SandRidge Energy (NYSE: SD) reported third-quarter earnings this evening, and results were strong across the board. The company delivered earnings of $0.07 per share, which beat estimates by $0.04. SandRidge also increased its full-year production guidance.
SandRidge delivered adjusted net income of $40.4 million, well ahead of last year's $29.6 million. Adjusted operating cash flow was even better at $235 million. SandRidge accomplished this in part by reducing its lease operating expense by 22% over the past year.
The other factor leading to these solid results can be attributed to its production growth. On the quarter, production out of the Mississippi Lime was up by 1% over last quarter and 59% over the third quarter of the prior year. The company was able to achieve this growth despite operating fewer rigs. Its rig count this past quarter was 15% lower than the previous quarter and 31% lower than the first quarter.
One other important item of note: SandRidge deferred the production of a dozen high-volume wells in the quarter because production is outperforming gas infrastructure capacity. An accelerated take-away project was placed into service shortly after the quarter ended, and all of the wells will come online over the next few months. Overall, the company's results continue to exceed exceptions, which is why the company is boosting its full-year production guidance again this quarter.
In commenting on the quarter, CEO James Bennett remarked, "Over the last couple of quarters, we have pursued several key themes operationally -- being more efficient with our capital, consistent Mississippian production growth, reducing our costs, and identifying new opportunities. We believe we are hitting the mark on all of these."