10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 10-Q

(Mark One)

☒    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2022

OR

☐    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ___________ to ___________

Commission File Number: 001-38083

Magnolia Oil & Gas Corporation

(Exact Name of Registrant as Specified in its Charter)

Delaware		81-5365682
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)
Nine Greenway Plaza, Suite 1300		77046
Houston,	Texas
(Address of principal executive offices)		(Zip Code)

Registrant’s telephone number, including area code: (713) 842-9050

Securities registered pursuant to section 12(b) of the Act:
Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Class A Common Stock, par value $0.0001	MGY	New York Stock Exchange

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ☒    No  ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ☒    No  ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  ☐    No  ☒

As of May 6, 2022, there were 187,439,431 shares of Class A Common Stock, $0.0001 par value per share, and 35,594,059 shares of Class B Common Stock, $0.0001 par value per share, outstanding.

GLOSSARY OF CERTAIN TERMS AND CONVENTIONS USED HEREIN

The following are definitions of certain other terms and conventions that are used in this Quarterly Report on Form 10-Q:

The “Company” or “Magnolia.” Magnolia Oil & Gas Corporation (either individually or together with its consolidated subsidiaries, as the context requires, including Magnolia Intermediate, Magnolia LLC, Magnolia Operating, and Magnolia Oil & Gas Finance Corp.).

“Magnolia Intermediate.” Magnolia Oil & Gas Intermediate LLC.

“Magnolia LLC.” Magnolia Oil & Gas Parent LLC.

“Magnolia LLC Units.” Units representing limited liability company interests in Magnolia LLC.

“Magnolia Operating.” Magnolia Oil & Gas Operating LLC.

“EnerVest.” EnerVest, Ltd.

“Karnes County Assets.” Certain right, title, and interest in certain oil and natural gas assets located primarily in the Karnes County portion of the Eagle Ford Shale formation in South Texas.

“Giddings Assets.” Certain right, title, and interest in certain oil and natural gas assets located primarily in the Giddings area of the Austin Chalk formation.

“Business Combination.” The acquisition, which closed on July 31, 2018, of the Karnes County Assets; the Giddings Assets; and a 35% membership interest in Ironwood Eagle Ford Midstream, LLC.

“Class A Common Stock.” Magnolia’s Class A Common Stock, par value $0.0001 per share.

“Class B Common Stock.” Magnolia’s Class B Common Stock, par value $0.0001 per share.

“Issuers.” Magnolia Operating and Magnolia Oil & Gas Finance Corp., a wholly owned subsidiary of Magnolia Operating, as it relates to the 2026 Senior Notes.

“Magnolia LLC Unit Holders.” EnerVest Energy Institutional Fund XIV-A, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-WIC, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-2A, L.P., a Delaware limited partnership, EnerVest Energy Institutional Fund XIV-3A, L.P., a Delaware limited partnership, and EnerVest Energy Institutional Fund XIV-C-AIV, L.P., a Delaware limited partnership.

“RBL Facility.” Senior secured reserve-based revolving credit facility.

“2026 Senior Notes.” 6.0% Senior Notes due 2026.

“Services Agreement.” That certain Services Agreement, as amended, dated as of July 31, 2018, by and between the Company, Magnolia Operating, and EnerVest Operating, L.L.C. (“EVOC”), pursuant to which EVOC provided certain services to the Company as described in the agreement.

“Stockholder Agreement.” The Stockholder Agreement, dated as of July 31, 2018, by and between the Company and the other parties thereto.

“Non-Compete.” That certain Non-Competition Agreement, dated July 31, 2018, between the Company and EnerVest, pursuant to which EnerVest and certain of its affiliates were restricted from competing with the Company in certain counties comprising the Eagle Ford Shale.

Table of Contents

		Page
PART I.	FINANCIAL INFORMATION
Item 1.	Financial Statements
	Consolidated Balance Sheets	1
	Consolidated Statements of Operations (unaudited)	2
	Consolidated Statements of Changes in Stockholders’ Equity (unaudited)	3
	Consolidated Statements of Cash Flows (unaudited)	5
	Notes to Consolidated Financial Statements (unaudited)	6
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	16
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	23
Item 4.	Controls and Procedures	24
PART II.	OTHER INFORMATION
Item 1.	Legal Proceedings	24
Item 1A.	Risk Factors	24
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	25
Item 3.	Defaults Upon Senior Securities	25
Item 4.	Mine Safety Disclosures	25
Item 5.	Other Information	25
Item 6.	Exhibits	26
Signatures		27

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

Magnolia Oil & Gas Corporation

Consolidated Balance Sheets

(In thousands)

	March 31, 2022		December 31, 2021
ASSETS	(Unaudited)		(Audited)
CURRENT ASSETS
Cash and cash equivalents	$	346,396	$	366,982
Accounts receivable	179,652		149,769
Drilling advances	2,516		615
Other current assets	1,688		552
Total current assets	530,252		517,918
PROPERTY, PLANT AND EQUIPMENT
Oil and natural gas properties	2,467,167		2,381,812
Other	7,173		7,036
Accumulated depreciation, depletion and amortization	(1,225,849)		(1,172,761)
Total property, plant and equipment, net	1,248,491		1,216,087
OTHER ASSETS
Deferred financing costs, net	7,017		3,701
Other long-term assets	8,854		9,036
Total other assets	15,871		12,737
TOTAL ASSETS	$	1,794,614	$	1,746,742
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	134,652	$	127,909
Other current liabilities (Note 7)	104,082		90,636
Total current liabilities	238,734		218,545
LONG-TERM LIABILITIES
Long-term debt, net	388,647		388,087
Asset retirement obligations, net of current	90,523		89,715
Other long-term liabilities	4,342		5,146
Total long-term liabilities	483,512		482,948
COMMITMENTS AND CONTINGENCIES (Note 9)
STOCKHOLDERS’ EQUITY
Class A Common Stock, $0.0001 par value, 1,300,000 shares authorized, 203,762 shares issued and 187,543 shares outstanding in 2022 and 193,437 shares issued and 179,270 shares outstanding in 2021	20		19
Class B Common Stock, $0.0001 par value, 225,000 shares authorized, 35,594 shares issued and outstanding in 2022 and 49,293 shares issued and outstanding in 2021	4		5
Additional paid-in capital	1,649,111		1,689,500
Treasury Stock, at cost, 16,218 shares and 14,168 shares in 2022 and 2021, respectively	(209,418)		(164,599)
Accumulated deficit	(542,129)		(708,168)
Noncontrolling interest	174,780		228,492
Total equity	1,072,368		1,045,249
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	$	1,794,614	$	1,746,742

The accompanying notes are an integral part to these consolidated financial statements.

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Magnolia Oil & Gas Corporation

Consolidated Statements of Operations (Unaudited)

(In thousands, except per share data)

	Three Months Ended
	March 31, 2022		March 31, 2021
REVENUES
Oil revenues	$	262,667	$	146,958
Natural gas revenues	56,580		35,663
Natural gas liquids revenues	58,592		26,486
Total revenues	377,839		209,107
OPERATING EXPENSES
Lease operating expenses	28,744		19,392
Gathering, transportation and processing	15,840		10,243
Taxes other than income	20,882		10,762
Exploration expenses	5,538		2,062
Asset retirement obligations accretion	789		1,331
Depreciation, depletion and amortization	53,106		42,944
Amortization of intangible assets	—		2,113
General and administrative expenses	17,070		20,364
Total operating expenses	141,969		109,211
OPERATING INCOME	235,870		99,896
OTHER INCOME (EXPENSE)
Interest expense, net	(9,357)		(7,294)
Loss on derivatives, net	—		(482)
Other income (expense), net	207		(229)
Total other expense, net	(9,150)		(8,005)
INCOME BEFORE INCOME TAXES	226,720		91,891
Income tax expense	18,100		399
NET INCOME	208,620		91,492
LESS: Net income attributable to noncontrolling interest	42,581		28,248
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCK	$	166,039	$	63,244
NET INCOME PER SHARE OF CLASS A COMMON STOCK
Basic	$	0.90	$	0.38
Diluted	$	0.90	$	0.37
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic	182,578		166,952
Diluted	183,163		169,636

The accompanying notes are an integral part of these consolidated financial statements.

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Magnolia Oil & Gas Corporation

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In thousands)

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Treasury Stock			Retained Earnings/ Accumulated Deficit		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
	Shares	Value		Shares	Value				Shares	Value
Balance, December 31, 2020	168,755	$	17	85,790	$	9	$	1,712,544	5,475	$	(38,958)	$	(1,125,450)	$	548,162	$	291,260	$	839,422
Stock based compensation expense, net of forfeitures	—	—		—	—		1,835		—	—		—		1,835		870		2,705
Changes in ownership interest adjustment	—	—		—	—		28,924		—	—		—		28,924		(28,924)		—
Common stock issued related to stock based compensation, net	244	—		—	—		(839)		—	—		—		(839)		(399)		(1,238)
Class A Common Stock repurchases	—	—		—	—		—		1,973	(20,281)		—		(20,281)		—		(20,281)
Class B Common Stock purchases and cancellations	—	—		(5,000)	(1)		1		—	—		—		—		(50,781)		(50,781)
Non-compete settlement	375	—		—	—		(11,231)		—	—		—		(11,231)		(5,921)		(17,152)
Conversion of Class B Common Stock to Class A Common Stock	14,166	1		(14,166)	(1)		—		—	—		—		—		—		—
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(155)		(155)
Net income	—	—		—	—		—		—	—		63,244		63,244		28,248		91,492
Balance, March 31, 2021	183,540	$	18	66,624	$	7	$	1,731,234	7,448	$	(59,239)	$	(1,062,206)	$	609,814	$	234,198	$	844,012

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Magnolia Oil & Gas Corporation

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited)

(In thousands)

	Class A Common Stock			Class B Common Stock			Additional Paid In Capital		Treasury Stock			Accumulated Deficit		Total Stockholders’ Equity		Noncontrolling Interest		Total Equity
	Shares	Value		Shares	Value				Shares	Value
Balance, December 31, 2021	193,437	$	19	49,293	$	5	$	1,689,500	14,168	$	(164,599)	$	(708,168)	$	816,757	$	228,492	$	1,045,249
Stock based compensation expense, net of forfeitures	—	—		—	—		2,360		—	—		—		2,360		525		2,885
Changes in ownership interest adjustment	—	—		—	—		(595)		—	—		—		(595)		595		—
Common stock issued related to stock based compensation and other, net	576	—		—	—		(4,871)		—	—		—		(4,871)		(1,043)		(5,914)
Class A Common Stock repurchases	—	—		—	—		—		2,050	(44,819)		—		(44,819)		—		(44,819)
Class B Common Stock purchase and cancellation	—	—		(3,950)	—		—		—	—		—		—		(84,733)		(84,733)
Conversion of Class B Common Stock to Class A Common Stock	9,749	1		(9,749)	(1)		—		—	—		—		—		—		—
Distributions to noncontrolling interest owners	—	—		—	—		—		—	—		—		—		(11,637)		(11,637)
Dividends declared ($0.20 per share)	—	—		—	—		(37,283)		—	—		—		(37,283)		—		(37,283)
Net income	—	—		—	—		—		—	—		166,039		166,039		42,581		208,620
Balance, March 31, 2022	203,762	$	20	35,594	$	4	$	1,649,111	16,218	$	(209,418)	$	(542,129)	$	897,588	$	174,780	$	1,072,368

The accompanying notes are an integral part to these consolidated financial statements.

4

Magnolia Oil & Gas Corporation

Consolidated Statements of Cash Flows (Unaudited)

(In thousands)

	Three Months Ended
	March 31, 2022		March 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
NET INCOME	$	208,620	$	91,492
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	53,106		42,944
Amortization of intangible assets	—		2,113
Asset retirement obligations accretion	789		1,331
Amortization of deferred financing costs	2,812		910
Unrealized loss on derivatives, net	—		482
Stock based compensation	2,885		2,705
Other	—		(84)
Changes in operating assets and liabilities:
Accounts receivable	(29,883)		(25,670)
Accounts payable	6,743		11,499
Accrued liabilities	(2,451)		(12,997)
Drilling advances	(1,901)		2,823
Other assets and liabilities, net	(1,851)		605
Net cash provided by operating activities	238,869		118,153
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions	(1,055)		(558)
Additions to oil and natural gas properties	(84,230)		(40,166)
Changes in working capital associated with additions to oil and natural gas properties	13,946		(1,744)
Other investing	131		(416)
Net cash used in investing activities	(71,208)		(42,884)
CASH FLOW FROM FINANCING ACTIVITIES
Class A Common Stock repurchases	(43,486)		(20,281)
Class B Common Stock purchases and cancellations	(84,733)		(50,781)
Non-compete settlement	—		(17,152)
Dividends paid	(37,174)		—
Cash paid for debt modification	(5,272)		—
Distributions to noncontrolling interest owners	(11,637)		(155)
Other financing activities	(5,945)		(1,267)
Net cash used in financing activities	(188,247)		(89,636)
NET CHANGE IN CASH AND CASH EQUIVALENTS	(20,586)		(14,367)
Cash and cash equivalents – Beginning of period	366,982		192,561
Cash and cash equivalents – End of period	$	346,396	$	178,194
SUPPLEMENTAL CASH FLOW INFORMATION:
Supplemental cash items:
Cash paid for income taxes	$	13,000	$	—
Cash paid for interest	12,225		12,441
Supplemental non-cash investing and financing activity:
Accruals or liabilities for capital expenditures	$	43,882	$	14,624
Supplemental non-cash lease operating activity:
Right-of-use assets obtained in exchange for operating lease obligations	$	404	$	53

The accompanying notes are an integral part of these consolidated financial statements.

5

Magnolia Oil & Gas Corporation

Notes to Consolidated Financial Statements

1. Description of Business and Basis of Presentation

Organization and Nature of Operations

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid (“NGL”) reserves. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas where the Company targets the Eagle Ford Shale and Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long-term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “2021 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the notes to the consolidated financial statements included in the Company’s 2021 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices. The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity. See Note 11—Stockholders’ Equity for further discussion of the noncontrolling interest.

2. Summary of Significant Accounting Policies

As of March 31, 2022, the Company’s significant accounting policies are consistent with those discussed in Note 1—Organization and Summary of Significant Accounting Policies of its consolidated financial statements contained in the Company’s 2021 Form 10-K.

3. Revenue Recognition

Magnolia’s revenues include the sale of crude oil, natural gas, and NGLs. The Company has concluded that disaggregating revenue by product type appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors and has reflected this disaggregation of revenue on the Company’s consolidated statements of operations for all periods presented. The Company’s receivables consist mainly of trade receivables from commodity sales and joint interest billings due from owners on properties the Company operates. Receivables from contracts with customers totaled $151.1 million as of March 31, 2022 and $125.1 million as of December 31, 2021. For further detail regarding the Company’s revenue recognition policies, please refer to Note 1—Organization and Summary of Significant Accounting Policies of the consolidated financial statements contained in the Company’s 2021 Form 10-K.

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4. Derivative Instruments

The Company had settled all of its natural gas costless collar derivative contracts by September 30, 2021. From September 30, 2020 to September 30, 2021, Magnolia utilized natural gas costless collars to reduce its exposure to price volatility for a portion of its natural gas production volumes. The Company’s policies do not permit the use of derivative instruments for speculative purposes. Under the Company’s costless collar contracts, each collar had an established floor price and ceiling price. When the settlement price was below the floor price, the counterparty was required to make a payment to the Company and when the settlement price was above the ceiling price, the Company was required to make a payment to the counterparty.

The Company has elected not to designate any of its derivative instruments as hedging instruments. Accordingly, changes in the fair value of the Company’s derivative instruments were recorded immediately to earnings as “Loss on derivatives, net” on the Company’s consolidated statements of operations.

The following table summarizes the effects of derivative instruments on the Company’s consolidated statements of operations during the three months ended March 31, 2022 and 2021:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Derivative settlements, realized (loss)	$	—	$	—
Unrealized (loss) on derivatives	—		(482)
(Loss) on derivatives, net	$	—	$	(482)

The Company had no outstanding derivative contracts in place as of March 31, 2022.

5. Fair Value Measurements

Certain of the Company’s assets and liabilities are carried at fair value and measured either on a recurring or nonrecurring basis. The Company’s fair value measurements are based either on actual market data or assumptions that other market participants would use in pricing an asset or liability in an orderly transaction, using the valuation hierarchy prescribed by GAAP under Accounting Standards Codification (“ASC”) 820.

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical investments at the measurement date are used.

Level 2 - Pricing inputs are other than quoted prices included within Level 1 that are observable for the investment, either directly or indirectly. Level 2 pricing inputs include quoted prices for similar investments in active markets, quoted prices for identical or similar investments in markets that are not active, inputs other than quoted prices that are observable for the investment, and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Pricing inputs are unobservable and include situations where there is little, if any, market activity for the investment. The inputs used in determination of fair value require significant judgment and estimation.

Recurring Fair Value Measurements

Debt Obligations

The carrying value and fair value of the financial instrument that is not carried at fair value in the accompanying consolidated balance sheets at March 31, 2022 and December 31, 2021 is as follows:

	March 31, 2022				December 31, 2021
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	388,647	$	407,460	$	388,087	$	411,500

The fair value of the 2026 Senior Notes at March 31, 2022 and December 31, 2021 is based on unadjusted quoted prices in an active market, which is considered a Level 1 input in the fair value hierarchy.

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The Company has other financial instruments consisting primarily of receivables, payables, and other current assets and liabilities that approximate fair value due to the nature of the instruments and their relatively short maturities. Non-financial assets and liabilities initially measured at fair value include assets acquired and liabilities assumed in business combinations and asset retirement obligations.

Certain of the Company’s assets and liabilities are measured at fair value on a nonrecurring basis. Specifically, stock based compensation is not measured at fair value on an ongoing basis but is subject to fair value calculations in certain circumstances. For further detail, see Note 12—Stock Based Compensation in the Notes to the Company’s consolidated financial statements. There were no other nonrecurring fair value measurements as of March 31, 2022 or December 31, 2021.

6. Intangible Assets

Non-Compete Agreement

On July 31, 2018 (the “Closing Date”), the Company and EnerVest, separate and apart from the Business Combination, entered into the Non-Compete, which prohibited EnerVest and certain of its affiliates from competing with the Company in the Eagle Ford Shale (the “Market Area”) until July 31, 2022 (“Prohibited Period End Date”). In January 2021, the Company amended the Non-Compete such that, rather than delivering an aggregate of 4.0 million shares of Class A Common Stock upon the two and one-half year and the four year anniversaries of the Closing Date, the Company would deliver (i) the cash value of approximately 2.0 million shares of Class A Common Stock and approximately 0.4 million shares of Class A Common Stock on the two and one-half year anniversary of the Closing Date and (ii) an aggregate of 1.6 million shares of Class A Common Stock on the four year anniversary of the Closing Date, in each case subject to the terms and conditions of the Non-Compete. On February 1, 2021, as consideration for compliance with the Non-Compete, the Company paid $17.2 million in cash and issued 0.4 million shares of Class A Common Stock.

On June 30, 2021, the Company amended the Non-Compete Prohibited Period End Date to terminate on June 30, 2021 and paid $24.9 million in cash in lieu of delivering the remaining 1.6 million shares of Class A Common Stock (the “Second Non-Compete Amendment”). The Second Non-Compete Amendment resulted in the Company accelerating the amortization of the remaining intangible assets. The Company includes the amortization in “Amortization of intangible assets” on the Company’s consolidated statements of operations.

7. Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	March 31, 2022		December 31, 2021
Accrued capital expenditures	$	43,882	$	29,936
Accrued production taxes	12,235		10,084
Other	47,965		50,616
Total Other current liabilities	$	104,082	$	90,636

8. Long-term Debt

The Company’s debt is comprised of the following:

(In thousands)	March 31, 2022		December 31, 2021
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(11,353)		(11,913)
Long-term debt, net	$	388,647	$	388,087

Credit Facility

In connection with the consummation of the Business Combination, the RBL Facility was entered into by and among Magnolia Operating, as borrower, Magnolia Intermediate, as its holding company, the banks, financial institutions, and other lending institutions from time to time party thereto, as lenders, the other parties from time to time party thereto, and Citibank, N.A., as

8

administrative agent, collateral agent, issuing bank, and swingline lender, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $100.0 million sublimit. The RBL Facility is guaranteed by certain parent companies and subsidiaries of Magnolia LLC and is collateralized by certain of Magnolia Operating’s oil and natural gas properties.

On February 16, 2022, Magnolia Operating, as borrower, amended and restated the RBL Facility (“Amended and Restated RBL Facility”) in its entirety, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $50.0 million sublimit, with an initial borrowing base of $450.0 million. The Amended and Restated RBL Facility matures in February 2026.

Borrowings under the Amended and Restated RBL Facility bear interest, at Magnolia Operating’s option, at a rate per annum equal to either the term SOFR rate or the alternative base rate plus the applicable margin. Additionally, Magnolia Operating is required to pay a commitment fee quarterly in arrears in respect of unused commitments under the Amended and Restated RBL Facility. The applicable margin and the commitment fee rate are calculated based upon the utilization levels of the Amended and Restated RBL Facility as a percentage of unused lender commitments then in effect.

The Amended and Restated RBL Facility contains certain affirmative and negative covenants customary for financings of this type, including compliance with a leverage ratio of less than 3.50 to 1.00 and a current ratio of greater than 1.00 to 1.00. As of March 31, 2022, the Company was in compliance with all covenants under the Amended and Restated RBL Facility. The Company incurred approximately $5.6 million of lender and transaction fees related to the modification of which $5.2 million were recorded as deferred financing costs and will be amortized prospectively over the remaining term of the Amended and Restated RBL Facility and $0.4 million of which were expensed and are reflected in “Interest expense, net” on the Company’s consolidated statements of operations for the three months ended March 31, 2022.

Deferred financing costs in connection with the Amended and Restated RBL Facility are amortized on a straight-line basis over a period of four years from February 2022 to February 2026 and included in “Interest expense, net” in the Company’s consolidated statements of operations. The Company recognized interest expense related to the Amended and Restated RBL Facility and the RBL facility, as applicable, of $2.8 million and $1.0 million for the three months ended March 31, 2022 and 2021, respectively. The unamortized portion of the deferred financing costs is included in “Deferred financing costs, net” on the accompanying consolidated balance sheet as of March 31, 2022.

The Company did not have any outstanding borrowings under the Amended and Restated RBL Facility as of March 31, 2022.

2026 Senior Notes

On July 31, 2018, the Issuers issued and sold $400.0 million aggregate principal amount of 2026 Senior Notes in a private placement under Rule 144A and Regulation S under the Securities Act of 1933, as amended. The 2026 Senior Notes were issued under the Indenture, dated as of July 31, 2018 (the “Indenture”), by and among the Issuers and Deutsche Bank Trust Company Americas, as trustee. The 2026 Senior Notes are guaranteed on a senior unsecured basis by the Company, Magnolia Operating, and Magnolia Intermediate and may be guaranteed by certain future subsidiaries of the Company. The 2026 Senior Notes will mature on August 1, 2026 and bear interest at the rate of 6.0% per annum.

On April 5, 2021, the terms of the Indenture were amended to modify, among other things, the criteria used by the Company to make Restricted Payments (as defined in the Indenture). The amendment to the Indenture was accounted for as a debt modification. Costs incurred with third parties directly related to the modification were expensed as incurred. The Company incurred approximately $1.1 million of transaction fees in the second quarter of 2021 related to the modification which were expensed. The Company also paid $5.0 million in fees to holders of the 2026 Senior Notes, which fees are recorded as deferred financing costs and amortized using the new effective interest rate applied prospectively over the remaining term of the 2026 Senior Notes.

As of March 31, 2022, the Company had incurred and capitalized a total of $16.8 million of deferred financing costs related to the issuance of, and the amendment to the Indenture governing, the 2026 Senior Notes. These costs are amortized using the effective interest method over the term of the 2026 Senior Notes and are included in “Interest expense, net” in the Company’s consolidated statements of operations. The unamortized portion of the deferred financing costs is included as a reduction to the carrying value of the 2026 Senior Notes, which has been recorded as “Long-term debt, net” on the Company’s consolidated balance sheet as of March 31, 2022. The Company recognized interest expense related to the 2026 Senior Notes of $6.6 million and $6.3 million for the three months ended March 31, 2022 and 2021, respectively.

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At any time prior to August 1, 2022, the Issuers may, on any one or more occasions, redeem all or a part of the 2026 Senior Notes at a redemption price equal to 100% of the principal amount of the 2026 Senior Notes redeemed, plus a “make whole” premium on accrued and unpaid interest, if any, to, but excluding, the date of redemption. After August 1, 2022, the Issuers may redeem all or a part of the 2026 Senior Notes based on principal plus a set premium, as set forth in the Indenture, including any accrued and unpaid interest.

9. Commitments and Contingencies

Legal Matters

From time to time, the Company is or may become involved in litigation in the ordinary course of business.

Certain of the Magnolia LLC Unit Holders and EnerVest Energy Institutional Fund XIV-C, L.P. (collectively the “Co-Defendants”) and the Company have been named as defendants in a lawsuit where the plaintiffs claim to be entitled to a minority working interest in certain Karnes County Assets. The litigation is in the pre-trial stage. The exposure related to this litigation is currently not reasonably estimable. The Co-Defendants retained all such liability in connection with the Business Combination.

A mineral owner in a Magnolia operated well in Karnes County, Texas filed a complaint with the Texas Railroad Commission (the “Commission”) challenging the validity of the permit to drill such well by questioning the long-standing process by which the Commission granted the permit. After the Commission affirmed the granting of the permit, and after judicial review of the Commission’s order by the 53rd Judicial District Court Travis County, Texas (the “District Court”), the District Court reversed and remanded the Commission’s order. The Commission and Magnolia have appealed the District Court’s judgment to the Third Court of Appeals in Austin, Texas.

At March 31, 2022, the Company does not believe the outcome of any such disputes or legal actions will have a material effect on its consolidated statements of operations, balance sheet, or cash flows. No amounts were accrued with respect to outstanding litigation at March 31, 2022 or March 31, 2021.

Environmental Matters

The Company, as an owner or lessee and operator of oil and natural gas properties, is subject to various federal, state, and local laws and regulations relating to discharge of materials into, and the protection of, the environment. These laws and regulations may, among other things, impose liability on a lessee under an oil and natural gas lease for the cost of pollution clean-up resulting from operations and subject the lessee to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in an affected area. The Company maintains insurance coverage, which it believes is customary in the industry, although the Company is not fully insured against all environmental risks.

Risks and Uncertainties 

The Company’s revenue, profitability, and future growth are substantially dependent upon the prevailing and future prices for oil and natural gas, which depend on numerous factors beyond the Company’s control such as overall oil and natural gas production and inventories in relevant markets, economic conditions, the global political environment, regulatory developments, and competition from other energy sources. Oil and natural gas prices historically have been volatile and may be subject to significant fluctuations in the future.

The coronavirus disease 2019 (“COVID-19”) pandemic and related economic repercussions have created significant volatility, uncertainty, and turmoil in the oil and natural gas industry. While oil and natural gas prices increased in 2021 and 2022, demand and pricing may again decline if there is a resurgence of the outbreak across the U.S. or other locations across the world or as a result of any related social distancing guidelines, travel restrictions, and stay-at-home orders. The extent of any further impact of the pandemic, including the emergence and spread of variant strains of COVID-19, on the Company’s industry and business cannot be reasonably predicted at this time.

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10. Income Taxes

The Company’s income tax provision consists of the following components:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Current:
Federal	$	16,784	$	—
State	1,316		399
	18,100		399
Deferred:
Federal	—		—
State	—		—
	—		—
Income tax expense	$	18,100	$	399

The Company is subject to U.S. federal income tax, margin tax in the state of Texas, and Louisiana corporate income tax. The Company estimates its annual effective tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which it operates. The Company’s effective tax rate for the three months ended March 31, 2022 and 2021 was 8.0% and 0.4%, respectively. As a result of impairments in the first quarter of 2020, the Company established full valuation allowances on the federal and state deferred tax assets, which resulted in additional differences between the effective tax rate and the statutory rate as of March 31, 2022 and March 31, 2021. The primary differences between the annual effective tax rate and the statutory rate of 21.0% are income attributable to noncontrolling interest, state taxes, and valuation allowances.

As of March 31, 2022, the Company did not have an accrued liability for uncertain tax positions and does not anticipate recognition of any significant liabilities for uncertain tax positions during the next 12 months. For the quarter ended March 31, 2022, no amounts were incurred for income tax uncertainties or interest and penalties. Currently, the Company is not aware of any issues under review that could result in significant payments, accruals, or a material deviation from its position. The Company’s tax years since its formation remain subject to possible income tax examinations by its major taxing authorities for all periods.

During the three months ended March 31, 2022, the Magnolia LLC Unit Holders redeemed 9.7 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public. Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. The redemption and exchange of these Magnolia LLC Units created additional tax basis in Magnolia LLC. There was no net tax impact as the Company recorded a full valuation allowance.

As of March 31, 2022, the Company’s net deferred tax asset was $204.6 million. Management assessed whether it is more-likely-than-not that it will generate sufficient taxable income to realize its deferred income tax assets, including the investment in partnership and net operating loss carryforwards. In making this determination, the Company considered all available positive and negative evidence and made certain assumptions. The Company considered, among other things, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. As of March 31, 2022, the Company assessed the realizability of the deferred tax assets and recorded a full valuation allowance of $204.6 million.

As commodity prices have improved during 2021 and 2022, Magnolia has begun to sustain a level of increased profitability such that, net of its net operating loss, Magnolia is beginning to project modest taxable income. Should this continue, increased weight will be given to positive operating results, along with projections of future taxable income, in determining whether future taxable income will be sufficient to provide for realization of the Company’s deferred tax assets, and if so, this new evidence may result in a change in estimate of the Company’s valuation allowance in the next 12 months.

11. Stockholders’ Equity

Class A Common Stock

At March 31, 2022, there were 203.8 million shares of Class A Common Stock issued and 187.5 million shares of Class A Common Stock outstanding. The holders of Class A Common Stock and Class B Common Stock vote together as a single class on all matters and are entitled one vote for each share held. There is no cumulative voting with respect to the election of directors, which results in the holders of more than 50% of the Company’s outstanding common shares being able to elect all of the directors, subject to

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voting obligations under the Stockholder Agreement. In the event of a liquidation, dissolution, or winding up of the Company, the holders of the Class A Common Stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. The holders of the Class A Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Class B Common Stock

At March 31, 2022, there were 35.6 million shares of Class B Common Stock issued and outstanding. Holders of Class B Common Stock vote together as a single class with holders of Class A Common Stock on all matters properly submitted to a vote of the stockholders. The holders of Class B Common Stock generally have the right to exchange all or a portion of their shares of Class B Common Stock, together with an equal number of Magnolia LLC Units, for the same number of shares of Class A Common Stock or, at Magnolia LLC’s option, an equivalent amount of cash. Upon the future redemption or exchange of Magnolia LLC Units held by any holder of Class B Common Stock, a corresponding number of shares of Class B Common Stock held by such holder of Class B Common Stock will be canceled. In the event of a liquidation, dissolution, or winding up of Magnolia LLC, the holders of the Class B Common Stock, through their ownership of Magnolia LLC Units, are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of units of Magnolia LLC, if any, having preference over the common units. The holders of the Class B Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Share Repurchases

The Company’s board of directors has authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. As of March 31, 2022, the Company had repurchased 15.7 million shares under the program at a cost of $197.9 million.

During the three months ended March 31, 2022, the Company also repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the three months ended March 31, 2022 Magnolia LLC repurchased and subsequently canceled 3.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $84.7 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 9.7 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

During the three months ended March 31, 2021 Magnolia LLC repurchased and subsequently canceled 5.0 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $50.8 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 14.2 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. Magnolia funded the Class B Common Stock Repurchases with cash on hand.

Dividends and Distributions

Distributions

On February 3, 2022, Magnolia LLC declared a cash distribution of $0.20 per Magnolia LLC Unit totaling $45.9 million, of which $37.3 million was distributed to the Company and $8.6 million was distributed to the Magnolia LLC Unit Holders.

On August 2, 2021, Magnolia LLC declared a cash distribution of $0.08 per Magnolia LLC Unit totaling $19.0 million, of which $14.2 million was distributed to the Company and $4.8 million was distributed to the Magnolia LLC Unit Holders.

The distributions to the Magnolia LLC Unit Holders were recorded as a reduction of noncontrolling interest on the Company’s consolidated balance sheets as of March 31, 2022 and December 31, 2021.

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Dividends

On February 3, 2022, the Company’s board of directors declared a semi-annual cash dividend of $0.20 per share of Class A Common Stock totaling approximately $37.3 million. The dividend was paid on March 1, 2022 to shareholders of record as of the close of business on February 14, 2022.

On August 2, 2021, the Company’s board of directors declared a semi-annual interim cash dividend of $0.08 per share of Class A Common Stock totaling approximately $14.2 million. The dividend was paid on September 1, 2021 to shareholders of record as of the close of business on August 12, 2021.

Dividends in excess of retained earnings are recorded as a reduction of additional paid-in capital. The $37.3 million and $14.2 million dividends declared during the first quarter of 2022 and the third quarter of 2021, respectively, were recorded as a reduction of additional paid-in capital on the Company’s consolidated balance sheets as of March 31, 2022 and December 31, 2021.

Noncontrolling Interest

Noncontrolling interest in Magnolia’s consolidated subsidiaries includes amounts attributable to Magnolia LLC Units that were issued to the Magnolia LLC Unit Holders in connection with the Business Combination. The noncontrolling interest percentage is affected by various equity transactions such as issuances and repurchases of Class A Common Stock, the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) for Class A Common Stock, or the cancellation of Class B Common Stock (and corresponding Magnolia LLC Units). As of March 31, 2022, Magnolia owned approximately 84.0% of the interest in Magnolia LLC and the noncontrolling interest was approximately 16.0%.

In the first quarter of 2019, Magnolia Operating formed Highlander Oil & Gas Holdings LLC (“Highlander”) as a joint venture whereby MGY Louisiana LLC, a wholly owned subsidiary of Magnolia Operating, holds approximately 84.7% of the units of Highlander, with the remaining 15.3% attributable to noncontrolling interest.

12. Stock Based Compensation

On October 8, 2018, the Company’s board of directors adopted the “Magnolia Oil & Gas Corporation Long Term Incentive Plan” (the “Plan”), effective as of July 17, 2018. A total of 16.8 million shares of Class A Common Stock have been authorized for issuance under the Plan as of March 31, 2022. The Company grants stock based compensation awards in the form of restricted stock units (“RSU”), performance stock units (“PSU”), and performance restricted stock units (“PRSU”) to eligible employees and directors to enhance the Company and its affiliates’ ability to attract, retain, and motivate persons who make important contributions to the Company and its affiliates by providing these individuals with equity ownership opportunities. Shares issued as a result of awards granted under the Plan are generally new shares of Class A Common Stock.

Stock based compensation expense is recognized net of forfeitures within “General and administrative expenses” and “Lease operating expenses” on the consolidated statements of operations and was $2.9 million and $2.7 million for the three months ended March 31, 2022 and 2021, respectively. The Company has elected to account for forfeitures of awards granted under the Plan as they occur in determining compensation expense.

The following table presents a summary of Magnolia’s unvested RSU, PSU, and PRSU activity for the three months ended March 31, 2022.

	Restricted Stock Units			Performance Stock Units			Performance Restricted Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2021	1,187,509	$	8.94	460,414	$	9.20	968,654	$	9.36
Granted	241,671	20.29		—	—		506,703	19.14
Granted for performance multiple(1)	—	—		90,965	13.88		—	—
Vested	(315,842)	9.31		(272,894)	13.88		(212,687)	9.33
Forfeited	(6,736)	10.38		—	—		(936)	11.38
Unvested at March 31, 2022	1,106,602	$	11.33	278,485	$	6.14	1,261,734	$	13.29

(1) Upon completion of the performance period for the PSUs granted in 2019, a performance multiple of 150% was applied to each of the grants resulting in additional grants of PSUs in 2022.

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Restricted Stock Units

The Company grants service-based RSU awards to employees, which generally vest ratably over a three-year or four-year service period, and to non-employee directors, which vest in full after one year. RSUs represent the right to receive shares of Class A Common Stock at the end of the vesting period equal to the number of RSUs that vest. RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases to be an employee or director of the Company prior to vesting of the award. Compensation expense for the service-based RSU awards is based upon the grant date market value of the award and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards. The aggregate fair value of RSUs that vested during the three months ended March 31, 2022 and 2021 was $7.9 million and $4.0 million, respectively. Unrecognized compensation expense related to unvested RSUs as of March 31, 2022 was $9.9 million, which the Company expects to recognize over a weighted average period of 2.8 years.

Performance Stock Units and Performance Restricted Stock Units

The Company grants PRSUs to certain employees. Each PRSU represents the contingent right to receive one share of Class A Common Stock once the PRSU is both vested and earned. PRSUs generally vest either ratably over a three-year service period or at the end of a three-year service period, in each case, subject to the recipient’s continued employment or service through each applicable vesting date. Each PRSU is earned based on whether Magnolia’s stock price achieves a target average stock price for any 20 consecutive trading days during the five-year performance period. If PRSUs are not earned by the end of the five-year performance period (“Performance Condition”), the PRSUs will be forfeited and no shares of Class A Common Stock will be issued, even if the vesting conditions have been met. Compensation expense for the PRSU awards is based upon grant date fair market value of the award, calculated using a Monte Carlo simulation, as presented below, and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards, as applicable. The aggregate fair value of PRSU awards that vested during the three months ended March 31, 2022 was $4.8 million. Unrecognized compensation expense related to unvested PRSUs as of March 31, 2022 was $14.9 million, which the Company expects to recognize over a weighted average period of 2.6 years.

The Company grants PSUs to certain employees. Each PSU, to the extent earned, represents the contingent right to receive one share of Class A Common Stock and the awardee may earn between zero and 150% of the target number of PSUs granted based on the total shareholder return (“TSR”) of the Class A Common Stock relative to the TSR achieved by a specific industry peer group over a three-year performance period, the last day of which is also the vesting date. In addition to the TSR conditions, vesting of the PSUs is subject to the awardee’s continued employment through the date of settlement of the PSUs, which will occur within 60 days following the end of the performance period. The aggregate fair value of PSU awards that vested during the three months ended March 31, 2022 and 2021 was $5.5 million and $0.1 million, respectively. Unrecognized compensation expense related to unvested PSUs as of March 31, 2022 was $0.5 million, which the Company expects to recognize over a weighted average period of 0.8 years.

The grant date fair values of the PRSUs granted during the three months ended March 31, 2022 and 2021, were $9.7 million and $9.4 million, respectively. Since the Performance Condition for the PRSUs granted in 2022 and 2021 were met on March 28, 2022 and March 17, 2021, respectively, the fair value of the PRSUs granted after the Performance Condition were met were based upon the grant date market value of the award. The fair values of the awards granted prior to the date the Performance Condition was met were determined using a Monte Carlo simulation. The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PRSUs in 2022 and 2021.

	Three Months Ended
PRSU Grant Date Fair Value Assumptions	March 31, 2022	March 31, 2021
Expected term (in years)	3.55	3.64
Expected volatility	59.58%	55.18%
Risk-free interest rate	1.89%	0.56%
Dividend yield	1.97%	—%

13. Earnings Per Share

The Company’s unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are deemed participating securities, and therefore dividends and net income allocated to such awards have been deducted from earnings in computing basic and diluted net income per share under the two-class method. Diluted net income per share attributable to common stockholders is calculated under both the two-class method and the treasury stock method and the more dilutive of the two calculations is presented.

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The components of basic and diluted net income per share attributable to common stockholders are as follows:

	Three Months Ended
(In thousands, except per share data)	March 31, 2022		March 31, 2021
Basic:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,416		213
Net income, net of participating securities	$	164,623	$	63,031
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Net income per share of Class A Common Stock - basic	$	0.90	$	0.38
Diluted:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,413		210
Net income, net of participating securities	$	164,626	$	63,034
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Add: Dilutive effect of stock based compensation and other	585		2,684
Weighted average number of common shares outstanding during the period - diluted	183,163		169,636
Net income per share of Class A Common Stock - diluted	$	0.90	$	0.37

For the three months ended March 31, 2022, the Company excluded 44.3 million of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive. For the three months ended March 31, 2021, the Company excluded 80.3 million weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units), as the effect was anti-dilutive.

14. Related Party Transactions

As of March 31, 2022, EnerVest Energy Institutional Fund XIV-A, L.P., a Delaware limited partnership, which is part of the Magnolia LLC Unit Holders, held more than 10% of the Company’s common stock and qualified as a principal owner of the Company, as defined in ASC 850, “Related Party Disclosures.”

Distributions

On February 3, 2022, Magnolia LLC declared a cash distribution of $0.20 per Magnolia LLC Unit totaling $45.9 million, of which $5.7 million was distributed to EnerVest Energy Institutional Fund XIV-A, L.P.

Class B Common Stock Repurchases and Redemptions

During the three months ended March 31, 2022, EnerVest Energy Institutional Fund XIV-A, L.P. received $56.1 million in cash and surrendered 2.6 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock. EnerVest Energy Institutional Fund XIV-A, L.P. also redeemed 6.5 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock, which were subsequently sold to the public.

During the three months ended March 31, 2021, EnerVest Energy Institutional Fund XIV-A, L.P. received $33.6 million in cash and surrendered 3.3 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock. EnerVest Energy Institutional Fund XIV-A, L.P. also redeemed 9.4 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock, which were subsequently sold to the public.

During the three months ended March 31, 2022 and 2021, Magnolia LLC subsequently canceled the surrendered Magnolia LLC Units and a corresponding number of shares of Class B Common Stock. Magnolia did not receive any proceeds from the sales of shares of Class A Common Stock by EnerVest Energy Institutional Fund XIV-A, L.P.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

FORWARD-LOOKING STATEMENTS

This report includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts included or incorporated by reference in this report, including, without limitation, statements regarding the Company’s future financial position, business strategy, budgets, projected revenues, projected costs, and plans and objectives of management for future operations, are forward-looking statements. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company’s management. In addition, forward-looking statements generally can be identified by the use of forward-looking terminology such as “may,” “will,” “could,” “expect,” “intend,” “project,” “estimate,” “anticipate,” “plan,” “believe,” or “continue” or similar terminology. Although Magnolia believes that the expectations reflected in such forward-looking statements are reasonable, the Company can give no assurance that such expectations will prove to have been correct. Important factors that could cause actual results to differ materially from the Company’s expectations include, but are not limited to, Magnolia’s assumptions about:

•the length, scope, and severity of the ongoing coronavirus disease 2019 (“COVID-19”) pandemic, including the emergence and spread of variant strains of COVID-19, including the effects of related public health concerns and the impact of continued or new actions taken by governmental authorities and other third parties in response to the pandemic and its impact on commodity prices and supply and demand considerations;

•legislative, regulatory, or policy changes, including those following the change in presidential administrations;

•the market prices of oil, natural gas, natural gas liquids (“NGLs”), and other products or services;

•the supply and demand for oil, natural gas, NGLs, and other products or services;

•production and reserve levels;

•geopolitical and business conditions in key regions of the world;

•drilling risks;

•economic and competitive conditions;

•the availability of capital resources;

•capital expenditures and other contractual obligations;

•weather conditions;

•inflation rates;

•the availability of goods and services;

•cyber attacks;

•the occurrence of property acquisitions or divestitures;

•the integration of acquisitions; and

•the securities or capital markets and related risks such as general credit, liquidity, market, and interest-rate risks.

All of Magnolia’s forward-looking information is subject to risks and uncertainties that could cause actual results to differ materially from the results expected. Although it is not possible to identify all factors, these risks and uncertainties include the risk factors and the timing of any of those risk factors identified in the reports that we have filed and may file with the Securities and Exchange Commission, including the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “2021 Form 10-K”).

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Management’s Discussion and Analysis of Financial Condition and Results of Operations should be read in conjunction with the Company’s unaudited consolidated financial statements and the related notes thereto.

Overview 

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and NGL reserves that operates in one reportable segment located in the United States. The Company's oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas, where the Company primarily targets the Eagle Ford Shale and the Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Magnolia’s business model prioritizes free cash flow, financial stability, and prudent capital allocation, and is designed to withstand challenging environments. The Company’s ongoing plan is to spend within cash flow on drilling and completing wells while maintaining low leverage. As of March 31, 2022, Magnolia operated one rig exclusively in the Giddings area, and one rig in both the Karnes and Giddings areas. The Company is well positioned to reduce or increase operations given the significant flexibility within its capital program as the Company has no long-term service obligations.

COVID-19 Pandemic and Market Conditions Update

The COVID-19 pandemic and related economic repercussions have created significant volatility, uncertainty, and turmoil in the oil and natural gas industry. As the global economy continues to recover from the effects of the COVID-19 pandemic, economic indicators have continued to strengthen. However, the economy has begun to experience elevated inflation levels as a result of global supply and demand imbalances. Inflationary pressures and labor shortages could result in increases to our operating and capital costs.

Business Overview

As of March 31, 2022, Magnolia’s assets in South Texas included 43,518 gross (23,793 net) acres in the Karnes area, and 638,830 gross (447,415 net) acres in the Giddings area. As of March 31, 2022, Magnolia held an interest in approximately 2,020 gross (1,292 net) wells, with total production of 71.8 thousand barrels of oil equivalent per day for the three months ended March 31, 2022. During the first quarter of 2022, Magnolia was running a two-rig program. One rig drilled multi-well development pads exclusively in the Giddings area. The second rig drilled a mix of wells in both the Karnes and Giddings areas.

Magnolia recognized net income attributable to Class A Common Stock of $166.0 million, or $0.90 per diluted common share, for the three months ended March 31, 2022. Magnolia recognized net income of $208.6 million, which includes a noncontrolling interest of $42.6 million related to the Magnolia LLC Units (and corresponding shares of Class B Common Stock) held by certain affiliates of EnerVest, for the three months ended March 31, 2022.

On February 3, 2022, the Company’s board of directors declared a semi-annual cash dividend of $0.20 per share of Class A Common Stock totaling approximately $37.3 million. The dividend was paid on March 1, 2022 to shareholders of record as of the close of business on February 14, 2022.

The Company’s board of directors has authorized a share repurchase program of up to 30.0 million shares. The program does not require purchases to be made within a particular time frame. As of March 31, 2022, the Company had repurchased 15.7 million shares under the program at a cost of $197.9 million.

During the three months ended March 31, 2022, the Company also repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the three months ended March 31, 2022, Magnolia LLC repurchased and subsequently canceled 3.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $84.7 million of cash consideration (the “Class B Common Stock Repurchases”). Magnolia funded the Class B Common Stock Repurchases with cash on hand. During the same period, the Magnolia LLC Unit Holders redeemed 9.7 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public. Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. As of March 31, 2022, Magnolia owned approximately 84.0% of the interest in Magnolia LLC and the noncontrolling interest was approximately 16.0%.

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Results of Operations

Factors Affecting the Comparability of the Historical Financial Results

Magnolia’s historical financial condition and results of operations for the periods presented may not be comparable, either from period to period or going forward, as a result of the following factors:

•On February 16, 2022, Magnolia Operating, as borrower, amended and restated the RBL Facility (“Amended and Restated RBL Facility”) in its entirety, which will now mature in February 2026.

•During the second quarter of 2021, the Company amended the term of the Services Agreement to end on June 30, 2021.

•During the second quarter of 2021, the Company amended the Non-Compete (the “Second Non-Compete Amendment”), which modified the term of the Non-Compete to end on June 30, 2021.

•The 2026 Senior Notes issued under the Indenture, dated as of July 31, 2018, were amended on April 5, 2021. This debt modification included approximately $1.1 million of one-time transaction fees which were expensed and $5.0 million in fees paid to holders of the 2026 Senior Notes, which were reflected as deferred financing costs reducing Long-term debt and will be amortized over the remaining term of the 2026 Senior Notes.

As a result of the factors listed above, the historical results of operations and period-to-period comparisons of these results and certain financial data may not be comparable or indicative of future results.

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Three Months Ended March 31, 2022 Compared to the Three Months Ended March 31, 2021

Oil, Natural Gas and NGL Sales Revenues. The following table provides the components of Magnolia’s revenues for the periods indicated, as well as each period’s respective average prices and production volumes. This table shows production on a boe basis in which natural gas is converted to an equivalent barrel of oil based on a ratio of six Mcf to one barrel. This ratio may not be reflective of the current price ratio between the two products.

	Three Months Ended
(In thousands, except per unit data)	March 31, 2022		March 31, 2021
Production:
Oil (MBbls)	2,816		2,593
Natural gas (MMcf)	12,378		10,240
NGLs (MBbls)	1,586		1,304
Total (Mboe)	6,465		5,604
Average daily production:
Oil (Bbls/d)	31,289		28,808
Natural gas (Mcf/d)	137,532		113,783
NGLs (Bbls/d)	17,624		14,490
Total (boe/d)	71,835		62,262
Revenues:
Oil revenues	$	262,667	$	146,958
Natural gas revenues	56,580		35,663
Natural gas liquids revenues	58,592		26,486
Total revenues	$	377,839	$	209,107
Average Price:
Oil (per barrel)	$	93.28	$	56.68
Natural gas (per Mcf)	4.57		3.48
NGLs (per barrel)	36.94		20.31

Oil revenues were 70% of the Company’s total revenues for each of the three months ended March 31, 2022 and 2021. Oil production was 44% and 46% of total production volume for the three months ended March 31, 2022 and 2021, respectively. Oil revenues for the three months ended March 31, 2022 were $115.7 million higher than the three months ended March 31, 2021. A 65% increase in average prices increased first quarter 2022 revenues by $94.9 million, while a 9% increase in oil production increased revenues by $20.8 million compared to the same period in the prior year.

Natural gas revenues were 14% and 17% of the Company’s total revenues for the three months ended March 31, 2022 and 2021, respectively. Natural gas production was 32% and 30% of total production volume for the three months ended March 31, 2022 and 2021, respectively. Natural gas revenues for the three months ended March 31, 2022 were $20.9 million higher than the three months ended March 31, 2021. A 31% increase in average prices increased first quarter 2022 revenues by $11.1 million compared to the same period in the prior year, while a 21% increase in natural gas production increased revenues by $9.8 million.

NGL revenues were 16% and 13% of the Company’s total revenues for the three months ended March 31, 2022 and 2021, respectively. NGL production was 24% and 23% of total production volume for the three months ended March 31, 2022 and 2021, respectively. NGL revenues for the three months ended March 31, 2022 were $32.1 million higher than the three months ended March 31, 2021. An 82% increase in average prices increased first quarter 2022 revenues by $21.7 million compared to the same period in the prior year, while a 22% increase in NGL production increased revenues by $10.4 million.

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Operating Expenses and Other Income (Expense). The following table summarizes the Company’s operating expenses and other income (expense) for the periods indicated.

	Three Months Ended
(In thousands, except per unit data)	March 31, 2022		March 31, 2021
Operating Expenses:
Lease operating expenses	$	28,744	$	19,392
Gathering, transportation and processing	15,840		10,243
Taxes other than income	20,882		10,762
Exploration expenses	5,538		2,062
Asset retirement obligations accretion	789		1,331
Depreciation, depletion and amortization	53,106		42,944
Amortization of intangible assets	—		2,113
General and administrative expenses	17,070		20,364
Total operating expenses	$	141,969	$	109,211
Other Income (Expense):
Interest expense, net	$	(9,357)	$	(7,294)
Loss on derivatives, net	—		(482)
Other income (expense), net	207		(229)
Total other expense, net	$	(9,150)	$	(8,005)
Average Operating Costs per boe:
Lease operating expenses	$	4.45	$	3.46
Gathering, transportation and processing	2.45		1.83
Taxes other than income	3.23		1.92
Exploration expenses	0.86		0.37
Asset retirement obligations accretion	0.12		0.24
Depreciation, depletion and amortization	8.21		7.66
Amortization of intangible assets	—		0.38
General and administrative expenses	2.64		3.63

Lease operating expenses are costs incurred in the operation of producing properties, including expenses for utilities, direct labor, water disposal, workover rigs, workover expenses, materials, and supplies. Lease operating expenses for the three months ended March 31, 2022 were $9.4 million, or $0.99 per boe, higher compared to the corresponding 2021 period, due to an increase in costs including operating and maintenance costs, workover activities and additional non-operated activities.

Gathering, transportation and processing costs are costs incurred to deliver oil, natural gas, and NGLs to the market. These expenses can vary based on the volume of oil, natural gas, and NGLs produced as well as the cost of commodity processing. The gathering, transportation and processing costs for the three months ended March 31, 2022 were $5.6 million, or $0.62 per boe, higher than the three months ended March 31, 2021, primarily due to increased natural gas production and higher prices.

Taxes other than income include production and ad valorem taxes. These taxes are based on rates primarily established by state and local taxing authorities. Production taxes are based on the market value of production. Ad valorem taxes are based on the fair market value of the mineral interests or business assets. Taxes other than income for the three months ended March 31, 2022 were $10.1 million, or $1.31 per boe, higher compared to the three months ended March 31, 2021, primarily due to an increase in oil, natural gas, and NGL revenues.

Exploration expenses are geological and geophysical costs that include seismic surveying costs, costs of unsuccessful exploratory dry wells, costs of expired or abandoned leases, and delay rentals. The exploration expenses for the three months ended March 31, 2022 were $3.5 million, or $0.49 per boe, higher than the three months ended March 31, 2021, due to increased seismic surveying costs.

Depreciation, depletion and amortization (“DD&A”) during the three months ended March 31, 2022 was $10.2 million, or $0.55 per boe, higher than the three months ended March 31, 2021 due to increased production and a higher depreciable cost basis.

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For the three months ended March 31, 2022, the Company did not recognize any amortization of intangible assets, because the intangible assets were fully amortized in June 2021 as a result of the termination of the Non-Compete. During the three months ended March 31, 2021, the Company recognized $2.1 million of amortization of intangible assets.

General and administrative expenses during the three months ended March 31, 2022 were $3.3 million, or $0.99 per boe, lower than the three months ended March 31, 2021, primarily driven by the reduction in costs due to the termination of the Services Agreement in June 2021, partially offset by higher corporate payroll expenses related to increased employee headcount.

Interest expense, net, during the three months ended March 31, 2022 was $2.1 million higher than the three months ended March 31, 2021, primarily driven by the write-off of previously capitalized deferred financing costs in connection with the amendment to the RBL Facility during the first quarter of 2022.

Liquidity and Capital Resources

Magnolia’s primary source of liquidity and capital has been its cash flows from operations. The Company’s primary uses of cash have been for acquisitions of oil and natural gas properties and related assets, development of the Company’s oil and natural gas properties, share repurchases, and general working capital needs.

The Company may also utilize borrowings under other various financing sources available to it, including its Amended and Restated RBL Facility and the issuance of equity or debt securities through public offerings or private placements, to fund Magnolia’s acquisitions and long-term liquidity needs. Magnolia’s ability to complete future offerings of equity or debt securities and the timing of these offerings will depend upon various factors, including prevailing market conditions and the Company’s financial condition. The Company anticipates its current cash balance, cash flows from operations, and its available sources of liquidity to be sufficient to meet the Company’s cash requirements.

As of March 31, 2022, the Company had $400.0 million of principal debt related to the 2026 Senior Notes outstanding and no outstanding borrowings related to the Amended and Restated RBL Facility. As of March 31, 2022, the Company had $796.4 million of liquidity comprised of the $450.0 million of borrowing base capacity of the Amended and Restated RBL Facility, and $346.4 million of cash and cash equivalents.

Cash and Cash Equivalents

At March 31, 2022, Magnolia had $346.4 million of cash and cash equivalents. The Company’s cash and cash equivalents are maintained with various financial institutions in the United States. Deposits with these institutions may exceed the amount of insurance provided on such deposits. However, the Company regularly monitors the financial stability of such financial institutions and believes that the Company is not exposed to any significant default risk.

21

Sources and Uses of Cash and Cash Equivalents

The following table presents the sources and uses of the Company’s cash and cash equivalents for the periods presented:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Sources of cash and cash equivalents
Net cash provided by operating activities	$	238,869	$	118,153
Uses of cash and cash equivalents
Acquisitions	$	(1,055)	$	(558)
Additions to oil and natural gas properties	(84,230)		(40,166)
Changes in working capital associated with additions to oil and natural gas properties	13,946		(1,744)
Class A Common Stock repurchases	(43,486)		(20,281)
Class B Common Stock purchases and cancellations	(84,733)		(50,781)
Non-compete settlement	—		(17,152)
Dividends paid	(37,174)		—
Distributions to noncontrolling interest owners	(11,637)		(155)
Other	(11,086)		(1,683)
	(259,455)		(132,520)
Decrease in cash and cash equivalents	$	(20,586)	$	(14,367)

Sources of Cash and Cash Equivalents

Net Cash Provided by Operating Activities

Operating cash flows are the Company’s primary source of liquidity and are impacted, in the short- and long-term, by oil and natural gas prices. The factors that determine operating cash flows are largely the same as those that affect net earnings, with the exception of certain non-cash expenses such as DD&A, the non-cash portion of exploration expenses, asset retirement obligations accretion, and deferred income tax expense.

Net cash provided by operating activities totaled $238.9 million and $118.2 million for the three months ended March 31, 2022 and 2021, respectively. During the three months ended March 31, 2022, cash provided by operating activities was positively impacted by increased oil, natural gas, and NGL prices, partially offset by higher operating expenses and income tax payments.

Uses of Cash and Cash Equivalents

Acquisitions

The Company made individually insignificant bolt-on acquisitions during each of the three months ended March 31, 2022 and 2021.

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Additions to Oil and Natural Gas Properties

The following table sets forth the Company’s capital expenditures for the three months ended March 31, 2022 and 2021:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Drilling and completion	$	83,357	$	38,850
Leasehold acquisition costs	873		1,316
Total capital expenditures	$	84,230	$	40,166

During the first quarter of 2022, Magnolia was running a two-rig program. One rig drilled multi-well development pads in the Giddings area. The second rig drilled a mix of wells in both the Karnes and Giddings areas. The number of operated drilling rigs is largely dependent on commodity prices and the Company’s strategy of maintaining spending to accommodate the Company’s business model.

Capital Requirements

The Company’s board of directors has authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame and whether the Company undertakes these additional repurchases is ultimately subject to numerous considerations, market conditions, and other factors. During the three months ended March 31, 2022 and 2021, the Company repurchased 1.5 million and 2.0 million shares for a total cost of approximately $33.3 million and $20.3 million, respectively.

During the three months ended March 31, 2022, the Company also repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the three months ended March 31, 2022 and 2021, Magnolia LLC repurchased and subsequently canceled 3.9 million and 5.0 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $84.7 million and $50.8 million of cash consideration, respectively. As of March 31, 2022, Magnolia owned approximately 84.0% of the interest in Magnolia LLC and the noncontrolling interest was approximately 16.0%.

In January 2021, the Company amended the Non-Compete such that, rather than delivering an aggregate of 4.0 million shares of Class A Common Stock upon the two and one-half year and the four year anniversaries of July 31, 2018 (the “Closing Date”), the Company would deliver (i) the cash value of approximately 2.0 million shares of Class A Common Stock and approximately 0.4 million shares of Class A Common Stock on the two and one-half year anniversary of the Closing Date and (ii) an aggregate of 1.6 million shares of Class A Common Stock on the four year anniversary of the Closing Date, in each case subject to the terms and conditions of the Non-Compete. On February 1, 2021, as consideration for compliance with the Non-Compete, the Company paid $17.2 million in cash and issued 0.4 million shares of Class A Common Stock. On June 30, 2021, as part of the Second Non-Compete Amendment, the Company paid $24.9 million in cash in lieu of delivering the remaining 1.6 million shares of Class A Common Stock.

On February 3, 2022, the Company’s board of directors declared a cash dividend of $0.20 per share of Class A Common Stock totaling $37.3 million, of which $37.2 million was paid as of March 31, 2022. In addition, $8.6 million was distributed to the Magnolia LLC Unit Holders. The amount and frequency of future dividends is subject to the discretion of the Company’s board of directors and primarily depends on earnings, capital expenditures, debt covenants, and various other factors.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk

For variable rate debt, interest rate changes generally do not affect the fair market value of such debt, but do impact future earnings and cash flows, assuming other factors are held constant. The Company is subject to market risk exposure related to changes in interest rates on borrowings under the Amended and Restated RBL Facility. Interest on borrowings under the RBL Facility is based on the SOFR rate or alternative base rate plus an applicable margin as stated in the agreement governing the Amended and Restated RBL Facility. At March 31, 2022, the Company had no borrowings outstanding under the Amended and Restated RBL Facility.

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Commodity Price Risk

Magnolia’s primary market risk exposure is to the prices it receives for its oil, natural gas, and NGL production. The prices the Company ultimately realizes for its oil, natural gas, and NGLs are based on a number of variables, including prevailing index prices attributable to the Company’s production and certain differentials to those index prices. Pricing for oil, natural gas, and NGLs has historically been volatile and unpredictable, and this volatility is expected to continue in the future. The prices the Company receives for production depend on factors outside of its control, including physical markets, supply and demand, financial markets, and national and international policies. A $1.00 per barrel increase (decrease) in the weighted average oil price for the three months ended March 31, 2022 would have increased (decreased) the Company’s revenues by approximately $11.3 million on an annualized basis and a $0.10 per Mcf increase (decrease) in the weighted average natural gas price for the three months ended March 31, 2022 would have increased (decreased) the Company’s revenues by approximately $5.0 million on an annualized basis.

Item 4. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

As required by Rule 13a-15(b) under the Exchange Act, Magnolia has evaluated, under the supervision and with the participation of its management, including Magnolia’s principal executive officer and principal financial officer, the effectiveness of the design and operation of its disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of March 31, 2022. Based on such evaluation, Magnolia’s principal executive officer and principal financial officer have concluded that as of such date, the Company’s disclosure controls and procedures were effective. The Company’s disclosure controls and procedures are designed to provide reasonable assurance that the information required to be disclosed by it in reports that it files under the Exchange Act is accumulated and communicated to management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow for timely decisions regarding required disclosure and is recorded, processed, summarized, and reported within the time periods specified in the rules and forms of the SEC.

Changes in Internal Control over Financial Reporting

There were no changes in the system of internal control over financial reporting (as defined in Rule 13a-15(f) and Rule 15d-15(f) under the Exchange Act) during the quarter ended March 31, 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

See Part I, Item 1, Note 9—Commitments and Contingencies to the consolidated financial statements, which is incorporated herein by reference.

From time to time, the Company is party to certain legal actions and claims arising in the ordinary course of business. While the outcome of these events cannot be predicted with certainty, management does not currently expect these matters to have a materially adverse effect on the financial position or results of operations of the Company.

Item 1A. Risk Factors

Please refer to Part I, Item 1A - Risk Factors of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, and Part I, Item 3 - Quantitative and Qualitative Disclosures About Market Risk of this Quarterly Report on Form 10-Q. Any of these factors could result in a significant or material adverse effect on Magnolia’s business, results of operations, or financial condition. There have been no material changes to the Company’s risk factors since its 2021 Form 10-K. Additional risk factors not presently known to the Company or that the Company currently deems immaterial may also impair its business, results of operations, or financial condition.

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Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

The following table sets forth the Company’s share repurchase activities for each period presented.

Period	Number of Shares of Class A Common Stock Purchased	Average Price Paid per Share		Total Number of Shares of Class A Common Stock Purchased as Part of Publicly Announced Program	Maximum Number of Shares of Class A Common Stock that May Yet Be Purchased Under the Program (1)
January 1, 2022 - January 31, 2022	—	$	—	—	5,832,455
February 1, 2022 - February 28, 2022 (2)	620,052	20.96		69,237	15,763,218
March 1, 2022 - March 31, 2022	1,430,763	22.24		1,430,763	14,332,455
Total	2,050,815	$	21.85	1,500,000	14,332,455

(1)As of December 31, 2021, the Company’s board of directors had authorized a share repurchase program of up to 20.0 million shares of Class A Common Stock. In February 2022, the Company’s board of directors increased the share repurchase authorization by an additional 10.0 million shares of Class A Common Stock which increases total authorization to 30.0 million shares. The program does not require purchases to be made within a particular time frame.

(2)The Company repurchased 0.6 million shares of Class A Common Stock for $11.6 million in a privately negotiated transaction with EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the three months ended March 31, 2022, outside of the share repurchase program, Magnolia LLC repurchased and subsequently canceled a total of 3.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for cash consideration of $84.7 million at an average price of $21.46 per share. There is no public market for the Class B Common Stock. For further detail, see Note 11—Stockholders’ Equity in the Notes to the Company’s consolidated financial statements included in this Quarterly Report on Form 10-Q.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Mine Safety Disclosures

Not applicable.

Item 5. Other Information

Not applicable.

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Item 6. Exhibits

The following exhibits are filed as part of, or incorporated by reference into, this Quarterly Report on Form 10-Q:

Exhibit Number	Description
3.1*	Second Amended and Restated Certificate of Incorporation of the Company, dated as of July 31, 2018 (incorporated herein by reference to Exhibit 3.1 filed with the Current Report on Form 8-K filed on August 6, 2018 (File No. 001-38083)).
3.2*	Bylaws of the Company (incorporated herein by reference to Exhibit 3.3 filed with the Registration Statement on Form S-1 filed on April 17, 2017 (File No. 333-217338)).
10.1**	Form of 2022 Non-Employee Director Restricted Stock Unit Grant Notice and attached Form of Restricted Stock Unit Agreement under the Magnolia Oil & Gas Corporation Long Term Incentive Plan, as amended.
31.1**	Certification of Chief Executive Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2**	Certification of Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1***	Certifications Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
101.INS**	XBRL Instance Document.
101.SCH**	XBRL Taxonomy Extension Schema Document.
101.CAL**	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF**	XBRL Taxonomy Extension Definition Linkbase Document.
101.LAB**	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE**	XBRL Taxonomy Extension Presentation Linkbase Document.
104**	Cover Page Interactive Data File (embedded within the Inline XBRL and contained in Exhibit 101).

*    Incorporated herein by reference as indicated.

**    Filed herewith.

***    Furnished herewith.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	MAGNOLIA OIL & GAS CORPORATION
Date: May 10, 2022	By:	/s/ Stephen Chazen
		Stephen Chazen
		Chief Executive Officer (Principal Executive Officer)
Date: May 10, 2022	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Financial Officer (Principal Financial Officer)

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EX-10.1

Exhibit 10.1

MAGNOLIA OIL & GAS CORPORATION

LONG TERM INCENTIVE PLAN

NON-EMPLOYEE DIRECTOR RESTRICTED STOCK UNIT GRANT NOTICE

Pursuant to the terms and conditions of the Magnolia Oil & Gas Corporation Long Term Incentive Plan, as amended from time to time (the “Plan”), Magnolia Oil & Gas Corporation (the “Company”) hereby grants to the individual listed below (“you” or the “Participant”) the number of Restricted Stock Units (“RSUs”) set forth below in this Restricted Stock Unit Grant Notice (this “Grant Notice”). This award of RSUs (this “Award”) is subject to the terms and conditions set forth herein, in the Restricted Stock Unit Agreement attached hereto as Exhibit A (the “Agreement”), in the Plan attached hereto as Exhibit B and, if timely completed and submitted by you, in the applicable Non-Employee Director Restricted Stock Unit Settlement Election Form (the “Settlement Election Form”), each of which is incorporated herein by reference. Capitalized terms used but not defined herein shall have the meanings set forth in the Plan.

Participant:	__________________________________
Date of Grant:	May 3, 2022
Total Number of Restricted Stock Units:	__________________________________
Vesting Commencement Date:	May 3, 2022 (“Vesting Commencement Date”)
Vesting Schedule:	Subject to the terms and conditions of this Grant Notice, the Agreement, and the Plan, the RSUs shall vest on the earlier to occur of: (i) the day preceding the next annual meeting of stockholders of the Company at which directors are elected or (ii) the first anniversary of the Vesting Commencement Date, in each case, so long as you remain a director or service provider to the Company or an Affiliate, as applicable, from the Date of Grant through such date. Notwithstanding the foregoing, (i) in the event that, in connection with or following a Change in Control, you cease to serve as a director or a service provider to the Company or an Affiliate, the RSUs will vest in full upon such cessation of service, and (ii) in the event of a Change in Control pursuant to which the successor company or a parent or subsidiary thereof does not assume the RSUs, then so long as you have continued to provide services to the Company or an Affiliate, as applicable, from the Date of Grant through the date of such Change in Control, the RSUs will vest in full upon such Change in Control. In accordance with of Section 7(b) the Plan, you may elect to defer settlement of the RSUs until you are no longer a director or service provider to the Company or an Affiliate or the occurrence of a Change in Control. Any deferral election must be made pursuant to a Settlement Election Form in compliance with such rules and procedures as the Committee deems advisable.
Settlement Event:	RSUs that have vested in accordance with the terms of this Grant Notice will be settled on the applicable date as elected by you on a timely submitted Settlement Election Form or, if no such form is timely submitted by you, then on the date of vesting of the RSUs (such date or event, a “Settlement Event”). Absent a provision in the Agreement or the Plan to the contrary, Stock with respect to vested RSUs will be delivered to you within 60 days following the applicable Settlement Event. Regardless of whether you have timely submitted a Settlement Election Form, Dividend Equivalent payments will be paid to you at the time or times set forth in Section 3 of the Agreement.

By clicking to accept, you agree to be bound by the terms and conditions of the Agreement, the Plan, and this Grant Notice. You acknowledge that you have reviewed in their entirety and fully understand all provisions of the Agreement, the Plan, and this Grant Notice. You hereby agree to accept as binding, conclusive and final all decisions or interpretations of the Committee regarding any questions or determinations arising under the Agreement, the Plan, or this Grant Notice.

In lieu of receiving documents in paper format, you agree, to the fullest extent permitted by applicable law, to accept electronic delivery of any documents that the Company may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, account statements, annual and quarterly reports, and all other forms of communications) in connection with this Award. Electronic delivery may be via a Company electronic mail system or by reference to a location on a Company intranet to which you have access. You hereby consent to all procedures the Company has established or may establish for an electronic signature system for delivery and acceptance of any such documents.

You acknowledge and agree that clicking to accept this Award constitutes your electronic signature and is intended to have the same force and effect as your manual signature.

[Remainder of Page Intentionally Blank; Signature Page Follows]

2

IN WITNESS WHEREOF, the Company has caused this Grant Notice to be executed by an officer thereunto duly authorized, effective for all purposes as provided above.

MAGNOLIA OIL & GAS CORPORATION

By:

Title: President, Chief Executive Officer, and Chairman

Name: Stephen Chazen

[Signature Page]

3

EXHIBIT A

RESTRICTED STOCK UNIT AGREEMENT

This Restricted Stock Unit Agreement (together with the Grant Notice, this “Agreement”) is made as of the Date of Grant set forth in the Grant Notice (the “Date of Grant”) by and between Magnolia Oil & Gas Corporation, a Delaware corporation (the “Company”), and [________________] (the “Participant”). Capitalized terms used but not specifically defined herein shall have the meanings specified in the Plan or the Grant Notice.

1. Award. For good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, effective as of the Date of Grant, the Company hereby grants to the Participant the number of RSUs set forth in the Grant Notice on the terms and conditions set forth in the Grant Notice, this Agreement, and the Plan, which is incorporated herein by reference. In the event of any inconsistency between the Plan and this Agreement, the terms of the Plan shall control. To the extent vested, each RSU represents the right to receive one share of Stock, subject to the terms and conditions set forth in the Grant Notice, this Agreement, and the Plan. Prior to settlement of this Award, the RSUs and this Award represent an unsecured and unfunded obligation of the Company. Consistent with the terms of the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the terms of the Plan or the Agreement shall be within the sole discretion of the Committee and shall be final, conclusive, and binding upon all persons.

2. Vesting of RSUs.

(a) The RSUs shall vest in accordance with the vesting schedule and other vesting terms set forth in the Grant Notice. Except in the case of vesting pursuant to a qualifying termination of service as set forth in the Grant Notice, in the event of the termination of the Participant’s service prior to the vesting of all of the RSUs, all unvested RSUs (and all rights arising from such RSUs and from being a holder thereof) will terminate automatically without any further action by the Company and will be forfeited without consideration or notice on the date of such termination.

(b) Notwithstanding any provision herein to the contrary, in the event of any inconsistency between this Section 2 and any written agreement entered into by and between the Participant and the Company or an Affiliate, as applicable, the terms of such agreement shall control.

3. Dividend Equivalents. In the event that the Company declares and pays a dividend in respect of its outstanding shares of Stock and, on the record date for such dividend, the Participant holds RSUs granted pursuant to this Agreement that have not been settled or forfeited as of such record date, the Company shall pay dividend equivalents to the Participant in the form of cash in an amount equal to the cash dividends the Participant would have received if the Participant was the holder of record, as of such record date, of the number of shares of Stock related to the portion of the Participant’s RSUs granted pursuant to this Agreement that have not been settled or forfeited as of such record date (the “Dividend Equivalents”), such payment to be made promptly following the date that the Company pays such dividend to its shareholders generally (each, a “Dividend Payment Date”) (however, in no event shall the Dividend Equivalents be paid later than 30 days following the Dividend Payment Date).

4. Settlement of RSUs. RSUs that have vested in accordance with the terms of the Grant Notice shall be settled within 60 days following the applicable Settlement Event (provided that the Participant shall not be allowed to designate the taxable year of the payment). Pursuant to this Section 4, the Company shall deliver to the Participant a number of shares of Stock equal to the number of vested RSUs. All shares of Stock issued hereunder shall be delivered either by delivering one or more certificates for such shares to the Participant or by entering such shares in book-entry form, as determined by the Committee in its sole discretion. In the event the Participant would otherwise become vested in a fractional portion of a RSU (a “Fractional RSU”) based on the vesting terms set forth in the Grant Notice, the Fractional RSU shall instead remain unvested until the final vesting date provided in the Grant Notice; provided, however, that if the Participant would otherwise vest in a subsequent Fractional RSU prior to the final vesting date for the RSUs and such Fractional RSU taken together with a previous Fractional RSU that remained unvested would equal a whole RSU, then such Fractional RSUs shall vest to the extent they equal a whole RSU. Upon the final vesting date, the value of any remaining Fractional RSUs shall be rounded up to the nearest whole RSU. The value of shares of Stock shall not bear any interest owing to the passage of time.

A-1

5. Non-Transferability. None of the RSUs, rights to receive Dividend Equivalents, or any interest or right therein may be sold, pledged, assigned, or transferred in any manner other than by will or the laws of descent and distribution, unless and until the shares of Stock underlying the RSUs have been issued (or, in the case of Dividend Equivalents, the Dividend Equivalents have been paid in cash), and all restrictions applicable to such shares have lapsed. Neither the RSUs nor any interest or right therein shall be liable for the debts, contracts or engagements of the Participant or his or her successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means, whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect against the Company and its Affiliates, except to the extent that such disposition is expressly permitted by the preceding sentence.

6. Compliance with Applicable Law. Notwithstanding any provision of this Agreement to the contrary, the issuance of shares of Stock hereunder will be subject to compliance with all requirements of applicable law with respect to such securities and with the requirements of any stock exchange or market system upon which the Stock may then be listed. No shares of Stock will be issued hereunder if such issuance would constitute a violation of any applicable law or regulation or the requirements of any stock exchange or market system upon which the Stock may then be listed. In addition, shares of Stock will not be issued hereunder unless (a) a registration statement under the Securities Act is in effect at the time of such issuance with respect to the shares to be issued, (b) in the opinion of legal counsel to the Company, the shares to be issued are permitted to be issued in accordance with the terms of an applicable exemption from the registration requirements of the Securities Act, or (c) the Company has attained from any regulatory body having jurisdiction the requisite authority, if any, deemed by the Company’s legal counsel to be necessary for the lawful issuance and sale of any shares of Stock hereunder. As a condition to any issuance of Stock hereunder, the Company may require the Participant to satisfy any requirements that may be necessary or appropriate to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect to such compliance.

7. Rights as a Stockholder. The Participant shall have no rights as a stockholder of the Company with respect to any shares of Stock that may become deliverable hereunder unless and until the Participant has become the holder of record of such shares of Stock, and no adjustments shall be made for dividends in cash or other property, distributions, or other rights in respect of any such shares of Stock, except as otherwise specifically provided for in the Plan or this Agreement.

8. Full Satisfaction. Any issuance or transfer of shares of Stock or other property to the Participant or the Participant’s legal representative, heir, legatee, or distributee in accordance with this Agreement shall be in full satisfaction of all claims of such person hereunder.

9. No Right of Continued Board Service or to Awards. Nothing in the adoption of the Plan, nor the grant of the RSUs thereunder pursuant to the Grant Notice and this Agreement, shall confer upon the Participant the right to continued service with the Board or the board of directors of any Affiliates. Nothing in the Plan or in this Agreement shall affect any right which the Company or any of its Affiliates may have to terminate the Board service of the Participant. The grant of the RSUs is a one-time benefit and does not create any contractual or other right to receive a grant of Awards or benefits in lieu of Awards in the future.

10. Agreement to Furnish Information. The Participant agrees to furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirement imposed upon the Company by or under any applicable statute or regulation.

11. Entire Agreement; Amendment. This Agreement, the Grant Notice, the Settlement Election Form (if applicable), and the Plan constitute the entire agreement of the parties with regard to the subject matter hereof, and contain all the covenants, promises, representations, warranties and agreements between the parties with respect to the RSUs granted hereby; provided¸ however, that the terms of this Agreement shall not modify and shall be subject to the terms and conditions of any service, consulting and/or severance agreement between the Company (or an Affiliate or other entity) and the Participant in effect as of the date a determination is to be made under this Agreement. Without limiting the scope of the preceding sentence, except as provided therein, all prior understandings and agreements, if any, among the parties hereto relating to the subject matter hereof are hereby null and void and of no further force and effect. The Committee may, in its sole discretion, amend this Agreement from time to time in any manner that is not inconsistent with the Plan.

A-2

12. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of Delaware, without regard to conflicts of law principles thereof.

13. Successors and Assigns. The Company may assign any of its rights under this Agreement without the Participant’s consent. This Agreement will be binding upon and inure to the benefit of the successors and assigns of the Company. Subject to the restrictions on transfer set forth herein and in the Plan, this Agreement will be binding upon the Participant and the Participant’s beneficiaries, executors, administrators and the person(s) to whom this Award may be transferred by will or the laws of descent or distribution.

14. Clawback. Notwithstanding any provision in this Agreement, the Grant Notice, the Settlement Election Form (if applicable), or the Plan to the contrary, to the extent required by (a) applicable law and/or (b) any policy that may be adopted or amended by the Board from time to time, all shares of Stock issued hereunder shall be subject to forfeiture, repurchase, recoupment and/or cancellation to the extent necessary to comply with such law(s) and/or policy.

15. Severability. If a court of competent jurisdiction determines that any provision of this Agreement (or any portion thereof) is invalid or unenforceable, then the invalidity or unenforceability of such provision (or portion thereof) shall not affect the validity or enforceability of any other provision of this Agreement, and all other provisions shall remain in full force and effect.

16. Section 409A. Notwithstanding anything herein or in the Plan to the contrary, the RSUs, any Dividend Equivalents, and all rights related thereto granted pursuant to this Agreement are intended to comply with or be exempt from the applicable requirements of the Nonqualified Deferred Compensation Rules and shall be limited, construed and interpreted in accordance with such intent. Notwithstanding the foregoing, the Company and its Affiliates make no representations that the RSUs, any Dividend Equivalents, and the rights related thereto provided under this Agreement are exempt from or compliant with the Nonqualified Deferred Compensation Rules and in no event shall the Company or any Affiliate be liable for all or any portion of any taxes, penalties, interest, or other expenses that may be incurred by the Participant on account of non-compliance with the Nonqualified Deferred Compensation Rules. The Participant’s service shall terminate on the date that he or she experiences a “separation from service” as defined under the Nonqualified Deferred Compensation Rules.

[Remainder of Page Intentionally Blank]

A-3

EXHIBIT B

MAGNOLIA OIL & GAS CORPORATION LONG TERM INCENTIVE PLAN

[SEE ATTACHED]

B-1

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Stephen Chazen, Chief Executive Officer of Magnolia Oil & Gas Corporation, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 10, 2022	By:	/s/ Stephen Chazen
		Stephen Chazen
		Chief Executive Officer (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO

RULES 13a-14(a) AND 15d-14(a) UNDER THE SECURITIES EXCHANGE ACT OF 1934,

AS ADOPTED PURSUANT TO SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Christopher Stavros, Chief Financial Officer of Magnolia Oil & Gas Corporation, certify that:

1.    I have reviewed this Quarterly Report on Form 10-Q of Magnolia Oil & Gas Corporation (the "registrant");

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.    The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c)    Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d)    Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting.

5.    The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):

(a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and

(b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.

Date: May 10, 2022	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Financial Officer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Magnolia Oil & Gas Corporation (the “Company”) on Form 10-Q for the period ended March 31, 2022, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), we, Stephen Chazen and Christopher Stavros, Principal Executive Officer and Principal Financial Officer, respectively, of the Company, certify, in the capacity and on the date indicated below, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1)    The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2)    The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 10, 2022	By:	/s/ Stephen Chazen
		Stephen Chazen
		Chief Executive Officer (Principal Executive Officer)

Date: May 10, 2022	By:	/s/ Christopher Stavros
		Christopher Stavros
		Chief Financial Officer (Principal Financial Officer)

XML

Cover - shares	3 Months Ended
	Mar. 31, 2022	May 06, 2022
Entity Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2022
Document Transition Report	false
Entity File Number	001-38083
Entity Registrant Name	Magnolia Oil & Gas Corp
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	81-5365682
Entity Address, Address Line One	Nine Greenway Plaza, Suite 1300
Entity Address, City or Town	Houston,
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77046
City Area Code	713
Local Phone Number	842-9050
Title of 12(b) Security	Class A Common Stock, par value $0.0001
Trading Symbol	MGY
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Central Index Key	0001698990
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q1
Amendment Flag	false
Class A Common Stock
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		187,439,431
Class B Common Stock
Entity Information [Line Items]
Entity Common Stock, Shares Outstanding		35,594,059

XML

Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
CURRENT ASSETS
Cash and cash equivalents	$ 346,396	$ 366,982
Accounts receivable	179,652	149,769
Drilling advances	2,516	615
Other current assets	1,688	552
Total current assets	530,252	517,918
PROPERTY, PLANT AND EQUIPMENT
Oil and natural gas properties	2,467,167	2,381,812
Other	7,173	7,036
Accumulated depreciation, depletion and amortization	(1,225,849)	(1,172,761)
Total property, plant and equipment, net	1,248,491	1,216,087
OTHER ASSETS
Deferred financing costs, net	7,017	3,701
Other long-term assets	8,854	9,036
Total other assets	15,871	12,737
TOTAL ASSETS	1,794,614	1,746,742
CURRENT LIABILITIES
Accounts payable	134,652	127,909
Other current liabilities (Note 7)	104,082	90,636
Total current liabilities	238,734	218,545
LONG-TERM LIABILITIES
Long-term debt, net	388,647	388,087
Asset retirement obligations, net of current	90,523	89,715
Other long-term liabilities	4,342	5,146
Total long-term liabilities	483,512	482,948
COMMITMENTS AND CONTINGENCIES (Note 9)
Additional paid-in capital	1,649,111	1,689,500
Treasury Stock, at cost, 16,218 shares and 14,168 shares in 2022 and 2021, respectively	(209,418)	(164,599)
Accumulated deficit	(542,129)	(708,168)
Noncontrolling interest	174,780	228,492
Total equity	1,072,368	1,045,249
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY	1,794,614	1,746,742
Class A Common Stock
Common stock	20	19
Class B Common Stock
Common stock	$ 4	$ 5

XML

Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2022	Dec. 31, 2021
Treasury stock (in shares)	16,218,000	14,168,000
Class A Common Stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	1,300,000,000	1,300,000,000
Common stock, shares issued (in shares)	203,762,000	193,437,000
Common stock, shares outstanding (in shares)	187,543,000	179,270,000
Class B Common Stock
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock, shares authorized (in shares)	225,000,000	225,000,000
Common stock, shares issued (in shares)	35,594,000	49,293,000
Common stock, shares outstanding (in shares)	35,594,000	49,293,000

XML

Consolidated Statements of Operations (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
REVENUES
Total revenues	$ 377,839	$ 209,107
OPERATING EXPENSES
Lease operating expenses	28,744	19,392
Gathering, transportation and processing	15,840	10,243
Taxes other than income	20,882	10,762
Exploration expenses	5,538	2,062
Asset retirement obligations accretion	789	1,331
Depreciation, depletion and amortization	53,106	42,944
Amortization of intangible assets	0	2,113
General and administrative expenses	17,070	20,364
Total operating expenses	141,969	109,211
OPERATING INCOME	235,870	99,896
OTHER INCOME (EXPENSE)
Interest expense, net	(9,357)	(7,294)
Loss on derivatives, net	0	(482)
Other income (expense), net	207	(229)
Total other expense, net	(9,150)	(8,005)
INCOME BEFORE INCOME TAXES	226,720	91,891
Income tax expense	18,100	399
NET INCOME	208,620	91,492
LESS: Net income attributable to noncontrolling interest	42,581	28,248
NET INCOME ATTRIBUTABLE TO CLASS A COMMON STOCK	$ 166,039	$ 63,244
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING
Basic (in shares)	182,578	166,952
Diluted (in shares)	183,163	169,636
Class A Common Stock
NET INCOME PER SHARE OF CLASS A COMMON STOCK
Basic (in dollars per share)	$ 0.90	$ 0.38
Diluted (in dollars per share)	$ 0.90	$ 0.37
Oil revenues
REVENUES
Total revenues	$ 262,667	$ 146,958
Natural gas revenues
REVENUES
Total revenues	56,580	35,663
Natural gas liquids revenues
REVENUES
Total revenues	$ 58,592	$ 26,486

XML

Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) - USD ($) shares in Thousands, $ in Thousands	Total	Class A Common Stock	Class B Common Stock	Total Stockholders’ Equity	Total Stockholders’ Equity Class A Common Stock	Common Stock Class A Common Stock	Common Stock Class B Common Stock	Additional Paid In Capital	Additional Paid In Capital Class B Common Stock	Treasury Stock	Treasury Stock Class A Common Stock	Retained Earnings/ Accumulated Deficit	Noncontrolling Interest	Noncontrolling Interest Class B Common Stock
Balance at beginning of period (in shares) at Dec. 31, 2020						168,755	85,790			5,475
Balance at beginning of period at Dec. 31, 2020	$ 839,422			$ 548,162		$ 17	$ 9	$ 1,712,544		$ (38,958)		$ (1,125,450)	$ 291,260
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	2,705			1,835				1,835					870
Changes in ownership interest adjustment	0			28,924				28,924					(28,924)
Common stock issued related to stock based compensation and other, net (in shares)						244
Common stock issued related to stock based compensation and other, net	(1,238)			(839)				(839)					(399)
Class A Common Stock repurchases (in shares)											1,973
Class A Common Stock repurchases		$ (20,281)			$ (20,281)						$ (20,281)
Class B Common Stock purchase and cancellation (in shares)							(5,000)
Class B Common Stock purchase and cancellation			$ (50,781)				$ (1)		$ 1					$ (50,781)
Non-compete settlement (in shares)						375
Non-compete settlement	(17,152)			(11,231)				(11,231)					(5,921)
Stock redeemed (in shares)						14,166	(14,166)
Conversion of Class B Common Stock to Class A Common Stock	0					$ 1	$ (1)
Distributions to noncontrolling interest owners	(155)												(155)
Net income	91,492			63,244								63,244	28,248
Balance at end of period (in shares) at Mar. 31, 2021						183,540	66,624			7,448
Balance at end of period at Mar. 31, 2021	844,012			609,814		$ 18	$ 7	1,731,234		$ (59,239)		(1,062,206)	234,198
Balance at beginning of period (in shares) at Dec. 31, 2021						193,437	49,293			14,168
Balance at beginning of period at Dec. 31, 2021	1,045,249			816,757		$ 19	$ 5	1,689,500		$ (164,599)		(708,168)	228,492
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Stock based compensation expense, net of forfeitures	2,885			2,360				2,360					525
Changes in ownership interest adjustment	0			(595)				(595)					595
Common stock issued related to stock based compensation and other, net (in shares)						576
Common stock issued related to stock based compensation and other, net	(5,914)			(4,871)				(4,871)					(1,043)
Class A Common Stock repurchases (in shares)											2,050
Class A Common Stock repurchases		$ (44,819)			$ (44,819)						$ (44,819)
Class B Common Stock purchase and cancellation (in shares)							(3,950)
Class B Common Stock purchase and cancellation			$ (84,733)											$ (84,733)
Stock redeemed (in shares)						(9,749)	9,749
Conversion of Class B Common Stock to Class A Common Stock	0					$ (1)	$ 1
Distributions to noncontrolling interest owners	(11,637)												(11,637)
Dividends declared ($0.20 per share)	(37,283)			(37,283)				(37,283)
Net income	208,620			166,039								166,039	42,581
Balance at end of period (in shares) at Mar. 31, 2022						203,762	35,594			16,218
Balance at end of period at Mar. 31, 2022	$ 1,072,368			$ 897,588		$ 20	$ 4	$ 1,649,111		$ (209,418)		$ (542,129)	$ 174,780

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Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
CASH FLOWS FROM OPERATING ACTIVITIES
NET INCOME	$ 208,620	$ 91,492
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization	53,106	42,944
Amortization of intangible assets	0	2,113
Asset retirement obligations accretion	789	1,331
Amortization of deferred financing costs	2,812	910
Unrealized loss on derivatives, net	0	482
Stock based compensation	2,885	2,705
Other	0	(84)
Changes in operating assets and liabilities:
Accounts receivable	(29,883)	(25,670)
Accounts payable	6,743	11,499
Accrued liabilities	(2,451)	(12,997)
Drilling advances	(1,901)	2,823
Other assets and liabilities, net	(1,851)	605
Net cash provided by operating activities	238,869	118,153
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisitions	(1,055)	(558)
Additions to oil and natural gas properties	(84,230)	(40,166)
Changes in working capital associated with additions to oil and natural gas properties	13,946	(1,744)
Other investing	131	(416)
Net cash used in investing activities	(71,208)	(42,884)
CASH FLOW FROM FINANCING ACTIVITIES
Non-compete settlement	0	(17,152)
Dividends paid	(37,174)	0
Cash paid for debt modification	(5,272)	0
Distributions to noncontrolling interest owners	(11,637)	(155)
Other financing activities	(5,945)	(1,267)
Net cash used in financing activities	(188,247)	(89,636)
NET CHANGE IN CASH AND CASH EQUIVALENTS	(20,586)	(14,367)
Cash and cash equivalents – Beginning of period	366,982	192,561
Cash and cash equivalents – End of period	346,396	178,194
Supplemental cash items:
Cash paid for income taxes	13,000	0
Cash paid for interest	12,225	12,441
Supplemental non-cash investing and financing activity:
Accruals or liabilities for capital expenditures	43,882	14,624
Supplemental non-cash lease operating activity:
Right-of-use assets obtained in exchange for operating lease obligations	404	53
Class A Common Stock
CASH FLOW FROM FINANCING ACTIVITIES
Common Stock repurchases	(43,486)	(20,281)
Class B Common Stock
CASH FLOW FROM FINANCING ACTIVITIES
Common Stock repurchases	$ (84,733)	$ (50,781)

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Consolidated Statements of Changes in Stockholders’ Equity (Unaudited) (Parenthetical) - $ / shares			3 Months Ended
	Feb. 03, 2022	Aug. 02, 2021	Mar. 31, 2022
Statement of Stockholders' Equity [Abstract]
Common stock, dividends, declared (in dollars per share)	$ 0.20	$ 0.08	$ 0.20

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Description of Business and Basis of Presentation

3 Months Ended

Mar. 31, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Description of Business and Basis of Presentation

Description of Business and Basis of Presentation

Organization and Nature of Operations

Magnolia Oil & Gas Corporation (the “Company” or “Magnolia”) is an independent oil and natural gas company engaged in the acquisition, development, exploration, and production of oil, natural gas, and natural gas liquid (“NGL”) reserves. The Company’s oil and natural gas properties are located primarily in Karnes County and the Giddings area in South Texas where the Company targets the Eagle Ford Shale and Austin Chalk formations. Magnolia’s objective is to generate stock market value over the long-term through consistent organic production growth, high full cycle operating margins, an efficient capital program with short economic paybacks, significant free cash flow after capital expenditures, and effective reinvestment of free cash flow.

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “2021 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the notes to the consolidated financial statements included in the Company’s 2021 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices. The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity. See Note 11—Stockholders’ Equity for further discussion of the noncontrolling interest.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

As of March 31, 2022, the Company’s significant accounting policies are consistent with those discussed in Note 1—Organization and Summary of Significant Accounting Policies of its consolidated financial statements contained in the Company’s 2021 Form 10-K.

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Revenue Recognition	3 Months Ended
	Mar. 31, 2022
Revenue from Contract with Customer [Abstract]
Revenue Recognition	Revenue RecognitionMagnolia’s revenues include the sale of crude oil, natural gas, and NGLs. The Company has concluded that disaggregating revenue by product type appropriately depicts how the nature, amount, timing, and uncertainty of revenue and cash flows are affected by economic factors and has reflected this disaggregation of revenue on the Company’s consolidated statements of operations for all periods presented. The Company’s receivables consist mainly of trade receivables from commodity sales and joint interest billings due from owners on properties the Company operates. Receivables from contracts with customers totaled $151.1 million as of March 31, 2022 and $125.1 million as of December 31, 2021. For further detail regarding the Company’s revenue recognition policies, please refer to Note 1—Organization and Summary of Significant Accounting Policies of the consolidated financial statements contained in the Company’s 2021 Form 10-K.

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Derivative Instruments

3 Months Ended

Mar. 31, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments

Derivative Instruments

The Company had settled all of its natural gas costless collar derivative contracts by September 30, 2021. From September 30, 2020 to September 30, 2021, Magnolia utilized natural gas costless collars to reduce its exposure to price volatility for a portion of its natural gas production volumes. The Company’s policies do not permit the use of derivative instruments for speculative purposes. Under the Company’s costless collar contracts, each collar had an established floor price and ceiling price. When the settlement price was below the floor price, the counterparty was required to make a payment to the Company and when the settlement price was above the ceiling price, the Company was required to make a payment to the counterparty.

The Company has elected not to designate any of its derivative instruments as hedging instruments. Accordingly, changes in the fair value of the Company’s derivative instruments were recorded immediately to earnings as “Loss on derivatives, net” on the Company’s consolidated statements of operations.

The following table summarizes the effects of derivative instruments on the Company’s consolidated statements of operations during the three months ended March 31, 2022 and 2021:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Derivative settlements, realized (loss)	$	—	$	—
Unrealized (loss) on derivatives	—		(482)
(Loss) on derivatives, net	$	—	$	(482)

The Company had no outstanding derivative contracts in place as of March 31, 2022.

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Fair Value Measurements

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Fair Value Measurements

Fair Value Measurements

Certain of the Company’s assets and liabilities are carried at fair value and measured either on a recurring or nonrecurring basis. The Company’s fair value measurements are based either on actual market data or assumptions that other market participants would use in pricing an asset or liability in an orderly transaction, using the valuation hierarchy prescribed by GAAP under Accounting Standards Codification (“ASC”) 820.

The three levels of the fair value hierarchy under ASC 820 are as follows:

Level 1 - Quoted prices (unadjusted) in active markets for identical investments at the measurement date are used.

Level 2 - Pricing inputs are other than quoted prices included within Level 1 that are observable for the investment, either directly or indirectly. Level 2 pricing inputs include quoted prices for similar investments in active markets, quoted prices for identical or similar investments in markets that are not active, inputs other than quoted prices that are observable for the investment, and inputs that are derived principally from or corroborated by observable market data by correlation or other means.

Level 3 - Pricing inputs are unobservable and include situations where there is little, if any, market activity for the investment. The inputs used in determination of fair value require significant judgment and estimation.

Recurring Fair Value Measurements

Debt Obligations

The carrying value and fair value of the financial instrument that is not carried at fair value in the accompanying consolidated balance sheets at March 31, 2022 and December 31, 2021 is as follows:

	March 31, 2022				December 31, 2021
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	388,647	$	407,460	$	388,087	$	411,500

The fair value of the 2026 Senior Notes at March 31, 2022 and December 31, 2021 is based on unadjusted quoted prices in an active market, which is considered a Level 1 input in the fair value hierarchy.

The Company has other financial instruments consisting primarily of receivables, payables, and other current assets and liabilities that approximate fair value due to the nature of the instruments and their relatively short maturities. Non-financial assets and liabilities initially measured at fair value include assets acquired and liabilities assumed in business combinations and asset retirement obligations.

Certain of the Company’s assets and liabilities are measured at fair value on a nonrecurring basis. Specifically, stock based compensation is not measured at fair value on an ongoing basis but is subject to fair value calculations in certain circumstances. For further detail, see Note 12—Stock Based Compensation in the Notes to the Company’s consolidated financial statements. There were no other nonrecurring fair value measurements as of March 31, 2022 or December 31, 2021.

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Intangible Assets

3 Months Ended

Mar. 31, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Intangible Assets

Intangible Assets

Non-Compete Agreement

On July 31, 2018 (the “Closing Date”), the Company and EnerVest, separate and apart from the Business Combination, entered into the Non-Compete, which prohibited EnerVest and certain of its affiliates from competing with the Company in the Eagle Ford Shale (the “Market Area”) until July 31, 2022 (“Prohibited Period End Date”). In January 2021, the Company amended the Non-Compete such that, rather than delivering an aggregate of 4.0 million shares of Class A Common Stock upon the two and one-half year and the four year anniversaries of the Closing Date, the Company would deliver (i) the cash value of approximately 2.0 million shares of Class A Common Stock and approximately 0.4 million shares of Class A Common Stock on the two and one-half year anniversary of the Closing Date and (ii) an aggregate of 1.6 million shares of Class A Common Stock on the four year anniversary of the Closing Date, in each case subject to the terms and conditions of the Non-Compete. On February 1, 2021, as consideration for compliance with the Non-Compete, the Company paid $17.2 million in cash and issued 0.4 million shares of Class A Common Stock.

On June 30, 2021, the Company amended the Non-Compete Prohibited Period End Date to terminate on June 30, 2021 and paid $24.9 million in cash in lieu of delivering the remaining 1.6 million shares of Class A Common Stock (the “Second Non-Compete Amendment”). The Second Non-Compete Amendment resulted in the Company accelerating the amortization of the remaining intangible assets. The Company includes the amortization in “Amortization of intangible assets” on the Company’s consolidated statements of operations.

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Other Current Liabilities

3 Months Ended

Mar. 31, 2022

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	March 31, 2022		December 31, 2021
Accrued capital expenditures	$	43,882	$	29,936
Accrued production taxes	12,235		10,084
Other	47,965		50,616
Total Other current liabilities	$	104,082	$	90,636

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Long-term Debt

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Long-term Debt

Long-term Debt

The Company’s debt is comprised of the following:

(In thousands)	March 31, 2022		December 31, 2021
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(11,353)		(11,913)
Long-term debt, net	$	388,647	$	388,087

Credit Facility

In connection with the consummation of the Business Combination, the RBL Facility was entered into by and among Magnolia Operating, as borrower, Magnolia Intermediate, as its holding company, the banks, financial institutions, and other lending institutions from time to time party thereto, as lenders, the other parties from time to time party thereto, and Citibank, N.A., as

administrative agent, collateral agent, issuing bank, and swingline lender, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $100.0 million sublimit. The RBL Facility is guaranteed by certain parent companies and subsidiaries of Magnolia LLC and is collateralized by certain of Magnolia Operating’s oil and natural gas properties.

On February 16, 2022, Magnolia Operating, as borrower, amended and restated the RBL Facility (“Amended and Restated RBL Facility”) in its entirety, providing for maximum commitments in an aggregate principal amount of $1.0 billion with a letter of credit facility with a $50.0 million sublimit, with an initial borrowing base of $450.0 million. The Amended and Restated RBL Facility matures in February 2026.

Borrowings under the Amended and Restated RBL Facility bear interest, at Magnolia Operating’s option, at a rate per annum equal to either the term SOFR rate or the alternative base rate plus the applicable margin. Additionally, Magnolia Operating is required to pay a commitment fee quarterly in arrears in respect of unused commitments under the Amended and Restated RBL Facility. The applicable margin and the commitment fee rate are calculated based upon the utilization levels of the Amended and Restated RBL Facility as a percentage of unused lender commitments then in effect.

The Amended and Restated RBL Facility contains certain affirmative and negative covenants customary for financings of this type, including compliance with a leverage ratio of less than 3.50 to 1.00 and a current ratio of greater than 1.00 to 1.00. As of March 31, 2022, the Company was in compliance with all covenants under the Amended and Restated RBL Facility. The Company incurred approximately $5.6 million of lender and transaction fees related to the modification of which $5.2 million were recorded as deferred financing costs and will be amortized prospectively over the remaining term of the Amended and Restated RBL Facility and $0.4 million of which were expensed and are reflected in “Interest expense, net” on the Company’s consolidated statements of operations for the three months ended March 31, 2022.

Deferred financing costs in connection with the Amended and Restated RBL Facility are amortized on a straight-line basis over a period of four years from February 2022 to February 2026 and included in “Interest expense, net” in the Company’s consolidated statements of operations. The Company recognized interest expense related to the Amended and Restated RBL Facility and the RBL facility, as applicable, of $2.8 million and $1.0 million for the three months ended March 31, 2022 and 2021, respectively. The unamortized portion of the deferred financing costs is included in “Deferred financing costs, net” on the accompanying consolidated balance sheet as of March 31, 2022.

The Company did not have any outstanding borrowings under the Amended and Restated RBL Facility as of March 31, 2022.

2026 Senior Notes

On July 31, 2018, the Issuers issued and sold $400.0 million aggregate principal amount of 2026 Senior Notes in a private placement under Rule 144A and Regulation S under the Securities Act of 1933, as amended. The 2026 Senior Notes were issued under the Indenture, dated as of July 31, 2018 (the “Indenture”), by and among the Issuers and Deutsche Bank Trust Company Americas, as trustee. The 2026 Senior Notes are guaranteed on a senior unsecured basis by the Company, Magnolia Operating, and Magnolia Intermediate and may be guaranteed by certain future subsidiaries of the Company. The 2026 Senior Notes will mature on August 1, 2026 and bear interest at the rate of 6.0% per annum.

On April 5, 2021, the terms of the Indenture were amended to modify, among other things, the criteria used by the Company to make Restricted Payments (as defined in the Indenture). The amendment to the Indenture was accounted for as a debt modification. Costs incurred with third parties directly related to the modification were expensed as incurred. The Company incurred approximately $1.1 million of transaction fees in the second quarter of 2021 related to the modification which were expensed. The Company also paid $5.0 million in fees to holders of the 2026 Senior Notes, which fees are recorded as deferred financing costs and amortized using the new effective interest rate applied prospectively over the remaining term of the 2026 Senior Notes.

As of March 31, 2022, the Company had incurred and capitalized a total of $16.8 million of deferred financing costs related to the issuance of, and the amendment to the Indenture governing, the 2026 Senior Notes. These costs are amortized using the effective interest method over the term of the 2026 Senior Notes and are included in “Interest expense, net” in the Company’s consolidated statements of operations. The unamortized portion of the deferred financing costs is included as a reduction to the carrying value of the 2026 Senior Notes, which has been recorded as “Long-term debt, net” on the Company’s consolidated balance sheet as of March 31, 2022. The Company recognized interest expense related to the 2026 Senior Notes of $6.6 million and $6.3 million for the three months ended March 31, 2022 and 2021, respectively.

At any time prior to August 1, 2022, the Issuers may, on any one or more occasions, redeem all or a part of the 2026 Senior Notes at a redemption price equal to 100% of the principal amount of the 2026 Senior Notes redeemed, plus a “make whole” premium on accrued and unpaid interest, if any, to, but excluding, the date of redemption. After August 1, 2022, the Issuers may redeem all or a part of the 2026 Senior Notes based on principal plus a set premium, as set forth in the Indenture, including any accrued and unpaid interest.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Legal Matters

From time to time, the Company is or may become involved in litigation in the ordinary course of business.

Certain of the Magnolia LLC Unit Holders and EnerVest Energy Institutional Fund XIV-C, L.P. (collectively the “Co-Defendants”) and the Company have been named as defendants in a lawsuit where the plaintiffs claim to be entitled to a minority working interest in certain Karnes County Assets. The litigation is in the pre-trial stage. The exposure related to this litigation is currently not reasonably estimable. The Co-Defendants retained all such liability in connection with the Business Combination.

A mineral owner in a Magnolia operated well in Karnes County, Texas filed a complaint with the Texas Railroad Commission (the “Commission”) challenging the validity of the permit to drill such well by questioning the long-standing process by which the Commission granted the permit. After the Commission affirmed the granting of the permit, and after judicial review of the Commission’s order by the 53rd Judicial District Court Travis County, Texas (the “District Court”), the District Court reversed and remanded the Commission’s order. The Commission and Magnolia have appealed the District Court’s judgment to the Third Court of Appeals in Austin, Texas.

At March 31, 2022, the Company does not believe the outcome of any such disputes or legal actions will have a material effect on its consolidated statements of operations, balance sheet, or cash flows. No amounts were accrued with respect to outstanding litigation at March 31, 2022 or March 31, 2021.

Environmental Matters

The Company, as an owner or lessee and operator of oil and natural gas properties, is subject to various federal, state, and local laws and regulations relating to discharge of materials into, and the protection of, the environment. These laws and regulations may, among other things, impose liability on a lessee under an oil and natural gas lease for the cost of pollution clean-up resulting from operations and subject the lessee to liability for pollution damages. In some instances, the Company may be directed to suspend or cease operations in an affected area. The Company maintains insurance coverage, which it believes is customary in the industry, although the Company is not fully insured against all environmental risks.

Risks and Uncertainties 

The Company’s revenue, profitability, and future growth are substantially dependent upon the prevailing and future prices for oil and natural gas, which depend on numerous factors beyond the Company’s control such as overall oil and natural gas production and inventories in relevant markets, economic conditions, the global political environment, regulatory developments, and competition from other energy sources. Oil and natural gas prices historically have been volatile and may be subject to significant fluctuations in the future.

The coronavirus disease 2019 (“COVID-19”) pandemic and related economic repercussions have created significant volatility, uncertainty, and turmoil in the oil and natural gas industry. While oil and natural gas prices increased in 2021 and 2022, demand and pricing may again decline if there is a resurgence of the outbreak across the U.S. or other locations across the world or as a result of any related social distancing guidelines, travel restrictions, and stay-at-home orders. The extent of any further impact of the pandemic, including the emergence and spread of variant strains of COVID-19, on the Company’s industry and business cannot be reasonably predicted at this time.

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Income Taxes

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

The Company’s income tax provision consists of the following components:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Current:
Federal	$	16,784	$	—
State	1,316		399
	18,100		399
Deferred:
Federal	—		—
State	—		—
	—		—
Income tax expense	$	18,100	$	399

The Company is subject to U.S. federal income tax, margin tax in the state of Texas, and Louisiana corporate income tax. The Company estimates its annual effective tax rate in recording its quarterly provision for income taxes in the various jurisdictions in which it operates. The Company’s effective tax rate for the three months ended March 31, 2022 and 2021 was 8.0% and 0.4%, respectively. As a result of impairments in the first quarter of 2020, the Company established full valuation allowances on the federal and state deferred tax assets, which resulted in additional differences between the effective tax rate and the statutory rate as of March 31, 2022 and March 31, 2021. The primary differences between the annual effective tax rate and the statutory rate of 21.0% are income attributable to noncontrolling interest, state taxes, and valuation allowances.

As of March 31, 2022, the Company did not have an accrued liability for uncertain tax positions and does not anticipate recognition of any significant liabilities for uncertain tax positions during the next 12 months. For the quarter ended March 31, 2022, no amounts were incurred for income tax uncertainties or interest and penalties. Currently, the Company is not aware of any issues under review that could result in significant payments, accruals, or a material deviation from its position. The Company’s tax years since its formation remain subject to possible income tax examinations by its major taxing authorities for all periods.

During the three months ended March 31, 2022, the Magnolia LLC Unit Holders redeemed 9.7 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public. Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. The redemption and exchange of these Magnolia LLC Units created additional tax basis in Magnolia LLC. There was no net tax impact as the Company recorded a full valuation allowance.

As of March 31, 2022, the Company’s net deferred tax asset was $204.6 million. Management assessed whether it is more-likely-than-not that it will generate sufficient taxable income to realize its deferred income tax assets, including the investment in partnership and net operating loss carryforwards. In making this determination, the Company considered all available positive and negative evidence and made certain assumptions. The Company considered, among other things, the overall business environment, its historical earnings and losses, current industry trends, and its outlook for future years. As of March 31, 2022, the Company assessed the realizability of the deferred tax assets and recorded a full valuation allowance of $204.6 million.

As commodity prices have improved during 2021 and 2022, Magnolia has begun to sustain a level of increased profitability such that, net of its net operating loss, Magnolia is beginning to project modest taxable income. Should this continue, increased weight will be given to positive operating results, along with projections of future taxable income, in determining whether future taxable income will be sufficient to provide for realization of the Company’s deferred tax assets, and if so, this new evidence may result in a change in estimate of the Company’s valuation allowance in the next 12 months.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

Class A Common Stock

At March 31, 2022, there were 203.8 million shares of Class A Common Stock issued and 187.5 million shares of Class A Common Stock outstanding. The holders of Class A Common Stock and Class B Common Stock vote together as a single class on all matters and are entitled one vote for each share held. There is no cumulative voting with respect to the election of directors, which results in the holders of more than 50% of the Company’s outstanding common shares being able to elect all of the directors, subject to

voting obligations under the Stockholder Agreement. In the event of a liquidation, dissolution, or winding up of the Company, the holders of the Class A Common Stock are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of stock, if any, having preference over the common stock. The holders of the Class A Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Class B Common Stock

At March 31, 2022, there were 35.6 million shares of Class B Common Stock issued and outstanding. Holders of Class B Common Stock vote together as a single class with holders of Class A Common Stock on all matters properly submitted to a vote of the stockholders. The holders of Class B Common Stock generally have the right to exchange all or a portion of their shares of Class B Common Stock, together with an equal number of Magnolia LLC Units, for the same number of shares of Class A Common Stock or, at Magnolia LLC’s option, an equivalent amount of cash. Upon the future redemption or exchange of Magnolia LLC Units held by any holder of Class B Common Stock, a corresponding number of shares of Class B Common Stock held by such holder of Class B Common Stock will be canceled. In the event of a liquidation, dissolution, or winding up of Magnolia LLC, the holders of the Class B Common Stock, through their ownership of Magnolia LLC Units, are entitled to share ratably in all assets remaining available for distribution to them after payment of liabilities and after provision is made for each class of units of Magnolia LLC, if any, having preference over the common units. The holders of the Class B Common Stock have no preemptive or other subscription rights, and there are no sinking fund provisions applicable to such shares.

Share Repurchases

The Company’s board of directors has authorized a share repurchase program of up to 30.0 million shares of Class A Common Stock. The program does not require purchases to be made within a particular time frame. As of March 31, 2022, the Company had repurchased 15.7 million shares under the program at a cost of $197.9 million.

During the three months ended March 31, 2022, the Company also repurchased 0.6 million shares of Class A Common Stock for $11.6 million from EnerVest Energy Institutional Fund XIV-C, L.P. outside of the share repurchase program.

During the three months ended March 31, 2022 Magnolia LLC repurchased and subsequently canceled 3.9 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $84.7 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 9.7 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

During the three months ended March 31, 2021 Magnolia LLC repurchased and subsequently canceled 5.0 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock for $50.8 million of cash consideration (the “Class B Common Stock Repurchases”). During the same period, the Magnolia LLC Unit Holders redeemed 14.2 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock and subsequently sold these shares to the public.

Magnolia did not receive any proceeds from the sale of shares of Class A Common Stock by the Magnolia LLC Unit Holders. Magnolia funded the Class B Common Stock Repurchases with cash on hand.

Dividends and Distributions

Distributions

On February 3, 2022, Magnolia LLC declared a cash distribution of $0.20 per Magnolia LLC Unit totaling $45.9 million, of which $37.3 million was distributed to the Company and $8.6 million was distributed to the Magnolia LLC Unit Holders.

On August 2, 2021, Magnolia LLC declared a cash distribution of $0.08 per Magnolia LLC Unit totaling $19.0 million, of which $14.2 million was distributed to the Company and $4.8 million was distributed to the Magnolia LLC Unit Holders.

The distributions to the Magnolia LLC Unit Holders were recorded as a reduction of noncontrolling interest on the Company’s consolidated balance sheets as of March 31, 2022 and December 31, 2021.

Dividends

On February 3, 2022, the Company’s board of directors declared a semi-annual cash dividend of $0.20 per share of Class A Common Stock totaling approximately $37.3 million. The dividend was paid on March 1, 2022 to shareholders of record as of the close of business on February 14, 2022.

On August 2, 2021, the Company’s board of directors declared a semi-annual interim cash dividend of $0.08 per share of Class A Common Stock totaling approximately $14.2 million. The dividend was paid on September 1, 2021 to shareholders of record as of the close of business on August 12, 2021.

Dividends in excess of retained earnings are recorded as a reduction of additional paid-in capital. The $37.3 million and $14.2 million dividends declared during the first quarter of 2022 and the third quarter of 2021, respectively, were recorded as a reduction of additional paid-in capital on the Company’s consolidated balance sheets as of March 31, 2022 and December 31, 2021.

Noncontrolling Interest

Noncontrolling interest in Magnolia’s consolidated subsidiaries includes amounts attributable to Magnolia LLC Units that were issued to the Magnolia LLC Unit Holders in connection with the Business Combination. The noncontrolling interest percentage is affected by various equity transactions such as issuances and repurchases of Class A Common Stock, the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) for Class A Common Stock, or the cancellation of Class B Common Stock (and corresponding Magnolia LLC Units). As of March 31, 2022, Magnolia owned approximately 84.0% of the interest in Magnolia LLC and the noncontrolling interest was approximately 16.0%.

In the first quarter of 2019, Magnolia Operating formed Highlander Oil & Gas Holdings LLC (“Highlander”) as a joint venture whereby MGY Louisiana LLC, a wholly owned subsidiary of Magnolia Operating, holds approximately 84.7% of the units of Highlander, with the remaining 15.3% attributable to noncontrolling interest.

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Stock Based Compensation

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

Stock Based Compensation

Stock Based Compensation

On October 8, 2018, the Company’s board of directors adopted the “Magnolia Oil & Gas Corporation Long Term Incentive Plan” (the “Plan”), effective as of July 17, 2018. A total of 16.8 million shares of Class A Common Stock have been authorized for issuance under the Plan as of March 31, 2022. The Company grants stock based compensation awards in the form of restricted stock units (“RSU”), performance stock units (“PSU”), and performance restricted stock units (“PRSU”) to eligible employees and directors to enhance the Company and its affiliates’ ability to attract, retain, and motivate persons who make important contributions to the Company and its affiliates by providing these individuals with equity ownership opportunities. Shares issued as a result of awards granted under the Plan are generally new shares of Class A Common Stock.

Stock based compensation expense is recognized net of forfeitures within “General and administrative expenses” and “Lease operating expenses” on the consolidated statements of operations and was $2.9 million and $2.7 million for the three months ended March 31, 2022 and 2021, respectively. The Company has elected to account for forfeitures of awards granted under the Plan as they occur in determining compensation expense.

The following table presents a summary of Magnolia’s unvested RSU, PSU, and PRSU activity for the three months ended March 31, 2022.

	Restricted Stock Units			Performance Stock Units			Performance Restricted Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2021	1,187,509	$	8.94	460,414	$	9.20	968,654	$	9.36
Granted	241,671	20.29		—	—		506,703	19.14
Granted for performance multiple(1)	—	—		90,965	13.88		—	—
Vested	(315,842)	9.31		(272,894)	13.88		(212,687)	9.33
Forfeited	(6,736)	10.38		—	—		(936)	11.38
Unvested at March 31, 2022	1,106,602	$	11.33	278,485	$	6.14	1,261,734	$	13.29

(1) Upon completion of the performance period for the PSUs granted in 2019, a performance multiple of 150% was applied to each of the grants resulting in additional grants of PSUs in 2022.

Restricted Stock Units

The Company grants service-based RSU awards to employees, which generally vest ratably over a three-year or four-year service period, and to non-employee directors, which vest in full after one year. RSUs represent the right to receive shares of Class A Common Stock at the end of the vesting period equal to the number of RSUs that vest. RSUs are subject to restrictions on transfer and are generally subject to a risk of forfeiture if the award recipient ceases to be an employee or director of the Company prior to vesting of the award. Compensation expense for the service-based RSU awards is based upon the grant date market value of the award and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards. The aggregate fair value of RSUs that vested during the three months ended March 31, 2022 and 2021 was $7.9 million and $4.0 million, respectively. Unrecognized compensation expense related to unvested RSUs as of March 31, 2022 was $9.9 million, which the Company expects to recognize over a weighted average period of 2.8 years.

Performance Stock Units and Performance Restricted Stock Units

The Company grants PRSUs to certain employees. Each PRSU represents the contingent right to receive one share of Class A Common Stock once the PRSU is both vested and earned. PRSUs generally vest either ratably over a three-year service period or at the end of a three-year service period, in each case, subject to the recipient’s continued employment or service through each applicable vesting date. Each PRSU is earned based on whether Magnolia’s stock price achieves a target average stock price for any 20 consecutive trading days during the five-year performance period. If PRSUs are not earned by the end of the five-year performance period (“Performance Condition”), the PRSUs will be forfeited and no shares of Class A Common Stock will be issued, even if the vesting conditions have been met. Compensation expense for the PRSU awards is based upon grant date fair market value of the award, calculated using a Monte Carlo simulation, as presented below, and such costs are recorded on a straight-line basis over the requisite service period for each separately vesting portion of the award, as if the award was, in-substance, multiple awards, as applicable. The aggregate fair value of PRSU awards that vested during the three months ended March 31, 2022 was $4.8 million. Unrecognized compensation expense related to unvested PRSUs as of March 31, 2022 was $14.9 million, which the Company expects to recognize over a weighted average period of 2.6 years.

The Company grants PSUs to certain employees. Each PSU, to the extent earned, represents the contingent right to receive one share of Class A Common Stock and the awardee may earn between zero and 150% of the target number of PSUs granted based on the total shareholder return (“TSR”) of the Class A Common Stock relative to the TSR achieved by a specific industry peer group over a three-year performance period, the last day of which is also the vesting date. In addition to the TSR conditions, vesting of the PSUs is subject to the awardee’s continued employment through the date of settlement of the PSUs, which will occur within 60 days following the end of the performance period. The aggregate fair value of PSU awards that vested during the three months ended March 31, 2022 and 2021 was $5.5 million and $0.1 million, respectively. Unrecognized compensation expense related to unvested PSUs as of March 31, 2022 was $0.5 million, which the Company expects to recognize over a weighted average period of 0.8 years.

The grant date fair values of the PRSUs granted during the three months ended March 31, 2022 and 2021, were $9.7 million and $9.4 million, respectively. Since the Performance Condition for the PRSUs granted in 2022 and 2021 were met on March 28, 2022 and March 17, 2021, respectively, the fair value of the PRSUs granted after the Performance Condition were met were based upon the grant date market value of the award. The fair values of the awards granted prior to the date the Performance Condition was met were determined using a Monte Carlo simulation. The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PRSUs in 2022 and 2021.

	Three Months Ended
PRSU Grant Date Fair Value Assumptions	March 31, 2022	March 31, 2021
Expected term (in years)	3.55	3.64
Expected volatility	59.58%	55.18%
Risk-free interest rate	1.89%	0.56%
Dividend yield	1.97%	—%

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Earnings Per Share

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Earnings Per Share

Earnings Per ShareThe Company’s unvested share-based payment awards that contain nonforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are deemed participating securities, and therefore dividends and net income allocated to such awards have been deducted from earnings in computing basic and diluted net income per share under the two-class method. Diluted net income per share attributable to common stockholders is calculated under both the two-class method and the treasury stock method and the more dilutive of the two calculations is presented.

The components of basic and diluted net income per share attributable to common stockholders are as follows:

	Three Months Ended
(In thousands, except per share data)	March 31, 2022		March 31, 2021
Basic:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,416		213
Net income, net of participating securities	$	164,623	$	63,031
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Net income per share of Class A Common Stock - basic	$	0.90	$	0.38
Diluted:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,413		210
Net income, net of participating securities	$	164,626	$	63,034
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Add: Dilutive effect of stock based compensation and other	585		2,684
Weighted average number of common shares outstanding during the period - diluted	183,163		169,636
Net income per share of Class A Common Stock - diluted	$	0.90	$	0.37

For the three months ended March 31, 2022, the Company excluded 44.3 million of weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units) as the effect was anti-dilutive. For the three months ended March 31, 2021, the Company excluded 80.3 million weighted average shares of Class A Common Stock issuable upon the exchange of Class B Common Stock (and corresponding Magnolia LLC Units), as the effect was anti-dilutive.

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Related Party Transactions

3 Months Ended

Mar. 31, 2022

Related Party Transactions [Abstract]

Related Party Transactions

Related Party Transactions

As of March 31, 2022, EnerVest Energy Institutional Fund XIV-A, L.P., a Delaware limited partnership, which is part of the Magnolia LLC Unit Holders, held more than 10% of the Company’s common stock and qualified as a principal owner of the Company, as defined in ASC 850, “Related Party Disclosures.”

Distributions

On February 3, 2022, Magnolia LLC declared a cash distribution of $0.20 per Magnolia LLC Unit totaling $45.9 million, of which $5.7 million was distributed to EnerVest Energy Institutional Fund XIV-A, L.P.

Class B Common Stock Repurchases and Redemptions

During the three months ended March 31, 2022, EnerVest Energy Institutional Fund XIV-A, L.P. received $56.1 million in cash and surrendered 2.6 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock. EnerVest Energy Institutional Fund XIV-A, L.P. also redeemed 6.5 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock, which were subsequently sold to the public.

During the three months ended March 31, 2021, EnerVest Energy Institutional Fund XIV-A, L.P. received $33.6 million in cash and surrendered 3.3 million Magnolia LLC Units with an equal number of shares of corresponding Class B Common Stock. EnerVest Energy Institutional Fund XIV-A, L.P. also redeemed 9.4 million Magnolia LLC Units (and a corresponding number of shares of Class B Common Stock) for an equivalent number of shares of Class A Common Stock, which were subsequently sold to the public.

During the three months ended March 31, 2022 and 2021, Magnolia LLC subsequently canceled the surrendered Magnolia LLC Units and a corresponding number of shares of Class B Common Stock. Magnolia did not receive any proceeds from the sales of shares of Class A Common Stock by EnerVest Energy Institutional Fund XIV-A, L.P.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2022

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission (“SEC”) for interim financial reporting. Accordingly, certain disclosures normally included in an Annual Report on Form 10-K have been omitted. The consolidated financial statements and related notes included in this Quarterly Report should be read in conjunction with the Company’s consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “2021 Form 10-K”). Except as disclosed herein, there have been no material changes to the information disclosed in the notes to the consolidated financial statements included in the Company’s 2021 Form 10-K.

In the opinion of management, all normal, recurring adjustments and accruals considered necessary to present fairly, in all material respects, the Company’s interim financial results have been included. Operating results for the periods presented are not necessarily indicative of expected results for the full year.

Certain reclassifications of prior period financial statements have been made to conform to current reporting practices. The consolidated financial statements include the accounts of the Company and its subsidiaries after elimination of intercompany transactions and balances. The Company’s interests in oil and natural gas exploration and production ventures and partnerships are proportionately consolidated. The Company reflects a noncontrolling interest representing primarily the interest owned by the Magnolia LLC Unit Holders through their ownership of Magnolia LLC Units in the consolidated financial statements. The noncontrolling interest is presented as a component of equity.

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Derivative Instruments (Tables)

3 Months Ended

Mar. 31, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Effect of Derivative Instruments on Consolidated Statements of Operations

The following table summarizes the effects of derivative instruments on the Company’s consolidated statements of operations during the three months ended March 31, 2022 and 2021:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Derivative settlements, realized (loss)	$	—	$	—
Unrealized (loss) on derivatives	—		(482)
(Loss) on derivatives, net	$	—	$	(482)

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Fair Value Measurements (Tables)

3 Months Ended

Mar. 31, 2022

Fair Value Disclosures [Abstract]

Schedule of Carrying Values and Fair Values of Financial Instruments Not Carried at Fair Value

The carrying value and fair value of the financial instrument that is not carried at fair value in the accompanying consolidated balance sheets at March 31, 2022 and December 31, 2021 is as follows:

	March 31, 2022				December 31, 2021
(In thousands)	Carrying Value		Fair Value		Carrying Value		Fair Value
Long-term debt	$	388,647	$	407,460	$	388,087	$	411,500

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Other Current Liabilities (Tables)

3 Months Ended

Mar. 31, 2022

Other Liabilities Disclosure [Abstract]

Other Current Liabilities

The following table provides detail of the Company’s other current liabilities for the periods presented:

(In thousands)	March 31, 2022		December 31, 2021
Accrued capital expenditures	$	43,882	$	29,936
Accrued production taxes	12,235		10,084
Other	47,965		50,616
Total Other current liabilities	$	104,082	$	90,636

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Long-term Debt (Tables)

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Components of Debt

The Company’s debt is comprised of the following:

(In thousands)	March 31, 2022		December 31, 2021
Revolving credit facility	$	—	$	—
Senior Notes due 2026	400,000		400,000
Total long-term debt	400,000		400,000
Less: Unamortized deferred financing cost	(11,353)		(11,913)
Long-term debt, net	$	388,647	$	388,087

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Income Taxes (Tables)

3 Months Ended

Mar. 31, 2022

Income Tax Disclosure [Abstract]

Components of Income Tax Provision (Benefit)

The Company’s income tax provision consists of the following components:

	Three Months Ended
(In thousands)	March 31, 2022		March 31, 2021
Current:
Federal	$	16,784	$	—
State	1,316		399
	18,100		399
Deferred:
Federal	—		—
State	—		—
	—		—
Income tax expense	$	18,100	$	399

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Stock Based Compensation (Tables)

3 Months Ended

Mar. 31, 2022

Share-based Payment Arrangement [Abstract]

Schedule of Unvested RSU, PSU, and PRSU Activity

The following table presents a summary of Magnolia’s unvested RSU, PSU, and PRSU activity for the three months ended March 31, 2022.

	Restricted Stock Units			Performance Stock Units			Performance Restricted Stock Units
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Unvested at December 31, 2021	1,187,509	$	8.94	460,414	$	9.20	968,654	$	9.36
Granted	241,671	20.29		—	—		506,703	19.14
Granted for performance multiple(1)	—	—		90,965	13.88		—	—
Vested	(315,842)	9.31		(272,894)	13.88		(212,687)	9.33
Forfeited	(6,736)	10.38		—	—		(936)	11.38
Unvested at March 31, 2022	1,106,602	$	11.33	278,485	$	6.14	1,261,734	$	13.29

(1) Upon completion of the performance period for the PSUs granted in 2019, a performance multiple of 150% was applied to each of the grants resulting in additional grants of PSUs in 2022.

Schedule of Assumptions Used to Calculate Grant Date Fair Value of PRSUs

The following table summarizes the Monte Carlo simulation assumptions used to calculate the grant date fair value of the PRSUs in 2022 and 2021.

	Three Months Ended
PRSU Grant Date Fair Value Assumptions	March 31, 2022	March 31, 2021
Expected term (in years)	3.55	3.64
Expected volatility	59.58%	55.18%
Risk-free interest rate	1.89%	0.56%
Dividend yield	1.97%	—%

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Earnings Per Share (Tables)

3 Months Ended

Mar. 31, 2022

Earnings Per Share [Abstract]

Reconciliation of Numerators and Denominators for Basic and Diluted Per Share Computation

The components of basic and diluted net income per share attributable to common stockholders are as follows:

	Three Months Ended
(In thousands, except per share data)	March 31, 2022		March 31, 2021
Basic:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,416		213
Net income, net of participating securities	$	164,623	$	63,031
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Net income per share of Class A Common Stock - basic	$	0.90	$	0.38
Diluted:
Net income attributable to Class A Common Stock	$	166,039	$	63,244
Less: Dividends and net income allocated to participating securities	1,413		210
Net income, net of participating securities	$	164,626	$	63,034
Weighted average number of common shares outstanding during the period - basic	182,578		166,952
Add: Dilutive effect of stock based compensation and other	585		2,684
Weighted average number of common shares outstanding during the period - diluted	183,163		169,636
Net income per share of Class A Common Stock - diluted	$	0.90	$	0.37

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Revenue Recognition (Details) - USD ($) $ in Millions	Mar. 31, 2022	Dec. 31, 2021
Revenue from Contract with Customer [Abstract]
Receivables from contracts with customers	$ 151.1	$ 125.1

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Derivative Instruments - Schedule of Effect of Derivative Instruments on Consolidated Statements of Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative settlements, realized (loss)	$ 0	$ 0
Unrealized (loss) on derivatives	0	(482)
Loss on derivatives, net	$ 0	$ (482)

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Fair Value Measurements - Carrying Values and Fair Values of Financial Instruments Not Carried at Fair Value (Details) - Fair Value, Inputs, Level 1 - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Carrying Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 388,647	$ 388,087
Fair Value
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Long-term debt	$ 407,460	$ 411,500

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Intangible Assets (Details) - USD ($) shares in Millions, $ in Millions				1 Months Ended
	Jun. 30, 2021	Feb. 01, 2021	Jul. 31, 2018	Jan. 31, 2021
EnerVest
Finite-Lived Intangible Assets [Line Items]
Cash paid upon compliance of non-compete agreement milestones, milestone 1		$ 17.2
Cash paid upon compliance of non-compete agreement milestones, milestone 2	$ 24.9
EnerVest | Class A Common Stock
Finite-Lived Intangible Assets [Line Items]
Number of shares authorized for issuance based on compliance of non-compete agreement milestones (in shares)			4.0
Cash value of equity interest authorized for issuance upon compliance of non-compete agreement milestones, milestone 1 (in shares)				2.0
Number of shares authorized for issuance based on compliance of non-compete agreement milestones, milestone 1 (in shares)				0.4
Number of shares authorized for issuance based on compliance of non-compete agreement milestones, milestone 2 (in shares)	1.6			1.6
Equity interests issued upon compliance of non-compete agreement milestones, milestone 1 (in shares)		0.4
Non-Compete | Minimum
Finite-Lived Intangible Assets [Line Items]
Estimated economic life of intangible asset			2 years 6 months	2 years 6 months
Non-Compete | Maximum
Finite-Lived Intangible Assets [Line Items]
Estimated economic life of intangible asset			4 years	4 years

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Other Current Liabilities (Details) - USD ($) $ in Thousands	Mar. 31, 2022	Dec. 31, 2021
Other Liabilities Disclosure [Abstract]
Accrued capital expenditures	$ 43,882	$ 29,936
Accrued production taxes	12,235	10,084
Other	47,965	50,616
Total Other current liabilities	$ 104,082	$ 90,636

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Long-term Debt - Components of Debt (Details) - USD ($)	Mar. 31, 2022	Dec. 31, 2021
Debt Instrument [Line Items]
Total long-term debt	$ 400,000,000	$ 400,000,000
Less: Unamortized deferred financing cost	(11,353,000)	(11,913,000)
Long-term debt, net	388,647,000	388,087,000
Line of Credit | Revolving credit facility
Debt Instrument [Line Items]
Total long-term debt	0	0
Senior Notes | Senior Notes due 2026
Debt Instrument [Line Items]
Total long-term debt	$ 400,000,000	$ 400,000,000

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Long-term Debt - Credit Facility Narrative (Details)	3 Months Ended
	Mar. 31, 2022 USD ($)	Mar. 31, 2021 USD ($)	Feb. 16, 2022 USD ($)	Dec. 31, 2021 USD ($)
Line of Credit Facility [Line Items]
Amortization of deferred financing costs	$ 2,812,000	$ 910,000
Deferred financing costs, net	7,017,000			$ 3,701,000
Outstanding borrowings	$ 400,000,000			400,000,000
Line of Credit | RBL Facility
Line of Credit Facility [Line Items]
Amortization period	4 years
Interest expense	$ 2,800,000	$ 1,000,000
Outstanding borrowings	0			$ 0
Line of Credit | RBL Facility | Magnolia Operating
Line of Credit Facility [Line Items]
Maximum commitments, aggregate principal amount	1,000,000,000
Line of Credit | Letter of Credit Sublimit | Magnolia Operating
Line of Credit Facility [Line Items]
Maximum commitments, aggregate principal amount	100,000,000		$ 50,000,000
Line of Credit | Amended and Restated RBL Facility | Magnolia Operating
Line of Credit Facility [Line Items]
Maximum commitments, aggregate principal amount			1,000,000,000
Borrowing base			$ 450,000,000
Leverage ratio (less than)			3.50
Current ratio (greater than)			1.00
Transaction fees related to the modification			$ 5,600,000
Amortization of deferred financing costs	$ 400,000
Deferred financing costs, net			$ 5,200,000

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Long-term Debt - 2026 Senior Notes Narrative (Details) - Senior Notes - Senior Notes due 2026 - USD ($)	3 Months Ended
	Mar. 31, 2022	Jun. 30, 2021	Mar. 31, 2021	Apr. 05, 2021	Jul. 31, 2018
Debt Instrument [Line Items]
Aggregate principal amount					$ 400,000,000
Stated interest rate					6.00%
Transaction fees		$ 1,100,000
Deferred financing costs incurred in connection with securing the 2026 Senior Notes	$ 16,800,000			$ 5,000,000
Interest expense	$ 6,600,000		$ 6,300,000
Redemption price, percentage of principal amount of Notes redeemed	100.00%

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Commitments and Contingencies (Details) - USD ($)	Mar. 31, 2022	Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract]
Amounts accrued with respect to outstanding litigation	$ 0	$ 0

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Income Taxes - Components of Income Tax Provision (Benefit) (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Current:
Federal	$ 16,784	$ 0
State	1,316	399
Current income tax provision	18,100	399
Deferred:
Federal	0	0
State	0	0
Deferred income tax provision	0	0
Income tax expense	$ 18,100	$ 399

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Income Taxes - Narrative (Details) - USD ($) shares in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Valuation Allowance [Line Items]
Effective tax rate	8.00%	0.40%
Liabilities for uncertain tax positions	$ 0
Amounts incurred for interest and penalties	0
Net deferred tax asset	204,600,000
Valuation allowance	$ 204,600,000
Class B Common Stock | Magnolia LLC Unit Holders
Valuation Allowance [Line Items]
Stock redeemed (in shares)	9.7	14.2
Magnolia LLC Units | Magnolia LLC Unit Holders
Valuation Allowance [Line Items]
Stock redeemed (in shares)	9.7	14.2

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Stockholders' Equity (Details) $ / shares in Units, $ in Thousands			3 Months Ended			32 Months Ended
	Feb. 03, 2022 USD ($) $ / shares	Aug. 02, 2021 USD ($) $ / shares	Mar. 31, 2022 USD ($) votePerShare $ / shares shares	Mar. 31, 2021 USD ($) shares	Mar. 31, 2019	Mar. 31, 2022 USD ($) votePerShare shares	Dec. 31, 2021 shares
Class of Stock [Line Items]
Distribution made to LLC member, cash distributions declared | $	$ 37,300	$ 14,200
Dividends declared | $	$ 37,300	$ 14,200
Common stock, dividends, declared (in dollars per share) | $ / shares	$ 0.20	$ 0.08	$ 0.20
Highlander
Class of Stock [Line Items]
Percentage of interest owned by noncontrolling interest holders					15.30%
VIE, Primary Beneficiary | Magnolia LLC
Class of Stock [Line Items]
Percentage of interest owned			84.00%
Percentage of interest owned by noncontrolling interest holders			16.00%			16.00%
MGY Louisiana LLC | Highlander
Class of Stock [Line Items]
Percentage of units held					84.70%
Magnolia LLC
Class of Stock [Line Items]
Stock repurchased, cash consideration | $			$ 84,700	$ 50,800
Distribution made to LLC member, distributions declared (in dollars per share) | $ / shares	$ 0.20	$ 0.08
Total declared distributions | $	$ 45,900	$ 19,000
Magnolia LLC Unit Holders
Class of Stock [Line Items]
Distribution made to LLC member, cash distributions declared | $	$ 8,600	$ 4,800
Class A Common Stock
Class of Stock [Line Items]
Common stock, shares issued (in shares)			203,762,000			203,762,000	193,437,000
Common stock, shares outstanding (in shares)			187,543,000			187,543,000	179,270,000
Number of votes for each share held | votePerShare			1			1
Number of shares authorized to be repurchased (in shares)			30,000,000			30,000,000
Number of shares repurchased (in shares)						15,700,000
Total cost of shares repurchased | $			$ 44,819	20,281		$ 197,900
Stock repurchased, cash consideration | $			$ 43,486	20,281
Class A Common Stock | EnerVest Energy Institutional Fund XIV-C, L.P. | Affiliate of EnerVest
Class of Stock [Line Items]
Number of shares repurchased (in shares)			600,000
Total cost of shares repurchased | $			$ 11,600
Class B Common Stock
Class of Stock [Line Items]
Common stock, shares issued (in shares)			35,594,000			35,594,000	49,293,000
Common stock, shares outstanding (in shares)			35,594,000			35,594,000	49,293,000
Number of votes for each share held | votePerShare			1			1
Stock repurchased, cash consideration | $			$ 84,733	$ 50,781
Class B Common Stock | Magnolia LLC
Class of Stock [Line Items]
Stock repurchased and subsequently canceled (in shares)			3,900,000	5,000,000
Class B Common Stock | Magnolia LLC Unit Holders
Class of Stock [Line Items]
Stock redeemed (in shares)			9,700,000	14,200,000
Magnolia LLC Units | Magnolia LLC
Class of Stock [Line Items]
Stock repurchased and subsequently canceled (in shares)			3,900,000	5,000,000
Magnolia LLC Units | Magnolia LLC Unit Holders
Class of Stock [Line Items]
Stock redeemed (in shares)			9,700,000	14,200,000

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Stock Based Compensation - Narrative (Details) - USD ($) $ in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Stock based compensation expense	$ 2.9	$ 2.7
RSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate fair value of equity instruments vested during the period	7.9	4.0
Unrecognized compensation expense	$ 9.9
Weighted average period over which unrecognized compensation expense is expected to be recognized	2 years 9 months 18 days
RSUs | Employees | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
RSUs | Employees | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	4 years
RSUs | Directors
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	1 year
PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period	3 years
Aggregate fair value of equity instruments vested during the period	$ 4.8
Unrecognized compensation expense	$ 14.9
Weighted average period over which unrecognized compensation expense is expected to be recognized	2 years 7 months 6 days
Number of consecutive trading days required to earn PRSUs	20 days
Performance period	5 years
Grant date fair value	$ 9.7	9.4
PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate fair value of equity instruments vested during the period	5.5	$ 0.1
Unrecognized compensation expense	$ 0.5
Weighted average period over which unrecognized compensation expense is expected to be recognized	9 months 18 days
Performance period	3 years
Vesting percentage	150.00%
Settlement date, period following performance period	60 days
Class A Common Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for issuance (in shares)	16,800,000
Class A Common Stock | PRSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contingent right to receive common stock, number of shares receivable for each PSU (in shares)	1
Class A Common Stock | PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Contingent right to receive common stock, number of shares receivable for each PSU (in shares)	1
Class A Common Stock | PSUs | Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	0.00%
Class A Common Stock | PSUs | Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	150.00%

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Stock Based Compensation - Schedule of Unvested RSU, PSU, and PRSU Activity (Details)	3 Months Ended
	Mar. 31, 2022 $ / shares shares
Restricted Stock Units
Units
Unvested stock units, beginning of period (in shares) | shares	1,187,509
Granted (in shares) | shares	241,671
Vested (in shares) | shares	(315,842)
Forfeited (in shares) | shares	(6,736)
Unvested stock units, end of period (in shares) | shares	1,106,602
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share) | $ / shares	$ 8.94
Granted (in dollars per share) | $ / shares	20.29
Vested (in dollars per share) | $ / shares	9.31
Forfeited (in dollars per share) | $ / shares	10.38
Unvested stock units, end of period (in dollars per share) | $ / shares	$ 11.33
Performance Stock Units
Units
Unvested stock units, beginning of period (in shares) | shares	460,414
Granted (in shares) | shares	0
Granted for performance multiple (in shares) | shares	90,965
Vested (in shares) | shares	(272,894)
Forfeited (in shares) | shares	0
Unvested stock units, end of period (in shares) | shares	278,485
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share) | $ / shares	$ 9.20
Granted (in dollars per share) | $ / shares	0
Granted for performance multiple (in dollars per share) | $ / shares	13.88
Vested (in dollars per share) | $ / shares	13.88
Forfeited (in dollars per share) | $ / shares	0
Unvested stock units, end of period (in dollars per share) | $ / shares	$ 6.14
Vesting percentage	150.00%
Performance Restricted Stock Units
Units
Unvested stock units, beginning of period (in shares) | shares	968,654
Granted (in shares) | shares	506,703
Vested (in shares) | shares	(212,687)
Forfeited (in shares) | shares	(936)
Unvested stock units, end of period (in shares) | shares	1,261,734
Weighted Average Grant Date Fair Value
Unvested stock units, beginning of period (in dollars per share) | $ / shares	$ 9.36
Granted (in dollars per share) | $ / shares	19.14
Vested (in dollars per share) | $ / shares	9.33
Forfeited (in dollars per share) | $ / shares	11.38
Unvested stock units, end of period (in dollars per share) | $ / shares	$ 13.29

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Stock Based Compensation - Schedule of Assumptions Used to Calculate Grant Date Fair Value of PRSUs (Details) - PRSUs	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected term (in years)	3 years 6 months 18 days	3 years 7 months 20 days
Expected volatility	59.58%	55.18%
Risk-free interest rate	1.89%	0.56%
Dividend yield	1.97%	0.00%

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Earnings Per Share - Reconciliation of Numerators and Denominators for Basic and Diluted Per Share Computation (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Basic:
Net income attributable to Class A Common Stock	$ 166,039	$ 63,244
Less: Dividends and net income allocated to participating securities	1,416	213
Net income, net of participating securities	$ 164,623	$ 63,031
Weighted average number of common shares outstanding during the period - basic (in shares)	182,578	166,952
Diluted:
Net income attributable to Class A Common Stock	$ 166,039	$ 63,244
Less: Dividends and net income allocated to participating securities	1,413	210
Net income, net of participating securities	$ 164,626	$ 63,034
Weighted average number of common shares outstanding during the period - basic (in shares)	182,578	166,952
Add: Dilutive effect of stock based compensation and other (in shares)	585	2,684
Weighted average number of common shares outstanding during the period - diluted (in shares)	183,163	169,636
Class A Common Stock
Basic:
Net income (loss) per share of Class A Common Stock - basic (in dollars per share)	$ 0.90	$ 0.38
Diluted:
Net income per share of Class A Common Stock - diluted (in dollars per share)	$ 0.90	$ 0.37

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Earnings Per Share - Narrative (Details) - shares shares in Millions	3 Months Ended
	Mar. 31, 2022	Mar. 31, 2021
Class A Common Stock
Class of Stock [Line Items]
Shares excluded due to antidilutive effect (in shares)	44.3	80.3

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Related Party Transactions (Details) - USD ($) $ / shares in Units, $ in Thousands, shares in Millions			3 Months Ended
	Feb. 03, 2022	Aug. 02, 2021	Mar. 31, 2022	Mar. 31, 2021
Class B Common Stock
Related Party Transaction [Line Items]
Stock repurchased, cash consideration			$ 84,733	$ 50,781
EnerVest Energy Institutional Fund XIV-A, L.P.
Related Party Transaction [Line Items]
Distribution made to limited partner	$ 5,700
EnerVest Energy Institutional Fund XIV-A, L.P. | Affiliate of EnerVest | Class B Common Stock
Related Party Transaction [Line Items]
Stock redeemed (in shares)			6.5	9.4
EnerVest Energy Institutional Fund XIV-A, L.P. | Affiliate of EnerVest | Magnolia LLC Units
Related Party Transaction [Line Items]
Stock redeemed (in shares)			6.5	9.4
Magnolia LLC
Related Party Transaction [Line Items]
Distribution made to LLC member, distributions declared (in dollars per share)	$ 0.20	$ 0.08
Total declared distributions	$ 45,900	$ 19,000
Stock repurchased, cash consideration			$ 84,700	$ 50,800
Magnolia LLC | Class B Common Stock
Related Party Transaction [Line Items]
Stock repurchased and subsequently canceled (in shares)			3.9	5.0
Magnolia LLC | Magnolia LLC Units
Related Party Transaction [Line Items]
Stock repurchased and subsequently canceled (in shares)			3.9	5.0
Magnolia LLC | EnerVest Energy Institutional Fund XIV-A, L.P. | Affiliate of EnerVest
Related Party Transaction [Line Items]
Stock repurchased, cash consideration			$ 56,100	$ 33,600
Magnolia LLC | EnerVest Energy Institutional Fund XIV-A, L.P. | Affiliate of EnerVest | Class B Common Stock
Related Party Transaction [Line Items]
Stock repurchased and subsequently canceled (in shares)			2.6	3.3
Magnolia LLC | EnerVest Energy Institutional Fund XIV-A, L.P. | Affiliate of EnerVest | Magnolia LLC Units
Related Party Transaction [Line Items]
Stock repurchased and subsequently canceled (in shares)			2.6	3.3