Chesapeake Energy Corporation (CHK): Debt Still A Problem

This high level of long-term debt is one of the biggest reasons investors are concerned about the company’s future, especially considering that Chesapeake Energy Corporation (NYSE:CHK) pledged last year to bring its debt down to about $9.5 billion by the end of 2012 or early 2013 – a promise it has clearly failed to keep.

As a result of its high debt load, Chesapeake continues to face a daunting funding gap – the difference between its expenditures and its expected cash flow – of roughly $3.5 billion for the year, as per the company’s estimates. To help reduce this cash flow shortfall, it hopes to meet its asset sale target of $4 billion-$7 billion this year.

The article 3 Key Takeaways From Chesapeake’s First-Quarter-Earnings Report originally appeared on Fool.com and is written by Arjun Sreekumar.

Motley Fool contributor Arjun Sreekumar has no position in any stocks mentioned. The Motley Fool has the following options: Long Jan 2014 $20 Calls on Chesapeake Energy, Long Jan 2014 $30 Calls on Chesapeake Energy Corporation (NYSE:CHK), and Short Jan 2014 $15 Puts on Chesapeake Energy.

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