Update on Gastar Exploration Inc (NYSEMKT:GST)

Gastar Exploration Inc (NYSEMKT:GST)

Gastar Exploration Inc (NYSEMKT:GST)

Gastar Exploration Inc (NYSEMKT:GST) yesterday reported Q1 2017 financial results as well as declaring cash dividends for holders of the company’s Series A and Series B preferred shares. Gastar Exploration Inc (NYSEMKT:GST) common shares are down over 5% on volumes around double their normal 30-day, daily average.

The dividend on the Series A Preferred Stock is payable on May 31, 2017 to holders of record at the close of business on May 22, 2017. The May 2017 dividend payment will be an annualized 8.625% per share, which is equivalent to $0.1796875 per share, based on the $25.00 per share liquidation preference of the Series A Preferred Stock.  The Series A Preferred Stock is currently listed on the NYSE MKT and trades under the ticker symbol “GST.PRA.”

The dividend on the Series B Preferred Stock is payable on May 31, 2017 to holders of record at the close of business on May 22, 2017. The May 2017 dividend payment will be an annualized 10.75% per share, which is equivalent to $0.2239584 per share, based on the $25.00 per share liquidation preference of the Series B Preferred Stock. The Series B Preferred Stock is currently listed on the NYSE MKT and trades under the ticker symbol “GST.PRB.”

Gastar Exploration Inc (NYSEMKT:GST) is an independent energy company engaged in the exploration, development and production of oil, condensate, natural gas and natural gas liquids in the United States. Gastar’s principal assets are in Oklahoma, referred to as its Mid-Continent area, where it is developing the primarily oil-bearing reservoirs of the Hunton Limestone horizontal play and testing the Meramec Shale/Middle Mississippi Lime formation.  Gastar believes its Mid-Continent acreage is prospective for the Meramec Shale/Mississippi Lime formation, the Woodford Shale and the Osage and Oswego formations, which Gastar collectively refers to as the Mid-Continent STACK Play. The Company has focused on the development of oil-bearing reservoirs in the Hunton Limestone, in Kingfisher County, and, as of year-end 2015, Gastar had drilled and completed 9 Upper Hunton and 46 Lower Hunton wells on its acreage.

Gastar Exploration Inc (NYSEMKT:GST) first quarter 2017 highlights included:

  • Average daily production 5,700 Boe per day, exceeding high-end of guidance by 6%
  • Production volumes comprised of 72% liquids, in line with mid-point guidance
  • Replaced revolving credit facility and redeemed senior secured notes due 2018 with proceeds from new debt and equity financing from Ares Management LLC (“Ares”) with maturity of March 2022
  • Completed the acquisition of additional interests in producing wells and additional STACK oil and gas leasehold interests in Kingfisher County, Oklahoma for $51.4 million.

I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. All information, or data, is provided with no guarantees of accuracy.

About the author: Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading.

Author: Steve Clark

Steve Clark is a 23-year Wall St professional with stints in M&A, risk management, and algorithm trading. Steve keeps his head in the game by looking for, and writing about, small companies that often get overlooked by the big investment firms.

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