Vanguard Natural Resources, LLC announced unaudited consolidated earnings and production results for the second quarter and six months ended June 30, 2018. For the quarter, the company reported average production of 363 MMcfe per day in the second quarter of 2018 represents a 1% decrease compared to 368 MMcfe per day for the first quarter of 2018 and was at the mid-point of guidance when normalizing for divestitures closing sooner than initially expected. The production decrease from the first quarter was primarily attributable to the planned shutdown of the BEC facility in Alabama and the closing of the Permian and Mississippi asset divestitures at the beginning of June 2018. Total production volumes was 33,041 MMcfe compared to 34,382 MMcfe a year ago.

For the six months, the company reported average production of 365 MMcfe per day in the first six months of 2018 represents a 4% decrease compared to 381 MMcfe per day during the same period in 2017. The production decrease was primarily attributable to divestitures completed during 2017 and 2018. On a Mcfe basis, crude oil, natural gas, and NGLs accounted for 15%, 71% and 14%, respectively, of year to date June 30, 2018 production. Total production volumes was 66,122 MMcfe compared to 69,020 MMcfe a year ago.

For the second quarter, the company reported impairment charge on oil and natural gas properties of $7,552,000.

For the quarter, the company reported a net loss attributable to common stockholders for the second quarter of 2018 of $57.8 million. This compares to a net loss attributable to common stockholders of $32.7 million in the first quarter of 2018. The increase in the company's reported net loss for the second quarter of 2018 is primarily attributable to lower revenues due to lower realized natural gas prices combined with increased losses on commodity derivative contracts (realized and unrealized). This was partially offset by lower impairment expense and a realized gain on divestitures in the second quarter. Adjusted net loss attributable to common stockholders (a non-GAAP financial measure defined below) was $25.2 million in the second quarter of 2018. Adjusted EBITDA was $30.5 million in the second quarter of 2018 and represents a 41% decrease as compared to the first quarter of 2018. The decrease as compared to the first quarter of 2018 is attributable primarily to a decrease in natural gas revenues due to lower realized pricing, as well as greater realized losses on commodity derivative contracts. Capital expenditures for the second quarter of 2018 were $38.4 million, down from $42.1 million in the first quarter of 2018. This $3.7 million decrease from the first quarter is primarily attributable to lower capital spend in the Piceance Basin, which was partially offset by higher spend in the Pinedale field. Net cash provided by operating activities was $14.859 million compared to $22.676 million a year ago. Adjusted net loss attributable to Vanguard common and class B stockholders/unitholders, per share/unit was $1.25 against $0.09 a year ago. Net loss attributable to vanguard common stockholders/unitholders, per share/unit was $2.87 against $0.41 a year ago.

For the six months, the company reported a net loss attributable to Common Stockholders during the first six months of 2018 of $90.5 million. This compares to a net loss attributable to Common Unitholders of $65.0 million during the comparable period in 2017. The increase in the company's reported net loss for the first six months of 2018 is primarily attributable to impairment expenses reported during the period. Adjusted net loss attributable to common stockholders was $29.9 million during the first six months of 2018. This compares to adjusted net income of $27.7 million in the first six months of 2017. Adjusted EBITDA was $82.4 million for the first six months of 2018 and represents a 29% decrease as compared to the same period in 2017. The decrease as compared to the first six months of 2017 is attributable primarily to an increase in SG&A and decreased production. Capital expenditures for the first six months of 2018 were $80.5 million, up from $37.3 million during the comparable period in 2017. Net cash provided by operating activities was $51.108 million compared to $73.850 million a year ago. Adjusted net loss attributable to Vanguard common and class B stockholders/unitholders, per share/unit was $1.49 against $0.21 a year ago. Net loss attributable to vanguard common stockholders/unitholders, per share/unit was $4.50 against $0.49 a year ago.

The company updated third quarter and full-year 2018 operational and financial guidance. For the third quarter, lease operating expenses to be in a range of $28,000,000 to $33,000,000. Interest expense expected to be in a range of $15,500,000 to $16,500,000. Capital expenditures expected to be in a range of $22,500,000 to $27,500,000.

For the year 2018, lease operating expenses to be in a range of $125,000,000 to $133,000,000. Interest expense expected to be in a range of $60,500,000 to $64,500,000. Capital expenditures expected to be in a range of $130,000,000 to $140,000,000.

Production is now estimated to be in the range of 343 MMcfe per day to 355 MMcfe per day and 348 MMcfe per day to 362 MMcfe per day for the third quarter and full year of 2018, respectively.