Midstates Petroleum Announces Fourth Quarter and Full Year 2017 Results

Midstates Petroleum Company, Inc. (“Midstates” or the “Company”) (NYSE:
MPO) today announced its fourth quarter and full year 2017 results.

Fourth Quarter and Full-Year 2017 Highlights
and Recent Key Items

• Announced a proposed combination with SandRidge Energy, Inc.
  (“SandRidge”) in an at-market, all-stock transaction with potential
  annual cost-saving synergies in excess of $70 million from highly
  complementary assets
• Engaged in ongoing discussions with SandRidge on the proposed
  combination
• Set market-focused strategy aimed at reducing costs, generating
  substantial free cash flow, improving liquidity and focusing activity
  to maximize optionality
• Reported a net loss of $85.1 million, or $3.39 loss per share, in
  2017, which included a non-cash ceiling-test impairment of $125.3
  million related to the application of the Company’s market-focused
  strategy and one-rig drilling program in the year-end 2017 reserve
  report
• Announced year-end 2017 SEC proved reserves of 108.9 million barrels
  of oil equivalent (MMBoe); utilizing March 9, 2018 strip pricing, the
  Company’s year-end 2017 proved reserves had a net present value
  discounted at 10% (PV-10) of approximately $600.1 million, an increase
  of approximately $40 million from year-end 2017 SEC pricing
• Achieved total Company production of 21,217 barrels of oil equivalent
  per day (BOEPD) in the fourth quarter of 2017, of which 82% was in the
  Mississippian Lime, with the balance in the Anadarko Basin
• Generated Adjusted EBITDA of $33.9 million in the fourth quarter of
  2017, an increase of 12% over $30.2 million in the prior quarter;
  full-year 2017 Adjusted EBITDA totaled $128.2 million
• Disclosed a 2018 capital budget of $100 million to $120 million with a
  one-rig drilling program
• Completed workforce reduction in January 2018 to streamline G&A with
  current activity; reducing adjusted cash G&A expense by $3 million to
  $5 million annually (excluding one-time severance costs)
• Executed $50 million pay-down to RBL facility in March 2018; reducing
  annualized interest expense by approximately $3 million

David Sambrooks, President and Chief Executive Officer, commented,
“During the second half of 2017, we made several key strategic decisions
to streamline our Company with a focus on the Miss Lime and to pursue a
drilling and development program that will be return driven and fully
funded with internally generated cash flow. By committing to a
single-rig drilling program for the foreseeable future, we will be able
to generate free cash flow, but as a result, we had to reclassify a
portion of our proved undeveloped reserves to probable which created a
non-cash impairment during the fourth quarter. We continue to
rationalize our portfolio and last year we sold our non-core assets in
Lincoln County, Oklahoma, and will conclude our Anadarko Basin strategic
review process soon. The continued execution of our strategy to generate
free cash flow will further enhance our very strong financial foundation
and provide maximum optionality to drive shareholder value.”

Mr. Sambrooks continued, “As we enter 2018 with stronger commodity
prices, a clean balance sheet, and a strategic direction that is focused
on free cash flow generation, the outlook for Midstates is clearly the
best it has been in many years. Even with our confidence in the future
for Midstates as a standalone company, we believe there are significant
benefits from an at-market, all stock merger with SandRidge. Combining
these two companies would form a stronger, more formidable company and
deliver undeniable benefits to all stakeholders. The strategic fit and
geographic overlap of both companies’ assets in the Mid-Con builds
critical mass, creates significant synergies, and generates attractive
risk-adjusted returns, while having options for growth in the Miss Lime,
NW STACK, and North Park assets. The combined company will have zero net
debt, strong liquidity, and forecasted free cash flow generation of up
to $400 million over the next five years.”

(Adjusted EBITDA, Adjusted Cash Operating Expenses, and Adjusted Cash
General and Administrative Expenses are non-GAAP financial measures.
Each measure is defined and reconciled to the most directly comparable
GAAP measure under “Non-GAAP Financial Measures” in the tables below.)

Production and Pricing

Production during the fourth quarter of 2017 totaled 21,217 BOEPD,
compared with 21,358 BOEPD during the third quarter of 2017. Production
from the Company’s Mississippian Lime properties contributed
approximately 82%, or 17,327 BOEPD, and the Anadarko Basin properties
contributed approximately 18%, or 3,890 BOEPD. For the total Company,
oil volumes comprised 30% of total production, natural gas liquids
(NGLs) 23%, and natural gas 47% during the fourth quarter of 2017.

In the fourth quarter of 2017, Midstates’ average realized price per
barrel of oil, before realized commodity derivatives, was $54.43 ($53.49
with realized derivatives), while its average realized price for NGLs
sales was $27.42 per barrel (there were no NGL hedges in place during
the fourth quarter). Natural gas averaged $2.44 per thousand cubic feet
(Mcf) ($2.67 with realized derivatives). Detailed comparisons of
commodity prices by period and region are included in the tables below.

Oil, NGLs and natural gas sales revenues in the fourth quarter of 2017
were $57.5 million, before the impact of derivatives, compared to $51.8
million in the third quarter of 2017. The loss on derivatives for the
fourth quarter of 2017 was $5.1 million, compared with a $3.6 million
loss during the third quarter of 2017.

Hedging Update

To reduce downside commodity price risk and protect cash flow, Midstates
has entered into a number of swaps, collars, and 3-way collars to hedge
a portion of the Company’s oil and natural gas revenues through 2019. A
summary of the Company’s hedges is included in the below table.

			NYMEX WTI
			Fixed Swaps						Collars									Three Way Collars
			Hedge Position (Bbls)		Weighted Avg Strike Price				Hedge Position (Bbls)		Weighted Avg Ceiling Price			Weighted Avg Floor Price				Hedge Position (Bbls)		Weighted Avg Ceiling Price			Weighted Avg Floor Price			Weighted Avg Sub-Floor Price
Quarter Ended:
December 31, 2017(1)(2)			276,000		$	53.58			46,000		$	60.00		$	50.00			115,000		$	62.80		$	50.00		$	40.00
March 31, 2018(1)			99,000		$	50.61			—		$	—		$	—			225,000		$	62.14		$	50.00		$	40.00
June 30, 2018(1)			145,600		$	51.22			—		$	—		$	—			182,000		$	60.65		$	50.00		$	40.00
September 30, 2018(1)			92,000		$	50.38			—		$	—		$	—			184,000		$	59.93		$	50.00		$	40.00
December 31, 2018(1)			92,000		$	50.38			—		$	—		$	—			46,000		$	56.70		$	50.00		$	40.00
March 31, 2019(1)			—		$	—			—		$	—		$	—			45,000		$	56.20		$	50.00		$	40.00
June 30, 2019(1)			—		$	—			—		$	—		$	—			45,500		$	56.20		$	50.00		$	40.00
September 30, 2019(1)			—		$	—			—		$	—		$	—			46,000		$	56.20		$	50.00		$	40.00
December 31, 2019(1)			—		$	—			—		$	—		$	—			46,000		$	56.20		$	50.00		$	40.00
			NYMEX HENRY HUB
			Fixed Swaps						Collars									Three Way Collars
			Hedge Position (MMBtu)		Weighted Avg Strike Price				Hedge Position (MMBtu)		Weighted Avg Ceiling Price			Weighted Avg Floor Price				Hedge Position (MMBtu)		Weighted Avg Ceiling Price			Weighted Avg Floor Price			Weighted Avg Sub-Floor Price
Quarter Ended:
December 31, 2017(1)			1,907,000		$	3.43			551,000		$	3.84		$	3.23			610,000		$	4.30		$	3.25		$	2.50
March 31, 2018(1)(3)			1,350,000		$	3.47			—		$	—		$	—			1,530,000		$	4.38		$	3.25		$	2.50
June 30, 2018(1)			—		$	—			—		$	—		$	—			1,365,000		$	3.40		$	3.00		$	2.50
September 30, 2018(1)			—		$	—			—		$	—		$	—			1,380,000		$	3.40		$	3.00		$	2.50
December 31, 2018(1)			—		$	—			—		$	—		$	—			1,380,000		$	3.40		$	3.00		$	2.50
March 31, 2019(1)			—		$	—			—		$	—		$	—			1,350,000		$	3.40		$	3.00		$	2.50

(1)		Positions shown represent open commodity derivative contract positions as of December 31, 2017.
(2)		During the second quarter of 2017, the Company entered into long call oil trades to offset its three way collar short calls for the second half of 2017.
(3)		During the second quarter, the Company entered into natural gas three way collars with long call ceilings in order to offset its Q1 2018 natural gas fixed swaps.

Proved Reserves

Midstates’ reserves were fully engineered by its third-party independent
reserve consultant, Cawley, Gillespie & Associates, Inc. The Company’s
estimated proved reserves for year-end 2017 totaled 108.9 MMBoe, which
consisted of 64.5 MMBoe of proved developed reserves and 44.5 MMBoe of
proved undeveloped (PUD) reserves. Total proved reserves were comprised
of 29% oil, 23% NGLs, and 48% natural gas. Geographically, 92% are in
the Mississippian Lime in Oklahoma and 8% are in the Anadarko Basin in
Oklahoma and Texas. Consistent with the Company’s strategy to prudently
develop the Mississippian Lime assets and generate free cash flow,
Midstates reduced the forward rig count assumptions in its reserve
report to match the current one-rig development program within the SEC
five-year window. As a result, the Company’s PUD reserve locations
decreased year-over-year to 139 locations at year-end 2017 from 274
locations at year-end 2016. Additionally, the Company’s Mississippian
Lime PUD type curve was reduced approximately 10%, to 450 MBoe from 512
MBoe, at year-end 2017.

At year-end 2017, Midstates’ proved reserves, as prepared utilizing SEC
pricing, had a PV-10 of $558.1 million. Utilizing March 9, 2018 strip
pricing, the Company’s year-end 2017 proved reserves had a PV-10 of
approximately $600.1 million.

			Oil (MBls)			Natural Gas (MMcf)			NGLs (MBbls)			Total (MBoe)			PV-10 (in millions)
Mississippian Lime:
Proved developed producing			12,606			148,052			11,359			48,640			$	333,398
Proved developed non-producing			1,822			21,605			1,680			7,103				40,191
Proved undeveloped			13,866			125,169			9,729			44,457				131,360
Total			28,294			294,826			22,768			100,200			$	504,949
Anadarko Basin:
Proved developed producing			2,840			20,893			2,425			8,747			$	53,183
Proved developed non-producing			—			—			—			—				—
Proved undeveloped			—			—			—			—				—
Total			2,840			20,893			2,425			8,747			$	53,184
Total Proved			31,134			315,719			25,193			108,947			$	558,132

Costs and Expenses

Adjusted Cash Operating Expenses (which excludes debt restructuring and
advisory fees, as well as severance costs) for the fourth quarter of
2017 were $24.9 million, or $12.77 per Boe, compared with $26.0 million,
or $13.22 per Boe, in the third quarter of 2017. The decrease in the
fourth quarter of 2017 compared with the third quarter of 2017 was
attributable to lower general and administrative costs.

Lease operating and workover expenses (LOE) totaled $15.2 million, or
$7.80 per Boe, in the fourth quarter of 2017, compared with $15.7
million, or $7.97 per Boe, in the third quarter of 2017. Fourth quarter
2017 LOE decreased compared to third quarter of 2017 primarily due to
reduced contract labor and workover expenses. Full year 2017 LOE
averaged $7.83 per Boe.

Severance and other taxes for the fourth quarter of 2017 were $2.7
million, or $1.38 per BOE (4.7% of oil, NGL and natural gas sales
revenue), compared to $2.4 million, or $1.20 per BOE (4.5% of oil, NGL
and natural gas sales revenue) in the third quarter of 2017. In May
2017, new legislation was signed into law in Oklahoma that increased the
incentive tax rate from 1% to 4% on wells that commenced production
between July 1, 2011 and July 1, 2015. Additionally, in November 2017,
new legislation was signed into law in Oklahoma that increased the 4%
incentive tax rate to 7% effective with December 2017 production.

In January 2018, to better align our general and administrative expense
with our current activity level, Midstates completed a workforce
reduction that will result in annualized adjusted cash G&A expense
savings of $3 million to $5 million (excluding one-time severance
costs). G&A expenses for the fourth quarter of 2017 totaled $6.3
million, or $3.20 per Boe, compared to $7.3 million, or $3.69 per Boe,
in the third quarter of 2017. Fourth quarter 2017 and third quarter 2017
general and administrative expenses included net non-cash share-based
compensation expense of $2.1 million, or $1.07 per Boe, and $2.8
million, or $1.44 per Boe, respectively. Adjusted cash general and
administrative expenses, which excludes non-cash share-based
compensation and certain non-recurring items, but includes capitalized
general and administrative costs, totaled $4.1 million, or $2.12 per Boe
for the fourth quarter of 2017, compared to $5.2 million, or $2.64 per
Boe, in the third quarter of 2017. Fourth quarter 2017 adjusted cash
general and administrative expenses decreased compared to third quarter
of 2017 primarily due to lower employee costs. Full year 2017 adjusted
cash general and administrative expenses averaged $2.48 per Boe.

Depreciation, depletion and amortization expense for the fourth quarter
of 2017 totaled $19.4 million, or $9.92 per Boe, compared to $15.2
million, or $7.72 per Boe in the third quarter of 2017.

During the fourth quarter of 2017, the Company recognized a $125.3
million non-cash impairment charge in conjunction with the reduced
forward rig count assumptions, as discussed above.

Interest expense totaled $1.7 million (net of amounts capitalized) for
the fourth quarter of 2017, compared to $1.6 million in the third
quarter of 2017. The Company capitalized $0.4 million in interest to
unproved properties in each of the fourth and third quarters of 2017.

The Company did not record an income tax expense or benefit during the
fourth quarter or full year 2017 and had an effective tax rate of 0%.

Capital Expenditures

In the fourth quarter of 2017, the Company invested $33.6 million of
operating capital, predominantly devoted to the Mississippian Lime
assets.

The following table provides operational capital spending by area as
well as a reconciliation to total capital expenditures for the three
months and full year ended December 31, 2017 (in thousands):

			For the Three Months Ended December 31, 2017				For the Year Ended December 31, 2017
Drilling and completion activities			$	31,779			$	121,753
Acquisition of acreage and seismic data				1,775				9,523
Operational capital expenditures incurred			$	33,554			$	131,276
Capitalized G&A, office, ARO & other				1,159				6,671
Capitalized interest				387				2,441
Total capital expenditures incurred			$	35,100			$	140,388
			For the Three Months Ended December 31, 2017				For the Year Ended December 31, 2017
Mississippian Lime			$	33,319			$	128,808
Anadarko Basin				235				2,468
Total operational capital expenditures incurred			$	33,554			$	131,276

Operational Update

Mississippian Lime Update

Key Highlights:

• Produced an average of 17,327 BOEPD in the fourth quarter of 2017, of
  which 29% was oil, 22% NGLs, and 49% natural gas
• Full year 2017 production averaged 18,181 BOEPD, of which 28% was oil,
  24% NGLs, and 48% natural gas
• Spud 9 wells and placed 5 wells online during the fourth quarter of
  2017; spud 32 wells and placed 26 wells online in 2017
• Incurred average drilling, completion and facility costs of $3.2
  million for wells brought online in 2017

During the fourth quarter 2017, the Company continued exploring options
to maximize individual well performance by increasing the number of frac
stages from approximately 17 stages to as many as 25 stages during its
completion operations. This resulted in increased average well cost for
its trial wells to $3.3 million per well, increasing the year-to-date
average cost per well from $2.8 million in the first half of 2017 to
$3.2 million for the full year 2017. Production results from this pilot
program are currently being evaluated and the completion design
optimization program is expected to continue in 2018.

Further, in conjunction with the appointment of David Sambrooks as
President and Chief Executive Officer on November 1, 2017, a strategic
review of all areas of operations was initiated. As part of this study,
along with the reduction of the rig count from two rigs to a one rig
program, completion of new wells were temporarily delayed pending a
review of completion techniques. By early March 2018, a modified design
was executed on six of the wells that had been awaiting completion.
Pending review of the production results, decisions regarding completion
design will be made on our remaining five drilled uncompleted wells.

During 2017, the Company brought online three additional non-Arbuckle
saltwater disposal injection wells in Woods and Alfalfa Counties,
Oklahoma. The Company has subsequently added another non-Arbuckle
saltwater disposal injection well in February 2018 in Alfalfa County,
Oklahoma. The Company is currently operating 11 non-Arbuckle injection
wells in Woods and Alfalfa Counties, Oklahoma, with a total permitted
injection capacity of approximately 240,000 barrels of water per day.
The Company’s total permitted injection capacity in Woods and Alfalfa
Counties, Oklahoma, which may differ from actual injection capacity due
to operational constraints, is approximately 372,000 barrels of water
per day, with a current disposal rate into all formations of
approximately 165,000 barrels of water per day.

Anadarko Basin Update

Midstates has engaged SunTrust to explore strategic alternatives for its
Anadarko Basin producing properties. The Company will retain the NW
STACK undeveloped acreage in Dewey County, Oklahoma.

The Company’s Anadarko Basin assets averaged production of 3,890 BOEPD
in the fourth quarter of 2017, of which 35% was oil, 27% NGLs, and 38%
natural gas.

Balance Sheet and Liquidity

On December 31, 2017, the Company’s liquidity was approximately $108.5
million, consisting of cash and cash equivalents of $68.5 million and
$40.0 million available under its credit facility. Its long-term debt
was $128.1 million, resulting in net debt of approximately $59.6 million.

On November 1, 2017, Midstates announced that the Company’s borrowing
base under its revolving credit facility was reaffirmed at $170 million.
The agreement with its bank group excludes the Company’s Anadarko Basin
assets in Texas and Oklahoma from the redetermination of the borrowing
base. The next scheduled borrowing base redetermination will occur on or
about April 1, 2018.

In early March 2018, the Company made a $50 million pay-down to the
outstanding RBL balance with cash on hand. This will reduce annualized
interest expense by approximately $3 million.

Fresh Start Accounting

The Company adopted fresh start accounting as of October 21, 2016, the
date the Company emerged from its Chapter 11 reorganization. Adopting
fresh start accounting results in a new reporting entity for financial
reporting purposes and as a result, the Company allocated its
reorganization value to its individual assets, including oil and gas
property, plant and equipment, based upon their estimated fair values as
of that date, and its historical retained deficit was eliminated. Due to
the application of fresh start accounting, the Company’s consolidated
financial statements on or after October 21, 2016 are not comparable
with its consolidated financial statements prior to that date.
References to “Successor” refer to the Company after the adoption of
fresh start accounting, while references to “Predecessor” refer to the
Company prior to adoption. Please refer to the Company’s Annual Report
on Form 10-K filed on March 30, 2017 for further information regarding
Midstates’ emergence from Chapter 11 restructuring and its application
of fresh start accounting.

Conference Call Information

The Company will host a conference call to discuss fourth quarter and
year-end 2017 results on Wednesday, March 14, at 8:30 a.m. Eastern time
(7:30 a.m. Central time). Participants may join the conference call by
dialing (877) 645-4610 (for U.S. and Canada) or (707) 595-2723
(International). The conference call access code is 3056599 for all
participants. To listen via live web cast, please visit the Investor
Relations section of the Company’s website, www.midstatespetroleum.com.

An audio replay of the conference call will be available approximately
two hours after the conclusion of the call. The audio replay will remain
available for approximately 30 days and can be accessed by dialing (855)
859-2056 (for U.S. and Canada) or (404) 537-3406 (International). The
conference call audio replay access code is 3056599 for all
participants. The audio replay will also be available in the Investors
section of the Company’s website approximately two hours after the
conclusion of the call and remain available for approximately 30
calendar days.

Forward-Looking Statements

This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. All statements that are not
statements of historical fact, including statements regarding the
Company’s strategy, future operations, financial position, estimated
revenues and losses, projected costs, resource potential, drilling
locations, prospects and plans and objectives of management, are
considered forward-looking statements. Without limiting the generality
of the foregoing, these statements are based on certain assumptions made
by the Company based on management's experience, expectations and
perception of historical trends, current conditions, anticipated future
developments and other factors believed to be appropriate. Although the
Company believes that its plans, intentions and expectations reflected
in or suggested by the forward-looking statements made in this press
release are reasonable, the Company gives no assurance that these plans,
intentions or expectations will be achieved when anticipated or at all.
Moreover, such statements are subject to a number of factors, many of
which are beyond the control of the Company, which may cause actual
results to differ materially from those implied or expressed by the
forward-looking statements. These factors include, but are not limited
to variations in the market demand for, and prices of, oil and natural
gas; uncertainties about the Company’s estimated quantities of oil and
natural gas reserves, resource potential and drilling locations; the
adequacy of the Company’s capital resources and liquidity; general
economic and business conditions; weather-related downtime; failure to
realize expected value creation from property acquisitions;
uncertainties about the Company’s ability to replace reserves and
economically develop its current reserves; risks related to the
concentration of the Company’s operations; drilling results; and
potential financial losses or earnings reductions from the Company’s
commodity derivative positions.

Any forward-looking statement speaks only as of the date on which such
statement is made and the Company undertakes no obligation to correct or
update any forward-looking statement, whether as a result of new
information, future events or otherwise, except as required by
applicable law.

About Midstates Petroleum Company, Inc.

Midstates Petroleum Company, Inc. is an independent exploration and
production company focused on the application of modern drilling and
completion techniques in oil and liquids-rich basins in the onshore U.S.
The Company’s operations are currently focused on oilfields in the
Mississippian Lime play in Oklahoma and the Anadarko Basin in Texas and
Oklahoma.

MIDSTATES PETROLEUM COMPANY, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
			December 31, 2017					December 31, 2016
ASSETS
CURRENT ASSETS:
Cash and cash equivalents			$	68,498				$	76,838
Accounts receivable:
Oil and gas sales				32,455					36,988
Joint interest billing				3,297					4,281
Other				166					2,456
Commodity derivative contracts				162					—
Other current assets				1,510					3,326
Total current assets				106,688					123,889
PROPERTY AND EQUIPMENT:
Oil and gas properties, on the basis of full-cost accounting
Proved properties				765,308					573,150
Unproved properties not being amortized				7,065					65,080
Other property and equipment				6,508					6,339
Less accumulated depreciation, depletion and amortization				(204,419	)				(12,974	)
Net property and equipment				574,462					631,595
OTHER NONCURRENT ASSETS				6,978					5,455
TOTAL			$	688,128				$	760,939
LIABILITIES AND EQUITY
CURRENT LIABILITIES:
Accounts payable			$	11,547				$	2,521
Accrued liabilities				42,842					53,731
Commodity derivative contracts				3,433					—
Total current liabilities				57,822					56,252
LONG-TERM LIABILITIES:
Asset retirement obligations				15,506					14,200
Commodity derivative contracts				562					—
Long-term debt				128,059					128,059
Other long-term liabilities				592					614
Total long-term liabilities				144,719					142,873
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY:
Preferred stock, $0.01 par value, 50,000,000 shares authorized; no shares issued or outstanding at December 31, 2017				—					—
Warrants, 6,625,554 warrants outstanding at December 31, 2017 and 2016				37,329					37,329
Common stock, $0.01 par value, 250,000,000 shares authorized; 25,272,969 shares issued and 25,173,346 shares outstanding at December 31, 2017 and 24,994,867 shares issued and outstanding at December 31, 2016				253					250
Treasury stock				(1,603	)				—
Additional paid-in-capital				524,755					514,305
Retained earnings (deficit)				(75,147	)				9,930
Total stockholders’ equity				485,587					561,814
TOTAL			$	688,128				$	760,939

MIDSTATES PETROLEUM COMPANY, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands)
			Successor																Predecessor
			For the Three Months Ended December 31, 2017					For the Year Ended December 31, 2017					For the Period October 21, 2016 through December 31, 2016						For the Period January 1, 2016 through October 20, 2016
REVENUES:
Oil sales			$	31,586				$	117,083				$	25,549					$	112,628
Natural gas liquid sales				12,532					44,112					8,391						27,473
Natural gas sales				13,387					59,708					13,635						48,318
Gains (losses) on commodity derivative contracts—net				(5,108	)				3,659					—						—
Other				947					4,191					950						4,809
Total revenues				53,344					228,753					48,525						193,228
EXPENSES:
Lease operating and workover				15,223					63,287					15,324						52,803
Gathering and transportation				3,480					14,507					3,194						14,362
Severance and other taxes				2,701					8,869					1,286						5,210
Asset retirement accretion				267					1,100					210						1,414
Depreciation, depletion, and amortization				19,361					65,832					12,974						62,302
Impairment in carrying value of oil and gas properties				125,300					125,300					—						232,108
General and administrative				6,250					29,352					4,864						22,362
Acquisition and transaction costs				—					—					—						—
Debt restructuring costs and advisory fees				—					—					—						7,590
Other				—					—					—						—
Total expenses				172,582					308,247					37,852						398,151
OPERATING INCOME (LOSS)				(119,238	)				(79,494	)				10,673						(204,923	)
OTHER INCOME (EXPENSE):
Interest income				9					9					—						81
Interest expense—net of amounts capitalized (Predecessor Period excludes interest expense of $89.5 million on senior and secured notes)				(1,738	)				(5,592	)				(743	)					(66,360	)
Reorganization items, net				—					—					—						1,594,281
Total other income (expense)				(1,729	)				(5,583	)				(743	)					1,528,002
INCOME (LOSS) BEFORE TAXES				(120,967	)				(85,077	)				9,930						1,323,079
Income tax expense				—					—					—						—
NET INCOME (LOSS)			$	(120,967	)			$	(85,077	)			$	9,930					$	1,323,079
Predecessor preferred stock dividend				—					—					—						—
Predecessor participating securities—non-vested restricted stock				—					—					—						(16,522	)
Successor participating securities—non-vested restricted stock				—					—					(280	)					—
NET INCOME (LOSS) ATTRIBUTABLE TO COMMON SHAREHOLDERS			$	(120,967	)			$	(85,077	)			$	9,650					$	1,306,557
Basic and diluted net income (loss) per share attributable to common shareholders			$	(4.78	)			$	(3.39	)			$	0.39					$	122.74
Basic and diluted weighted average number of common shares outstanding				25,253					25,119					25,009						10,645

MIDSTATES PETROLEUM COMPANY, INC.
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS’ EQUITY (DEFICIT)
(In thousands)
			Series A Preferred Stock					Common Stock					Warrants				Treasury Stock					Additional Paid-in-Capital					Retained Earnings (Deficit)					Total Stockholders’ Equity (Deficit)
Balance as of December 31, 2014 (Predecessor)			$	3				$	70				$	—			$	(2,592	)			$	882,528				$	(414,147	)			$	465,862
Share-based compensation				—					3					—				—					5,753					—					5,756
Acquisition of treasury stock				—					—					—				(489	)				—					—					(489	)
Net loss				—					—					—				—					—					(1,797,195	)				(1,797,195	)
Conversion of preferred shares				(3	)				37					—				—					(34	)				—					—
Balance as of December 31, 2015 (Predecessor)			$	—				$	110				$	—			$	(3,081	)			$	888,247				$	(2,211,342	)			$	(1,326,066	)
Share-based compensation				—					(6	)				—				—					3,045					—					3,039
Acquisition of treasury stock				—					—					—				(53	)				—					—					(53	)
Net income				—					—					—				—					—					1,323,079					1,323,079
Balance as of October 21, 2016 (Predecessor)			$	—				$	104				$	—			$	(3,134	)			$	891,292				$	(888,263	)			$	(1	)
Cancellation of predecessor equity				—					(104	)				—				3,134					(891,292	)				888,263					1
Balance as of October 21, 2016 (Predecessor)			$	—				$	—				$	—			$	—				$	—				$	—				$	—
Issuance of successor common stock				—					247					—				—					510,905					—					511,152
Issuance of successor warrants				—					—					37,329				—					—					—					37,329
Balance as of October 21, 2016 (Successor)			$	—				$	247				$	37,329			$	—				$	510,905				$	—				$	548,481
Issuance of successor common stock				—					3					—				—					—					—					3
Share-based compensation				—					—					—				—					3,400					—					3,400
Net income				—					—					—				—					—					9,930					9,930
Balance as of December 31, 2016 (Successor)			$	—				$	250				$	37,329			$	—				$	514,305				$	9,930				$	561,814
Share-based compensation				—					3					—				—					10,450					—					10,453
Acquisition of treasury stock				—					—					—				(1,603	)				—					—					(1,603	)
Net loss				—					—					—				—					—					(85,077	)				(85,077	)
Balance as of December 31, 2017 (Successor)			$	—				$	253				$	37,329			$	(1,603	)			$	524,755				$	(75,147	)			$	485,587

MIDSTATES PETROLEUM COMPANY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
			Successor										Predecessor
			Year Ended December 31, 2017					For the Period October 21, 2016 through December 31, 2016					For the Period January 1, 2016 through October 20, 2016
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss)			$	(85,077	)			$	9,930				$	1,323,079
Adjustments to reconcile net income/(loss) to net cash provided by operating activities:
Gains on commodity derivative contracts—net				(3,659	)				—					—
Net cash received for commodity derivative contracts not designated as hedging instruments				6,891					—					—
Asset retirement accretion				1,100					210					1,414
Depreciation, depletion, and amortization				65,832					12,974					62,302
Impairment in carrying value of oil and gas properties				125,300					—					232,108
Share-based compensation, net of amounts capitalized to oil and gas properties				9,196					2,909					2,564
Deferred income taxes				—					—					—
Amortization of deferred financing costs				385					63					4,587
Paid-in-kind interest expense				—					—					3,531
Amortization of deferred gain on debt restructuring				—					—					(8,246	)
Operating lease abandonment				—					—					1,574
Non-cash reorganization items				—					—					(1,630,873	)
Transaction costs for debt restructuring				—					—					—
Change in operating assets and liabilities:
Accounts receivable—oil and gas sales				2,766					(115	)				(2,391	)
Accounts receivable—JIB and other				3,362					(1,812	)				22,002
Other current and noncurrent assets				283					1,783					(5,868	)
Accounts payable				2,961					(1,555	)				1,797
Accrued liabilities				(8,973	)				(740	)				55,160
Other				(765	)				(3	)				(743	)
Net cash provided by operating activities			$	119,602				$	23,644				$	61,997
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment in property and equipment			$	(130,199	)			$	(23,346	)			$	(133,307	)
Proceeds from the sale of oil and gas properties				4,235					—					—
Net cash used in investing activities			$	(125,964	)			$	(23,346	)			$	(133,307	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from long-term borrowings			$	—				$	—				$	—
Proceeds from revolving credit facility				—					—					249,384
Repayment of long-term borrowings				—					—					(60,000	)
Repayment of revolving credit facility				—					—					(121,324	)
Deferred financing costs				(375	)				—					(1,250	)
Transaction costs for debt restructuring				—					—					—
Repurchase of restricted stock for tax withholdings				(1,603	)				—					(53	)
Net cash (used in) provided by financing activities			$	(1,978	)			$	—				$	66,757
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			$	(8,340	)			$	298				$	(4,553	)
Cash and cash equivalents, beginning of period			$	76,838				$	76,540				$	81,093
Cash and cash equivalents, end of period			$	68,498				$	76,838				$	76,540

MIDSTATES PETROLEUM COMPANY, INC.
SELECTED FINANCIAL AND OPERATING STATISTICS
			For the Three Months Ended December 31,										For the Year Ended December 31,										For the Three Months Ended September 30,
			2017				2016(1)						2017				2016(1)						2017
Operating Data – Mississippian Lime:
Net production volumes:
Oil (Bbls/day)				4,960				6,140						5,108				7,741						4,940
NGLs (Bbls/day)				3,903				4,875						4,273				5,231						4,145
Natural gas (Mcf/day)				50,787				59,329						52,797				66,278						51,130
Total oil equivalents (MBoe)				1,594				1,923						6,636				8,791						1,620
Average daily production (Boe/day)				17,327				20,903						18,181				24,018						17,606
Operating Data – Anadarko Basin:
Net production volumes:
Oil (Bbls/day)				1,347				1,540						1,379				1,845						1,329
NGLs (Bbls/day)				1,065				1,139						1,066				1,222						992
Natural gas (Mcf/day)				8,867				10,064						9,135				10,669						8,581
Total oil equivalents (MBoe)				358				401						1,448				1,773						345
Average daily production (Boe/day)				3,890				4,356						3,967				4,845						3,752
Operating Data - Combined:
Net production volumes:
Oil (Bbls/day)				6,307				7,680						6,487				9,586						6,269
NGLs (Bbls/day)				4,968				6,013						5,339				6,453						5,137
Natural gas (Mcf/day)				59,654				69,393						61,932				76,948						59,711
Total oil equivalents (MBoe)				1,952				2,324						8,084				10,564						1,965
Average daily production (Boe/day)				21,217				25,259						22,148				28,863						21,358
Average Sales Prices:
Oil, without realized derivatives (per Bbl)			$	54.43			$	47.19					$	49.45			$	39.38					$	47.14
Oil, with realized derivatives (per Bbl)			$	53.49			$	47.19					$	50.92			$	39.38					$	50.11
Natural gas liquids, without realized derivatives (per Bbl)			$	27.42			$	19.51					$	22.64			$	15.19					$	22.55
Natural gas liquids, with realized derivatives (per Bbl)			$	27.42			$	19.51					$	22.64			$	15.19					$	22.55
Natural gas, without realized derivatives (per Mcf)			$	2.44			$	2.74					$	2.64			$	2.20					$	2.54
Natural gas, with realized derivatives (per Mcf)			$	2.67			$	2.74					$	2.79			$	2.20					$	2.76
Costs and Expenses (per Boe of production):
Lease operating and workover			$	7.80			$	8.01					$	7.83			$	6.45					$	7.97
Gathering and transportation			$	1.78			$	1.78					$	1.79			$	1.66					$	1.88
Severance and other taxes			$	1.38			$	0.74					$	1.10			$	0.62					$	1.20
Asset retirement accretion			$	0.14			$	0.13					$	0.14			$	0.15					$	0.14
Depreciation, depletion and amortization			$	9.92			$	6.90					$	8.14			$	7.13					$	7.72
Impairment of oil and gas properties			$	64.19			$	3.24					$	15.50			$	21.97						—
General and administrative			$	3.20			$	3.50					$	3.63			$	2.58					$	3.69
Acquisition and transaction costs				—				—						—				—						—
Debt restructuring costs and advisory fees				—				—						—			$	0.72						—
Other				—				—						—				—						—

⁽¹⁾ For illustrative purposes, Midstates has combined the
Successor Period and Predecessor Period to derive combined results for
the three months ended December 31, 2016 and the year ended December 31,
2016. The combination was generated by addition of comparable financial
statement line item captions. However, because of various adjustments to
the consolidated financial statements in connection with the application
of fresh-start accounting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
Period are not comparable to those of the Predecessor Period. The
financial information preceding the table above provides the Successor
Period and the Predecessor Period GAAP results for the applicable
periods. Midstates believes that subject to consideration of the impact
of fresh-start accounting, combining the results of the Predecessor
Period and Successor Period provide meaningful information about the
financial results of Midstates, including production, revenues and
costs, that assist a reader in understanding its financial results for
the applicable periods.

MIDSTATES PETROLEUM COMPANY, INC.
ADJUSTED EBITDA
(In thousands)
			For the Three Months Ended December 31,											For the Year Ended December 31,											For the Three Months Ended September 30,
			2017					2016(1)						2017					2016(1)						2017
Adjusted EBITDA to net income (loss) reconciliation:
Net income (loss)			$	(120,967	)			$	1,541,705					$	(85,077	)			$	1,333,009					$	3,663
Depreciation, depletion and amortization				19,361					16,047						65,832					75,276						15,170
Impairment in carrying value of oil and gas properties				125,300					7,524						125,300					232,108						—
Losses (gains) on commodity derivative contracts—net				5,108					—						(3,659	)				—						3,591
Net cash received (paid) for commodity derivative contracts not designated as hedging instruments				742					—						6,891					—						2,909
Income tax expense				—					—						—					—						—
Interest income				(9	)				—						(9	)				(81	)					—
Interest expense, net of amounts capitalized				1,738					1,384						5,592					67,103						1,649
Asset retirement obligation accretion				267					308						1,100					1,624						274
Reorganization items, net				—					(1,536,517	)					—					(1,594,281	)					—
Share-based compensation, net of amounts capitalized				2,094					4,198						9,196					5,473						2,835
Adjusted EBITDA – Non-GAAP			$	33,634				$	34,649					$	125,166				$	120,231					$	30,091
Debt restructuring costs and advisory fees				300					—						3,030					7,590						139
Adjusted EBITDA before restructuring and advisory costs – Non-GAAP			$	33,934				$	34,649					$	128,196				$	127,821					$	30,230

⁽¹⁾ For illustrative purposes, Midstates has combined the
Successor Period and Predecessor Period to derive combined results for
the three months ended December 31, 2016 and the year ended December 31,
2016. The combination was generated by addition of comparable financial
statement line item captions. However, because of various adjustments to
the consolidated financial statements in connection with the application
of fresh-start accounting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
Period are not comparable to those of the Predecessor Period. The
financial information preceding the table above provides the Successor
Period and the Predecessor Period GAAP results for the applicable
periods. Midstates believes that subject to consideration of the impact
of fresh-start accounting, combining the results of the Predecessor
Period and Successor Period provide meaningful information about the
financial results of Midstates, including production, revenues and
costs, that assist a reader in understanding its financial results for
the applicable periods.

MIDSTATES PETROLEUM COMPANY, INC.
CASH OPERATING EXPENSES
(In thousands)
			For the Three Months Ended December 31,										For the Year Ended December 31,										For the Three Months Ended September 30,
			2017				2016(1)						2017				2016(1)						2017
Operating Expenses – GAAP			$	172,582			$	56,467					$	308,247			$	436,003					$	44,403
Adjustments for certain non-cash items:
Asset retirement accretion				267				308						1,100				1,624						274
Share-based compensation, net				2,094				4,198						9,196				5,473						2,835
Depreciation, depletion and amortization				19,360				16,047						65,832				75,276						15,170
Impairment of oil and gas properties				125,300				7,524						125,300				232,108						—
Other				—				—						—				—						—
Cash Operating Expenses – Non-GAAP			$	25,561			$	28,390					$	106,819			$	121,522					$	26,124
Cash Operating Expenses – Non-GAAP per BOE			$	13.09			$	12.22					$	13.21			$	11.50					$	13.29
Debt restructuring costs and advisory fees			$	300			$	—					$	3,030			$	7,590					$	139
Debt restructuring costs and advisory fees, per BOE			$	0.15			$	—					$	0.37			$	0.72					$	0.07
Severance and Houston lease abandonment costs			$	331			$	—					$	331			$	3,210					$	—
Severance and Houston lease abandonment costs, per BOE			$	0.17			$	—					$	0.04			$	0.30					$	—
Adjusted Cash Operating Expenses – Non-GAAP			$	24,930			$	28,390					$	103,458			$	110,722					$	25,985
Adjusted Cash Operating Expenses – Non-GAAP per BOE			$	12.77			$	12.22					$	12.80			$	10.48					$	13.22

⁽¹⁾ For illustrative purposes, Midstates has combined the
Successor Period and Predecessor Period to derive combined results for
the three months ended December 31, 2016 and the year ended December 31,
2016. The combination was generated by addition of comparable financial
statement line item captions. However, because of various adjustments to
the consolidated financial statements in connection with the application
of fresh-start accounting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
Period are not comparable to those of the Predecessor Period. The
financial information preceding the table above provides the Successor
Period and the Predecessor Period GAAP results for the applicable
periods. Midstates believes that subject to consideration of the impact
of fresh-start accounting, combining the results of the Predecessor
Period and Successor Period provide meaningful information about the
financial results of Midstates, including production, revenues and
costs, that assist a reader in understanding its financial results for
the applicable periods.

MIDSTATES PETROLEUM COMPANY, INC.
ADJUSTED CASH GENERAL AND ADMINISTRATIVE EXPENSES
(In thousands)
			For the Three Months Ended December 31,											For the Year Ended December 31,											For the Three Months Ended September 30,
			2017					2016(1)						2017					2016(1)						2017
General and Administrative Expenses – GAAP			$	6,250				$	8,133					$	29,352				$	27,226					$	7,255
Adjustments for certain non-cash and non-recurring items:
Share-based compensation, net				(2,094	)				(4,198	)					(9,196	)				(5,473	)					(2,835	)
Capitalized general and administrative expenses				606					876						3,270					3,737						898
Severance and other costs				(331	)				—						(331	)				(1,636	)					—
Houston office lease abandonment costs				—					—						—					(1,574	)					—
Advisory costs included in general and administrative expenses				(300	)				1,070						(3,030	)				1,070						(139	)
Adjusted Cash General and Administrative Expenses – Non-GAAP			$	4,131				$	5,881					$	20,065				$	23,350					$	5,179
Adjusted Cash General and Administrative Expenses – Non-GAAP per BOE			$	2.12				$	2.53					$	2.48				$	2.21					$	2.64

⁽¹⁾ For illustrative purposes, Midstates has combined the
Successor Period and Predecessor Period to derive combined results for
the three months ended December 31, 2016 and the year ended December 31,
2016. The combination was generated by addition of comparable financial
statement line item captions. However, because of various adjustments to
the consolidated financial statements in connection with the application
of fresh-start accounting, including asset valuation adjustments and
liability adjustments, the results of operations for the Successor
Period are not comparable to those of the Predecessor Period. The
financial information preceding the table above provides the Successor
Period and the Predecessor Period GAAP results for the applicable
periods. Midstates believes that subject to consideration of the impact
of fresh-start accounting, combining the results of the Predecessor
Period and Successor Period provide meaningful information about the
financial results of Midstates, including production, revenues and
costs, that assist a reader in understanding its financial results for
the applicable periods.

MIDSTATES PETROLEUM COMPANY, INC.
Reconciliation of
PV-10 to the Standardized Measure

We refer to PV-10 as the present value of estimated future net cash
flows of estimated proved reserves as calculated in the respective
reserves report using a discount rate of 10%. This amount includes
projected revenues, estimated production costs, estimated future
development costs and estimated cash flows related to future asset
retirement obligations (“ARO”). PV-10 is a financial measure not defined
under US GAAP. Accordingly, the following table reconciles total PV-10
to the standardized measure of discounted future net cash flows, which
is the most directly comparable US GAAP financial measure. We believe
the presentation of PV-10 provides useful information because it is
widely used by investors in evaluating oil and natural gas companies
without regard to specific income tax characteristics of such entities.
PV-10 is not a measure of financial or operating performance under US
GAAP, nor is it intended to represent the current market value of our
estimated proved reserves. PV-10 should not be considered in isolation
or as a substitute for the standardized measure of discounted future net
cash flows as defined under US GAAP.

The following table provides a reconciliation of PV-10 to the
standardized measure of discounted cash flows (in thousands):

			As of December 31, 2017				As of December 31, 2016
PV-10			$	558,133			$	578,155
Present value of future income tax, discounted at 10%				(8,890)				(48,205)
Standardized measure of discounted future net cash flows			$	549,243			$	529,950

View source version on businesswire.com: http://www.businesswire.com/news/home/20180313006507/en/

Source: Business Wire
(March 13, 2018 - 4:34 PM EDT)

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