Crescent Point Energy (CPG) Q4 Results - Mar 1

[dan_s]

KEY HIGHLIGHTS
• Transformed portfolio, increasing premium inventory to over 20 years and enhancing excess cash flow profile.
• Replaced over 900 percent of 2023 production on a 2P reserves basis including strategic A&D, or 150 percent organically.
• Generated $980 million of excess cash flow in 2023, with capital expenditures and production in-line with guidance.
• Returned approximately $600 million, or 60 percent of excess cash flow, to shareholders in 2023.
• Increasing quarterly base dividend by 15 percent to $0.115 per share, or $0.46 per share annually.
• Generated a strong FD&A recycle ratio of 2.5 times in 2023, including change in FDC, based on 2P reserves.
• Excess cash flow of $830 million expected in 2024 at US$75 WTI, with 60 percent returned to shareholders.
• Five-year plan expected to generate strong per share growth and cumulative excess cash flow of $4.7 billion at US$70 WTI.

"This past year was pivotal in our company's history as we successfully transformed our portfolio," said Craig Bryksa, President and
CEO of Crescent Point. "Through this execution, we have materially enhanced the long-term sustainability of our business, including
by increasing our premium drilling inventory to over 20 years and enhancing our excess cash flow profile on a per share basis. Our
strategic priorities going forward are operational execution, balance sheet strength and increasing return of capital to shareholders."

FINANCIAL HIGHLIGHTS ($Cdn)

• Adjusted funds flow totaled over $2.3 billion for the year ended December 31, 2023, or $4.27 per share diluted, driven by a strong
operating netback of $43.71 per boe. In fourth quarter, adjusted funds flow totaled $574.5 million, or $1.03 per share diluted. < Beat my forecast of $410 million Adjusted Operating Cash Flow.

• For the year ended December 31, 2023, development capital expenditures, which included drilling and development, facilities and
seismic costs, totaled $1.14 billion, within the Company's annual guidance range of $1.05 billion to $1.15 billion.

• The Company's net debt as at December 31, 2023 was approximately $3.7 billion. Throughout 2023, Crescent Point executed on
its portfolio strategy which included material additions in the Alberta Montney along with non-core asset dispositions. During fourth
quarter 2023, Crescent Point entered into agreements to dispose of its Swan Hills and Turner Valley assets in Alberta, which have
closed or are expected to close in first quarter 2024.

• For the year ended December 31, 2023, Crescent Point reported net income from continuing operations of $799.4 million, or
$1.46 per share diluted. The Company's total net income for 2023, including discontinued operations, was $570.3 million, or $1.04
per share diluted, which included net non-cash charges of $106.7 million related to the disposition of its U.S. assets.

• The Company has hedged approximately 45 percent of its oil and liquids production and over 30 percent of its natural gas
production in 2024, net of royalty interest. The Company has also diversified its pricing exposure for natural gas, with the majority
of its production through 2025 receiving a combination of fixed prices and pricing related to major U.S. markets.

RETURN OF CAPITAL HIGHLIGHTS

• The Company's total return of capital to shareholders in 2023, including the base dividend, was $599.5 million, or approximately
60 percent of its annual excess cash flow.

• During fourth quarter, Crescent Point prioritized share buybacks within its return of capital framework, repurchasing 8.4 million
shares for $83.8 million. The Company repurchased a total of 34.6 million shares for $349.9 million in 2023, representing over six
percent of its public float at the start of the year. Crescent Point intends to file with the Toronto Stock Exchange ("TSX") a notice of
intention to renew its normal course issuer bid ("NCIB"), which is due to expire on March 8, 2024. < The Company's aggressive stock buyback program is one of the keys to my valuation of this stock.

• Crescent Point's Board of Directors has approved and declared a first quarter 2024 base dividend of $0.115 per share, an
increase of 15 percent from the prior level. The base dividend is payable on April 1, 2024 to shareholders of record on March 15,
2024. This base dividend increase equates to an annualized base dividend of $0.46Cdn per share.

[dan_s]

This is why I believe CPG has significant upside for us:

"Crescent Point's 2P net asset value ("NAV") was $22.45 per share at year-end 2023, based on independent engineering pricing.
On a PDP and 1P basis, the Company's NAV was $7.63 and $14.07 per share, respectively. The independent engineering price
forecast assumes an average WTI price of approximately US$76.35/bbl and AECO price of approximately $3.60/Mcf in the first
five years. The Company's NAV at year-end 2023 does not include unbooked locations, primarily in the Kaybob Duvernay and
Alberta Montney, allowing for future reserves additions."

CPG is currently trading at $10.22Cdn per share. A profitable company that is generating lots of free cash flow should trade for at least the PV10 NAV of it Proved Reserves (P1).

[dan_s]

OUTLOOK

Crescent Point's strategic priorities remain focused on operational execution, balance sheet strength and increasing return of capital
to shareholders.

The Company's previously released 2024 annual average production guidance of 198,000 to 206,000 boe/d and development capital
expenditures budget of $1.4 billion to $1.5 billion remain unchanged. This budget remains disciplined and flexible, with a continued
focus on allocating capital to the highest-return assets. Approximately 45 percent of Crescent Point's 2024 budget is allocated to the
Alberta Montney, 35 percent to Kaybob Duvernay and 20 percent to Saskatchewan. The Company's 2024 capital budget, including its
base dividend, remains fully funded at approximately US$55/bbl WTI.

Within its operations, Crescent Point continues to target additional efficiencies and improved productivity by further enhancing drilling
and completions optimization, including optimizing wells drilled per section on its recently acquired Alberta Montney assets and
drilling longer lateral wells in the Kaybob Duvernay. In Saskatchewan, the Company continues to build on its operational momentum
through the advancement of its OHML drilling and decline mitigation programs.

Crescent Point's 2024 budget is expected to generate significant excess cash flow of approximately $830 million at average
commodity prices of approximately US$75/bbl WTI and $2.30/Mcf AECO for the full year. The Company's funds flow sensitivity is
approximately $30 million for every US$1/bbl change in WTI and $20 million for every $0.25/Mcf change in AECO for the remainder
of the year.

Crescent Point plans to continue allocating 60 percent of its excess cash flow to shareholders through the base dividend and share
repurchases, with the remaining 40 percent directed toward the balance sheet. The Company's leverage ratio, or net debt to adjusted
funds flow, is expected to be approximately 1.2 times by year-end 2024, based on average commodity prices of approximately
US$75/bbl WTI and $2.30/Mcf AECO for the full year.

The Company plans to increase the percentage of excess cash flow it returns to shareholders over time as it further strengthens its
balance sheet. Crescent Point's strategy is focused on delivering meaningful and sustainable total returns through a combination of
return of capital, per-share growth and balance sheet strength.