Expand Energy Reports Significant Financial Decline, Completes $7.9 Billion Merger with Southwestern Energy

Expand Energy Corporation, formerly known as Chesapeake Energy Corporation, reported significant financial changes in its latest 10-Q filing for the quarter ending September 30, 2024. The company experienced a substantial decline in total revenues, which amounted to $648 million, down from $1,512 million in the same quarter of 2023. For the nine months ended September 30, 2024, total revenues were $2,234 million, compared to $6,773 million for the same period in the previous year. This decline was primarily attributed to lower natural gas, oil, and NGL revenues, which fell to $407 million from $682 million year-over-year.

Despite a decrease in revenues, total operating expenses also declined to $803 million from $1,433 million in the prior year, largely due to reduced marketing expenses, which dropped to $192 million from $723 million. However, the company reported a loss before income taxes of $(158) million for the quarter, contrasting with a profit of $71 million in the same period last year. The net loss for the quarter was $(114) million, compared to a net income of $70 million in 2023. For the nine-month period, the net loss was $(315) million, a stark contrast to a net income of $1,850 million in the previous year.

The company’s total current assets decreased to $1,797 million from $2,609 million at the end of 2023, while total assets fell to $13,392 million from $14,376 million. Total stockholders' equity also declined to $10,188 million from $10,729 million. In terms of cash flow, net cash provided by operating activities decreased to $1,183 million from $1,910 million in the prior year.

Strategically, Expand Energy completed a significant merger with Southwestern Energy on October 1, 2024, valued at approximately $7.9 billion. This merger involved the issuance of approximately 95.7 million shares of common stock to Southwestern's shareholders and the assumption of about $3.7 billion in Southwestern’s senior notes. The merger is expected to enhance the company’s position as the largest independent natural gas producer in the U.S.

Additionally, the company has been active in divesting its Eagle Ford assets, with total proceeds exceeding $3.5 billion in 2023. The latest divestiture involved selling the final portion of these assets to SilverBow Resources for approximately $700 million, which closed on November 30, 2023.

As of September 30, 2024, Expand Energy's total long-term debt was reported at $2,017 million, with a fair value of $1,969 million. The company has also received investment-grade ratings from S&P Global Ratings and Fitch Ratings, reflecting improved financial stability following the merger.