Riley Exploration (REPX) Q4 Results - Mar 7

[dan_s]

My current valuation of REPX is $50/share

FOURTH QUARTER 2023 HIGHLIGHTS

Averaged 19.9 MBoe/d of total equivalent production (oil production of 13.6 MBbls/d) < Beat my forecast of 19,000 Boepd.

Generated $66 million of operating cash flow or $54 million of operating cash flow before changes in working capital < My forecast was $53.9 million adjusted operating cash flow.

Incurred total accrual (activity-based) and cash capital expenditures before acquisitions of $25 million and $21 million, respectively

Generated Free Cash Flow of $33 million

Paid dividends of $0.36 per share in the fourth quarter for a total of $7 million

Reduced debt outstanding by $30 million

Initiated temporary operations on baseload power generation owned by our joint venture, RPC Power LLC

FULL YEAR 2023 HIGHLIGHTS

Averaged 18.6 MBoe/d of total equivalent production (oil production of 13.2 MBbls/d), which included contribution from the New Mexico Acquisition properties for three of four quarters in 2023

Generated $207 million of operating cash flow

Incurred $136 million for both total accrual (activity-based) and cash capital expenditures before acquisitions

Generated Free Cash Flow of $70 million

Paid dividends of $1.38 per share for a total of $28 million

Reported proved reserves as of December 31, 2023 of 108 MMBoe (62% oil); proved developed ("PDP") reserves of 60 MMBoe (61% oil and 56% of proved reserves)

2024 GUIDANCE HIGHLIGHTS

Full year 2024 guidance for oil production of 14.0 – 15.0 MBbls/d, corresponding to approximately 10% year-over-year growth at the midpoint

Full year 2024 guidance for total production of 21.0 – 22.5 MBoe/d, corresponding to approximately 17% year-over-year growth at the midpoint, benefiting from the anticipated addition of natural gas processing capacity through the year < Above my 2024 production forecast of 20.7 MBoe/d.

Full year 2024 guidance for activity-based investing expenditures before acquisitions of $115 - 130 million, corresponding to an approximate 10% year-over-year reduction at the midpoint

Bobby D. Riley, Chief Executive Officer, President and Chairman of the Board, said "We had outstanding operational and financial performance for 2023. This success continues to demonstrate our established track record of growth through both organic development and strategic acquisitions. Over the full year, the Company achieved a remarkable 49% growth in oil production and 62% total production growth year-over-year, which includes the impact of the New Mexico Acquisition for nine months of 2023.

"Our production growth on our legacy assets encompassed a 22% year-over-year increase organically and demonstrates our continued ability to achieve annual organic volume growth. Furthermore, our Free Cash Flow experienced a year-over-year increase of 26%, and we increased our dividend by 9%.

The Company increased proved reserves by 39%, primarily attributed to the New Mexico Acquisition, complemented by a robust development program.

"Looking ahead to 2024, our objective is to achieve a 10% growth in oil production while concurrently reducing capital expenditures by 10%. Our focus is on executing efficient operations and implementing cost-saving measures, which we believe will be the most impactful aspect of our 2024 plan."

OPERATIONS AND DEVELOPMENT ACTIVITY UPDATE

During the fourth quarter, the Company drilled 6 gross operated horizontal wells, including 4 in Texas and 2 in New Mexico. The Company completed 4 gross operated horizontal wells and turned to sales 2 gross operated horizontal wells.

For the full year 2023, the Company drilled 23 gross operated horizontal wells, including 17 gross wells in Texas and 6 gross wells in New Mexico. The Company completed 18 gross operated horizontal wells and turned to sales 18 gross operated horizontal wells.
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MY TAKE: Outstanding results and better production growth in 2024 will increase my stock valuation.

[ChuckGeb]

Market was happy about it, up 14.7% today. Listened to conference call. they have some DUC's going into 2024 so they should continue to perform. Well managed company. i see Dan listed as an analyst on their website It would be great to have them host another luncheon or webinar to get the word out. Their public float is only about 33%.

[dan_s]

I intend to get them to host a webinar and Houston luncheon soon.