Berry Corporation (bry) (NASDAQ: BRY) (“bry” or the “Company”)
today announced the details of its new shareholder return model,
which will go into effect January 1, 2022, and is expected to
provide industry-leading returns.
This new model is designed to increase cash
returns to our shareholders, further demonstrating bry’s commitment
to be a leading returner of capital to its shareholders. The model
is based on our discretionary free cash flow, which is defined as
cash flow from operations less regular fixed dividends and the
capital needed to hold production flat.
Under this new model, the company intends to
allocate discretionary free cash flow on a quarterly basis as
follows:
- 60%
predominantly in the form of cash variable dividends to be paid
quarterly, as well as opportunistic debt repurchases1
- 40% in the form
of discretionary capital, to be used for organic growth, including
from our extensive inventory of drilling opportunities, advancing
our short- and long-term sustainability initiatives, share
repurchases, and/or capital retention
“We have long been committed to returning a
substantial amount of capital to stockholders, and today we are
announcing the next step in that direction. Since going public in
the summer of 2018, we have returned nearly $130 million to our
shareholders through dividends and share repurchases. Today’s
announcement reinforces that returning capital is a priority of the
Company. This new return framework is designed to pay a sustainable
fixed dividend, as we do now, while returning an additional,
substantial portion of our discretionary free cash flow to
investors each quarter. Like our business model, this new
shareholder returns model is simple and strengthens our commitment
to return capital to our shareholders,” stated Trem Smith, bry’s
Chairman of the Board and CEO.
“Our cash flow potential is easier to measure
than most of the industry. We have a predictable cost structure
that we highlight every quarter in our investor presentation, which
always includes the cost of keeping our production flat. This new
return model continues to keep our focus on maintaining production
while providing us the opportunity to use our abundant inventory to
grow our production. Our focus remains creating the greatest value
for our shareholders while providing affordable and equitable
energy for all Californians,” added Smith.
The timing, volume and manner of debt and/or
share repurchases under the Board’s authorization of this program
will be determined by management at its discretion.
1 Subject to board approval and amounts of cash
variable dividend will be announced with quarterly earnings
release.
About bry
Bry is a publicly traded (NASDAQ: BRY) western
United States independent upstream energy company with a focus on
the conventional, long-lived oil reserves in the San Joaquin basin
of California. More information can be found at the Company’s
website at bry.com.
Forward Looking Statements
The information in this press release includes
forward-looking statements within the meaning of Section 27A of the
Securities Act of 1933 and Section 21E of the Securities Exchange
Act of 1934. All statements, other than statements of historical
facts, included in this press release that address plans,
activities, events, objectives, goals, strategies, or developments
that the Company expects, believes or anticipates will or may occur
in the future, such as those regarding its financial position;
liquidity; cash flows; anticipated financial and operating results;
capital program and development and production plans; operations
and business strategy; potential acquisition opportunities;
reserves; hedging activities; capital expenditures, shareholder
returns or return of capital; payment, payment of or improvement of
future dividends; future repurchases of stock or debt; capital
investments, and guidance are forward-looking statements. The
forward-looking statements in this press release are based upon
various assumptions, many of which are based, in turn, upon further
assumptions. Although we believe that these assumptions were
reasonable when made, these assumptions are inherently subject to
significant uncertainties and contingencies which are difficult or
impossible to predict and are beyond our control. Therefore, such
forward-looking statements involve significant risks and
uncertainties that could materially affect our expected results of
operations, liquidity, cash flows and business prospects.
Bry cautions you that these forward-looking
statements are subject to all of the risks and uncertainties,
incident to the exploration for and development, production,
gathering and sale of natural gas, NGLs and oil most of which are
difficult to predict and many of which are beyond bry’s control.
These risks include, but are not limited to, commodity price
volatility; legislative and regulatory processes and actions that
may prevent, delay or otherwise restrict our ability to drill and
develop our assets, including regulatory approval and permitting
requirements; legislative and regulatory initiatives in California
or our other areas of operation addressing climate change or other
environmental concerns; drilling, production and other operating
risks; investment in and development of competing or alternative
energy sources; uncertainties inherent in estimating natural gas
and oil reserves and in projecting future rates of production; cash
flow and access to capital; the timing and funding of development
expenditures; environmental, health and safety risks; effects of
hedging arrangements; potential shut-ins of production due to lack
of downstream demand or storage capacity; the impact and duration
of the ongoing COVID-19 pandemic on demand and pricing levels; and
the other risks described under the heading “Item 1A. Risk Factors”
in the Company’s Annual Report on Form 10-K for the year ended
December 31, 2020 and subsequent filings with the SEC, including
the Company’s Form 10-Q for the quarter ended September 30,
2021.
You can typically identify forward-looking
statements by words such as aim, anticipate, achievable, believe,
budget, continue, could, effort, estimate, expect, forecast, goal,
guidance, intend, likely, may, might, objective, outlook, plan,
potential, predict, project, seek, should, target, will or would
and other similar words that reflect the prospective nature of
events or outcomes.
Any forward-looking statement speaks only as of
the date on which such statement is made, and we undertake no
obligation to correct or update any forward-looking statement,
whether as a result of new information, future events or otherwise
except as required by applicable law. Investors are urged to
consider carefully the disclosure in our filings with the
Securities and Exchange Commission, available from us at via our
website or via the Investor Relations contact below, or from the
SEC’s website at www.sec.gov.
Contact
Todd Crabtree – Manager, Investor Relations
(661) 616-3811
ir@bry.com
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