well and production volumes would have been essentially flat with first quarter 2020. I am proud of our team’s ability to manage uptime and performance despite the unique challenges presented by recent events. Our field employees continue to follow strict safety protocols, and have kept COVID-19 absent from our operations,” stated Roger W. Jenkins, President and Chief Executive Officer of Murphy Oil Corporation.

PROTECTING THE COMPANY’S FINANCIAL POSITION

As of June 30, 2020, Murphy had approximately $1.6 billion of liquidity, comprised of $1.4 billion undrawn under the $1.6 billion senior unsecured credit facility and approximately $146 million of cash and cash equivalents.

At the end of second quarter 2020, Murphy had outstanding debt of $2.8 billion in long-term, fixed-rate notes and $170 million drawn under its senior unsecured credit facility. The fixed-rate notes had a weighted average maturity of 7.3 years and a weighted average coupon of 5.9 percent. Overall, approximately 80 percent of total fixed-rate notes are due in 2024 or later.

COMMODITY HEDGE POSITIONS MITIGATE CASH FLOW VOLATILITY

The company employs commodity derivative instruments to manage certain risks associated with commodity price volatility and underpin capital spending associated with certain assets. Subsequent to quarter-end, Murphy opportunistically layered on hedges to protect cash flow with the execution of WTI fixed prices swaps, resulting in a total 15 MBOPD hedged for full year 2021 at an average price of $42.93 per barrel.

Details for the current hedge positions can be found in the attached schedules.

FURTHER REDUCING CAPTIAL EXPENDITURES

Murphy has continued to rework its remaining 2020 capital plans given ongoing macroeconomic conditions and low commodity prices. As a result, the company’s full year budget has been reduced a further $40 million at the midpoint, to a range of $680 million to $720 million, or more than a 50 percent reduction from original guidance. Note that CAPEX guidance excludes Gulf of Mexico noncontrolling interest (NCI) and King’s Quay floating production system (FPS) construction spending. For second quarter 2020, Murphy accrued a total $174 million of CAPEX, including approximately $33 million for the King’s Quay FPS which, along with previous King’s Quay expenditures, will be reimbursed at close of the transaction, which is anticipated to occur in the third quarter.

“This quarter, we made meaningful reductions to right-size our cost structure, capital spending and quarterly dividend. With our capital program significantly weighted towards the first half of 2020, this sets the company up to generate free cash flow, after the dividend, for the remainder of the year based on current strip prices. As I look ahead, we are in the early stages of benefiting from our new low-cost structure with the reduction in force and office closures finalized just last month, and we look forward to executing our business plans in a streamlined setting going forward,” Jenkins added.

THIRD QUARTER 2020 PRODUCTION GUIDANCE

With the revised capital budget, Murphy anticipates production volumes of approximately 153 MBOEPD to 163 MBOEPD for the third quarter. This guidance range is primarily impacted by two major factors – assumed storm downtime of nearly 5 MBOEPD, and repairs at Delta House facility totaling 8 MBOEPD – as well as planned maintenance at a non-operated Gulf of Mexico field, resulting in 1,200 BOEPD of third quarter downtime.

OPERATIONS SUMMARY

North American Onshore

The North American onshore business produced approximately 90 MBOEPD in the second quarter.

Eagle Ford Shale – Production averaged 38 MBOEPD with 74 percent oil volumes in the second quarter. As planned, early in the quarter Murphy brought online 11 operated wells in Karnes, comprised of nine new wells and two refracs. The five non-operated Karnes wells scheduled to come online were delayed to the third quarter. An additional three non-operated wells are scheduled to come online, for a total of eight non-operated wells to come online in the third quarter. Drilling and completions costs have improved considerably since 2019, with the average cost reduced to approximately $5 million per well for the first half of 2020. No further operated activity is planned for 2020.

Tupper Montney – Natural gas production averaged 237 MMCFD for the quarter. No activity occurred in the second quarter, and none is planned for the remainder of 2020.

Kaybob Duvernay – Second quarter production averaged nearly 11 MBOEPD. One well was brought online during the quarter as planned, with production from the remaining four new wells deferred to the third quarter due to market pricing. No drilling and completions activity is planned for the remainder of 2020.

Placid Montney – Produced 2 MBOEPD in the second quarter through Murphy’s non-operated position. As planned, six non-operated wells were brought online in April, and shut in for May and June due to low commodity prices. Production from these new wells resumed in July.

Global Offshore

The offshore business produced 78 MBOEPD for the second quarter, comprised of 80 percent oil. This excludes production from discontinued operations and noncontrolling interest. Gulf of Mexico production in the quarter averaged 72 MBOEPD, consisting of 78 percent oil. Canada offshore production averaged 6 MBOEPD, comprised of 100 percent oil.

Gulf of Mexico – The second well in the Front Runner rig program, A7 (Green Canyon 338), was completed and brought online during the second quarter. As previously disclosed, the planned third well in the program has been postponed as part of Murphy’s revised capital budget due to ongoing low commodity prices.

Also in the quarter, the Dalmatian DC 134 #2 (De Soto Canyon 134) and Cascade 4 (Walker Ridge 250) well workovers were completed and the wells returned to production for total net workover costs of approximately $20 million, representing nearly 15 percent of total operating expenses for the quarter.

Murphy’s operating partner in Kodiak #3 (Mississippi Canyon 727) drilled the well to total depth in the second quarter, with completion delayed until prices recover. Additionally, the non-operated St. Malo waterflood project continues to progress, and the producer well PN005 (Walker Ridge 678) was spud during the quarter.

The King’s Quay FPS transaction documentation is progressing, with the logistical effects of COVID-19 delaying closing, which is now targeted for the third quarter. During the second quarter, construction on the FPS with Hyundai Heavy Industries achieved the significant milestone of 1 million man-hours with zero Lost Time Incidents.

Canada Offshore – As previously announced, non-operated Terra Nova is expected to remain offline for the year.

EXPLORATION

Gulf of Mexico – The non-operated Mt. Ouray well (Green Canyon 767) was drilled in the second quarter for $7.8 million cost net to Murphy as 20 percent working interest owner. The well has been classified as a dry hole.

CONFERENCE CALL AND WEBCAST SCHEDULED FOR AUGUST 6, 2020

Murphy will host a conference call to discuss second quarter 2020 financial and operating results on Thursday, August 6, 2020, at 9:00 a.m. EDT. The call can be accessed either via the Internet through the Investor Relations section of Murphy Oil’s website at http://ir.murphyoilcorp.com or via the telephone by dialing toll free 1-888-886-7786, reservation number 90315402.

FINANCIAL DATA

Summary financial data and operating statistics for second quarter 2020, with comparisons to the same period from the previous year, are contained in the following schedules. Additionally, a schedule indicating the impacts of items affecting comparability of results between periods, a reconciliation of EBITDA and EBITDAX between periods, as well as guidance for the third quarter 2020, are also included.

¹ In accordance with GAAP, Murphy reports the 100 percent interest, including a 20 percent noncontrolling interest (NCI), in its subsidiary, MP Gulf of Mexico, LLC (MP GOM). The GAAP financials include the NCI portion of revenue, costs, assets and liabilities and cash flows. Unless otherwise noted, the financial and operating highlights and metrics discussed in this news release, but not the accompanying schedules, exclude the NCI, thereby representing only the amounts attributable to Murphy.

ABOUT MURPHY OIL CORPORATION

As an independent oil and natural gas exploration and production company, Murphy Oil Corporation believes in providing energy that empowers people by doing right always, staying with it and thinking beyond possible. It challenges the norm, taps into its strong legacy and uses its foresight and financial discipline to deliver inspired energy solutions. Murphy sees a future where it is an industry leader who is positively impacting lives for the next 100 years and beyond. Additional information can be found on the company’s website at www.murphyoilcorp.com.

FORWARD-LOOKING STATEMENTS

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identified through the inclusion of words such as “aim”, “anticipate”, “believe”, “drive”, “estimate”, “expect”, “expressed confidence”, “forecast”, “future”, “goal”, “guidance”, “intend”, “may”, “objective”, “outlook”, “plan”, “position”, “potential”, “project”, “seek”, “should”, “strategy”, “target”, “will” or variations of such words and other similar expressions. These statements, which express management’s current views concerning future events or results, are subject to inherent risks and uncertainties. Factors that could cause one or more of these future events or results not to occur as implied by any forward-looking statement include, but are not limited to: macro conditions in the oil and gas industry, including supply/demand levels, actions taken by major oil exporters and the resulting impacts on commodity prices; increased volatility or deterioration in the success rate of our exploration programs or in our ability to maintain production rates and replace reserves; reduced customer demand for our products due to environmental, regulatory, technological or other reasons; adverse foreign exchange movements; political and regulatory instability in the markets where we do business; the impact on our operations or market of health pandemics such as COVID-19 and related government responses; other natural hazards impacting our operations or markets; any other deterioration in our business, markets or prospects; any failure to obtain necessary regulatory approvals; any inability to service or refinance our outstanding debt or to access debt markets at acceptable prices; or adverse developments in the U.S. or global capital markets, credit markets or economies in general. For further discussion of factors that could cause one or more of these future events or results not to occur as implied by any forward-looking statement, see “Risk Factors” in our most recent Annual Report on Form 10-K filed with the U.S. Securities and Exchange Commission (“SEC”) and any subsequent Quarterly Report on Form 10-Q or Current Report on Form 8-K that we file, available from the SEC’s website and from Murphy Oil Corporation’s website at http://ir.murphyoilcorp.com. Murphy Oil Corporation undertakes no duty to publicly update or revise any forward-looking statements.

NON-GAAP FINANCIAL MEASURES

This news release contains certain non-GAAP financial measures that management believes are useful tools for internal use and the investment community in evaluating Murphy Oil Corporation’s overall financial performance. These non-GAAP financial measures are broadly used to value and compare companies in the crude oil and natural gas industry. Not all companies define these measures in the same way. In addition, these non-GAAP financial measures are not a substitute for financial measures prepared in accordance with GAAP and should therefore be considered only as supplemental to such GAAP financial measures. Please see the attached schedules for reconciliations of the differences between the non-GAAP financial measures used in this news release and the most directly comparable GAAP financial measures.