0001070412truefalse00010704122023-07-272023-07-270001070412us-gaap:CommonStockMember2023-07-272023-07-270001070412cnx:PreferredSharePurchaseRightsMember2023-07-272023-07-27

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

Date of Report (date of earliest event reported): July 27, 2023
CNX Resources Corporation
(Exact name of registrant as specified in its charter)
Delaware 001-14901 51-0337383
(State or other jurisdiction
of incorporation)		 (Commission File Number) (IRS Employer
Identification No.)
 
CNX Center
1000 Horizon Vue Drive
Canonsburg, Pennsylvania 15317

(Address of principal executive offices)
(Zip code)

Registrant's telephone number, including area code:
(724) 485-4000

Not Applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of exchange on which registered
Common Stock ($.01 par value) CNX New York Stock Exchange
Preferred Share Purchase Rights -- New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
☐



Item 2.02 Results of Operations and Financial Condition.
 
CNX Resources Corporation (“CNX” or the “Company”) today released financial and operational results for the second quarter 2023 by posting those results on its website. A copy of those results is attached to this Current Report as Exhibit 99.1 and incorporated into this Item 2.02 by reference.

The information furnished pursuant to this Item 2.02 and Item 7.01, including Exhibit 99.1, are being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that section, and will not be incorporated by reference into any filing under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated therein by reference.

Item 7.01 Regulation FD

The information set forth under Item 2.02 is incorporated into this Item 7.01 by reference.    

Item 8.01 Other Events.

On July 25, 2023, the Company’s Board of Directors approved a $1.0 billion increase to its existing stock repurchase program. As of July 25, 2023, this approval increased the dollar amount of common stock currently available to be repurchased under the Company’s existing stock repurchase program to approximately $1.3 billion, which is not subject to a termination date or expiration date. The repurchases may be effected from time-to-time through open market purchases, privately negotiated transactions, Rule 10b5-1 plans, accelerated stock repurchases, block trades, derivative contracts or otherwise in compliance with Rule 10b-18. The timing of any repurchases will be based on a number of factors, including available liquidity, the Company's stock price, the Company's financial outlook, and alternative investment options. The stock repurchase program does not obligate the Company to repurchase any dollar amount or number of shares and the Board may modify, suspend, or discontinue its authorization of the program at any time. The Board of Directors will continue to evaluate the size of the stock repurchase program based on CNX's free cash flow position, leverage ratio, and capital plans.

Item 9.01 Financial Statements and Exhibits.
 
(d) Exhibits.  




























SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
                        
                        CNX RESOURCES CORPORATION

By:    /s/ Alan K. Shepard
     Alan K. Shepard
Chief Financial Officer and Executive Vice President


Dated: July 27, 2023






cnxlogo2a03.jpg

2Q 2023 Earnings Results &
Supplemental Information of CNX Resources
TABLE OF CONTENTS:Page:
Production Volumes and Activity Summary........................................................................................................................2
Hedge Volumes and Pricing…...........................................................................................................................................3
Gas Hedging Gain/Loss Projections and Actuals..............................................................................................................4
Consolidated Statements of Income..................................................................................................................................5
Consolidated Balance Sheets............................................................................................................................................6
Consolidated Statements of Cash Flows….......................................................................................................................7
Market Mix and Natural Gas Price Reconciliation…..........................................................................................................8
Price and Cost Data (Per Mcfe).........................................................................................................................................9
Guidance…........................................................................................................................................................................10
Definitions..........................................................................................................................................................................11
Sales of Natural Gas, NGL and Oil, including Cash Settlements and Natural Gas, NGL and Oil Production Costs.........
12
Quarterly Adjusted EBITDAX and Adjusted Net Income....................................................................................................13
Operating Margin...............................................................................................................................................................14
Cash Operating Margin......................................................................................................................................................15
Net Debt and Adjusted EBITDAX TTM..............................................................................................................................16
Free Cash Flow..................................................................................................................................................................17

NOTE: Please note that CNX is unable to provide a reconciliation of non-GAAP projected financial results contained in this presentation, including the non-GAAP measures referenced above, to their respective comparable financial measure calculated in accordance with GAAP. This is due to our inability to calculate the comparable GAAP projected metrics, including operating income, net cash provided by operating activities and total production costs, given the unknown effect, timing, and potential significance of certain income statement items.





PRODUCTION VOLUMES
GASQ2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Shale Sales Volumes (Bcf)114.0 114.8 119.0 125.1 122.1 
CBM Sales Volumes (Bcf)10.1 10.4 10.5 10.7 11.0 
Other Sales Volumes (Bcf)0.1 0.1 0.1 0.2 0.1 
LIQUIDS*
NGLs Sales Volumes (Bcfe)9.7 10.1 10.5 10.2 8.8 
Oil and Condensate Sales Volumes (Bcfe)0.3 0.5 0.5 0.2 0.3 
TOTAL (Bcfe)134.2 135.9 140.6 146.4 142.3 
Average Daily Production (MMcfe)1,474.2 1,509.6 1,528.4 1,590.9 1,564.1 
* NGLs, Oil and Condensate are converted to Mcfe at the rate of one barrel equals six Mcf based upon the approximate relative energy content of oil and natural gas, which is not indicative of the relationship of oil, NGLs, condensate, and natural gas prices.
Q2 2023 ACTIVITY SUMMARYTDFracTIL
Average Lateral Length(1)
Rigs at Period End
SWPA CentralMarcellus771314,140-
Utica22---
SWPA GreaterMarcellus1---1
Utica-----
CPA SouthMarcellus-----
Utica----1
Total109132
(1) Measured in lateral feet from perforation to perforation.



2

NATURAL GAS HEDGE VOLUMES AND PRICING(1)
Q3 202320232024202520262027
NYMEX Hedges
Volumes (Bcf)105.6387.1289.5232.0244.0105.6
Average Prices ($/Mcf)$3.02$3.04$3.07$3.25$3.28$4.22
Physical Fixed Price Sales and Index Hedges
Volumes (Bcf)8.734.7121.6129.689.3111.6
Average Prices ($/Mcf)$2.14$2.17$2.43$2.30$2.60$3.30
Total Volumes Hedged (Bcf)(2)
114.3421.8411.1361.6333.3217.2
NYMEX + Basis (fully-covered volumes)(3)
Volumes (Bcf)112.8421.8407.7361.6306.2197.3
Average Prices ($/Mcf)$2.43$2.49$2.46$2.39$2.46$3.24
NYMEX Hedges Exposed to Basis
Volumes (Bcf)1.5-3.4-27.119.9
Average Prices ($/Mcf)$3.02-$3.07-$3.28$4.22
Total Volumes Hedged (Bcf)(2)
114.3421.8411.1361.6333.3217.2
Estimated Conversion Factor(4)
1.0811.0831.0751.0711.0661.063
(1) Hedge positions as of 7/6/2023.
(2) Excludes basis hedges in excess of NYMEX hedges of 10.8 Bcf and 12.8 Bcf for 2023 and 2025, respectively.
(3) Includes the impact of NYMEX and basis-only hedges as well as physical sales agreements.
(4) To convert Bcf to TBtu, multiply by conversion factor; to convert $/Mcf to $/MMBtu, divide by conversion factor.



3

HEDGING GAIN/LOSS PROJECTIONS
Q3 2023CY2023CY2024
Hedged VolumesWtd. Avg. AverageForecastedHedged VolumesWtd. Avg.AverageForecastedHedged VolumesWtd. Avg.AverageForecasted
($/MMBtu)(000 MMBtu)Hedged Price
Forward Market(1)
Gain/(Loss)(2) ($ in 000s)
(000 MMBtu)Hedged Price
Forward Market(1)
Gain/(Loss)(2) ($ in 000s)
(000 MMBtu)Hedged PriceForward Market
Gain/(Loss)(2) ($ in 000s)
NYMEX114,080$2.79$2.60$21,437419,300$2.81$2.81$20,572311,330$2.85$3.50($197,161)
Index9,200$1.98$1.20$7,174 36,500$1.98$1.81$6,212 118,250$2.27$2.74($55,211)
Basis:
Eastern Gas-South (DOM)14,950($0.66)($1.37)$10,66459,313($0.66)($0.99)$19,83373,200($0.58)($0.88)$21,711
TCO Pool (TCO)28,750($0.65)($1.05)$11,448100,850($0.64)($0.76)$12,93532,335($0.57)($0.68)$3,508
Michcon (NMC)11,040($0.25)($0.38)$1,34643,190($0.25)($0.25)($151)16,780($0.21)($0.32)$1,776
TETCO M3 (TMT)1,840($0.98)($1.21)$4376,530($0.04)$0.34($3,843)--$0.14-
TETCO M2 (BM2)40,020($0.56)($1.45)$35,465158,775($0.56)($1.01)$71,622150,060($0.61)($0.87)$38,023
Transco Zone 5 South (DKR)3,220($0.08)$0.18($834)12,165$0.62$1.67($12,609)2,275$1.23$0.83($3,731)
Total Financial Basis Hedges99,820$58,526380,823$87,787274,650$61,287
Total Projected Realized Gain (Loss)$87,137$114,571($191,085)
Note: Forward market prices, hedged volumes, and hedge prices are as of 7/6/2023. Anticipated hedging activity is not included in projections.
(1) January 2023 through July 2023 prices are settled.
(2) Forecasted Gain/(Loss) amounts are based on sum of current monthly hedge positions vs. strip.

Actual Change in Derivatives
(Dollars in millions)Q2 2023Q1 2023Q4 2022Q3 2022Q2 2022
Realized Gain (Loss)$79($61)($360)($651)($531)
Unrealized Gain (Loss)$463$823$1,138($411)($122)
Gain (Loss) on Commodity Derivative Instruments$542$762$778($1,062)($653)

4

CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
Dollars in thousands, except per share data
Revenue and Other Operating Income (Loss):Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Natural Gas, NGL and Oil Revenue$257,061$455,639$776,740$1,127,341$1,003,406
Gain (Loss) on Commodity Derivative Instruments542,472762,167777,615(1,062,353)(652,643)
Purchased Gas Revenue9,35536,81261,42131,73846,552
Other Revenue and Operating Income30,81221,35921,05420,33523,103
Total Revenue and Other Operating Income839,700 1,275,977 1,636,830 117,061 420,418 
Costs and Expenses:
Operating Expense
Lease Operating Expense13,09216,47417,73919,23914,282
Transportation, Gathering and Compression87,87298,09696,38596,63288,357
Production, Ad Valorem, and Other Fees5,4199,64111,59913,4819,958
Depreciation, Depletion and Amortization103,682105,222112,245114,167116,180
Exploration and Production Related Other Costs1,7275,1041,2126854,712
Purchased Gas Costs8,79434,34762,21732,30946,041
Selling, General, and Administrative Costs30,01736,57631,96127,72230,454
Other Operating Expense21,031 15,139 9,818 21,238 20,539 
Total Operating Expense271,634320,599343,176325,473330,523
Other Expense
Other Expense2,5101,1683,4941,9225,179
(Gain) Loss on Assets Sales and Abandonments, net(105,986)(9,482)(1,426)12,077(6,240)
Loss on Debt Extinguishment——199,95312,981
Interest Expense34,820 35,736 35,218 34,351 31,051 
Total Other (Income) Expense(68,656)27,42237,30558,30342,971
Total Costs and Expenses202,978 348,021 380,481 383,776 373,494 
Earnings (Loss) Before Income Tax636,722927,9561,256,349(266,715)46,924
Income Tax Expense161,767 217,561 81,770 160,357 13,567 
Net Income (Loss)$474,955$710,395$1,174,579$(427,072)$33,357
Earnings (Loss) per Share
Basic$2.89$4.22$6.64$(2.28)$0.17
Diluted$2.47$3.61$5.68$(2.28)$0.15
Weighted-Average Shares OutstandingQ2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Weighted-Average Shares of Common Stock Outstanding164,139,583 168,452,107 176,916,881 187,511,940 194,021,639 
Effect of Diluted Shares*28,852,003 28,692,767 30,127,743 — 30,387,055 
Weighted-Average Diluted Shares of Common Stock Outstanding192,991,586 197,144,874 207,044,624 187,511,940 224,408,694 
*During periods in which the Company incurs a net loss, diluted weighted average shares outstanding are equal to basic weighted average shares outstanding because the effect of all equity awards and the potential share settlement impact related to CNX's Convertible Notes are antidilutive.




5

CONSOLIDATED BALANCE SHEETS
(Unaudited)
Dollars in thousands30-Jun-2331-Mar-2331-Dec-2230-Sep-2230-Jun-22
ASSETS
Current Assets:
Cash and Cash Equivalents$22,765$2,799$21,321$1,594$238
Accounts and Notes Receivable
Trade, net97,702 136,208 348,458 479,088 447,464 
Other Receivables, net11,370 8,015 6,184 5,436 6,010 
Supplies Inventories26,470 29,339 27,156 19,650 14,490 
Derivative Instruments227,012 159,794 154,474 200,598 137,492 
Prepaid Expenses14,504 15,443 16,211 17,373 12,503 
Total Current Assets399,823 351,598 573,804 723,739 618,197 
Property, Plant and Equipment:
Property, Plant and Equipment:12,247,858 12,099,212 11,907,698 11,738,308 11,606,088 
Less-Accumulated Depreciation, Depletion and Amortization5,008,026 4,913,268 4,811,189 4,704,665 4,593,364 
Total Property, Plant and Equipment—Net7,239,832 7,185,944 7,096,509 7,033,643 7,012,724 
Other Non-Current Assets:
Operating Lease Right-of-Use Assets164,503 170,376 174,849 187,376 176,613 
Derivative Instruments305,887 208,933 244,931 258,539 420,291 
Goodwill323,314 323,314 323,314 323,314 323,314 
Other Intangible Assets73,714 75,352 76,990 78,628 80,266 
Deferred Income Taxes— — — — 14,107 
Other Non-Current Assets24,782 24,628 25,376 27,887 50,378 
Total Other Non-Current Assets892,200 802,603 845,460 875,744 1,064,969 
TOTAL ASSETS$8,531,855$8,340,145$8,515,773$8,633,126$8,695,890
LIABILITIES AND EQUITY
Current Liabilities:
Accounts Payable$164,177$195,867$191,343$169,406$154,449
Derivative Instruments240,874 242,900 782,653 1,407,892 1,210,715 
Current Portion of Finance Lease Obligations1,379 1,423 881 686 637 
Current Portion of Long-Term Debt— — — 323,122 322,622 
Current Portion of Operating Lease Obligations53,166 50,844 47,436 48,710 40,951 
Other Accrued Liabilities232,417 213,874 290,491 308,212 302,599 
Total Current Liabilities692,013 704,908 1,312,804 2,258,028 2,031,973 
Non-Current Liabilities:
Long-Term Debt2,154,093 2,203,108 2,205,735 1,920,440 1,907,074 
Finance Lease Obligations3,732 4,023 1,970 1,375 1,342 
Operating Lease Obligations114,998 122,726 132,105 143,291 139,428 
Derivative Instruments812,744 1,124,884 1,517,021 2,012,326 1,899,736 
Deferred Income Taxes609,133 449,656 232,280 146,621 — 
Asset Retirement Obligations87,987 89,619 89,079 87,243 88,463 
Other Non-Current Liabilities73,968 73,925 74,318 86,814 90,850 
Total Non-Current Liabilities3,856,655 4,067,941 4,252,508 4,398,110 4,126,893 
TOTAL LIABILITIES4,548,668 4,772,849 5,565,312 6,656,138 6,158,866 
Stockholders' Equity
Common Stock1,625 1,663 1,712 1,835 1,918 
Capital in Excess of Par Value2,440,895 2,468,079 2,506,269 2,602,697 2,665,440 
Preferred Stock— — — — — 
Retained Earnings (Accumulated Deficit)1,547,036 1,103,995 448,993 (613,426)(116,081)
Accumulated Other Comprehensive Loss(6,369)(6,441)(6,513)(14,118)(14,253)
TOTAL STOCKHOLDERS' EQUITY3,983,187 3,567,296 2,950,461 1,976,988 2,537,024 
TOTAL LIABILITIES AND EQUITY$8,531,855$8,340,145$8,515,773$8,633,126$8,695,890




6

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Dollars in thousands
Cash Flows from Operating Activities:Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Net Income (Loss)$474,955$710,395$1,174,579($427,072)$33,357
Depreciation, Depletion and Amortization103,682105,222112,245114,167116,180
Amortization of Deferred Financing Costs2,3172,2972,2932,0482,073
Stock-Based Compensation4,5428,6381,4933,8293,722
(Gain) Loss on Asset Sales and Abandonments, net(105,986)(9,482)(1,426)12,077(6,240)
Loss on Debt Extinguishment——199,95312,981
(Gain) Loss on Commodity Derivative Instruments(542,472)(762,167)(777,615)1,062,353652,643
Loss (Gain) on Other Derivative Instruments176961(300)(2,694)(2,131)
Net Cash Received (Paid) in Settlement of Commodity Derivative Instruments63,957(140,005)(282,897)(651,247)(530,129)
Deferred Income Taxes159,450217,34983,076160,68014,370
Other(1,334)(114)1,6191,646623
Changes in Operating Assets:
Accounts and Notes Receivable35,400210,383129,759(31,478)(185,196)
Supplies Inventories2,868(2,183)(7,505)(5,160)(8,021)
Prepaid Expenses9397681,181(4,840)1,041
Changes in Other Assets498(153)(143)19,8001,520
Changes in Operating Liabilities:
Accounts Payable(16,981)(19,242)25,947(684)30,541
Accrued Interest16,2742,21616,550(14,373)12,128
Other Operating Liabilities342(75,792)(36,289)19,20242,906
Changes in Other Liabilities98(353)(315)(3,825)(402)
Net Cash Provided by Operating Activities198,725248,738442,271264,382191,966
Cash Flows from Investing Activities:
Capital Expenditures(195,985)(170,028)(173,217)(133,553)(136,668)
Proceeds from Asset Sales132,29310,5176,8894,0417,107
Net Cash Used in Investing Activities(63,692)(159,511)(166,328)(129,512)(129,561)
Cash Flows from Financing Activities:
Payments on Long-Term Notes———(358,750)(26,969)
Proceeds from CNXM Revolving Credit Facility Borrowings60,55072,750109,70056,80066,200
Repayments of CNXM Revolving Credit Facility Borrowings(97,050)(90,450)(104,150)(96,950)(88,100)
Proceeds from CNX Revolving Credit Facility Borrowings446,900460,400631,9001,208,250918,075
Repayments of CNX Revolving Credit Facility Borrowings(460,700)(446,600)(676,550)(1,297,250)(880,425)
Proceeds from Issuance of CNX Senior Notes———493,750—
Payments on Other Debt(362)(348)(191)(163)(157)
Proceeds from Issuance of Common Stock12961078135376
Shares Withheld for Taxes(40)(9,344)(180)(7)(83)
Purchases of Common Stock(64,146)(94,759)(215,106)(138,052)(59,494)
Debt Issuance and Financing Fees(348)(8)(1,717)(1,277)(160)
Net Cash Used in Financing Activities(115,067)(107,749)(256,216)(133,514)(70,737)
Net Increase (Decrease) in Cash and Cash Equivalents19,966(18,522)19,7271,356(8,332)
Cash and Cash Equivalents at Beginning of Period2,79921,3211,5942388,570
Cash and Cash Equivalents at End of Period$22,765$2,799$21,321$1,594$238





7

MARKET MIX AND NATURAL GAS PRICE RECONCILIATION
2023E
Gas Sold (%)(1)
Basis(2)
Eastern Gas-South6%($0.68)
ETNG Mainline5%$0.89
TCO Pool27%($0.83)
TETCO ELA & WLA5%($0.35)
TETCO M33%$0.10
TETCO M234%($1.05)
Michcon11%($0.45)
Physical basis sales9%($0.11)
Weighted Average Basis100%($0.66)
NYMEX$2.81
Weighted Average Basis (Not considering hedging)($0.66)
Realized Price (per MMBtu)$2.15
     Conversion Factor (MMBtu/Mcf)1.083
Realized Price Before Financial Hedging (per Mcf)$2.33
(1) Individual market percentages exclude physical basis sales, which are shown separately.
(2) Reflects actual realized basis for six months ended June 30; July - December forward market basis prices as of 7/6/2023.

8

PRICE AND COST DATA (PER MCFE) - NON-GAAP
Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Average Sales Price - Natural Gas$1.80$3.22$5.54$7.82$7.02
Average Gain (Loss) on Commodity Derivative Instruments - Cash Settlement- Gas$0.64 ($0.49)($2.78)($4.79)($3.98)
Average Sales Price - Oil and Condensate*$10.57$11.22$12.34$14.74$16.04
Average Sales Price - NGLs*$3.18$4.58$4.92$6.05$7.21
Average Sales Price of Natural Gas, NGL and Oil, including Cash Settlement
$2.51$2.90$2.96$3.25$3.32
Lease Operating Expense (LOE)$0.10$0.12$0.13$0.13$0.10
Production, Ad Valorem, and Other Fees$0.04$0.07$0.08$0.09$0.07
Transportation, Gathering and Compression$0.65$0.72$0.69$0.66$0.62
Depreciation, Depletion and Amortization (DD&A)$0.75$0.75$0.77$0.76$0.79
Total Natural Gas, NGL and Oil Production Costs
$1.54$1.66$1.67$1.64$1.58
Total Natural Gas, NGL and Oil Production Cash Costs, before DD&A
$0.79$0.91$0.90$0.88$0.79
Natural Gas, NGL and Oil Production Cash Margin, before DD&A$1.72$1.99$2.06$2.37$2.53
Fully Burdened Cash Costs, before DD&A(1)
$1.15$1.28$1.29$1.29$1.22
Fully Burdened Cash Margin, before DD&A$1.36$1.62$1.67$1.96$2.10
Note: "Total Natural Gas, NGL and Oil Production Costs" excludes Selling, General, and Administration and Other Operating Expenses.
*NGLs, Oil, and Condensate are converted to Mcfe at the rate of one barrel equals six Mcf based upon the approximate relative energy content of oil and natural gas, which is not indicative of the relationship of oil, NGLs, condensate, and natural gas prices.
(1) Fully burdened cash costs include production cash costs, selling, general and administrative (SG&A) cash costs, other operating cash expense, other cash (income) expense, other revenue and operating income, and cash interest expense. Q2 2023, Q1 2023, Q4 2022, Q3 2022 and Q2 2022 total fully burdened cash costs exclude a loss/(gain) on asset sales of $0.79 per Mcfe, ($0.07) per Mcfe, ($0.01) per Mcfe, $0.08 per Mcfe and ($0.04) per Mcfe, respectively. Q2 2023, Q1 2023, Q4 2022, Q3 2022 and Q2 2022 exclude unrealized losses on interest rate swaps and noncash amortization of $0.02 per Mcfe, $0.02 per Mcfe, $0.01 per Mcfe, $0.00 per Mcfe and $0.00 per Mcfe, respectively. Q2, 2023, Q1, 2023, Q4 2022, Q3 2022 and Q2 2022 exclude loss on debt extinguishment of $0.00 per Mcfe, $0.00 per Mcfe,$0.00 per Mcfe $0.07 per Mcfe and $0.09 per Mcfe, respectively.
Natural Gas Price ReconciliationQ2-2023Q1-2023Q4-2022Q3-2022Q2-2022
NYMEX Natural Gas ($/MMBtu)$2.10$3.42$6.26$8.20$7.17
Average Differential(0.44)(0.44)(1.17)(1.01)(0.73)
BTU Conversion (MMBtu/Mcf)*0.14 0.24 0.45 0.63 0.58 
Gain (Loss) on Commodity Derivative Instruments-Cash Settlement0.64 (0.49)(2.78)(4.79)(3.98)
Realized Gas Price per Mcf$2.44$2.73$2.76$3.03$3.04
*Conversion factor1.091.081.091.091.09







9

GUIDANCE
PreviousUpdated
($ in millions)2023E2023E
LowHighLowHigh
Production Volumes (Bcfe)555-575545-555
    % Liquids~7%‘-~8%~7%‘-~8%
    % of Natural Gas Hedged83%85%
Prices on Open Volumes(1)
    Natural Gas NYMEX ($/MMBtu)$2.76$2.81
    Natural Gas Differential ($/MMBtu)($0.43)($0.66)
    NGL Realized Price ($/Bbl)~$21.00~$20.00
($ in millions)
Adjusted EBITDAX(2)
$950-$1,050$900-$1,000
Capital Expenditures
    Drilling & Completions (D&C)$430-$475$455-$475
    Non-D&C $120-$160$145-$160
    Discretionary Capital$25-$40$25-$40
Total Capital Expenditures$575-$675$625-$675
($ in millions)
Free Cash Flow (FCF)(2)
~$250~$325
    FCF Per Share(2)(3)
~$1.51~$2.01
(1) Forward market prices for updated 2023 guidance as of 7/6/2023.
(2) Non-GAAP measures. See “Non-GAAP Financial Measures” for definitions. FCF for the updated guidance includes approximately $165 million in expected asset sales in 2023.
(3) Previous guidance for 2023 FCF per share based on shares outstanding of 165,575,514, as of 4/13/2023. Updated guidance for 2023 FCF per share based on shares outstanding of 161,464,938, as of 7/14/2023.

2023E ACTIVITY SUMMARYTIL
Average Lateral Length(1)
SWPA CentralMarcellus2314,500
Utica411,300
SWPA GreaterMarcellus410,800
Utica--
CPAMarcellus38,000
Utica--
Total34
(1) Measured in lateral feet from perforation to perforation.



10

Non-GAAP Measures (Definitions, Purpose, and Reconciliations)

CNX's management uses certain non-GAAP financial measures for planning, forecasting and evaluating business and financial performance, and believes that they are useful for investors in analyzing the company. Although these are not measures of performance calculated in accordance with generally accepted accounting principles (GAAP), management believes that these financial measures are useful to an investor in evaluating CNX because (i) analysts utilize these metrics when evaluating company performance and have requested this information as of a recent practicable date, (ii) these metrics are widely used to evaluate a company’s operating performance, and (iii) we want to provide updated information to investors. Investors should not view these metrics as a substitute for measures of performance that are calculated in accordance with GAAP. In addition, because all companies do not calculate these measures identically, these measures may not be comparable to similarly titled measures of other companies.

Definitions: EBIT is defined as earnings before deducting net interest expense (interest expense less interest income) and income taxes. EBITDAX is defined as earnings before deducting net interest expense (interest expense less interest income), income taxes, depreciation, depletion and amortization, and exploration. Adjusted EBITDAX is defined as EBITDAX after adjusting for the discrete items listed below. Although EBIT, EBITDAX, and adjusted EBITDAX are not measures of performance calculated in accordance with generally accepted accounting principles, management believes that they are useful to an investor in evaluating CNX Resources because they are widely used to evaluate a company's operating performance. We exclude stock-based compensation from adjusted EBITDAX because we do not believe it accurately reflects the actual operating expense incurred during the relevant period and may vary widely from period to period irrespective of operating results. Investors should not view these metrics as a substitute for measures of performance that are calculated in accordance with generally accepted accounting principles. In addition, because all companies do not calculate EBIT, EBITDAX or adjusted EBITDAX identically, the presentation here may not be comparable to similarly titled measures of other companies. Sales of natural gas, NGL and oil, including cash settlements excludes the impacts of changes in the fair value of commodity derivative instruments prior to settlement, which are often volatile, and only includes the impact of settled commodity derivative instruments. Natural gas, NGL and oil production costs excludes certain expenses that are not directly related to CNX’s natural gas producing activities and are managed outside our production operations. Adjusted Net Income (Loss) is defined as net income after adjusting for the discrete items listed below as well as the tax effectiveness. Operating Margins are defined as adjusted EBIT divided by Total Revenue after adjusting for unrealized (gain) loss on commodity derivative instruments. Adjusted Trailing-Twelve-Months (TTM) EBITDAX is defined as EBITDAX over the trailing-twelve-months after adjusting for the discrete items listed below. Cash Operating Margins are defined as adjusted EBITDA divided by total Revenue after adjusting for unrealized (gain) loss on commodity derivative instruments. Net Debt is defined as total long-term debt minus cash and cash equivalents. Adjusted Net Debt is defined as total long-term debt plus the historical impact of recent accounting pronouncement, minus cash and cash equivalents. Free Cash Flow (FCF) is defined as operating cash flow minus capex plus proceeds from asset sales. Organic FCF is defined as operating cash flow minus capex.

Reconciliations of EBIT, EBITDAX, adjusted EBITDAX, adjusted EBIT, adjusted EBITDA, sales of natural gas, NGL and oil, including cash settlements, natural gas, NGL and oil production costs, adjusted net income, operating margins, cash operating margins, net debt, adjusted net debt, adjusted TTM EBITDAX, FCF and organic FCF to the most directly comparable GAAP financial measures are as follows:






11

Non-GAAP Measures
Sales of Natural Gas, NGL and Oil, including cash settlements excludes the impacts of changes in the fair value of commodity derivative instruments prior to settlement, which are often volatile, and only includes the impact of settled commodity derivative instruments. Sales of Natural Gas, NGL and Oil, including cash settlements is a non-GAAP measure that excludes purchased gas revenue and other revenue and operating income, which are not directly related to CNX’s natural gas producing activities. Natural Gas, NGL and Oil Production Costs is a non-GAAP measure that excludes certain expenses that are not directly related to CNX’s natural gas producing activities and are managed outside our production operations (See Note 21 - Segment Information of the Notes to the Audited Consolidated Financial Statements in Item 8 of CNX's 2022 Annual Report on Form 10-K as filed with the SEC on February 9, 2023). These expenses include, but are not limited to, interest expense and other corporate expenses such as selling, general and administrative costs in the current periods presented.
(Dollars in millions)Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Total Revenue and Other Operating Income$840$1,276$1,637$117$420
Add (Deduct):
Purchased Gas Revenue(9)(37)(62)(32)(46)
Unrealized (Gain) Loss on Commodity Derivative Instruments(463)(823)(1,138)411 122 
Other Revenue and Operating Income(31)(21)(21)(20)(23)
Sales of Natural Gas, NGL and Oil, including Cash Settlements, a Non-GAAP Financial Measure$337$395$416$476$473
Total Operating Expense$272$320$343$326$330
Add (Deduct):
Depreciation, Depletion and Amortization (DD&A) - Corporate (3)(3)(4)(3)(2)
   Exploration and Production Related Other Costs(2)(5)(1)(1)(5)
Purchased Gas Costs(9)(34)(62)(32)(46)
Selling, General and Administrative Costs(30)(37)(33)(28)(30)
Other Operating Expense(21)(15)(8)(22)(21)
Natural Gas, NGL and Oil Production Costs, a Non-GAAP Financial Measure1
$207$226$235$240$226
1 Natural Gas, NGL and Oil production costs consists primarily of lease operating expense, production ad valorem and other fees, transportation, gathering and compression and production related depreciation, depletion and amortization.









12

Non-GAAP Measures
EBIT is defined as earnings before deducting net interest expense (interest expense less interest income) and income taxes. EBITDAX is defined as earnings before deducting net interest expense (interest expense less interest income), income taxes, depreciation, depletion and amortization, and exploration. Adjusted EBITDAX is defined as EBITDAX after adjusting for the discrete items listed below.
(Dollars in millions)Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Net Income (Loss)$475$710$1,175($427)$33
Interest Expense35 36 35 35 31 
Income Tax Expense161 218 82 160 14 
Earnings (Loss) Before Interest & Taxes (EBIT)671 964 1,292 (232)78 
Depreciation, Depletion & Amortization104105 112 114 116 
Exploration Expense25 1 1 5 
Earnings (Loss) Before Interest, Taxes, DD&A and Exploration (EBITDAX)$777$1,074$1,405($117)$199
Adjustments:
Unrealized (Gain) Loss on Commodity Derivative Instruments(463)(823)(1,138)411 122 
Gain on Non-Operated Asset Sale(103)— — — — 
Stock-Based Compensation4 9 1 4 4 
Loss on Debt Extinguishment— — — 10 13 
Loss on Abandonment—— 4 16 — 
Virginia Flood Expense1— 1 2 — 
Severance11 1 — — 
Total Pre-tax Adjustments(560)(813)(1,131)443 139 
Adjusted EBITDAX$217$261$274$326$338
Adjusted Net Income (Loss) is defined as net income (loss) after adjusting for the discrete items listed below as well as the related tax effect.
(Dollars in millions)Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Net Income (Loss) from EBITDAX Reconciliation$475$710$1,175($427)$33
Adjustments:
Total Pre-tax Adjustments from EBITDAX Reconciliation(560)(813)(1,131)443 139 
Tax Effect of Adjustments142 212 295 (116)(36)
Adjusted Net Income (Loss)$57$109$339($100)$136







13

Non-GAAP Measures
Operating Margin: Adjusted EBIT divided by Total Revenue and Other Operating Income after adjusting for unrealized (gain) loss on commodity derivative instruments.
(Dollars in millions)Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Total Revenue and Other Operating Income$840$1,276$1,637$117$420
Net Income (Loss)$475$710$1,175($427)$33
Interest Expense3536353531
Income Tax Expense1612188216014
Earnings (Loss) Before Interest & Taxes (EBIT)6719641,292(232)78
Depreciation, Depletion & Amortization104105112114116
Earnings (Loss) Before Interest, Taxes, DD&A (EBITDA)$775$1,069$1,404($118)$194
Adjustments:
Unrealized (Gain) Loss on Commodity Derivative Instruments($463)($823)($1,138)$411$122
Total Adjustments($463)($823)($1,138)$411$122
Total Revenue and Other Operating Income Minus Unrealized (Gain) Loss on Commodity Derivative Instruments$377$453$499$528$542
Adjusted EBIT$208$141$154$179$200
Operating Margin55 %31 %31 %34 %37 %
















14

Non-GAAP Measures
Cash Operating Margin: Adjusted EBITDA divided by Total Revenue and Other Operating Income after adjusting for unrealized (gain) loss on commodity derivative instruments, stock based compensation and the other discrete items listed below.
(Dollars in millions)Q2-2023Q1-2023Q4-2022Q3-2022Q2-2022
Total Revenue and Other Operating Income$840$1,276$1,637$117$420
Net Income (Loss)$475$710$1,175($427)$33
Interest Expense3536353531
Income Tax Expense1612188216014
Earnings (Loss) Before Interest & Taxes (EBIT)6719641,292(232)78
Depreciation, Depletion & Amortization104105112114116
Earnings (Loss) Before Interest, Taxes, DD&A (EBITDA)$775$1,069$1,404($118)$194
Adjustments:
Unrealized (Gain) Loss on Commodity Derivative Instruments$(463)($823)($1,138)$411$122
Gain on Non-Operated Asset Sale(103)————
Stock-Based Compensation49144
Loss on Abandonment——416—
Virginia Flood Expense1—12—
Loss on Debt Extinguishment———1013
Severance111——
Total Adjustments($560)($813)($1,131)$443$139
Total Revenue and Other Operating Income Minus Unrealized (Gain) Loss on Commodity Derivative Instruments$377$453$499$528$542
Adjusted EBITDA$215$256$273$325$333
Cash Operating Margin57 %57 %55 %62 %61 %















15

Non-GAAP Measures
Management uses net debt to determine the company's outstanding debt obligations that would not be readily satisfied by its cash and cash equivalents on hand. Management believes that using net debt is useful to investors in determining the company's leverage ratio since the company could choose to use its cash and cash equivalents to retire debt.
Net Debt: Total long-term debt minus cash and cash equivalents.
Adjusted Net Debt: Total long-term debt, plus the historical impact of recent accounting pronouncement, minus cash and cash equivalents.
(Dollars in millions)
Net Debt30-Jun-2331-Mar-2331-Dec-2231-Dec-2131-Dec-2030-Sep-20
Total Long-Term Debt (GAAP)(1)
$2,154$2,203$2,206$2,214$2,424$2,600
Less: Cash and Cash Equivalents23321422156
Net Debt$2,131$2,200$2,185$2,210$2,402$2,444
(1) Includes current portion
(Dollars in millions)
Adjusted Net Debt30-Jun-2331-Mar-2331-Dec-2231-Dec-2131-Dec-2030-Sep-20
Total Long-Term Debt (GAAP)(1)
$2,154$2,203$2,206$2,214$2,424$2,600
Plus: Impact of Recent Accounting Pronouncement(2)
———8298101
Less: Cash and Cash Equivalents23321422156
Adjusted Net Debt $2,131$2,200$2,185$2,292$2,500$2,545
(1) Includes current portion
(2) On January 1, 2022, the Company adopted Accounting Standards Update (ASU) 2020-06 - Accounting for Convertible Instruments and Contracts in an Entity's Own Equity and upon adoption long-term debt increased by $82MM (See Note 9 - Long-Term Debt in the Notes to the Unaudited Consolidated Financial Statements in Item 1 of CNX’s June 30, 2023 Form 10-Q for additional information). As this adjustment was recorded on a prospective basis, Management believes that presenting investors with the net debt on a historical basis would be beneficial.

Adjusted TTM EBITDAX: EBITDAX over the trailing-twelve-months after adjusting for the discrete items listed below.
Three Months EndedTwelve Months Ended
(Dollars in millions)30-Sep-2231-Dec-2231-Mar-2330-Jun-2330-Jun-23
Net (Loss) Income($427)$1,175$710$475$1,933
Interest Expense35353635141
Income Tax Expense16082218161621
(Loss) Earnings Before Interest & Taxes (EBIT)(232)1,2929646712,695
Depreciation, Depletion & Amortization114112105104435
Exploration Expense11529
(Loss) Earnings Before Interest, Taxes, DD&A, and Exploration (EBITDAX)(117)1,4051,0747773,139
Adjustments:
Unrealized Loss (Gain) on Commodity Derivative Instruments411(1,138)(823)(463)(2,013)
Gain on Non-Operated Asset Sale———(103)(103)
Stock Based Compensation419418
Loss on Debt Extinguishment10———10
Severance—1113
Loss on Abandonment164——20
Virginia Flood Expense21—14
Total Pre-tax Adjustments443(1,131)(813)(560)(2,061)
Adjusted EBITDAX TTM$326$274$261$217$1,078


16

Non-GAAP Measures
The Company's management believes that the following measures provide useful information to external users of the Company's consolidated financial statements, such as industry analysts, lenders and ratings agencies. Free cash flow and organic free cash flow should not be considered as alternatives to net cash provided by operating activities or any other measure of liquidity presented in accordance with GAAP.                                    
Free Cash Flow (FCF): Operating cash flow minus capex plus proceeds from asset sales.
Organic Free Cash Flow (FCF): Operating cash flow minus capex.
2023 Free Cash Flow
(Dollars in millions)Q2-2023Q1-2023
Net Cash Provided by Operating Activities$199$249
Capital Expenditures(196)(170)
Proceeds from Asset Sales13210
Free Cash Flow$135$89
2022 Free Cash Flow
(Dollars in millions)Q4-2022Q3-2022Q2-2022Q1-2022YTD-2022
Net Cash Provided by Operating Activities$442$265$192$336$1,235
Capital Expenditures(173)(134)(137)(122)(566)
Proceeds from Asset Sales7472038
Free Cash Flow$276$135$62$234$707
2022 Organic Free Cash Flow
(Dollars in millions)Q4-2022Q3-2022Q2-2022Q1-2022YTD-2022
Net Cash Provided by Operating Activities$442$265$192$336$1,235
Capital Expenditures(173)(134)(137)(122)(566)
Organic Free Cash Flow$269$131$55$214$669
2021 Free Cash Flow
(Dollars in millions)Q4-2021Q3-2021Q2-2021Q1-2021YTD-2021
Net Cash Provided by Operating Activities$254$215$239$219$927
Capital Expenditures(117)(97)(129)(123)(466)
Proceeds from Asset Sales21127545
Free Cash Flow$158$130$117$101$506
2021 Organic Free Cash Flow
(Dollars in millions)Q4-2021Q3-2021Q2-2021Q1-2021YTD-2021
Net Cash Provided by Operating Activities$254$215$239$219$927
Capital Expenditures(117)(97)(129)(123)(466)
Organic Free Cash Flow$137$118$110$96$461
2020 Free Cash Flow
(Dollars in millions)Q4-2020Q3-2020Q2-2020Q1-2020YTD-2020
Net Cash Provided by Operating Activities$161$223$144$267$795
Capital Expenditures(92)(108)(135)(152)(487)
Proceeds from Asset Sales166121448
Free Cash Flow$85$121$21$129$356

17

Risk Factors

This presentation, including the oral statements made in connection herewith, contains forward-looking statements estimates and projections within the meaning of the federal securities laws. Statements that are not historical are forward-looking and may include our operational and strategic plans; estimates of gas reserves and resources; projected timing and rates of return of future investments; and projections and estimates of future production revenues, income and capital spending. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those statements estimates and projections. Investors should not place undue reliance on forward-looking statements as a prediction of future actual results. The forward-looking statements in this presentation speak only as of the date of this presentation; we disclaim any obligation to update the statements, and we caution you not to rely on them unduly.

Specific factors that could cause future actual results to differ materially from the forward-looking statements are described in detail under the captions "Forward-Looking Statements" and "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2022 filed with the Securities and Exchange Commission (SEC) as supplemented by our quarterly reports on Form 10-Q and any subsequent reports filed with the SEC. Those risk factors discuss, among other matters, pricing volatility or pricing decline for natural gas and NGLs; the failure to realize the anticipated costs savings, synergies and other benefits of CNX’s purchase of the outstanding interests in CNXM not already owned by CNX; local, regional and national economic conditions and the impact they may have on our customers; the impact of outbreaks of communicable diseases such as COVID-19 on business activity, our operations and national and global economic conditions, generally; conditions in the oil and gas industry, including a sustained decrease in the level of supply or demand for oil or natural gas or a sustained decrease in the price of oil or natural gas; the financial condition of our customers; any non-performance by customers of their contractual obligations; changes in customer, employee or supplier relationships resulting from the proposed transaction; and changes in safety, health, environmental and other regulations.

18
v3.23.2
Cover Page Cover Page
Jul. 27, 2023
Entity Information [Line Items]  
Document Type 8-K
Document Period End Date Jul. 27, 2023
Entity Registrant Name CNX Resources Corporation
Entity Incorporation, State or Country Code DE
Entity File Number 001-14901
Entity Tax Identification Number 51-0337383
Entity Address, Address Line One CNX Center
Entity Address, Address Line Two 1000 Horizon Vue Drive
Entity Address, City or Town Canonsburg
Entity Address, State or Province PA
Entity Address, Postal Zip Code 15317
City Area Code 724
Local Phone Number 485-4000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Central Index Key 0001070412
Amendment Flag false
Entity Emerging Growth Company false
Common Stock  
Entity Information [Line Items]  
Title of 12(b) Security Common Stock ($.01 par value)
Trading Symbol CNX
Security Exchange Name NYSE
Preferred Share Purchase Rights  
Entity Information [Line Items]  
Title of 12(b) Security Preferred Share Purchase Rights
Security Exchange Name NYSE
No Trading Symbol Flag true
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