W&T Offshore, Inc. Form 8-K Summary
Business Context and Reporting Period
This Current Report on Form 8-K was filed by W&T Offshore, Inc. on November 2, 2016. The filing primarily addresses the company's third-quarter 2016 financial results (referenced via an attached press release) and a significant legal development regarding a pending lawsuit with Apache Corporation.
Key Financial Metrics
The filing text itself does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These metrics are contained within the press release furnished as Exhibit 99.1, which is referenced but not included in the provided text.
Material Changes and Legal Developments
A material event reported is the jury verdict in the lawsuit Apache Corporation v. W&T Offshore, Inc., which concluded on October 31, 2016. The dispute concerned W&T's alleged failure to pay its proportional share of costs for plugging and abandoning three deepwater wells in the Mississippi Canyon area.
- Jury Findings: The jury found that W&T failed to comply with the contract regarding the MC 674 wells.
- Compensation Award: The jury determined the compensation amount for Apache was $43.2 million.
- Offset Determination: The jury found this amount should be offset by $17.0 million.
- Bad Faith Finding: The jury found that Apache acted in bad faith, which caused W&T's non-compliance.
Outlook, Risks, and Management Commentary
Management intends to file a motion with the trial court requesting a judgment consistent with the jury's finding of Apache's bad faith. W&T asserts that this finding bars Apache from recovering damages under applicable law. If damages are not barred entirely, W&T argues the judgment should reflect the $17.0 million offset determined by the jury. The filing notes that the press release (Exhibit 99.1) contains guidance for the fourth quarter and full year of 2016, though specific guidance figures are not detailed in this text.
Investor Verification Checklist
- Review Exhibit 99.1 (Press Release) for specific Q3 2016 financial results and full-year 2016 guidance.
- Monitor the status of the motion W&T intends to file regarding the Apache Corporation lawsuit verdict.
- Assess the potential financial impact of the $43.2 million jury award versus the $17.0 million offset and the bad faith defense.
- Verify if the bad faith finding legally precludes Apache from collecting any damages.