Viper Energy, Inc., (NASDAQ:VNOM) (“Viper” or the “Company”), a
subsidiary of Diamondback Energy, Inc. (NASDAQ:FANG)
(“Diamondback”), today announced financial and operating results
for the fourth quarter and full year ended December 31, 2023.
FOURTH QUARTER HIGHLIGHTS
- Q4 2023 average production of
24,533 bo/d (43,783 boe/d)
- Received $2.4 million in lease
bonus income
- Q4 2023 consolidated net income
(including non-controlling interest) of $125.9 million; net income
attributable to Viper Energy, Inc. of $57.0 million, or $0.70 per
common share
- Q4 2023 cash available for
distribution to Viper’s common shares (as defined and reconciled
below) of $63.8 million, or $0.74 per Class A common share
- Declared Q4 2023 base cash dividend
of $0.27 per Class A common share; implies a 3.1% annualized yield
based on the February 16, 2024 share closing price of
$35.40
- Q4 2023 variable cash dividend of
$0.29 per Class A common share; total base-plus-variable dividend
of $0.56 per Class A common share implies a 6.3% annualized yield
based on the February 16, 2024 share closing price of
$35.40
- Repurchased 1.0 million Class A
common shares in Q4 2023 for $28.7 million, excluding excise
tax (average price of $28.70 per share)
- Total Q4 2023 return of capital of
$61.9 million, or $0.72 per Class A common share, represents
97% of cash available for distribution from share repurchases and
the declared base-plus-variable dividend
- As previously announced, closed
acquisition of certain mineral and royalty interests from
affiliates of Warwick Capital Partners and GRP Energy Capital (the
“GRP acquisition”) on November 1, 2023
- As previously announced, on
November 13, 2023 completed the conversion from a Delaware limited
partnership to a Delaware corporation
- 246 total gross (3.0 net 100%
royalty interest) horizontal wells turned to production on Viper’s
acreage during Q4 2023 with an average lateral length of 10,688
feet
FULL YEAR 2023 HIGHLIGHTS
- Full year 2023 average production
of 21,995 bo/d (39,244 boe/d)
- Received $109.7 million in lease
bonus income
- Full year 2023 consolidated net
income (including non-controlling interest) of $501.3 million; net
income attributable to Viper Energy, Inc. of $200.1 million, or
$2.69 per Class A common share
- Declared dividends of $1.82 per
Class A common share during the full year 2023
- Repurchased 3.4 million common
shares during the full year 2023 for $95.2 million (average price
of $28.08 per share)
- Generated full year 2023
consolidated adjusted EBITDA (as defined and reconciled below) of
$757.5 million
- Proved reserves as of
December 31, 2023 of 179,249 Mboe (80% PDP, 89,903 Mbo), up
20% year over year with oil up 14% from year end 2022
- 982 total gross (20.9 net 100%
royalty interest) horizontal wells turned to production on Viper’s
acreage during 2023 with an average lateral length of 10,869
feet
2024 OUTLOOK
- Initiating average daily production
guidance for Q1 2024 of 25,000 to 25,500 bo/d (44,750 to 45,500
boe/d)
- Initiating full year 2024 average
daily production guidance of 25,500 to 27,500 bo/d (45,500 to
49,000 boe/d)
- As of December 31, 2023, there
were approximately 787 gross horizontal wells in the process of
active development on Viper’s acreage in which Viper expects to own
an average 1.7% net royalty interest (13.4 net 100% royalty
interest wells)
- Approximately 762 gross (20.0 net
100% royalty interest) line-of-sight wells on Viper’s acreage that
are not currently in the process of active development, but for
which Viper has visibility to the potential of future development
in coming quarters, based on Diamondback’s current completion
schedule and third party operators’ permits
“The fourth quarter wrapped up a milestone year
for Viper. For the full year, average oil production increased 13%
compared to the previous year while our average share count was
reduced by one percent over the same period. As a result of
continued strong organic production growth, accretive acquisitions,
and an opportunistic share repurchase program, the fourth quarter
of 2023 represented the eighth consecutive quarter of increased
production per share for Viper Energy,” stated Travis Stice, Chief
Executive Officer of Viper.
Mr. Stice continued, “There were several
strategic initiatives completed during 2023 that marked important
steps in the growth and evolution of Viper. Our GRP acquisition,
which closed during the fourth quarter, clearly laid out the
framework we look for in large scale M&A: accretive on all
relevant financial metrics, high quality undeveloped inventory that
supports our long-term growth profile and provides clear visibility
to future development, and significant scale that results in a pro
forma business that is both bigger and better. Additionally, Viper
completed its conversion into a Delaware corporation, a step which
we believe has delivered increased governance rights for our
shareholders and positions Viper to continue to grow the business
and fully highlight the advantaged nature of mineral and royalty
ownership.”
Mr. Stice continued, “Looking ahead to 2024, we
have initiated production guidance for both Q1 and the full year.
While Q1 is expected to be the weakest quarter of the year,
primarily as a result of the timing of large pads, we continue to
see strong activity levels across our acreage position and expect
significant growth to occur throughout the year with Q4 2024
expected to be at, or above, the high-end of our guidance range.
This continued production growth, along with our best-in-class cost
structure, should enable Viper to continue to return a substantial
amount of capital to our shareholders, primarily through our
base-plus-variable dividend.”
FINANCIAL UPDATE
Viper’s fourth quarter 2023 average unhedged
realized prices were $77.65 per barrel of oil, $1.50 per Mcf of
natural gas and $21.47 per barrel of natural gas liquids, resulting
in a total equivalent realized price of $50.20/boe.
Viper’s fourth quarter 2023 average hedged
realized prices were $76.56 per barrel of oil, $1.34 per Mcf of
natural gas and $21.47 per barrel of natural gas liquids, resulting
in a total equivalent realized price of $49.38/boe.
During the fourth quarter of 2023, the Company
recorded total operating income of $204.7 million and consolidated
net income (including non-controlling interest) of $125.9
million.
As of December 31, 2023, the Company had a
cash balance of $25.9 million and total long-term debt outstanding
(excluding debt issuance, discounts and premiums) of $1.1 billion,
resulting in net debt (as defined and reconciled below) of $1.1
billion. Viper’s outstanding long-term debt as of December 31,
2023 consisted of $430.4 million in aggregate principal amount of
its 5.375% Senior Notes due 2027, $400.0 million in aggregate
principal amount of its 7.375% Senior Notes due 2031 and $263.0
million in borrowings on its revolving credit facility, leaving
$587.0 million available for future borrowings and $612.9 million
of total liquidity.
FOURTH QUARTER 2023 CASH DIVIDEND &
CAPITAL RETURN PROGRAM
Viper announced today that the Board of
Directors (the “Board”) of Viper Energy, Inc., declared a base
dividend of $0.27 per Class A common share for the fourth quarter
of 2023 payable on March 12, 2024 to Class A common shareholders of
record at the close of business on March 5, 2024.
The Board also declared a variable cash dividend
of $0.29 per Class A common share for the fourth quarter of 2023
payable on March 12, 2024 to Class A common shareholders of record
at the close of business on March 5, 2024.
During the fourth quarter of 2023, Viper
repurchased 1.0 million Class A common shares for an aggregate
purchase price of $28.7 million, excluding excise tax (average
price of $28.70 per share). In total, since the initiation of
Viper’s repurchase program through December 31, 2023, the
Company has repurchased 13.4 million shares for an aggregate of
$315.8 million, excluding excise tax, reflecting an average price
of $23.49 per share.
OPERATIONS UPDATE
During the fourth quarter of 2023, Viper
estimates that 246 gross (3.0 net 100% royalty interest) horizontal
wells with an average royalty interest of 1.2% were turned to
production on its acreage position with an average lateral length
of 10,688 feet. Of these 246 gross wells, Diamondback is the
operator of 48 gross wells, with an average royalty interest of
4.4%, and the remaining 198 gross wells, with an average royalty
interest of 0.5%, are operated by third parties.
Viper’s footprint of mineral and royalty
interests was 34,217 net royalty acres as of December 31,
2023.
Our gross well information as of
December 31, 2023 is as follows, unless otherwise
specified:
|
|
DiamondbackOperated |
|
Third PartyOperated |
|
Total |
| Horizontal wells
turned to production (fourth quarter
2023)(1): |
|
|
|
|
|
|
Gross wells |
48 |
|
198 |
|
246 |
|
Net 100% royalty interest wells |
2.1 |
|
0.9 |
|
3.0 |
|
Average percent net royalty interest |
4.4% |
|
0.5% |
|
1.2% |
| |
|
|
|
|
|
| Horizontal wells
turned to production (year ended December 31,
2023)(2): |
|
|
|
|
|
|
Gross wells |
232 |
|
750 |
|
982 |
|
Net 100% royalty interest wells |
13.6 |
|
7.3 |
|
20.9 |
|
Average percent net royalty interest |
5.9% |
|
1.0% |
|
2.1% |
| |
|
|
|
|
|
| Horizontal producing
well count: |
|
|
|
|
|
|
Gross wells |
1,844 |
|
9,433 |
|
11,277 |
|
Net 100% royalty interest wells |
127.7 |
|
107.5 |
|
235.2 |
|
Average percent net royalty interest |
6.9% |
|
1.1% |
|
2.1% |
| |
|
|
|
|
|
| Horizontal active
development well count: |
|
|
|
|
|
|
Gross wells |
114 |
|
673 |
|
787 |
|
Net 100% royalty interest wells |
5.2 |
|
8.2 |
|
13.4 |
|
Average percent net royalty interest |
4.6% |
|
1.2% |
|
1.7% |
| |
|
|
|
|
|
| Line of sight
wells: |
|
|
|
|
|
|
Gross wells |
171 |
|
591 |
|
762 |
|
Net 100% royalty interest wells |
10.8 |
|
9.2 |
|
20.0 |
|
Average percent net royalty interest |
6.3% |
|
1.6% |
|
2.6% |
|
|
|
|
|
|
|
(1) Average lateral length of 10,688 feet.(2)
Average lateral length of 10,869 feet.
The 787 gross wells currently in the process of
active development are those wells that have been spud and are
expected to be turned to production within approximately the next
six to eight months. Further in regard to the active development on
Viper’s asset base, there are currently 75 gross rigs operating on
Viper’s acreage, 12 of which are operated by Diamondback. The 762
line-of-sight wells are those that are not currently in the process
of active development, but for which Viper has reason to believe
that they will be turned to production within approximately the
next 15 to 18 months. The expected timing of these line-of-sight
wells is based primarily on permitting by third party operators or
Diamondback’s current expected completion schedule. Existing
permits or active development of Viper’s royalty acreage does not
ensure that those wells will be turned to production.
YEAR END RESERVES UPDATE
Viper’s proved oil and natural gas reserve
estimates and their associated future net cash flows were prepared
by Viper’s internal reservoir engineers, and audited by Ryder Scott
Company, L.P., independent petroleum engineers, as of
December 31, 2023. Reference prices of $78.22 per barrel of
oil and natural gas liquids and $2.64 per MMbtu of natural gas were
used in accordance with applicable rules of the Securities and
Exchange Commission. Realized prices with applicable differentials
were $77.93 per barrel of oil, $1.54 per Mcf of natural gas and
$23.79 per barrel of natural gas liquids.
Proved reserves at year-end 2023 of 179,249 Mboe
(89,903 Mbo) represent a 20% increase over year-end 2022 reserves.
The year-end 2023 proved reserves have a PV-10 value (as defined
and reconciled below) of approximately $3.6 billion and a
standardized measure of discounted future net cash flows of $3.2
billion.
Proved developed reserves increased by 34% year
over year to 143,371 Mboe (69,043 Mbo) as of December 31,
2023, reflecting continued horizontal development by the operators
of Viper’s acreage.
Net proved reserve additions of 44,673 Mboe
resulted in a reserve replacement ratio of 312% (defined as the sum
of extensions, discoveries, revisions, purchases and divestitures,
divided by annual production). The organic reserve replacement
ratio was 179% (defined as the sum of extensions, discoveries and
revisions, divided by annual production).
Extensions and discoveries of 25,558 Mboe are
primarily attributable to the drilling of 904 new wells and from
179 new proved undeveloped locations added. The Company’s total
positive revisions of previous estimated quantities of 138 Mboe
consist of positive revisions of 5,688 MBOE primarily attributable
to performance revisions which were largely offset by PUD
downgrades of 5,548 MBOE. The purchase of reserves in place of
18,977 Mboe resulted primarily from the GRP Acquisition and other
acquisitions of certain mineral and royalty interests.
| |
Oil (MBbls) |
|
Gas (MMcf) |
|
Liquids (MBbls) |
|
MBOE |
|
As of December 31,
2022 |
79,004 |
|
|
209,964 |
|
|
34,902 |
|
|
148,900 |
|
|
Purchase of reserves in
place |
10,469 |
|
|
27,011 |
|
|
4,006 |
|
|
18,977 |
|
|
Extensions and
discoveries |
13,636 |
|
|
34,632 |
|
|
6,150 |
|
|
25,558 |
|
|
Revisions of previous
estimates |
(5,178 |
) |
|
11,101 |
|
|
3,466 |
|
|
138 |
|
|
Production |
(8,028 |
) |
|
(19,130 |
) |
|
(3,108 |
) |
|
(14,324 |
) |
| As of December 31,
2023 |
89,903 |
|
|
263,578 |
|
|
45,416 |
|
|
179,249 |
|
As the owner of mineral and royalty interests, Viper incurred no
exploration and development costs during the year ended
December 31, 2023.
| |
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2021 |
|
| |
(in thousands) |
| Acquisition costs: |
|
|
|
|
|
|
Proved properties |
$ |
402,659 |
|
|
$ |
46,307 |
|
|
$ |
138,882 |
|
|
Unproved properties |
|
758,342 |
|
|
|
16,624 |
|
|
|
479,041 |
|
|
Total |
$ |
1,161,001 |
|
|
$ |
62,931 |
|
|
$ |
617,923 |
|
GUIDANCE UPDATE
Below is Viper’s updated guidance for the full
year 2024, as well as production guidance for Q1 2024.
|
|
|
|
|
Viper Energy, Inc. |
|
|
|
| Q1 2024 Net Production -
MBo/d |
25.00 - 25.50 |
| Q1 2024 Net Production -
MBoe/d |
44.75 - 45.50 |
| Full Year 2024 Net Production
- MBo/d |
25.50 - 27.50 |
| Full Year 2024 Net Production
- MBoe/d |
45.50 - 49.00 |
| |
|
| Share costs ($/boe) |
|
| Depletion |
$11.00 - $11.50 |
| Cash G&A |
$0.80 - $1.00 |
| Non-Cash Share-Based
Compensation |
$0.10 - $0.15 |
| Interest Expense |
$4.00 - $4.50 |
| |
|
| Production and Ad Valorem
Taxes (% of Revenue) |
~7% |
| Cash Tax Rate (% of Pre-Tax
Income Attributable to Viper Energy, Inc.)(1) |
20% - 22% |
| Q1 2024 Cash Taxes ($ -
million)(2) |
$10.0 - $15.0 |
| |
|
(1) Pre-tax income attributable to Viper
Energy, Inc. is reconciled below.(2) Attributable
to Viper Energy, Inc.
CONFERENCE CALL
Viper will host a conference call and webcast
for investors and analysts to discuss its results for the fourth
quarter of 2023 on Wednesday, February 21, 2024 at 11:00 a.m. CT.
Access to the live audio-only webcast, and replay which will be
available following the call, may be found here. The live webcast
of the earnings conference call will also be available via Viper’s
website at www.viperenergy.com under the “Investor Relations”
section of the site.
About Viper Energy, Inc.
Viper is a corporation formed by Diamondback to
own, acquire and exploit oil and natural gas properties in North
America, with a focus on owning and acquiring mineral and royalty
interests in oil-weighted basins, primarily the Permian Basin. For
more information, please visit www.viperenergy.com.
About Diamondback Energy, Inc.
Diamondback is an independent oil and natural
gas company headquartered in Midland, Texas focused on the
acquisition, development, exploration and exploitation of
unconventional, onshore oil and natural gas reserves primarily in
the Permian Basin in West Texas. For more information, please visit
www.diamondbackenergy.com.
Forward-Looking Statements
This news release contains “forward-looking
statements” within the meaning of Section 27A of the Securities Act
and Section 21E of the Exchange Act, which involve risks,
uncertainties, and assumptions. All statements, other than
statements of historical fact, including statements regarding
Viper’s: future performance; business strategy; future operations;
estimates and projections of operating income, losses, costs and
expenses, returns, cash flow, and financial position; production
levels on properties in which Viper has mineral and royalty
interests, developmental activity by other operators; reserve
estimates and Viper’s ability to replace or increase reserves;
anticipated benefits of strategic transactions (such as
acquisitions or divestitures); and plans and objectives (including
Diamondback’s plans for developing Viper’s acreage and Viper’s cash
dividend policy and common stock repurchase program) are
forward-looking statements. When used in this news release, the
words “aim,” “anticipate,” “believe,” “continue,” “could,”
“estimate,” “expect,” “forecast,” “future,” “guidance,” “intend,”
“may,” “model,” “outlook,” “plan,” “positioned,” “potential,”
“predict,” “project,” “seek,” “should,” “target,” “will,” “would,”
and similar expressions (including the negative of such terms) as
they relate to Viper are intended to identify forward-looking
statements, although not all forward-looking statements contain
such identifying words. Although Viper believes that the
expectations and assumptions reflected in its forward-looking
statements are reasonable as and when made, they involve risks and
uncertainties that are difficult to predict and, in many cases,
beyond its control. Accordingly, forward-looking statements are not
guarantees of Viper’s future performance and the actual outcomes
could differ materially from what Viper expressed in its
forward-looking statements.
Factors that could cause the outcomes to differ
materially include (but are not limited to) the following: changes
in supply and demand levels for oil, natural gas, and natural gas
liquids, and the resulting impact on the price for those
commodities; the impact of public health crises, including epidemic
or pandemic diseases, and any related company or government
policies or actions; actions taken by the members of OPEC and
Russia affecting the production and pricing of oil, as well as
other domestic and global political, economic, or diplomatic
developments, including any impact of the ongoing war in Ukraine
and the Israel-Hamas war on the global energy markets and
geopolitical stability; instability in the financial sector;
concerns over economic slowdown or potential recession; rising
interest rates and their impact on the cost of capital; regional
supply and demand factors, including delays, curtailment delays or
interruptions of production on Viper’s mineral and royalty acreage,
or governmental orders, rules or regulations that impose production
limits on such acreage; federal and state legislative and
regulatory initiatives relating to hydraulic fracturing, including
the effect of existing and future laws and governmental
regulations; physical and transition risks relating to climate
change and the risks and other factors disclosed in Viper’s filings
with the Securities and Exchange Commission, including its Forms
10-K, 10-Q and 8-K, which can be obtained free of charge on the
Securities and Exchange Commission's web site at
http://www.sec.gov.
In light of these factors, the events
anticipated by Viper’s forward-looking statements may not occur at
the time anticipated or at all. Moreover, the new risks emerge from
time to time. Viper cannot predict all risks, nor can it assess the
impact of all factors on its business or the extent to which any
factor, or combination of factors, may cause actual results to
differ materially from those anticipated by any forward-looking
statements it may make. Accordingly, you should not place undue
reliance on any forward-looking statements made in this news
release. All forward-looking statements speak only as of the date
of this news release or, if earlier, as of the date they were made.
Viper does not intend to, and disclaims any obligation to, update
or revise any forward-looking statements unless required by
applicable law.
|
|
|
Viper Energy, Inc. |
|
Consolidated Balance Sheets |
|
(unaudited, in thousands, except share
amounts) |
| |
|
|
|
| |
December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
Assets |
|
|
|
| Current assets: |
|
|
|
|
Cash and cash equivalents |
$ |
25,869 |
|
|
$ |
18,179 |
|
|
Royalty income receivable (net of allowance for credit losses) |
|
108,681 |
|
|
|
81,657 |
|
|
Royalty income receivable—related party |
|
3,329 |
|
|
|
6,260 |
|
|
Income tax receivable |
|
813 |
|
|
|
728 |
|
|
Derivative instruments |
|
358 |
|
|
|
9,328 |
|
|
Prepaid expenses and other current assets |
|
4,467 |
|
|
|
2,468 |
|
|
Total current assets |
|
143,517 |
|
|
|
118,620 |
|
| Property: |
|
|
|
|
Oil and natural gas interests, full cost method of accounting
($1,769,341 and $1,297,221 excluded from depletion at
December 31, 2023 and December 31, 2022, respectively) |
|
4,628,983 |
|
|
|
3,464,819 |
|
|
Land |
|
5,688 |
|
|
|
5,688 |
|
|
Accumulated depletion and impairment |
|
(866,352 |
) |
|
|
(720,234 |
) |
|
Property, net |
|
3,768,319 |
|
|
|
2,750,273 |
|
| Derivative instruments |
|
92 |
|
|
|
442 |
|
| Deferred income taxes (net of
allowances) |
|
56,656 |
|
|
|
49,656 |
|
| Other assets |
|
5,509 |
|
|
|
1,382 |
|
|
Total assets |
$ |
3,974,093 |
|
|
$ |
2,920,373 |
|
|
Liabilities and Stockholders’ Equity |
|
|
|
| Current liabilities: |
|
|
|
|
Accounts payable |
$ |
19 |
|
|
$ |
1,129 |
|
|
Accounts payable—related party |
|
1,330 |
|
|
|
306 |
|
|
Accrued liabilities |
|
27,021 |
|
|
|
19,600 |
|
|
Derivative instruments |
|
2,961 |
|
|
|
— |
|
|
Income taxes payable |
|
1,925 |
|
|
|
911 |
|
|
Total current liabilities |
|
33,256 |
|
|
|
21,946 |
|
| Long-term debt, net |
|
1,083,082 |
|
|
|
576,895 |
|
| Derivative instruments |
|
201 |
|
|
|
7 |
|
|
Total liabilities |
|
1,116,539 |
|
|
|
598,848 |
|
| Stockholders’ equity: |
|
|
|
|
General Partner |
|
— |
|
|
|
649 |
|
|
Common units (73,229,645 units issued and outstanding as of
December 31, 2022) |
|
— |
|
|
|
689,178 |
|
|
Class B units (90,709,946 units issued and outstanding as of
December 31, 2022) |
|
— |
|
|
|
832 |
|
|
Class A Common stock, 0.000001 par value: 1,000,000,000 shares
authorized; 86,144,273 shares issued and outstanding as of
December 31, 2023 |
|
— |
|
|
|
— |
|
|
Class B Common stock, 0.000001 par value: 1,000,000,000 shares
authorized; 90,709,946 shares issued and outstanding as of
December 31, 2023 |
|
— |
|
|
|
— |
|
|
Additional paid-in capital |
|
1,031,078 |
|
|
|
— |
|
|
Retained earnings (accumulated deficit) |
|
(16,786 |
) |
|
|
— |
|
|
Total Viper Energy, Inc. stockholders’ equity |
|
1,014,292 |
|
|
|
690,659 |
|
| Non-controlling interest |
|
1,843,262 |
|
|
|
1,630,866 |
|
|
Total equity |
|
2,857,554 |
|
|
|
2,321,525 |
|
|
Total liabilities and stockholders’ equity |
$ |
3,974,093 |
|
|
$ |
2,920,373 |
|
|
|
|
Viper Energy, Inc. |
|
Consolidated Statements of Operations |
|
(unaudited, in thousands, except per share
data) |
| |
|
|
|
|
|
|
|
| |
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| Operating
income: |
|
|
|
|
|
|
|
|
Royalty income |
$ |
202,214 |
|
|
$ |
186,148 |
|
|
$ |
717,110 |
|
|
$ |
837,976 |
|
|
Lease bonus income—related party |
|
2,238 |
|
|
|
16,715 |
|
|
|
107,823 |
|
|
|
23,367 |
|
|
Lease bonus income |
|
125 |
|
|
|
568 |
|
|
|
1,855 |
|
|
|
4,424 |
|
|
Other operating income |
|
135 |
|
|
|
194 |
|
|
|
909 |
|
|
|
700 |
|
|
Total operating income |
|
204,712 |
|
|
|
203,625 |
|
|
|
827,697 |
|
|
|
866,467 |
|
| Costs and
expenses: |
|
|
|
|
|
|
|
|
Production and ad valorem taxes |
|
12,607 |
|
|
|
10,825 |
|
|
|
50,401 |
|
|
|
56,372 |
|
|
Depletion |
|
44,787 |
|
|
|
31,238 |
|
|
|
146,118 |
|
|
|
121,071 |
|
|
General and administrative expenses |
|
3,951 |
|
|
|
2,570 |
|
|
|
10,603 |
|
|
|
8,542 |
|
|
Other operating expense |
|
356 |
|
|
|
— |
|
|
|
356 |
|
|
|
— |
|
|
Total costs and expenses |
|
61,701 |
|
|
|
44,633 |
|
|
|
207,478 |
|
|
|
185,985 |
|
| Income (loss) from
operations |
|
143,011 |
|
|
|
158,992 |
|
|
|
620,219 |
|
|
|
680,482 |
|
| Other income
(expense): |
|
|
|
|
|
|
|
|
Interest expense, net |
|
(16,727 |
) |
|
|
(10,251 |
) |
|
|
(48,907 |
) |
|
|
(40,409 |
) |
|
Gain (loss) on derivative instruments, net |
|
4,892 |
|
|
|
1,228 |
|
|
|
(25,793 |
) |
|
|
(18,138 |
) |
|
Other income, net |
|
972 |
|
|
|
216 |
|
|
|
1,774 |
|
|
|
416 |
|
|
Total other expense, net |
|
(10,863 |
) |
|
|
(8,807 |
) |
|
|
(72,926 |
) |
|
|
(58,131 |
) |
| Income (loss) before
income taxes |
|
132,148 |
|
|
|
150,185 |
|
|
|
547,293 |
|
|
|
622,351 |
|
|
Provision for (benefit from) income taxes |
|
6,217 |
|
|
|
4,944 |
|
|
|
45,952 |
|
|
|
(32,653 |
) |
| Net income
(loss) |
|
125,931 |
|
|
|
145,241 |
|
|
|
501,341 |
|
|
|
655,004 |
|
|
Net income (loss) attributable to non-controlling interest |
|
68,959 |
|
|
|
123,535 |
|
|
|
301,253 |
|
|
|
503,331 |
|
| Net income (loss)
attributable to Viper Energy, Inc. |
$ |
56,972 |
|
|
$ |
21,706 |
|
|
$ |
200,088 |
|
|
$ |
151,673 |
|
| |
|
|
|
|
|
|
|
| Net income (loss)
attributable to common shares: |
|
|
|
|
|
|
|
|
Basic |
$ |
0.70 |
|
|
$ |
0.29 |
|
|
$ |
2.69 |
|
|
$ |
2.00 |
|
|
Diluted |
$ |
0.70 |
|
|
$ |
0.29 |
|
|
$ |
2.69 |
|
|
$ |
2.00 |
|
| Weighted average
number of common shares outstanding: |
|
|
|
|
|
|
|
|
Basic |
|
81,219 |
|
|
|
73,823 |
|
|
|
74,176 |
|
|
|
75,612 |
|
|
Diluted |
|
81,219 |
|
|
|
73,884 |
|
|
|
74,176 |
|
|
|
75,679 |
|
|
|
|
Viper Energy, Inc. |
|
Consolidated Statements of Cash Flows |
|
(unaudited, in thousands) |
| |
|
|
|
|
|
|
|
| |
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| Cash flows from operating
activities: |
|
|
|
|
|
|
|
|
Net income (loss) |
$ |
125,931 |
|
|
$ |
145,241 |
|
|
$ |
501,341 |
|
|
$ |
655,004 |
|
|
Adjustments to reconcile net income (loss) to net cash provided by
operating activities: |
|
|
|
|
|
|
|
|
Provision for (benefit from) deferred income taxes |
|
(7,887 |
) |
|
|
— |
|
|
|
(7,000 |
) |
|
|
(49,656 |
) |
|
Depletion |
|
44,787 |
|
|
|
31,238 |
|
|
|
146,118 |
|
|
|
121,071 |
|
|
(Gain) loss on derivative instruments, net |
|
(4,892 |
) |
|
|
(1,228 |
) |
|
|
25,793 |
|
|
|
18,138 |
|
|
Net cash receipts (payments) on derivatives |
|
(3,300 |
) |
|
|
(4,027 |
) |
|
|
(13,319 |
) |
|
|
(31,319 |
) |
|
Other |
|
1,397 |
|
|
|
698 |
|
|
|
3,442 |
|
|
|
5,070 |
|
|
Changes in operating assets and liabilities: |
|
|
|
|
|
|
|
|
Royalty income receivable |
|
(5,232 |
) |
|
|
12,558 |
|
|
|
(27,379 |
) |
|
|
(13,089 |
) |
|
Royalty income receivable—related party |
|
4,102 |
|
|
|
4,007 |
|
|
|
2,931 |
|
|
|
(4,116 |
) |
|
Accounts payable and accrued liabilities |
|
2,155 |
|
|
|
(3,461 |
) |
|
|
6,311 |
|
|
|
151 |
|
|
Accounts payable—related party |
|
1,330 |
|
|
|
306 |
|
|
|
1,024 |
|
|
|
306 |
|
|
Income taxes payable |
|
(11,397 |
) |
|
|
911 |
|
|
|
1,014 |
|
|
|
440 |
|
|
Other |
|
(1,199 |
) |
|
|
312 |
|
|
|
(2,084 |
) |
|
|
(2,204 |
) |
| Net cash provided by (used in)
operating activities |
|
145,795 |
|
|
|
186,555 |
|
|
|
638,192 |
|
|
|
699,796 |
|
| Cash flows from investing
activities: |
|
|
|
|
|
|
|
|
Acquisitions of oil and natural gas interests—related party |
|
— |
|
|
|
— |
|
|
|
(75,073 |
) |
|
|
— |
|
|
Acquisitions of oil and natural gas interests |
|
(731,618 |
) |
|
|
(25,797 |
) |
|
|
(830,128 |
) |
|
|
(64,131 |
) |
|
Proceeds from sale of oil and natural gas interests |
|
2 |
|
|
|
53,757 |
|
|
|
(3,164 |
) |
|
|
111,702 |
|
| Net cash provided by (used in)
investing activities |
|
(731,616 |
) |
|
|
27,960 |
|
|
|
(908,365 |
) |
|
|
47,571 |
|
| Cash flows from financing
activities: |
|
|
|
|
|
|
|
|
Proceeds from borrowings under credit facility |
|
313,000 |
|
|
|
43,000 |
|
|
|
573,000 |
|
|
|
272,000 |
|
|
Repayment on credit facility |
|
(300,000 |
) |
|
|
(136,000 |
) |
|
|
(462,000 |
) |
|
|
(424,000 |
) |
|
Proceeds from senior notes |
|
400,000 |
|
|
|
— |
|
|
|
400,000 |
|
|
|
— |
|
|
Repayment of senior notes |
|
— |
|
|
|
— |
|
|
|
— |
|
|
|
(48,963 |
) |
|
Proceeds from public offering to Diamondback |
|
200,000 |
|
|
|
— |
|
|
|
200,000 |
|
|
|
— |
|
|
Repurchased shares/units under buyback program |
|
(28,040 |
) |
|
|
(31,661 |
) |
|
|
(95,221 |
) |
|
|
(150,593 |
) |
|
Dividends/distributions to shareholders |
|
(44,596 |
) |
|
|
(35,718 |
) |
|
|
(128,777 |
) |
|
|
(182,835 |
) |
|
Dividends/distributions to Diamondback |
|
(68,047 |
) |
|
|
(47,553 |
) |
|
|
(195,976 |
) |
|
|
(234,103 |
) |
|
Other |
|
(7,441 |
) |
|
|
(20 |
) |
|
|
(13,163 |
) |
|
|
(142 |
) |
| Net cash provided by (used in)
financing activities |
|
464,876 |
|
|
|
(207,952 |
) |
|
|
277,863 |
|
|
|
(768,636 |
) |
| Net increase (decrease) in
cash and cash equivalents |
|
(120,945 |
) |
|
|
6,563 |
|
|
|
7,690 |
|
|
|
(21,269 |
) |
| Cash, cash equivalents and
restricted cash at beginning of period |
|
146,814 |
|
|
|
11,616 |
|
|
|
18,179 |
|
|
|
39,448 |
|
| Cash, cash equivalents and
restricted cash at end of period |
$ |
25,869 |
|
|
$ |
18,179 |
|
|
$ |
25,869 |
|
|
$ |
18,179 |
|
|
|
|
Viper Energy, Inc. |
|
Selected Operating Data |
|
(unaudited) |
| |
|
|
|
|
|
|
|
| |
Three Months Ended December 31, |
|
Year Ended December 31, |
|
|
|
2023 |
|
|
|
2022 |
|
|
|
2023 |
|
|
|
2022 |
|
| Production
Data: |
|
|
|
|
|
|
|
|
Oil (MBbls) |
|
2,257 |
|
|
|
1,838 |
|
|
|
8,028 |
|
|
|
7,097 |
|
|
Natural gas (MMcf) |
|
5,321 |
|
|
|
4,155 |
|
|
|
19,130 |
|
|
|
15,868 |
|
|
Natural gas liquids (MBbls) |
|
884 |
|
|
|
683 |
|
|
|
3,108 |
|
|
|
2,540 |
|
|
Combined volumes (MBOE)(1) |
|
4,028 |
|
|
|
3,214 |
|
|
|
14,324 |
|
|
|
12,282 |
|
| |
|
|
|
|
|
|
|
|
Average daily oil volumes (BO/d) |
|
24,533 |
|
|
|
19,978 |
|
|
|
21,995 |
|
|
|
19,444 |
|
|
Average daily combined volumes (BOE/d) |
|
43,783 |
|
|
|
34,935 |
|
|
|
39,244 |
|
|
|
33,649 |
|
| |
|
|
|
|
|
|
|
| Average sales
prices: |
|
|
|
|
|
|
|
|
Oil ($/Bbl) |
$ |
77.65 |
|
|
$ |
83.30 |
|
|
$ |
77.13 |
|
|
$ |
94.02 |
|
|
Natural gas ($/Mcf) |
$ |
1.50 |
|
|
$ |
3.74 |
|
|
$ |
1.62 |
|
|
$ |
5.24 |
|
|
Natural gas liquids ($/Bbl) |
$ |
21.47 |
|
|
$ |
25.65 |
|
|
$ |
21.55 |
|
|
$ |
34.47 |
|
|
Combined ($/BOE)(2) |
$ |
50.20 |
|
|
$ |
57.92 |
|
|
$ |
50.06 |
|
|
$ |
68.23 |
|
| |
|
|
|
|
|
|
|
|
Oil, hedged ($/Bbl)(3) |
$ |
76.56 |
|
|
$ |
82.71 |
|
|
$ |
76.05 |
|
|
$ |
92.85 |
|
|
Natural gas, hedged ($/Mcf)(3) |
$ |
1.34 |
|
|
$ |
3.03 |
|
|
$ |
1.37 |
|
|
$ |
4.20 |
|
|
Natural gas liquids ($/Bbl)(3) |
$ |
21.47 |
|
|
$ |
25.65 |
|
|
$ |
21.55 |
|
|
$ |
34.47 |
|
|
Combined price, hedged ($/BOE)(3) |
$ |
49.38 |
|
|
$ |
56.66 |
|
|
$ |
49.13 |
|
|
$ |
66.21 |
|
| |
|
|
|
|
|
|
|
| Average Costs
($/BOE): |
|
|
|
|
|
|
|
|
Production and ad valorem taxes |
$ |
3.13 |
|
|
$ |
3.37 |
|
|
$ |
3.52 |
|
|
$ |
4.59 |
|
|
General and administrative - cash component(4) |
|
0.90 |
|
|
|
0.70 |
|
|
|
0.65 |
|
|
|
0.59 |
|
|
Total operating expense - cash |
$ |
4.03 |
|
|
$ |
4.07 |
|
|
$ |
4.17 |
|
|
$ |
5.18 |
|
| |
|
|
|
|
|
|
|
|
General and administrative - non-cash stock compensation
expense |
$ |
0.08 |
|
|
$ |
0.10 |
|
|
$ |
0.09 |
|
|
$ |
0.11 |
|
|
Interest expense, net |
$ |
4.15 |
|
|
$ |
3.19 |
|
|
$ |
3.41 |
|
|
$ |
3.29 |
|
|
Depletion |
$ |
11.12 |
|
|
$ |
9.72 |
|
|
$ |
10.20 |
|
|
$ |
9.86 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Bbl equivalents are calculated using a
conversion rate of six Mcf per one
Bbl.(2) Realized price net of all deducts for
gathering, transportation and
processing.(3) Hedged prices reflect the impact of
cash settlements of our matured commodity derivative transactions
on our average sales prices.(4) Excludes non-cash
stock compensation for the respective periods presented.
NON-GAAP FINANCIAL MEASURES
Adjusted EBITDA is a supplemental non-GAAP
financial measure that is used by management and external users of
our financial statements, such as industry analysts, investors,
lenders and rating agencies. Viper defines Adjusted EBITDA as net
income (loss) attributable to Viper Energy Inc. plus net income
(loss) attributable to non-controlling interest (“net income
(loss)”) before interest expense, net, non-cash share-based
compensation expense, depletion, non-cash (gain) loss on derivative
instruments, (gain) loss on extinguishment of debt, if any, other
non-cash operating expenses, other non-recurring expenses and
provision for (benefit from) income taxes. Adjusted EBITDA is not a
measure of net income as determined by United States’ generally
accepted accounting principles (“GAAP”). Management believes
Adjusted EBITDA is useful because it allows them to more
effectively evaluate Viper’s operating performance and compare the
results of its operations from period to period without regard to
its financing methods or capital structure. Adjusted EBITDA should
not be considered as an alternative to, or more meaningful than,
net income, royalty income, cash flow from operating activities or
any other measure of financial performance or liquidity presented
as determined in accordance with GAAP. Certain items excluded from
Adjusted EBITDA are significant components in understanding and
assessing a company’s financial performance, such as a company’s
cost of capital and tax structure, as well as the historic costs of
depreciable assets, none of which are components of Adjusted
EBITDA.
Viper defines cash available for dividends
generally as an amount equal to its Adjusted EBITDA for the
applicable quarter less cash needed for income taxes payable, debt
service, contractual obligations, fixed charges and reserves for
future operating or capital needs that the Board may deem
appropriate, lease bonus income, net of tax, distribution
equivalent rights payments and preferred distributions, if any.
Management believes cash available for dividends is useful because
it allows them to more effectively evaluate Viper’s operating
performance excluding the impact of non-cash financial items and
short-term changes in working capital. Viper’s computations of
Adjusted EBITDA and cash available for dividends may not be
comparable to other similarly titled measures of other companies or
to such measure in its credit facility or any of its other
contracts. Viper further defines cash available for variable
dividends as 75 percent of cash available for dividends less base
dividends declared and repurchased shares as part of its share
buyback program for the applicable quarter. Additionally, a
non-recurring share repurchase from certain selling stockholders
relating to the GRP acquisition in November 2023 is excluded from
the calculation of cash available for variable dividends for the
fourth quarter of 2023.
The following tables present a reconciliation of
the GAAP financial measure of net income (loss) to the non-GAAP
financial measures of Adjusted EBITDA, cash available for dividends
and cash available for variable dividends:
|
Viper Energy, Inc. |
|
(unaudited, in thousands, except per share
data) |
| |
|
|
|
| |
Three Months EndedDecember 31, 2023 |
|
Year EndedDecember 31, 2023 |
|
Net income (loss) attributable to Viper Energy,
Inc. |
$ |
56,972 |
|
|
$ |
200,088 |
|
|
Net income (loss) attributable to non-controlling interest |
|
68,959 |
|
|
|
301,253 |
|
| Net income
(loss) |
|
125,931 |
|
|
|
501,341 |
|
|
Interest expense, net |
|
16,727 |
|
|
|
48,907 |
|
|
Non-cash share-based compensation expense |
|
311 |
|
|
|
1,302 |
|
|
Depletion |
|
44,787 |
|
|
|
146,118 |
|
|
Non-cash (gain) loss on derivative instruments |
|
(8,192 |
) |
|
|
12,474 |
|
|
Other non-cash operating expenses |
|
356 |
|
|
|
356 |
|
|
Other non-recurring expenses |
|
1,010 |
|
|
|
1,010 |
|
|
Provision for (benefit from) income taxes |
|
6,217 |
|
|
|
45,952 |
|
| Consolidated Adjusted
EBITDA |
|
187,147 |
|
|
|
757,460 |
|
|
Less: Adjusted EBITDA attributable to non-controlling interest |
|
97,491 |
|
|
|
416,425 |
|
| Adjusted EBITDA
attributable to Viper Energy, Inc. |
$ |
89,656 |
|
|
$ |
341,035 |
|
| |
|
|
|
| Adjustments to
reconcile Adjusted EBITDA to cash available for
dividends: |
|
|
|
|
Income taxes payable for the current period |
$ |
(14,104 |
) |
|
$ |
(52,951 |
) |
|
Debt service, contractual obligations, fixed charges and
reserves |
|
(10,677 |
) |
|
|
(26,904 |
) |
|
Lease bonus income, net of tax |
|
(1,026 |
) |
|
|
(38,824 |
) |
|
Distribution equivalent rights payments |
|
(48 |
) |
|
|
(211 |
) |
|
Preferred dividends |
|
(50 |
) |
|
|
(185 |
) |
| Cash available for
dividends to Viper Energy, Inc. shareholders |
$ |
63,751 |
|
|
$ |
221,960 |
|
| |
Three Months Ended December 31, 2023 |
| |
Amounts |
|
Amounts PerCommon Share |
| Reconciliation to cash
available for variable dividends: |
|
|
|
|
Cash available for distribution to Viper Energy, Inc.
shareholders |
$ |
63,751 |
|
|
$ |
0.74 |
|
| |
|
|
|
| 75% Committed Return of
Capital |
$ |
47,813 |
|
|
$ |
0.56 |
|
| Less: |
|
|
|
|
Base dividend |
|
23,259 |
|
|
|
0.27 |
|
|
Repurchased shares as part of share buyback(1) |
|
— |
|
|
|
— |
|
| Cash available for
variable dividend |
$ |
24,554 |
|
|
$ |
0.29 |
|
| |
|
|
|
| Total approved base
and variable dividend per share |
|
|
$ |
0.56 |
|
| |
|
|
|
| Common Class A shares
outstanding |
|
|
|
86,144 |
|
| |
|
|
|
|
|
(1) Reflects amounts attributable to the common
stockholders’ ownership interest in Viper Energy, Inc., excluding
approximately $28.7 million for the repurchase of 1.0 million
shares of Class A Common Stock in an underwritten public offering
of shares by certain selling stockholders relating to the GRP
acquisition.
The following table presents a reconciliation of
the GAAP financial measure of income (loss) before income taxes to
the non-GAAP financial measure of pre-tax income attributable to
Viper Energy, Inc. Management believes this measure is useful to
investors given it provides the basis for income taxes payable by
Viper Energy, Inc, which is an adjustment to reconcile Adjusted
EBITDA to cash available for dividends to holders of Viper Energy,
Inc. Class A Common Stock.
|
|
|
Viper Energy, Inc. |
|
Pre-tax income attributable to Viper Energy,
Inc. |
|
(unaudited, in thousands) |
| |
|
| |
Three Months EndedDecember 31, 2023 |
|
Income (loss) before income taxes |
$ |
132,148 |
|
|
Less: Net income (loss) attributable to non-controlling
interest |
|
68,959 |
|
|
Pre-tax income attributable to Viper Energy,
Inc. |
$ |
63,189 |
|
| |
|
|
Income taxes payable for the current period |
$ |
14,104 |
|
|
Effective cash tax rate attributable to Viper Energy,
Inc. |
|
22.3 |
% |
Adjusted net income (loss) is a non-GAAP
financial measure equal to net income (loss) attributable to Viper
Energy, Inc. plus net income (loss) attributable to non-controlling
interest adjusted for non-cash (gain) loss on derivative
instruments, (gain) loss on extinguishment of debt, if any, other
non-cash operating expenses, other non-recurring expenses and
related income tax adjustments. The Company’s computation of
adjusted net income may not be comparable to other similarly titled
measures of other companies or to such measure in our credit
facility or any of our other contracts. Management believes
adjusted net income helps investors in the oil and natural gas
industry to measure and compare the Company’s performance to other
oil and natural gas companies by excluding from the calculation
items that can vary significantly from company to company depending
upon accounting methods, the book value of assets and other
non-operational factors.
The following table presents a reconciliation of
the GAAP financial measure of net income (loss) attributable to
Viper Energy, Inc. to the non-GAAP financial measure of adjusted
net income (loss):
|
|
|
Viper Energy, Inc. |
|
Adjusted Net Income (Loss) |
|
(unaudited, in thousands, except per share
data) |
| |
|
| |
Three Months Ended December 31, 2023 |
| |
Amounts |
|
Amounts PerDiluted Share |
|
Net income (loss) attributable to Viper Energy,
Inc. (1) |
$ |
56,972 |
|
|
$ |
0.70 |
|
|
Net income (loss) attributable to non-controlling interest |
|
68,959 |
|
|
|
0.85 |
|
| Net income
(loss)(1) |
|
125,931 |
|
|
|
1.55 |
|
|
Non-cash (gain) loss on derivative instruments, net |
|
(8,192 |
) |
|
|
(0.10 |
) |
|
Other non-cash operating expenses |
|
356 |
|
|
|
— |
|
|
Other non-recurring expenses |
|
1,010 |
|
|
|
0.02 |
|
|
Adjusted income excluding above items(1) |
|
119,105 |
|
|
|
1.47 |
|
|
Income tax adjustment for above items |
|
321 |
|
|
|
— |
|
| Adjusted net income
(loss)(1) |
|
119,426 |
|
|
|
1.47 |
|
|
Less: Adjusted net income (loss) attributed to non-controlling
interests |
|
65,397 |
|
|
|
0.80 |
|
| Adjusted net income
(loss) attributable to Viper Energy, Inc.
(1) |
$ |
54,029 |
|
|
$ |
0.67 |
|
| |
|
|
|
| Weighted average Class
A common shares outstanding: |
|
|
|
|
Basic |
|
81,219 |
|
|
Diluted |
|
81,219 |
|
|
|
|
|
|
(1) The Company’s earnings (loss) per diluted
share amount has been computed using the two-class method in
accordance with GAAP. The two-class method is an earnings
allocation which reflects the respective ownership among holders of
Class A common shares and participating securities. Diluted
earnings per share using the two-class method is calculated as (i)
net income attributable to Viper Energy, Inc., (ii) less the
reallocation of $0.1 million in earnings attributable to
participating securities, (iii) divided by diluted weighted average
Class A common shares outstanding.
RECONCILIATION OF LONG-TERM DEBT TO NET
DEBT
The Company defines the non-GAAP measure of net
debt as debt (excluding debt issuance costs, discounts and
premiums) less cash and cash equivalents. Net debt should not be
considered an alternative to, or more meaningful than, total debt,
the most directly comparable GAAP measure. Management uses net debt
to determine the Company's outstanding debt obligations that would
not be readily satisfied by its cash and cash equivalents on hand.
The Company believes this metric is useful to analysts and
investors in determining the Company's leverage position because
the Company has the ability to, and may decide to, use a portion of
its cash and cash equivalents to reduce debt.
| |
December 31,2023 |
|
Net
Q4PrincipalBorrowings/(Repayments) |
|
September 30,2023 |
|
June 30,2023 |
|
March 31,2023 |
|
December 31,2022 |
| |
(in thousands) |
|
Total long-term debt(1) |
$ |
1,093,350 |
|
|
$ |
413,000 |
|
|
$ |
680,350 |
|
|
$ |
654,350 |
|
|
$ |
700,350 |
|
|
$ |
582,350 |
|
| Cash and cash equivalents |
|
(25,869 |
) |
|
|
|
|
(146,814 |
) |
|
|
(13,079 |
) |
|
|
(9,106 |
) |
|
|
(18,179 |
) |
| Net debt |
$ |
1,067,481 |
|
|
|
|
$ |
533,536 |
|
|
$ |
641,271 |
|
|
$ |
691,244 |
|
|
$ |
564,171 |
|
(1) Excludes debt issuance costs, discounts
& premiums.
PV-10
PV-10 is the Company’s estimate of the present
value of the future net revenues from proved oil and natural gas
reserves after deducting estimated production and ad valorem taxes,
future capital costs and operating expenses, but before deducting
any estimates of future income taxes. The estimated future net
revenues are discounted at an annual rate of 10% to determine their
“present value.” The Company believes PV-10 to be an important
measure for evaluating the relative significance of its oil and
natural gas properties and that the presentation of the non-GAAP
financial measure of PV-10 provides useful information to investors
because it is widely used by professional analysts and investors in
evaluating oil and natural gas companies. Because there are many
unique factors that can impact an individual company when
estimating the amount of future income taxes to be paid, the
Company believes the use of a pre-tax measure is valuable for
evaluating the Company. The Company believes that PV-10 is a
financial measure routinely used and calculated similarly by other
companies in the oil and natural gas industry.
The following table reconciles the Company’s
standardized measure of discounted future net cash flows, a GAAP
financial measure to PV-10, a non-GAAP financial measure. PV-10
should not be considered as an alternative to the standardized
measure as computed under GAAP.
| (in
thousands) |
December 31, 2023 |
|
Standardized measure of discounted future net cash flows after
taxes |
$ |
3,186,886 |
|
| Add: Present value of future
income tax discounted at 10% |
|
435,314 |
|
|
PV-10 |
$ |
3,622,200 |
|
Derivatives
As of the filing date, the Company had the
following outstanding derivative contracts. The Company’s
derivative contracts are based upon reported settlement prices on
commodity exchanges, with crude oil derivative settlements based on
New York Mercantile Exchange West Texas Intermediate pricing and
Crude Oil Brent. When aggregating multiple contracts, the weighted
average contract price is disclosed.
| |
Crude Oil (Bbls/day, $/Bbl) |
| |
Q1 2024 |
|
Q2 2024 |
|
Q3 2024 |
|
Q4 2024 |
|
Deferred Premium Puts - WTI (Cushing) |
|
16,000 |
|
|
|
14,000 |
|
|
|
14,000 |
|
|
|
6,000 |
|
|
Strike |
$ |
58.13 |
|
|
$ |
59.29 |
|
|
$ |
55.00 |
|
|
$ |
55.00 |
|
|
Premium |
$ |
(1.54 |
) |
|
$ |
(1.51 |
) |
|
$ |
(1.71 |
) |
|
$ |
(1.79 |
) |
| |
Crude Oil (Bbls/day, $/Bbl) |
| |
Q1 2024 |
|
Q2 2024 |
|
Q3 2024 |
|
Q4 2024 |
|
Costless Collars - WTI (Cushing) |
|
6,000 |
|
|
|
6,000 |
|
|
|
4,000 |
|
|
|
4,000 |
|
|
Floor |
$ |
65.00 |
|
|
$ |
65.00 |
|
|
$ |
55.00 |
|
|
$ |
55.00 |
|
|
Ceiling |
$ |
95.55 |
|
|
$ |
95.55 |
|
|
$ |
93.66 |
|
|
$ |
93.66 |
|
| |
Natural Gas (Mmbtu/day, $/Mmbtu) |
| |
Q1 2024 |
|
Q2 2024 |
|
Q3 2024 |
|
Q4 2024 |
|
FY 2025 |
|
Natural Gas Basis Swaps - Waha Hub |
|
30,000 |
|
|
|
30,000 |
|
|
|
30,000 |
|
|
|
30,000 |
|
|
|
40,000 |
|
|
Swap Price |
$ |
(1.20 |
) |
|
$ |
(1.20 |
) |
|
$ |
(1.20 |
) |
|
$ |
(1.20 |
) |
|
$ |
(0.68 |
) |
Investor Contact:
Austen Gilfillian+1 432.221.7420agilfillian@viperenergy.com
Source: Viper Energy, Inc.; Diamondback Energy, Inc.
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