Antero Resources (AR) - Q4 2024 Results

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On February 12 Antero Resources Corporation (NYSE: AR) ("Antero Resources," "Antero," or the "Company") announced its fourth quarter 2024 financial and operating results, year end 2024 estimated proved reserves and 2025 guidance. The relevant consolidated financial statements are included in Antero Resources' Annual Report on Form 10-K for the year ended December 31, 2024.

Fourth Quarter 2024 Highlights:

Net production averaged 3.4 Bcfe/d < Agrees with my forecast.

Natural gas production averaged 2.1 Bcf/d, a 7% decrease from the year ago period < Slightly below my forecast of 2.175 Bcfpd.

Liquids production averaged 217 MBbl/d, a 14% increase from the year ago period < Above my forecast of 208,354 bpd.

Realized a pre-hedge natural gas equivalent price of $3.64 per Mcfe, an $0.85 per Mcfe premium to NYMEX

Realized a pre-hedge C3+ NGL price of $44.29 per barrel, a $3.09 per barrel premium to Mont Belvieu

Net income was $150 million and Adjusted Net Income was $181 million (Non-GAAP) < Beat my forecast of $91.9 million Net Income.

Adjusted EBITDAX was $332 million (Non-GAAP); net cash provided by operating activities was $278 million

Drilling and completion capital was $120 million, 27% below the prior year period

Free Cash Flow was $159 million (Non-GAAP)

Averaged a quarterly company record of 13.2 completion stages per day

Full Year 2024 Highlights:

Net Production averaged 3.4 Bcfe/d, an increase of 1% from the prior year

Natural gas production averaged 2.2 Bcf/d, a decrease of 3% from the prior year

Liquids production averaged 209 MBbl/d, an increase of 8% from the prior year

Drilling and completion capital was $620 million, a 32% decline from the prior year

Completion stages per day averaged 12.2 stages per day, a 14% increase compared to 2023

Estimated proved reserves were 17.9 Tcfe at year end 2024 and proved developed reserves were 13.7 Tcfe (77% proved developed)

Estimated future development cost for 4.2 Tcfe of proved undeveloped reserves is $0.44 per Mcfe

2025 Guidance Highlights:

Raised previously communicated maintenance production targets by 50 MMcfe/d to 3.35 to 3.45 Bcfe/d, driven by growth in liquids production

Realized natural gas price is expected to average a premium of $0.10 to $0.20 per Mcf to NYMEX

Realized C3+ NGL price is expected to average a premium of $1.50 to $2.50 per barrel to Mont Belvieu

Reduced previously communicated drilling and completion capital budget, by $25 million at the midpoint to $650 million to $700 million

Paul Rady, Chairman, CEO and President of Antero Resources commented, "Our 2024 development program delivered production that was 2% above the midpoint of the initial guidance range and capital that was 8% below the midpoint of the initial guidance range. This exceptional performance highlights the strength of our asset base and the significant capital efficiency gains we made throughout the year. Our 2025 budget reflects an increase to our maintenance production targets driven by our liquids. This development program positions us to capture a significant increase in Free Cash Flow year-over-year with the greatest exposure to higher natural gas prices."

Michael Kennedy, CFO of Antero Resources said, "Antero's 2024 financial results reflect the company's peer-leading Free Cash Flow breakeven level driven by our significant liquids production and firm transportation portfolio. These attributes enabled us to generate Free Cash Flow of $73 million in 2024 despite being unhedged with Henry Hub averaging $2.27 per Mcf. Looking ahead to 2025, our firm transportation portfolio delivers 75% of our natural gas to the LNG corridor along the Gulf Coast, and is expected to result in higher premium price realizations to NYMEX following the recent start-up of two large LNG export terminals in the Gulf."

For a discussion of the non-GAAP financial measures including Adjusted Net Income, Adjusted EBITDAX, Free Cash Flow and Net Debt please see "Non-GAAP Financial Measures."

2025 Guidance

Antero's 2025 drilling and completion capital budget is $650 to $700 million. Net production is expected to average between 3.35 and 3.45 Bcfe/d during 2025. The Company's land capital guidance is $75 million to $100 million. < Free Cash Flow should be approximately $1.2 billion.