PHX Minerals Inc (NYSE:PHX) stock fell 9.77% (As on Dec 14, 11:07:58 AM UTC-4, Source: Google Finance) after the company posted lower than expected results for the fourth quarter of FY 21. Natural gas, oil and NGL revenue increased 140% in the 2021 quarter as total production increased 9% and product prices increased 121%, relative to the 2020 quarter. Royalty revenue increased 186% in the 2021 quarter as total production increased 29% and product prices increased 122%, relative to the 2020 quarter. Total production increased due to the recent mineral and royalty interest acquisitions in the Haynesville play, in Texas and Louisiana, and SCOOP. These increases were offset by naturally declining production in the Eagle Ford and Arkoma Stack. The 2% decrease in total cost per Mcfe in the 2021 quarter, relative to the 2020 quarter, was primarily driven by a decrease in DD&A. DD&A decreased $950,365, or 38%, in the 2021 quarter to $0.71 per Mcfe, as compared to $1.24 per Mcfe in the 2020 quarter.

Meanwhile, on Sept. 2, 2021, the Company settled all of its derivative contracts with Bank of Oklahoma (BOKF) by paying $8.8 million.  On Sept. 3, 2021, the Company entered into new derivative contracts with BP Energy Company (BP) that had similar terms to the contracts settled with BOK and received a payment of $8.8 million from BP.  The new derivative contracts consisted of all fixed swap contracts and are secured under the Company’s credit facility with Independent Bank.

PHX in the fourth quarter of FY 21 has reported the adjusted loss per share of 14 cents, missing the analysts’ estimates for the adjusted loss per share of 7 cents. The company had reported the adjusted revenue of $4,071,567 in the fourth quarter of FY 21, missing the analysts’ estimates for revenue of $10.50 billion.

On the other hand, the company has recently entered into an amendment to its revolving Credit Facility (“Credit Facility”) under which the borrowing base of the Credit Facility has been increased from $27.5 million to $32.0 million in connection with its regularly scheduled semi-annual redetermination. Additionally, PHX has entered into purchase and sale agreements to acquire 426 total net royalty acres in Caddo Parish, La., for $5,787,272 in cash from two private sellers, subject to customary closing adjustments. Pro forma the Acquisition, the Company’s total debt drawn on the Credit Facility will be approximately $20.0 million. The Board of Directors of PHX unanimously approved the Acquisition, which is expected to close by Dec. 15, 2021.