EXCO Resources, Inc. Reports Fourth Quarter and Full Year 2015 Results

EXCO Resources Inc. (NYSE:XCO) (“EXCO” or the "Company") today announced fourth quarter and full year operating and financial results for 2015 and other developments.

• Liquidity was $334 million at December 31, 2015. EXCO executed a series of transactions during the fourth quarter 2015 that reduced its aggregate principal amount of debt outstanding by $402 million from the third quarter 2015 as part of its ongoing balance sheet restructuring program. The Company repurchased $49 million of senior unsecured notes for $7 million in cash subsequent to the fourth quarter 2015. EXCO's plans for 2016 are focused on capital preservation and protecting its liquidity.
• EXCO delivered operational and financial results within guidance for the full year 2015 with the exception of capital expenditures, which were lower than guidance due to reductions in spending in response to the decline in commodity prices.
• Proved reserves were 907.3 Bcfe and PV-10 calculated using the prices prescribed by the Securities and Exchange Commission ("SEC PV-10") was $402 million, as of December 31, 2015. PV-10 of proved reserves based on NYMEX futures prices as of December 31, 2015 ("NYMEX PV-10") was $811 million^(*).
• Produced 319 Mmcfe per day, or 29.3 Bcfe, for the fourth quarter 2015 and produced 340 Mmcfe per day, or 124.0 Bcfe, for the full year 2015, in line with the mid-point of guidance. Production decreased 21 Mmcfe per day, or 6%, from the third quarter 2015, primarily due to lower production in the Appalachia region as EXCO pro-actively shut-in wells due to low regional natural gas prices and normal production declines. Production decreased 10 Mmcfe per day, or 3%, from full year 2014 excluding divested assets, primarily due to normal production declines and a reduced development program.
• Adjusted EBITDA, a non-GAAP measure, was $50 million for the fourth quarter 2015, 19% below adjusted EBITDA for the third quarter 2015, and $238 million for the full year 2015, 39% below adjusted EBITDA for the full year 2014, primarily due to lower commodity prices and production.
• Adjusted net loss, a non-GAAP measure, was $9 million, or $0.03 per diluted share, and GAAP net loss was $66 million, or $0.24 per diluted share, for the fourth quarter 2015. Adjusted net loss was $51 million, or $0.19 per diluted share, and GAAP net loss was $1.2 billion, or $4.36 per diluted share, for the full year 2015. The GAAP net loss was primarily due to impairments of the Company’s oil and natural gas properties pursuant to the ceiling test in accordance with full cost accounting of $205 million and $1.2 billion for the fourth quarter and full year 2015, respectively.
• Drilled 6 gross (2.7 net) and turned-to-sales 8 gross (4.3 net) operated horizontal wells in the fourth quarter 2015 and drilled 37 gross (17.8 net) and turned to sales 68 gross (29.2 net) operated horizontal wells for the full year 2015.

Strategic plan update

EXCO recently refined its strategic plan to focus on the following three core objectives: 1) restructuring the balance sheet to enhance business and extend structural liquidity, 2) transforming EXCO into the lowest cost producer, and 3) optimizing and repositioning the portfolio. The Company believes the execution of this strategy will allow it to persevere through the current commodity price cycle and create long-term value for its shareholders. The three core objectives and the Company's recent progress are detailed below:

1. Restructuring the balance sheet to enhance business and extend structural liquidity - The Company is focused on improving its capital structure and providing structural liquidity. EXCO executed a series of transactions during fourth quarter 2015 to enhance its liquidity and financial flexibility, including the execution of a 12.5% senior secured second lien term loan in the aggregate principal amount of $300 million (“Fairfax Term Loan”) and a 12.5% senior secured second lien term loan in the aggregate principal amount of $400 million (“Exchange Term Loan”). The proceeds from the Fairfax Term Loan were used to reduce approximately $300 million of outstanding indebtedness under EXCO’s credit agreement (“Credit Agreement”). EXCO used the proceeds from the Exchange Term Loan to repurchase an aggregate of $551 million principal amount of its 7.5% senior unsecured notes due September 15, 2018 ("2018 Notes"), and an aggregate of $277 million principal amount of its 8.5% senior unsecured notes due April 15, 2022 (“2022 Notes”). The second lien term loans are due in October 2020 and accrue interest at a rate of 12.5% per annum. Additionally, EXCO repurchased $41 million in principal amount of the 2018 Notes with $12 million in cash in the fourth quarter of 2015 and $9 million in principal amount of the 2018 Notes and $40 million in principal amount of the 2022 Notes with $7 million in cash in February 2016, resulting in an estimated reduction in interest expense of approximately $6 million per year. EXCO is currently evaluating additional balance sheet restructuring transactions including the issuance of additional indebtedness, the restructuring or repurchase of existing indebtedness, issuance of equity or divestitures of assets. EXCO's liquidity was $334 million as of year-end 2015 and the Company has approximately $125 million of liens capacity that can be utilized for future exchanges or issuances of secured indebtedness.
   
   EXCO believes that fourth quarter 2015 open market purchases of common shares by funds associated with EXCO’s Board of Directors demonstrate their commitment to the Company. In the fourth quarter 2015, Fairfax Financial Holdings Limited (“Fairfax”) purchased an aggregate of 8.0 million common shares in the open market, resulting in a 9.0% ownership stake as reported in SEC filings, and Energy Strategic Advisory LLC (“ESAS”) purchased an aggregate of 12.5 million common shares in the open market pursuant to its agreement entered into earlier in 2015, increasing its ownership to 6.5%, as reported in SEC filings. As of year-end 2015, common shares held by EXCO’s directors, officers and their respective affiliates, associates and related funds in the aggregate constituted approximately 51% of the outstanding common shares.
   
   In addition, EXCO continued to reduce its costs under commercial contracts and renegotiated a natural gas sales contract in North Louisiana during the first quarter 2016 that improved the rate per Mcfe in exchange for extending the term of the contract. This is expected to result in annual savings of approximately $1.5 million to $2.0 million net to EXCO. The Company remains committed to restructuring its gathering and transportation contracts, which include contracts in the East Texas and North Louisiana regions with a significant amount of underutilized capacity and fee structures above current market rates.
2. Transforming EXCO into the lowest cost producer - EXCO continues to exercise fiscal discipline to transform itself into the lowest cost producer. EXCO has implemented several initiatives to reduce its general and administrative costs and lease operating costs, including significant reductions in its workforce. As a result of the reductions in force, the Company's total employee count decreased by 32% compared to the third quarter 2015 and 44% compared to year-end 2014. The general and administrative cost saving initiatives also included reductions in benefits, office expenses, software licenses and other costs. The Company expects its general and administrative expenses and lease operating expenses to continue to decrease in 2016 as it realizes a full year of cost savings from the reductions in force and other initiatives. EXCO was able to achieve top-tier safety performance for 2015 with a total recordable incident rate of 0.58 for employees and 0.34 for contractors, which is significantly below the industry average.
   
   The Company's operational team is dedicated to the continuous improvement and innovation of well designs in order to maximize return on capital. The Company's improved well performance was the primary driver of the 184 Bcfe of upward revisions to its proved reserves during 2015. Enhanced well design and completion methods improved the well performance in the East Texas region and resulted in an increase in the estimated ultimate recoveries ("EUR") to 1.5 Bcf per 1,000 lateral feet for certain proved undeveloped Haynesville and Bossier shale locations, compared to 1.3 Bcf per 1,000 lateral feet as of year-end 2014. EXCO was able to achieve this improved performance while reducing the average drilling and completion capital by 28% on a lateral foot basis compared to year-end 2014. These capital reductions were the result of additional service cost reductions, design changes, performance improvements and other efficiencies that more than offset the use of significantly more proppant in the completion phase. The enhanced well designs and completion methods also resulted in an increase of the EUR to 2.0 Bcf per 1,000 lateral feet for certain proved undeveloped Haynesville shale locations in its core area of North Louisiana, compared to 1.6 Bcf per 1,000 lateral feet as of year-end 2014. EXCO's development of Haynesville shale assets in the North Louisiana region during 2016 will feature these enhanced completion methods. The Company has also seen sustained performance improvements in North Louisiana from the implementation of a full field compression program, which is expected to flatten its base decline and reduce future capital requirements.
3. Optimizing and repositioning the portfolio - EXCO has implemented a disciplined capital allocation approach to ensure the highest and best use of capital. The Company's capital is allocated based on the highest risk adjusted rates of return, including both the development of its oil and natural gas properties and liability management initiatives. EXCO's Board of Directors approved a 2016 capital budget of $103 million, including $70 million for the first half of 2016 focused on natural gas drilling and completion activities in North Louisiana and East Texas, which represent a reduction of $101 million, or 59%, versus the comparable 2015 period, and $33 million to fund field operations, land, capitalized corporate costs and other expenditures for the full year 2016. The Company's drilling and completion activities in North Louisiana achieve rates of return^(*) in excess of 35%, which are the highest returns for drilling opportunities in its portfolio. During 2016, the Company will continue to evaluate market conditions and recommend approval from the Board of Directors for the funding of drilling and completion activities, if any, for the second half of the year if the well returns exceed the internal rate of return hurdles and are consistent with EXCO's strategic objectives.
   
   The Company allocates capital to drilling to generate value and to leasing and acquisitions to increase its drilling inventory. EXCO continues to evaluate acquisition opportunities that meet its strategic objectives to allow the Company to increase its drilling inventory and generate accretive returns throughout the commodity price cycle. The Company will also evaluate divestitures of assets that would allow it to redeploy capital to projects with higher rates of return.

North Louisiana

Highlights:

• Produced 174 Mmcfe per day, a decrease of 23 Mmcfe per day, or 12%, from the third quarter 2015, and a decrease of 19 Mmcfe per day, or 10%, from the fourth quarter 2014.
• Enhanced completion methods resulted in an increase to 2.0 Bcf per 1,000 lateral feet from 1.6 Bcf per 1,000 lateral feet for proved undeveloped locations in the Haynesville shale within the Company's core area of North Louisiana during the fourth quarter 2015.
• Implementing a modified well design featuring enhanced completion methods to drill and complete 9 gross (5.5 net) horizontal wells during 2016.

EXCO’s decrease in production compared to the third quarter 2015 was primarily the result of normal production declines since its most recent well in the region turned-to-sales in June 2015. The Company plans to operate an average of two drilling rigs to drill 9 gross (5.5 net) wells during the first six months of 2016 and complete 9 gross (5.5 net) wells for the full year 2016 at an average cost ranging from $6.7 million to $8.9 million per well with lateral lengths ranging from 4,500 to 7,500 feet. The wells expected to be drilled in 2016 will feature similar completion methods that have proven to be successful in the Company's East Texas region, including the use of up to 2,700 lbs per lateral foot of proppant, modified well spacing and longer laterals. These improvements to well designs resulted in an increase to 2.0 Bcf per 1,000 lateral feet from 1.6 Bcf for proved undeveloped locations in the Haynesville shale within its core area of North Louisiana during the fourth quarter 2015. The Company is targeting rates of return^(*) in excess of 35% in this region during 2016.

EXCO has implemented several initiatives to enhance and manage its base production in the region. This includes a full field compression program in the Holly area that began in late 2015. EXCO has realized sustained performance improvement from this initiative as evidenced by a flattening of its base production decline as the overall gathering system pressure has been reduced from approximately 1,185 psi to the target of 500 psi.

East Texas

Highlights:

• Produced 64 Mmcfe per day, an increase of 12 Mmcfe per day, or 23%, from the third quarter 2015, and an increase of 17 Mmcfe per day, or 36%, from the fourth quarter 2014.
• Drilled 6 gross (2.7 net) operated horizontal Haynesville and Bossier wells and turned-to-sales 4 gross (2.0 net) operated horizontal wells in the Haynesville and Bossier shales during the fourth quarter 2015.
• Enhanced completion methods resulted in an increase to 1.5 Bcf per 1,000 lateral feet from 1.3 Bcf for proved undeveloped locations in the Bossier shale in East Texas.

EXCO’s increase in production in East Texas compared to the third quarter 2015 was primarily the result of additional wells turned-to-sales. Development during the fourth quarter 2015 included 3 rigs that drilled 3 gross (1.2 net) wells in the Haynesville shale and 3 gross (1.5 net) wells in the Bossier shale. The wells turned-to-sales included 3 gross (1.5 net) wells in the Haynesville shale and 1 gross (0.5 net) well in the Bossier shale. The wells turned-to-sales in this region during 2015 featured enhanced completion methods that have continued to yield strong results. The well performance in the East Texas region resulted in an increase of the EUR to 1.5 Bcf per 1,000 lateral feet for certain proved undeveloped locations in both the Haynesville and Bossier shales compared to 1.3 Bcf per 1,000 lateral feet as of year-end 2014. EXCO believes there is the potential for additional upside in the EURs as more production history is established.

EXCO recognized certain reductions in drilling and completion costs including renegotiated rig and completion service contracts, as well as spacing modifications that allowed EXCO to utilize multi-well pad sites. The utilization of these multi-well pad sites allowed for reductions in road and location costs and lower mobilization costs due to closer proximity between well sites. In addition, EXCO's development in this region allowed it to realize economies of scale and increased drilling efficiency as the Company moved from an appraisal mode to a manufacturing mode. These changes have resulted in a decrease to $10.4 million for East Texas Haynesville wells that were drilled and expected to be completed in early 2016 despite the use of 90% more proppant in the completion phase, compared to average costs of $12.5 million for wells drilled in the region in 2014. The Company's average drilling time for the fourth quarter was 39 days with an average total measured depth of approximately 20,000 feet.

EXCO completed a Haynesville shale well in Nacogdoches County, Texas, with a total measured depth of 21,289 feet, the longest in the Company's history, in the third quarter 2015. As of December 31, 2015, the well continues to perform above expectations with a production rate of 10.5 Mmcfe per day on a 17/64th restricted choke with a flowing tubing pressure of 8,832 psi. The Company believes the continued strong results of this well show further upside for the undeveloped southern area of the Company's East Texas position. The Company currently has 112 undeveloped gross locations prospective for the Haynesville and Bossier shales in this area.

South Texas

Highlights:

• Produced 7.3 Mboe per day consistent with the third quarter 2015 and an increase of 1.1 Mboe per day, or 19%, from the fourth quarter 2014.
• Turned-to-sales 3 gross (1.8 net) operated horizontal wells.

EXCO’s production remained consistent compared to the third quarter 2015 primarily due to additional wells turned-to-sales that were offset by normal production declines in the region. Development included 2 gross (0.8 net) wells turned-to-sales in the Eagle Ford shale featuring enhanced completion methods. The average costs of the wells turned-to-sales in the Eagle Ford shale during the fourth quarter was approximately $6.1 million, with average lateral lengths of 8,900 feet and proppant of 2,300 lbs per lateral foot. The initial production rates from these wells averaged 780 Bbls per day. Development in the Buda formation included 1 gross (1.0 net) well turned-to-sales.

As a result of continued depressed oil prices, EXCO has no plans to drill in the region during 2016. The Company's acreage in the South Texas region is approximately 81% held-by-production, including 100% of its core area, which allows EXCO flexibility in the timing of development of this region.

Appalachia

Highlights:

• Produced 37 Mmcfe per day, a decrease of 10 Mmcfe per day, or 21%, from the third quarter 2015, and a decrease of 17 Mmcfe per day, or 32%, from the fourth quarter 2014.

EXCO’s decrease in production compared to the third quarter 2015 was primarily attributable to shut-in production of approximately 11 Mmcfe per day during the fourth quarter from its Marcellus shale wells due to low regional market prices for natural gas. EXCO turned-to-sales 1 gross (0.5 net) well during the fourth quarter. The Company's position in the Marcellus shale requires low maintenance capital and approximately 84% of the acreage is held-by-production.

EXCO implemented reductions in force of field employees that primarily impacted the Appalachia region, reducing its field employee count in the area by 41% from 147 employees as of December 31, 2014, to 87 employees as of December 31, 2015. As a result of the reductions in force, the Company restructured its field organization to better align the operations personnel with the asset base and reduce its operating costs.

EXCO's proved reserves as of December 31, 2015, were 907 Bcfe with a SEC PV-10 of $402 million. For 2015, the SEC reference price was $2.59 per Mmbtu for natural gas and $50.28 per Bbl for oil. Each of the reference prices for oil and natural gas were adjusted for regional differentials. The SEC reference prices used were held flat for the life of the reserves. NYMEX PV-10 of proved reserves as of December 31, 2015, was $811 million^(*). See the "Non-GAAP Financial Measures" section of this press release for additional information.

During 2015, EXCO added 198.1 Bcfe through discoveries and extensions, primarily as a result of its development programs of the Haynesville and Bossier shales in East Texas and the Eagle Ford shale in South Texas. The revisions of previous estimates included downward revisions to proved reserve quantities of 615.8 Bcfe as a result of decreased commodity prices, which shortened the economic life of certain producing properties and resulted in the reclassification of proved undeveloped properties to unproved locations as those properties became uneconomical when using prices prescribed by the SEC. The SEC reference natural gas price decreased 40% to $2.59 per Mmbtu for the year ended December 31, 2015, from $4.35 per Mmbtu for the year ended December 31, 2014, and the SEC reference oil price decreased 47% to $50.28 per Bbl for the year ended December 31, 2015, from $94.99 per Bbl for the year ended December 31, 2014. The revisions of previous estimates also included 183.8 Bcfe of upward revisions due to performance and other factors. This included 152.2 Bcfe of upward revisions in the North Louisiana region primarily due to modifications in the well design to incorporate more proppant and longer laterals. The upward revisions also included 36.7 Bcfe from the East Texas region primarily due to strong results in both the Haynesville and Bossier shales based on similar modifications in the well design. Reserves were reduced by 124.0 Bcfe as a result of production during the year.

Finding and development costs to convert reserves to proved developed reserves were $0.80 per Mcfe during 2015 compared to $3.13 per Mcfe during 2014. At December 31, 2014, EXCO had 40 gross (14.7 net) wells being completed or awaiting completion that were converted to proved developed reserves in 2015. This resulted in the finding and development costs to be significantly lower for the year-to-date 2015 as compared to year-to-date 2014. The Company's finding and development costs were $1.46 per Mcfe for 2015 and 2014 on a combined basis.

EXCO’s decrease in adjusted EBITDA in the fourth quarter 2015 compared to the third quarter 2015 and for the year-to-date 2015 compared to 2014 was primarily due to lower revenues as a result of lower market prices for oil and natural gas and lower natural gas production. Oil differentials were negatively impacted by the narrowing of the premium of the LLS price index compared to the WTI price index in the fourth quarter 2015. The GAAP net loss during the fourth quarter and full year 2015 was primarily due to impairments of the Company’s oil and natural gas properties pursuant to the ceiling test in accordance with full cost accounting of $205 million and $1.2 billion, respectively.

EXCO has implemented several initiatives to reduce its general and administrative costs, including reductions in its workforce during the second quarter 2014 and first and fourth quarters 2015. Excluding the impact of the severance costs, general and administrative expenses decreased 21% for year-to-date 2015 compared to 2014 (excluding equity-based compensation). General and administrative expenses for the quarter-to-date 2015 were above guidance due to $2.7 million of severance costs and the accrual of $1.8 million for the annual incentive payment to ESAS as a result of EXCO's performance rank under the plan during 2015. EXCO's performance rank, based on total shareholder return, was the highest in its peer group during the first nine months of the measurement period under the ESAS services and investment agreement. Excluding the impact of the severance costs and ESAS incentive accrual that were not contemplated in the development of the guidance, EXCO's general and administrative costs would have been below the low-end of guidance. EXCO's general and administrative costs are expected to continue to decrease in 2016 as it realizes a full year of cost savings from the reduction in force and initiatives such as the elimination of the employer matching program on its 401(k) plan and other benefits, as well as reductions in office expenses, software costs, and other initiatives.

EXCO's decrease in operating cash flows in the fourth quarter compared to the third quarter 2015 was primarily the result of lower revenues and the timing of payments surrounding year-end. During the fourth quarter 2015, EXCO primarily used its cash flows from operations and borrowings under the Credit Agreement to fund drilling and development. EXCO's financing activities in the fourth quarter 2015 also included the issuance of the Fairfax Term Loan, repayments under its Credit Agreement, repurchases of the 2018 Notes, fees associated with the issuance of Second Lien Term Loans and payments on the Exchange Term Loan.

EXCO's decrease in operating cash flows for 2015 compared to 2014 was primarily the result of lower revenues and less favorable working capital conversions, offset by higher cash receipts on derivative contracts. During the year ended 2015, EXCO primarily used its cash flows from operations and borrowings under the Credit Agreement to fund drilling and development. EXCO's financing activities for year-to-date 2015 consisted of $300 million of proceeds received from the Fairfax Term Loan, $135 million of net repayments under its Credit Agreement, repurchases of the 2018 Notes, fees associated with the issuance of Second Lien Term Loans and payments on the Exchange Term Loan.

EXCO's liquidity was $334 million as of year-end 2015. EXCO's 2016 capital budget is expected to exceed its cash flows from operations and the deficit is expected to be funded with borrowings under the Credit Agreement. The Company continues to evaluate and implement further cost reduction initiatives to mitigate the impact of low commodity prices on its cash flows and liquidity. The initiatives implemented during 2015 have included reductions in its workforce, reduced operating and capital expenditures through negotiations with key vendors and restructuring of commercial contracts including sales and firm transportation agreements. EXCO is currently evaluating transactions to further enhance its liquidity and capital structure including the issuance of additional indebtedness, the restructuring or repurchase of existing indebtedness, issuance of equity, cost reductions and divestitures of assets.

EXCO's derivative financial instruments were comprised of oil and natural gas swaps as of December 31, 2015. In the fourth quarter 2015, the Company converted all of its remaining 2016 three-way collars to fixed-price swaps covering 10,980 Bbtu of natural gas at an average price of $2.78 per Mmbtu.

The Company's derivative financial instruments covered approximately 68% of estimated production volumes for the full year 2015. Since year-end 2015, EXCO entered into swaption contracts that included fixed price swaps covering 6,700 Bbtu of natural gas at a price of $2.76 per Mmbtu for 2016 in exchange for an option on behalf of the counterparty to swap 7,300 Bbtu of natural gas at a price of $2.76 per Mmbtu for 2017. The Company also entered into fixed price swaps covering 12,200 Bbtu of natural gas at an average price of $2.45 per Mmbtu for 2016 and 1,800 Bbtu of natural gas at a price of $2.36 per Mmbtu for 2017. As a result, the Company currently has outstanding swap contracts covering 53,670 Bbtu of natural gas at an average price of $2.90 per Mmbtu for 2016.

In addition, the Company is proactively managing its credit risk in light of the current commodity price environment and has obtained financial assurances from certain customers, owners and other counterparties.

On February 26, 2016, EXCO was notified by the New York Stock Exchange (“NYSE”) of its noncompliance with continued listing standards because the average closing price of its common shares over a period of 30 consecutive trading days had fallen below $1.00 per share, which is the minimum average closing price per share required to maintain listing on the NYSE.

Under the NYSE rules, during the six-month period from the date of the NYSE notice, EXCO can regain compliance if the price per share of EXCO’s common shares on the last trading day of any calendar month within such period and the 30 trading day average price per common share for that month is at least $1.00. During this period, subject to EXCO’s compliance with other NYSE continued listing requirements, EXCO’s common shares will continue to be traded on the NYSE under the symbol “XCO” but will have an added designation of “.BC” to indicate the status of the common shares as below compliance.

EXCO intends to notify the NYSE of its intent to cure this noncompliance and is currently exploring its options for regaining compliance, including a potential reverse share split of EXCO’s common shares at a ratio of up to 1-for-10 as previously approved by EXCO’s shareholders. EXCO’s Board of Directors is currently evaluating whether to exercise its discretion to effect the reverse share split in an effort to regain compliance with the NYSE continued listing standards by increasing the market price of its common shares. In addition, EXCO is also currently evaluating transactions that could further enhance its liquidity and capital structure, including the issuance of additional indebtedness, further restructuring or repurchases of existing indebtedness, the issuance of equity, cost reductions, divestitures of assets, acquisitions or similar transactions, any of which could impact the trading price of EXCO’s common shares.

EXCO anticipates that the reverse share split, if completed, will cure the deficiency and the Company will regain compliance with the NYSE continued listing requirement. If EXCO is unable to regain compliance, the NYSE will initiate procedures to suspend and delist EXCO’s common shares.

The NYSE notification does not affect EXCO’s business operations or its Securities and Exchange Commission (“SEC”) reporting requirements and does not conflict with or cause an event of default under any of the Company’s material debt agreements. Furthermore, the NYSE notice is not related to the NYSE continued listing requirement that a listed company have a market capitalization of at least $50 million. Based on the closing price of the Company’s common shares on February 26, 2016, the Company’s market capitalization was approximately $280 million. A reverse share split would not be expected to affect the Company’s market capitalization.

The following financial statements are attached.

EXCO will host a conference call on Wednesday, March 2, 2016, at 9:00 a.m. (Central time), to discuss the contents of this release and respond to questions. Please call (800) 309-5788 if you wish to participate, and ask for the EXCO conference call ID#24918641. The conference call will also be webcast on EXCO’s website at www.excoresources.com under the Investor Relations tab. Presentation materials related to this release will be posted on EXCO’s website prior to the conference call. A digital recording will be available starting two hours after the completion of the conference call until March 30, 2016. Please call (800) 585-8367 and enter conference ID#24918641 to hear the recording. A digital recording of the conference call will also be available on EXCO’s website.

Additional information about EXCO Resources, Inc. may be obtained by contacting Chris Peracchi, EXCO’s Vice President of Finance and Investor Relations, and Treasurer, at EXCO’s headquarters, 12377 Merit Drive, Suite 1700, Dallas, TX 75251, telephone number (214) 368-2084, or by visiting EXCO’s website at www.excoresources.com. EXCO’s SEC filings and press releases can be found under the Investor Relations tab.

This press release contains statements that are forward-looking statements as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, among others, statements regarding estimates, expectations and production forecasts, estimates of costs and expenses, and EXCO’s drilling program. It is important to communicate expectations of future performance to investors. However, events may occur in the future that EXCO is unable to accurately predict, or over which EXCO has no control. Users of the financial statements are cautioned not to place undue reliance on a forward-looking statement. Any number of factors could cause actual results to differ materially from those in EXCO's forward-looking statements, including, but not limited to, the volatility of oil and natural gas prices, future capital requirements and the availability of capital and financing, uncertainties about reserve estimates, the outcome of future drilling activity, environmental risks and regulatory changes. Declines in oil or natural gas prices may have a material adverse effect on EXCO's financial condition, liquidity, results of operations, ability to fund operations and the amount of oil or natural gas that can be produced economically. Historically, oil and natural gas prices and markets have been volatile, with prices fluctuating widely, and they are likely to continue to be volatile. EXCO undertakes no obligation to publicly update or revise any forward-looking statements. When considering EXCO's forward-looking statements, investors are urged to read the cautionary statements and the risk factors included in EXCO's Annual Report on Form 10-K for the year ended December 31, 2014, filed with the SEC on February 25, 2015, as amended by Amendment No. 1 to Annual Report on Form 10-K/A filed with the SEC on April 10, 2015, and after March 2, 2016, its annual Report on Form 10-K for the year ended December 31, 2015, and its other periodic filings with the SEC.

Other Non-GAAP Financial Measures

Certain non-GAAP (as defined below) financial measures are set forth in this release. A non-GAAP financial measure is a numerical measure of a company’s performance that either excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles in the United States (“GAAP”). SEC PV-10 and NYMEX PV-10 as used in this release are considered non-GAAP financial measures. EXCO believes that SEC PV-10, while not a financial measure in accordance with U.S. GAAP, is an important financial measure used by investors and independent oil and natural gas producers for evaluating the relative significance of oil and natural gas properties and acquisitions due to tax characteristics which can differ significantly among comparable companies. The total Standardized Measure, a measure recognized under GAAP, as of December 31, 2015, was $402.1 million. The Standardized Measure represents the SEC PV-10 after giving effect to income taxes, and is calculated in accordance with the Financial Accounting Standards Board Accounting Standards Codification 932, Extractive Activities, Oil and Gas. There is no difference in Standardized Measure and SEC PV-10 for all years presented in this release as the impacts of net operating loss carry-forwards eliminated future income taxes.

The NYMEX PV-10 as disclosed in this release differs from the Standardized Measure, a GAAP measure, primarily due to the oil and natural gas prices utilized in the determination of future net cash flows. EXCO believes that NYMEX PV-10 can be used within the industry and by creditors and securities analysts to evaluate estimated net cash flows in the current commodity price environment. There is not a corresponding GAAP measure for NYMEX PV-10 of proved reserves calculated using prices other than those prescribed by the SEC. Accordingly, it is not practicable to reconcile NYMEX PV-10 as of December 31, 2015, to the Standardized Measure.

View source version on businesswire.com: http://www.businesswire.com/news/home/20160301007000/en/

EXCO Resources Inc.
Chris Peracchi, 214-368-2084