Successor net income totaled $295 million, or $2.75 per diluted share

Generated adjusted EBITDAX (a non-GAAP measure) of $510 million for the combined 2021 Successor and Predecessor Periods (January 1, 2021 - March 31, 2021)

March 31, 2021 unrestricted cash balance of $340 million; reducing March 31, 2021 net debt (a non-GAAP measure) to adjusted 2021E EBITDAX ratio to 0.6x

Launched sustainable dividend at an initial annual rate of $1.375 per share to be paid quarterly beginning in the 2021 Second Quarter; base dividend built to withstand commodity price volatility with incremental cash return strategy to be defined by year end 2021

Increased five-year cumulative free cash flow (a non-GAAP measure) outlook to ~$3 billion

Mike Wichterich, Chesapeake's Board Chairman and Interim Chief Executive Officer, commented, "Our strong first quarter results demonstrate the significant value creating opportunities that lie ahead for Chesapeake. We are committed to returning meaningful cash to our shareholders and are pleased to announce a highly competitive dividend that is built to withstand commodity price cycles. With our talented employees, pristine balance sheet, operational leadership, and free cash flow outlook, I firmly believe Chesapeake is poised to deliver differential returns to our shareholders."

Dividend Policy and Balance Sheet Update

Following Chesapeake's emergence from Chapter 11 restructuring proceedings, the company generated $409 million of operating cash flow and ended the quarter with $340 million of unrestricted cash on hand. As of April 30, 2021, Chesapeake had approximately $500 million of unrestricted cash on hand. With the company's strong liquidity position and free cash flow generation, Chesapeake's Board of Directors has declared an annual dividend on its common shares of $1.375 per share. The dividend will be paid quarterly, with the first such payment to be payable on June 10, 2021 to shareholders of record at the close of business on May 24, 2021.

Operations Update

Chesapeake achieved an average net production rate of approximately 436,000 barrels of oil equivalent per day (approximately 77 percent natural gas and 23 percent total liquids) during the 2021 first quarter. Chesapeake is currently operating seven rigs across its portfolio, with three rigs in Appalachia, three rigs in Haynesville and one rig in South Texas.

Fresh Start Accounting and Predecessor and Successor Periods

In connection with our emergence from bankruptcy on February 9, 2021, Chesapeake qualified for and applied fresh start accounting. In applying fresh start accounting, Chesapeake allocated its reorganization value to its individual assets based on their estimated fair values. Accordingly, the consolidated financial statements after February 9, 2021 are not comparable with the consolidated financial statements as of or prior to that date. References to "Successor" refer to the post-emergence reorganized Chesapeake after February 9, 2021, and references to "Predecessor" refer to pre-emergence Chesapeake for periods on or before February 9, 2021.

Outlook and Guidance Update

Today, Chesapeake released its first complete post-restructuring guidance and outlook for the full year 2021, including full-year cost estimates and projections for production and capital expenditures. In addition, the company announced that it expects total production levels in 2022 to remain flat to 2021, with natural gas increasing to approximately 85% of the total production mix for 2022.

• Chesapeake Energy Corp