Legacy Reserves Inc. Announces First Quarter 2019 Results

MIDLAND, Texas, May 9, 2019

• Generated quarterly oil production of 17,922 Bbls/d, a 4% increase relative to Q1'18;
• Reduced lease operating expense by 9% quarter-over-quarter; and
• Generated net loss of $78.4 million and adjusted EBITDA of $63.9 million.

As previously announced, Legacy is evaluating and exploring potential strategic alternatives. These alternatives include, among others, a sale or other business combination transaction, sales of assets, financing transactions, or some combination of these.

Financial and Operating Results - Three-Month Period Ended March 31, 2019 Compared to Three-Month Period Ended March 31, 2018

• Production increased 1% to 46,389 Boe/d from 46,078 Boe/d primarily due to additional oil production from our Permian Basin horizontal drilling program. This was partially offset by natural production declines.
• Average realized price, excluding net cash settlements from commodity derivatives, decreased 14% to $28.38 per Boe in 2019 from $33.15 per Boe in 2018 driven by a decrease in average realized price due to a decrease in the average West Texas Intermediate ("WTI") crude price of  $8.09 per Bbl coupled with the widening Mid-Cush and other regional differentials, and a decrease in the realized NGL price of 44% to $0.45 per gallon in 2019 from $0.80 per gallon in 2018. These decreases were partially offset by an average realized natural gas price increase of 1% to $2.60 per Mcf in 2019 from $2.57 per Mcf in 2018.
• Production expenses, excluding ad valorem taxes, were relatively flat at $45.0 million in 2019, a decrease from $45.6 million in 2018.
• General and administrative expenses, excluding unit-based Long-Term Incentive Plan ("LTIP") compensation expense, increased to $12.4 million in 2019 from $11.3 million in 2018 due to a $0.9 million increase in costs related to our strategic alternative process.
• Cash settlements received on our commodity derivatives during 2019 were $9.6 million compared to $2.8 million paid in 2018. The increase in cash settlements is a result of lower commodity prices.
• Total development capital expenditures decreased to $39.4 million in 2019 from $59.7 million in 2018. The 2019 activity was in line with our previously announced capital budget and was primarily related to our Permian horizontal drilling program.

Quarterly Report on Form 10-Q

Financial results contained herein are preliminary and subject to the final, unaudited financial statements and related footnotes included in Legacy's Form 10-Q which will be filed on or about May 10, 2019.

About Legacy Reserves Inc.