EQT Corp. (NYSE:EQT)

Current Income Tax Expense

The current income tax expense shows significant fluctuations over the reported periods. In 2017, the expense was relatively moderate at -94,333 thousand US dollars. However, it sharply increased in 2018 to -559,511 thousand US dollars, indicating a substantial rise in current tax obligations. The value then decreased markedly in 2019, reaching -100,713 thousand US dollars, followed by a slight increase in 2020 to -143,018 thousand US dollars. By 2021, the current income tax expense dropped dramatically to -567 thousand US dollars, suggesting a near elimination of current tax expense in that year.

Deferred Income Tax Expense

Deferred income tax expense has generally been negative throughout the period, signifying deferred tax benefits. In 2017, the deferred tax benefit was very large at -1,094,083 thousand US dollars. It then declined sharply in 2018 to -137,000 thousand US dollars, reflecting a reduction of deferred tax benefit recognized. The deferred tax expense fluctuated in the following years, increasing again to -275,063 thousand US dollars in 2019, then decreasing to -155,840 thousand US dollars in 2020. In 2021, the deferred tax expense increased notably to -433,608 thousand US dollars, indicating a larger deferred tax benefit compared to the previous two years.

Total Income Tax Benefit

The total income tax benefit, which combines current and deferred components, follows a declining trend over the period. Starting from a high benefit of -1,188,416 thousand US dollars in 2017, the total benefit decreased substantially to -696,511 thousand US dollars in 2018. The trend continued downward in 2019 to -375,776 thousand US dollars and further to -298,858 thousand US dollars in 2020. In 2021, there was a slight increase to -434,175 thousand US dollars, interrupting the downward trend, but the total tax benefit remained significantly lower than in the earlier years.

Summary of Trends

The data reveals considerable volatility in both current and deferred income tax expenses, with the deferred portion contributing most significantly to the overall income tax benefits across the periods. The sharp decline in total income tax benefits from 2017 to 2020 suggests a reduction in recognized tax benefits or possibly changes in profit levels, tax rates, or tax planning strategies. The near elimination of current tax expense in 2021 combined with an increased deferred tax benefit suggests a shift toward recognizing tax benefits through deferred mechanisms in the latest year. Overall, the variations emphasize a dynamic tax expense profile with notable swings in the magnitude and timing of tax recognition.

Federal statutory tax rate

The federal statutory tax rate experienced a significant decrease from 35% in 2017 to 21% starting in 2018 and remained stable at 21% through 2021. This reflects a notable shift in the statutory tax environment that likely impacts the overall tax expense calculations.

Effective tax rate, before federal tax law change

The effective tax rate before the adjustment for federal tax law changes showed a general increasing trend over the years. It began at 8.4% in 2017, increased to 22.8% in 2018, and then slightly increased to 23.5% in 2019, remaining almost constant at 23.6% in 2020 before rising again to 27.3% in 2021. This trend suggests an increasing tax burden relative to earnings before considering federal law adjustments.

Effective tax rate

The effective tax rate showed a highly unusual negative value of -598.4% in 2017, indicating an extraordinary tax benefit or adjustment for that year. From 2018 onwards, the effective tax rate stabilized and closely mirrored the trend of the effective tax rate before the federal tax law change, starting at 22.6% in 2018 and gradually increasing to 27.3% by 2021. This convergence suggests that the impact of federal tax law changes was primarily relevant in 2017, with subsequent years reflecting a more normalized tax expense relative to earnings.

The financial data reveals distinct trends in the company’s tax-related assets and liabilities, as well as its property holdings over the five-year period examined.

Net Operating Loss (NOL) Carryforwards

This item shows a fluctuating but overall increasing trend, starting at $564.2 million in 2017, dipping in 2018 to $430.0 million, then rising steadily to reach $948.7 million by 2021, indicating accumulation of losses that can potentially offset future taxable income.

Net Unrealized Losses

Data for net unrealized losses is incomplete but shows figures increasing from $28.1 million in 2018 to a peak of $456.8 million in 2021, implying rising unrealized financial losses during this period.

Federal Tax Credits

Federal tax credits have generally increased from $50.3 million in 2017 to $83.2 million in 2021, with intermediate fluctuations reflecting possible changes in tax credit utilization or accumulation.

Alternative Minimum Tax (AMT) Credit Carryforward

This asset exhibits a marked decrease over time from $435.2 million in 2017 to $81.2 million in 2020 and 2021, suggesting consistent usage or expiration of previously held AMT credits.

Investment in Equitrans Midstream

The investment value shows growth from $10.4 million in 2018 to a high of $109.9 million in 2019, followed by declines to $69.2 million in 2021, indicating divestitures or valuation impairments in later years.

Federal and State Capital Loss Carryforward

Introduced in 2020 with $28.3 million and rising to $32.7 million in 2021, this item reflects newly recognized capital loss carryforwards available for offsetting future gains.

Incentive and Deferred Compensation Plans

Values decreased from $43.8 million in 2017 to $20.4 million in 2021, with some variability in intervening years, indicating reduced deferred compensation liabilities or plans' outstanding balances.

Other Items

This fluctuates significantly, with a low of about $1.3 million in 2020 and a high of $61.8 million in 2018, without a clear trend, suggesting variability in miscellaneous deferred tax-related items.

Deferred Tax Assets (DTA)

The DTA balance trends upward overall, from approximately $1.11 billion in 2017 to $1.69 billion in 2021, indicating increased recognition of deductible temporary differences and carryforwards.

Valuation Allowances

These allowances consistently increased in magnitude (negative amounts) from -$262.4 million in 2017 to -$551.0 million in 2021, reflecting growing skepticism regarding the realizability of deferred tax assets.

Net Deferred Tax Asset

Calculated as deferred tax assets less valuation allowances, this figure decreased between 2017 and 2020 from $850.1 million to $610.8 million but sharply increased to $1.14 billion in 2021, signaling an overall improvement in anticipated tax benefits realization by year-end 2021.

Property, Plant and Equipment (PP&E)

This asset account shows a continuous decline from -$2.72 billion in 2017 to approximately -$2.05 billion in 2021, indicating disposals, depreciation, or asset impairments over time.

Net Unrealized Gains

Limited data show a negative $21.4 million figure in 2017 and a more significant negative $54.5 million in 2019, with no recorded values in later years, implying recognized unrealized losses in certain periods but incomplete data for full trend analysis.

Convertible Debt

First recorded in 2020 with a negative balance of -$37.5 million, decreasing slightly to -$31.4 million in 2021, this represents a liability that declined marginally, possibly through repayment or conversion.

Deferred Tax Liabilities (DTL)

Deferred tax liabilities decreased from -$2.74 billion in 2017 to -$2.08 billion in 2021, indicating either utilization or reclassification of taxable temporary differences.

Net Deferred Tax Asset (Liability)

Presented as a net figure, this liability position improved somewhat from -$1.89 billion in 2017 to -$938.6 million in 2021, reflecting a gradual reduction in net deferred tax liabilities relative to assets over the period.

Overall, the data indicate increasing deferred tax assets and valuation allowances, pointing to significant tax planning considerations and uncertainty regarding realization. Asset values in property, plant and equipment, and investments have generally declined, while net operating losses and capital loss carryforwards signify accumulated tax shield potential. Changes in deferred tax liabilities and related balances suggest adjustments consistent with evolving tax positions and asset valuations over time.

The data reveals a consistent downward trend in deferred tax liabilities over the analyzed five-year period.

Deferred Tax Liabilities

Starting from a balance of approximately 1.89 billion US dollars at the end of 2017, the figure declined gradually each year. By the end of 2018, it had reduced to roughly 1.82 billion US dollars, followed by a further decrease to about 1.49 billion US dollars in 2019. The downward trend continued through 2020, with the amount lowering to approximately 1.37 billion US dollars, and culminated in a significant reduction to around 939 million US dollars by the end of 2021.

This continuous decrease over the period indicates a potential reduction in future tax obligations recognized on the balance sheet, which may result from changes in tax regulations, asset base adjustments, or company-specific tax planning strategies. The marked decline between 2020 and 2021 suggests a particularly impactful event or strategic decision influencing deferred tax positions during that time.

The financial data reveals notable trends in liabilities, equity, and net income for the analyzed periods.

Total Liabilities

Both reported and adjusted total liabilities show a generally decreasing trend from 2017 through 2020, with reported liabilities declining from approximately 11.1 billion to 8.85 billion US dollars, and adjusted liabilities decreasing from about 9.2 billion to 7.48 billion US dollars during the same timeframe. However, a marked increase is observed in 2021, where reported liabilities rise sharply to approximately 11.56 billion, and adjusted liabilities also increase substantially to over 10.6 billion US dollars. This reversal suggests a significant escalation in the company’s obligations in the latest year reported.

Common Shareholders’ Equity

The reported common shareholders’ equity displays a consistent downward trend from 2017 to 2020, decreasing from about 13.3 billion US dollars to roughly 9.3 billion. In 2021, a modest recovery is visible as equity increases slightly to over 10 billion US dollars. Conversely, the adjusted common shareholders’ equity maintains higher values throughout all periods, starting at approximately 15.2 billion in 2017 and declining steadily to about 10.6 billion by 2020, then leveling off with a small rise to nearly 11 billion in 2021. The disparity between reported and adjusted equity indicates the impact of deferred income tax adjustments on the company's equity valuation.

Net Income (Loss) Attributable to the Corporation

Reported net income exhibits a significant deterioration beginning with a positive figure of about 1.5 billion US dollars in 2017, followed by substantial losses in subsequent years, peaking in negative territory with a loss exceeding 2.2 billion in 2018. The losses persist but are somewhat reduced in magnitude through 2019 to 2021, ranging between approximately -967 million to -1.15 billion US dollars annually. The adjusted net income, which accounts for deferred tax considerations, mirrors these trends but with consistently larger losses after 2017, indicating that tax adjustments exacerbate the reported net losses over the following years. The 2017 adjusted net income is significantly lower than the reported figure, reflecting one-time or timing tax effects.

Overall, the data suggests that the company experienced a stressful financial period beginning in 2018, characterized by declining equity and increasing liabilities, coupled with persistent net losses. The adjustments for deferred income taxes reveal a less favorable financial position than reported figures alone, particularly with respect to income performance. The sharp increase in liabilities in 2021 signals a potential change in financing or operational circumstances warranting further inquiry.

The financial data over the five-year period reveals a decline in profitability and changes in leverage ratios, presenting a challenging environment for the company.

Net Profit Margin

The reported net profit margin shows a substantial decrease from a positive 56.9% in 2017 to negative values in the subsequent years, reaching -16.99% in 2021. The adjusted net profit margin follows a similar trajectory but indicates even more pronounced negative performance from 2018 onward, with the margin worsening from -50.72% in 2018 to -23.36% in 2021. This declining trend signals sustained profitability challenges after accounting for reported and deferred income tax adjustments.

Financial Leverage

Reported financial leverage initially decreases from 2.22 in 2017 to a low of 1.89 in 2018, then gradually increases to 2.15 by 2021. Adjusted financial leverage mirrors this pattern but remains consistently lower than the reported figures, moving from 1.94 in 2017 to 1.97 in 2021. The overall moderate rise suggests a cautious increase in debt relative to equity or assets in recent years.

Return on Equity (ROE)

Reported ROE declines sharply from 11.33% in 2017 into negative territory, remaining negative throughout 2018 to 2021 and ending at -11.52% in 2021. Adjusted ROE presents a similar negative trend but at lower levels, from 2.72% in 2017 to -14.49% in 2021. The persistent negative ROE implies ongoing difficulties in generating returns that exceed the cost of equity, intensified after adjusting for tax considerations.

Return on Assets (ROA)

Both reported and adjusted ROA demonstrate deterioration over the period. The reported ROA drops from 5.11% in 2017 to negative values from 2018 onward, stabilizing near -5.35% in 2021. Adjusted ROA also declines from 1.4% in 2017 to -7.36% in 2021, with the adjustment revealing a more negative asset profitability trend. The consistent negative ROA suggests that the assets have not been effectively employed to generate positive income.

Overall, the company exhibits a significant decline in profitability measures across the reviewed periods, both on a reported and adjusted basis. The leverage ratios indicate a relatively stable but slightly increasing use of debt. The trends reflect persistent operational or market challenges, with after-tax adjustments exacerbating the negative financial outcomes. These patterns underscore the need for strategic measures to improve profitability and asset utilization.

The data presents a clear and consistent downward trajectory in the financial performance over the five-year period. Both reported and adjusted net income figures exhibit declining trends, starting from positive values in 2017 and moving into significant losses from 2018 onward.

Net Income Trends

Reported net income attributable to the company was robustly positive in 2017 at approximately $1.51 billion. However, in the subsequent years, it transitioned into losses, with the magnitude increasing annually: roughly -$2.24 billion in 2018, -$1.22 billion in 2019, -$967 million in 2020, and around -$1.16 billion in 2021. Similarly, adjusted net income followed the same pattern but consistently remained lower than reported net income, indicating significant adjustments that further reduced profitability. The adjusted figures declined from about $414 million in 2017 to losses exceeding $1.58 billion by 2021.

Net Profit Margin Behavior

Reported net profit margins started at a high positive level of 56.9% in 2017, which sharply reversed in 2018 to a negative margin of -47.8%. This negative trend continued over the period, although the absolute negative margin percentage lessened slightly by 2021, standing at approximately -17%. The adjusted net profit margin mirrored this trend but indicated even larger losses as a percentage of revenue, starting at 15.63% in 2017 and bottoming at -50.72% in 2018, with subsequent values remaining deeply negative, albeit with some fluctuations, ending at around -23.36% in 2021.

Comparative Insights

The disparity between reported and adjusted net income and margins suggests persistent and sizeable accounting adjustments affecting profitability, potentially linked to deferred tax considerations or other non-operational items. The consistent negative adjustment impact implies that the company’s operational returns may be under additional pressure once these factors are accounted for. Despite some marginal improvement in the margins towards 2021 compared to the peak negative values in 2018, the company remains unprofitable on both reported and adjusted bases throughout the period assessed.

The analysis of the annual reported and deferred income tax adjusted financial data indicates several notable trends in the equity and leverage metrics over the five-year period ending in 2021.

Common Shareholders' Equity

Reported common shareholders’ equity shows a declining trend from 2017 to 2020, decreasing from approximately $13.3 billion to $9.3 billion. However, there is a recovery in 2021, with equity increasing to just over $10 billion. This suggests a period of contraction followed by a modest recovery in the company's reported equity position.

Adjusted common shareholders’ equity follows a similar downward pattern from 2017 through 2020, declining from around $15.2 billion to $10.6 billion. Unlike the reported equity, the adjusted equity sees a more pronounced stabilization and slight increase in 2021 to about $11 billion. The adjusted figures consistently remain higher than the reported ones, reflecting the impact of deferred income tax adjustments in enhancing the equity base.

Financial Leverage

The reported financial leverage ratio declines significantly from 2.22 in 2017 to a low point around 1.89 in 2018, stabilizing near 1.9 through 2020 before rising again to 2.15 in 2021. This pattern indicates an initial deleveraging phase, possibly reflecting debt reduction or equity increases, followed by increased leverage in the final year.

The adjusted financial leverage ratio mirrors the reported pattern but at slightly lower levels, moving from 1.94 in 2017 down to 1.62 in 2018, then gradually increasing to 1.97 by 2021. The consistently lower adjusted leverage ratio compared to the reported ratio suggests that adjustments for deferred income taxes provide a more conservative estimation of leverage, potentially due to the recognition of deferred tax assets or liabilities affecting debt-equity relationships.

Overall, the data indicate a phase of shrinking equity and deleveraging through 2018, followed by a period of stabilization and a moderate increase in leverage in 2021. The adjusted figures consistently reflect a stronger equity position and lower leverage, underscoring the importance of considering deferred income tax effects in evaluating financial stability and risk. The increasing leverage in the final year may warrant attention for its implications on the company's risk profile moving forward.

The financial data reveals significant fluctuations and negative trends over the five-year period. The company experienced a strong reported net income in 2017, followed by consecutive years of reported net losses through 2021. The reported net income decreased sharply from a positive value of approximately 1.51 billion US dollars in 2017 to losses exceeding 1 billion US dollars in the subsequent years, indicating financial challenges or adverse market conditions during that timeframe.

The adjusted net income figures show a similar pattern, starting with a positive value of around 414 million US dollars in 2017 and then declining into negative territory for the rest of the period. Adjusted net losses deepened over time, reaching nearly -1.59 billion US dollars by the end of 2021, slightly worse than reported net losses, reflecting additional adjustments that further impacted profitability assessments.

Common shareholders’ equity, both reported and adjusted, experienced a downward trend from 2017 to 2020, indicating a contraction in equity value. The reported equity decreased from about 13.3 billion US dollars in 2017 to 9.25 billion US dollars in 2020. Adjusted equity shows a similar decline but consistently remains higher than reported equity, suggesting that adjustments account for items that positively affect equity values. Notably, in 2021, there is a modest recovery in reported equity to approximately 10 billion US dollars and a further increase in adjusted equity to nearly 11 billion US dollars, indicating a partial improvement in the company’s financial position.

Return on equity (ROE) metrics, both reported and adjusted, display a sharp decline following 2017. Reported ROE dropped from a healthy 11.33% in 2017 to deeply negative values, stabilizing somewhat around negative 10% to negative 12% in the following years. Adjusted ROE presents an even more severe pattern, with an initial low positive figure of 2.72% in 2017, turning highly negative thereafter, reaching almost -14.5% in 2021. This signals a persistent inability to generate returns for shareholders based on both reported and adjusted equity during this period.

Overall, the data indicates that the company struggled with sustained losses and negative returns on equity between 2018 and 2021. Despite some recovery in equity values toward the end of the period, profitability metrics remained deeply negative. The adjustments made to net income and equity consistently resulted in lower profitability and higher equity valuations, underscoring the impact of deferred income tax and other accounting considerations on the reported financial performance and condition.

Reported Net Income (Loss) Attributable to EQT Corporation

The reported net income demonstrated a significant negative trend over the analyzed period. Starting with a substantial positive value in 2017, it shifted sharply into negative territory in 2018. The loss continued through subsequent years, with the magnitude of the loss peaking in 2018 and remaining persistently high thereafter, demonstrating ongoing financial challenges.

Adjusted Net Income (Loss) Attributable to EQT Corporation

Adjusted net income followed a pattern similar to the reported net income but exhibited more pronounced losses starting from 2018. After a modest positive result in 2017, adjusted earnings fell deeply into the negative range and worsened progressively through 2021, indicating that adjustments for items such as deferred income taxes and other non-operational factors reveal greater underlying financial difficulties.

Reported Return on Assets (ROA)

Reported ROA showed a dramatic decline moving from a healthy positive level in 2017 to substantially negative returns starting in 2018. The negative returns persisted consistently through 2021, with a slight stabilization in the degree of return loss but no recovery into positive territory. This pattern reflects diminished asset profitability and operational performance stress across these years.

Adjusted Return on Assets (ROA)

The adjusted ROA mirrored the downward trajectory of the reported ROA but indicated even lower profitability when accounting for adjustments. The transition from a positive return in 2017 to increasingly negative returns after 2017 suggests that when considering deferred income tax effects and other adjustments, the company's asset utilization has worsened more than the reported figures alone imply.