CNX Resources Revenue Falls as Natural Gas Prices Decline
Total revenue and other operating income fell to $618.5 million in the second quarter.
CNX Resources (CNX) reported a decline in second-quarter revenue and earnings as lower natural gas prices weighed on margins.
The results followed a period of contracting production and pricing pressure. Total production volumes decreased to 151.5 Bcfe in the second quarter from 152.4 Bcfe in the first quarter, continuing a downward trend from 167.6 Bcfe in the second quarter of 2024.
Total revenue and other operating income fell to $618.5 million in the second quarter from $786.7 million in the prior quarter. Adjusted EBITDAX decreased to $290 million from $400 million.
The decline was driven by a drop in the average sales price of natural gas, which fell to $2.87 per Mcfe from $3.28 per Mcfe in the first quarter. Consequently, the operating margin compressed to 30% from 43%, and the cash operating margin declined to 59% from 71%.
Natural gas sales volumes declined sequentially to 136.3 Bcf from 139.0 Bcf. NGL sales volumes rose to 14.8 Bcfe from 13.1 Bcfe during the same period. The fully burdened cash margin, before DD&A, decreased to $1.68 per Mcfe from $2.33 per Mcfe.
CNX updated its 2024 guidance for natural gas NYMEX prices downward to $3.55/MMBtu from $3.64/MMBtu, though it improved natural gas differential guidance to ($0.59)/MMBtu from ($0.64)/MMBtu. The company raised its 2024 free cash flow guidance per share to approximately $3.55 from approximately $3.41, attributed to an increase in shares outstanding from 141.5 million to 147.9 million.
Net debt decreased to $2.215 billion as of June 30, 2024, from $2.361 billion as of March 31, 2024. The company accelerated common stock buybacks to $200.4 million in the second quarter, up from $54.0 million in the first quarter.