Ranger Oil Corp (ROCC) Q3 Update - Oct 21

[dan_s]

I'm two days late on this, but it is very good news for the newest addition to the Sweet 16. ROCC replaces CLR, which is going private.

Ranger Oil Corporation
Wed, October 19, 2022 at 3:20 PM

Highlights:
> Total sales volumes above high-end of guidance
> Drilling and completion capital expenditures within guidance
> Company adds third rig in Q4, creating significant momentum for 2023 < This is very good news.
> Approximately $70 million returned to equity holders since May, reducing share count by nearly 5%

HOUSTON, TX / ACCESSWIRE / October 19, 2022 / Ranger Oil Corporation ("Ranger" or the "Company") (NASDAQ:ROCC) today provided a preliminary update on its third quarter 2022 financial and operating results. Complete results are planned for release after market close on Wednesday, November 2, 2022, with a conference call scheduled for 11 a.m. ET, Thursday, November 3, 2022 (details provided in this release).

Preliminary Third Quarter '22 Highlights:

Total sales volumes were approximately 42.6 thousand barrels of oil equivalent per day ("Mboe/d"), exceeding the top end of the guidance range of 40.9 - 42.5 Mboe/d. Oil sales volumes were approximately 30.7 thousand barrels of oil per day ("Mbbl/d"), exceeding the mid-point of the guidance range of 29.9 - 31.1 Mbbl/d.

Realized oil prices were approximately $93.03 per barrel, a premium to the quarterly WTI benchmark, or $83.14 per barrel including effects of derivatives, net1. < About $3/bbl lower than my forecast because they cashed out of some hedges early.

Drilling and completion ("D&C") capital expenditures were approximately $151.9 million, which included approximately $3.4 million of incremental capital due to D&C operations completed ahead of schedule. D&C capital in the quarter was in-line with the Company's guidance range of $135 - $160 million. Ranger continues to find innovative ways to offset industry-wide inflationary pressures and ensure wells get turned to sales on time and on budget.

As previously discussed, Ranger utilized a third rig for a portion of the second and third quarters of 2022. Due to the Company's efforts relating to its supply chain and its robust free cash flow profile, the Company picked up a third rig and now plans to employ a three-rig development pace through year-end 2022. This enhanced drilling pace is expected to significantly benefit 2023 production volumes. Ranger may elect to continue with a 3-rig development program in 2023 based on the rig's performance, market conditions, and capital allocation plans for next year.

Approximately $70 million has been returned to shareholders over the last five months through Ranger's share repurchase and dividend program. Repurchases total nearly 5% of total common stock outstanding, or approximately 2.0 million shares (average repurchase price: $34.36 per share). As of October 19, 2022, total shares of common stock outstanding were approximately 41.8 million. < This increases my per share valuation.

Ranger continues its focused consolidation strategy and expects to acquire incremental working interests in its operated properties, enhancing both its inventory depth and quality. The acquisition activity also adds incremental value to the Company's high rate of return development program.

The Company's leverage ratio further decreased during the third quarter, inclusive of approximately $93 million of previously announced bolt-on acquisitions that closed in the quarter, subject to customary adjustments. As of September 30, 2022, the Company had $400 million of senior unsecured notes and approximately $195 million drawn, net of cash, on its revolving credit facility. < Balance sheet is in good shape.

Darrin Henke, President and CEO remarked "The Ranger team is executing exceptionally well. We continue our focus on growing per share value through efficient operations while maximizing risk-adjusted returns on capital, strengthening our capital structure, and returning cash to shareholders. Our solid operating performance is expected to result in ongoing deleveraging and generation of significant free cash flow for the quarter, marking over three years of consistent quarterly free cash flow2 generation for Ranger. Our decision to add a third rig in the fourth quarter reflects our assessment of how to maximize risk-adjusted returns and is based on our recent operational success and the depth of our top-tier inventory. As our focus shifts to next year, we will continue to review our cash allocation to target maximizing risk-adjusted returns, while maintaining low leverage and substantial liquidity."

Conference Call Details

A conference call to discuss third quarter financial and operating results is planned for 11 a.m. ET, Thursday, November 3, 2022. To participate in the call, please dial (844) 707-6931 (international: (412) 317-9248) approximately 10 minutes prior to the scheduled start time. For the webcast, please log in to Ranger's website at least 15 minutes prior to the scheduled start time to download supporting materials and install necessary audio software.

A replay of the webcast (posted shortly after the call) will be available on the Company's website through November 10, 2022. The replay can be accessed by phone by dialing (877) 344-7529 (international (412) 317-0088) and entering passcode 6601669.

About Ranger Oil Corporation

Ranger Oil is a pure-play independent oil and gas company engaged in the development and production of oil, NGLs and natural gas, with operations in the Eagle Ford shale in South Texas. For more information, please visit our website at www.rangeroil.com.