Diamondback Energy (FANG) Q2 results - Aug 5

[dan_s]

SECOND QUARTER 2024 HIGHLIGHTS

Average oil production of 276.1 MBO/d (474.7 MBOE/d) < Beat my Q2 forecast of 462,000 Boepd with 273,000 bpd of crude oil.

Net cash provided by operating activities of $1.5 billion; Operating Cash Flow Before Working Capital Changes of $1.5 billion < Beat my forecast of $1,395 million Adjusted Operating Cash Flow.

Cash capital expenditures of $637 million

Free Cash Flow of $816 million; Adjusted Free Cash Flow of $841 million

Declared Q2 2024 base cash dividend of $0.90 per share and a variable cash dividend of $1.44 per share, in each case payable on August 22, 2024; implies a 5.0% annualized yield based on August 2, 2024 closing share price of $189.06 < The total "Base + Variable" dividend of $2.34 beat my forecast of $2.10.

Total Q2 2024 return of capital of $421 million; represents ~52% of Q2 2024 Free Cash Flow and 50% of Adjusted Free Cash Flow from the declared Q2 2024 base-plus-variable dividend

In June, completed a $95 million sale of non-operated properties in the Delaware Basin

In July, our 25%-owned joint venture Remuda Midstream Holdings LLC completed its previously announced sale of its subsidiary WTG Midstream Holdings LLC; in connection with that closing Diamondback received total consideration valued at approximately $375 million on a pretax basis, including approximately 10.1 million common units of Energy Transfer LP (NYSE: ET)

As previously announced, the pending merger with Endeavor Energy Resources, L.P. was approved by Diamondback stockholders on April 26, 2024. The deal remains subject to regulatory approval and other customary closing conditions and is expected to close in the third or fourth quarter of 2024 < This "Mega Merger" should push Diamondback's production up to approximately 820,000 Boepd.