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Actionable news in UNT: UNIT CORPORATION,

Unit: Vice President, Investor Relations

The following excerpt is from the company's SEC filing.

(918) 493-7700

www.unitcorp.com

For Immediate Release…

UNIT CORPORATION REPORTS 2015 THIRD QUARTER RESULTS

Tulsa, Oklahoma . . . Unit Corporation (NYSE - UNT) today reported its financial and operational results for the third quarter of 2015. Highlights for the quarter include:

Total production of 5.1 million barrels of oil equivalent (MMBoe), a 10% increase over the third quarter of 2014

Oil and natural gas liquids (NGLs) production increased 5% over the third quarter of 2014

Gas gathered and gas processed volumes per day increased 12% and 10 %, respectively, over the third quarter of 2014

THIRD QUARTER AND FIRST NINE MONTHS 2015 RESULTS

Adjusted net income for the quarter (which excludes the effect of non-cash commodity derivatives and the effect of the non-cash ceiling test write-down) was $1.7 million, or $0.03 per diluted share (see Non-GAAP Financial Measures below). Lower commodity prices continued to impact Unit’s financial results. For the quarter, lower commodity prices resulted in Unit incurring a pre-tax non-cash ceiling test write-down of $329.9 million in the carrying value of the company’s oil and natural gas properties. Although this write-down was a non-cash item, it resulted in Unit recording a net loss of $205.3 million, or $4.18 per share, for the quarter compared to net income of $67.5 million, or $1.37 per diluted share, for the third quarter of 2014. Total revenues for the quarter were $212.4 million (45% oil and natural gas, 31% contract drilling, and 24% mid-stream), compared to $401.0 million (47% oil and natural gas, 30% contract drilling, and 23% mid-stream) for the third quarter of 2014. Adjusted EBITDA for the 2015 third quarter (which excludes the effect of non-cash commodity derivatives and the effect of the loss on sale of assets primarily attributable to the sale of drilling rigs and equipment) was $102.1 million or $2.07 per diluted share (see Non-GAAP Financial Measures below).

Adjusted net loss for the first nine months (which excludes the effect of non-cash commodity derivatives and the effects of the non-cash write-downs) was $0.5 million, or $0.01 per diluted share (see Non-GAAP Financial Measures below). For the first nine months of 2015, Unit has recorded pre-tax non-cash ceiling test write-downs of $1.1 billion in the carrying value of the company’s oil and natural gas properties and $8.3 million (pre-tax) in its drilling rigs and other assets. Due to these write-downs, Unit recorded a net loss of $728.0 million, or $14.83 per share, compared to net income of $178.8 million, or $3.65 per diluted share, for the first nine months of 2014. Total revenues for the first nine months were $681.9 million (45% oil and natural gas, 32% contract drilling, and 23% mid-stream), compared to $1.2 billion (48% oil and natural gas, 29% contract drilling, and 23% mid-stream) for the first nine months of 2014. Adjusted EBITDA for the first nine months of 2015 (which excludes the effect of non-cash commodity derivatives and the effect of the loss on sale of assets primarily attributable to the sale of drilling rigs and equipment) was $311.1 million or $6.31 per diluted share (see Non-GAAP Financial Measures below).

OIL AND NATURAL GAS SEGMENT INFORMATION

For the quarter, total equivalent production was 5.1 million barrels of oil equivalent (MMBoe), an increase of 10% over the third quarter of 2014 and essentially unchanged from the second quarter of 2015. Liquids (oil and NGLs) production represented 45% of total equivalent production for the quarter. Oil production for the quarter was 10,324 barrels per day, a decrease of 9% from the third quarter of 2014 and a decrease of 1% from the second quarter of 2015. NGLs production for the quarter was 14,557 barrels per day, an increase of 17% over the third quarter of 2014 and essentially unchanged from the

second quarter of 2015. Natural gas production for the quarter was 180,288 thousand cubic feet (Mcf) per day, an increase of 14% over the third quarter of 2014 and a decrease of 2% from the second quarter of 2015. Total production for the first nine months of 2015 was 15.2 MMBoe.

Unit’s average realized per barrel equivalent price for the third quarter was $20.61, a decrease of 48% from the third quarter of 2014 and an 8% decrease from the second quarter of 2015. Unit’s average natural gas price for the quarter was $2.66 per Mcf, a decrease of 28% from the third quarter of 2014 and essentially unchanged from the second quarter of 2015. Unit’s average oil price for the quarter was $50.87 per barrel, a decrease of 44% from the third quarter of 2014 and a decrease of 8% from the second quarter of 2015. Unit’s average NGLs price for the quarter was $8.74 per barrel, a 71% decrease from the third quarter of 2014 and a decrease of 27% from the second quarter of 2015. All prices in this paragraph include the effects of derivative contracts.

The following table summarizes this segment’s outstanding derivative contracts.

Period

Structure

Volume

Bbl/Day

Weighted

Average

Fixed Price

Floor Price

Subfloor Price

Ceiling Price

Oct'15 - Dec'15

$95.00

Collar

$58.00

$64.40

Jan'16 - Dec'16

3-Way Collar

$46.50

$35.00

$57.00

Jan'16 - Jun'16

$44.00

$54.00

Jul'16 - Dec'16

$47.50

$63.50

Natural Gas

MMBtu/Day

40,000

Nov'15 - Dec'15

13,500

10,000

27,000

The following table illustrates this segment’s comparative production, realized prices, and operating profit for the periods indicated:

Three Months Ended

Nine Months Ended

Sept 30, 2015

Sept 30, 2014

Change

June 30, 2015

Oil and NGLs Production, MBbl

Natural Gas Production, Bcf

Production, MBoe

15,225

13,414

Production, MBoe/day

Avg. Realized Natural Gas Price, Mcf

Avg. Realized NGL Price, Bbl

Avg. Realized Oil Price, Bbl

Realized Price / Boe

Operating Profit Before Depreciation, Depletion, & Amortization (MM)

Realized price includes oil, NGLs, natural gas, and associated derivatives.

Operating profit before depreciation is calculated by taking operating revenues for this segment less operating expenses excluding depreciation, depletion, amortization, and impairment.

Currently, two Unit drilling rigs are operating for this segment. One is operating in the Southern Oklahoma Hoxbar Oil Trend (SOHOT) and one is drilling in the Wilcox play, located in Southeast Texas. The current plan is to keep these two Unit drilling rigs operating through the end of the year. Unit’s expectations are to be at the top end of the revised upward 2015 production guidance of 6% to 8% growth over 2014. Anticipated capital expenditures are estimated to be in line with projected cash flow. Well service cost reductions and operating efficiencies are resulting in current AFE’s continuing to be approximately 28% lower as compared to 2014.

In the SOHOT area, four horizontal operated Hoxbar wells were completed during the third quarter with one well in the Marchand bench and three wells in the Medrano bench. During the first nine months of 2015, a total of three Marchand wells and nine Medrano wells were completed. The 30 day initial production rate for the 2015 Marchand wells averaged 1,345 Boe per day (79% oil, 11% NGLs) which is 7% higher than the current type curve. The 30 day initial production rate for the 2015 Medrano wells averaged 7.0 MMcfe per day...


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