PR - Earnings call transcript Q4 2024 | Permian Resources Corporation

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Operator

Good morning, and welcome to Permian Resources conference call to discuss its fourth quarter and full year 2024 Earnings. Today's call is being recorded. A replay of the call will be accessible until March 6, 2025 by dialing (888) 660-6264 and entering the replay access called [ 75050 ] or by visiting the company's website at www.permianres.com. At this time, I will turn the call over to Hays Mabry, Permian Resources Vice President of Investor Relations, for some opening remarks. Please go ahead.

Hays Mabry

you joining thank and Yna, all us. for Thanks,

Will James Guy Walter, the our call Chief and are today And On our Hickey Executive Financial Officer. Chief Olefin, Officers.

of and discussed would risks our the factors forward-looking I the are forward-looking that and actual beyond affect risks in control sections in of that involve note risk Many results to that or statements comments this plans. more call statement like detail during the filings are could our are the with uncertainties and many of these our SEC.

the are may not We actual Although expectations we they performance, may assumptions, results on also are refer believe of and future expressed based to materially. reasonable non-GAAP differ guarantees measures. financial

use, GAAP nearest we Hickey, to our to For Co-CEO. I With in found over any measure be release turn a corresponding or earnings presentation. Will will that, measure the reconciliation call can the non-GAAP

William Hickey

well Thanks, per the Hays. outstanding continues out production extremely QX, to fourth perform plan discuss free our in our We're that the in results demonstrating by excited in to well, morning. field. flow reported cash execution quarter a as and led XXXX both record lay share this We business as quarter

Additionally, manifest cost cost and on when we controllable compared cost our focus into saw cash relentless control lower DMC to QX.

compared flow this the share our outstanding in achieved operations. a resulting leverage, per reflecting team XXXX. nearly impressive, results, full in consistency the strength delivered XXXX, increase free of of increasing Over cash our year Even core without XX% and we to more

for positioning highly a represents sustained XXXX year believe we result, performance growth. and a us As repeatable

continue We're maximizing drilling generate we by significant cash XXXX, value highly on per to expected XXXX out flow free to look a program. lay capital-efficient to executing growth. which shareholder plan Delaware we share to to our expect continue Basin proud As

XXX,XXX barrels QX XXX,XXX per day. per and of of of results. barrels expectations oil with production day quarterly total into oil of production equivalent Moving exceeded oil production

XXX D&C in extremely execute continues to at tilled wells team led which also XXXX. an Our to high level,

with our well $X.X within executed we guidance billion. on of this plan billion Importantly, range CapEx to $X.X remaining original

paired with the In million supporting of BOE QX of and Strong cash BOE per CapEx cash flow costs and an resulted $XXX operating per cash costs with $X.XX $XXX million. cash low delivered addition, strong million and $X.XX production of of in $XXX G&A $X.XX per LOE GP&T cash adjusted we results leading quarter, BOE. flow adjusted of in free of margins

oil of higher provide wanted X% bolt-on acquisitions just on strong to our outperformance. XXXX when able We a to how production guidance was PR. we including delivered guidance. When the year base the for review year, and/or quick X. Turning original to we Slide quarter XXXX a throughout every compared were to beat raise closed the We production

balance a cost half Our were improvements well a year Most reduction with recent service throughout result structural most controls efficiency over this importantly, result as of the of direct little gained costs XXXX. was also compared lower almost a well deflation. to performed the extremely cost of XX%

capital return shareholders. that out for dividend rolled program also base We our XXXX enhanced leading a an prioritizes during

our material on by little improvements business, free This per cash bit. in in generation share a we the underpinned just flow change is of more touch will which

accretive ability change our $X.X we no with a by liquidity strong billion Showcasing financial Lastly, $X maintain during leverage while XXXX, increase M&A. to our approximately very were of billion. executing able to in on position

cycles. through prioritize to maintain the fortress continue will balance believe we sheet and commodity be maintaining have a price and flexibility this to allows as opportunistic We us

the and cost expertise Delaware illustrates X Basin. Slide leadership our in

levels. us controllable cash Our costs allows D&C both drive relentless leadership peer-leading to focus on to and low-cost

from greatly James which plan, the benefits all-in cost reduction past the year. a here minute, seen XXXX Our in will we've over outline in

flow flow Given supporting nature a business, is free critical free strong low-cost share. in cash per running the of cash marginal

each Turning high executed XX,XXX to several equivalent for consisted acres net barrels consisted in that ground want transactions rate acres. success smaller approximately to X,XXX Slide We of bolt-on day mix X. We asset We on position. game large continue of in acquisitions per type M&A and draw to that ] XX,XXX capital. for net believe transaction for return inventory means our expertise acquisitions to provides billion and of $X.X of about replace XXXX over Brea competes highlight drilled a immediately PR of The acreage locations of [ the our finally, oil executing XXX with a of of these that of across acquisitions the program. substantial our deal

As value see, long-term M&A inventory that midterm these than of near-term, that plan XXXX we accretive adds throughout of continuing better XXXX acquisitions drilled development. and similar you can the to with replace our We record our strong return more track pursuing rates shareholders. to or on

at Slide a want for X, at shareholders. been value that successful why creates big looking Now region to M&A for we so highlight we've

sustainable we acreage immediately. can our areas acquired leading PR's One advantages in is of apply where cost the structure assets our competitive ability buy to to

BOE assets prior our lift per Similarly, costs per achieved Specifically, This optimized base. compression and side, to chemical team reduced a we've acquisition, wells. of the driven D&C production field prior we've months technical programs we the artificial foot through expertise on asset when $XXX LOE compare most while downtime. organization, over the that compared last a to operator's when by lateral of reducing maximizes leading field recent several reduction that in largely already lean was $X on

improvements. plans. to at it sourcing with will this return. attractive that I at key Delaware Our our We're to confident to cycle ability us With Basin go of find of execute materials over and our scale to optimization that, over opportunities rates will completion turn to support level allow times, leading James these continue 'XX

James Walter

Will. Thanks,

on flow consistent, through allocation share thoughtful free discuss to excited focused we're X, XXXX maximizing and is which our capital execution. Slide business and per cash plan, to returns low-cost Turning

Our thank that for a our to tremendous amount Resources, result went hard team this in we work plan as a want pulling all to every effort from entire department Permian of of together. of the

For the expect per production XXXX. XXXX, average production XXX,XXX total and XXX,XXX delivers and oil production year XXX,XXX This average X% oil between we BOE XXX,XXX of between full per to full day plan higher to and annual day. year compared to barrels oil

and despite consists $X completion expect we drilling the XX% operations, of which than the Our and materially approximately production allocated we the capital XX% remaining inventory in value capital to this XXXX. as position capital year primarily The higher same beyond. PR is DUC efficiency continue carried to roughly in program improved turn is where line approximately in less showing XXX wells base, is program XXXX investments billion, drive to that with year-over-year. to XXXX infrastructure

year, be Texas development will our XX% the about continue and same Our high-returning last accounting Delaware on XX% as and in getting for to with balance. we'll Basin largely the be about activity. Dollar accounting our Basin asset focused of for The wellness program the New Mexico Midland

expect lateral XXXX approximately in average feet. which to is approximately to average length XX%, We to be XX,XXX working increase our line with our ingest

approximately believe be be We $X.XX expect we cost lowest to to the in we mentioned controllable cost cash Permian. earlier, which per our as the BOE,

or continued $XX costs prices. strip approximately meaningfully for well same taxes we've million XXXX The lower breakevens in strategies at of current XXXX. optimize efficiency productivity the in improved board, Additionally, to expect the with our combination drive capital across planning better and tax lower and

We we and leverage current approximately high maintained low at at exit leverage Slide $X.X in and sheet Xx XXXX the billion same reflects of prices. X, to liquidity while of our balance shown around have philosophy to through levered Turning predecessor acquisitions, founding course to XXXX X.Xx company. the the expect strip assuming our we doing right

positions $XXX this we As in market cash. the in of opportunities environment, mentioned opportunistic value us sector. the liquidity, represent of any believe approximately in including $X as with to greatest we earlier, be billion dislocations some creation million exited This year

our our value current and consistent many financial first of our hedges downside conservative next status, end investment-grade for strategic The achievement and yield our $XX policies in hedging. think leverage dividend oil our We We've due of dividend years. represents given XX% than the peers. has lower over year Resources the November, paid at the strong crude few our base come base which Permian priority our we X%. relative With the and the also $X.XX is sheet approximately and of gas oil protected highlighting of before balance stock is heads today. for of next per share And investment-grade the

highlights post-dividend Importantly, driven fundamentals the free improvement in have deck which the plan. highlighted to of have cash throughout approximately our the we our flow sustainability breakeven down business $XX,

the have on go to back performance want to will outsized investor highlight XX. highlight returns of that XXXX Turning drive the slide. metrics following some We Slide to to helped the

or focus of that know, to grow growth key $X share per in sole the XX way we per free XXXX to basis. improvements share over share free almost have in XX%, substantial to value you From Slide $X cash reducing our our deliver positioned per structure our per we material is peer-leading from in by on us XXXX. has of And just XXXX, time flow metrics during share the share our and flow is cost XX. end cash public on adjusted share over a production production those same result on a approximately doubled period. As creating per by per share. results team XXXX per shows our per business will debt to the Slide share

value XXXX. per merger and returns best-in-class every since led Our the shareholder creation on in team's growth Colgate free flow ] to continual [ tireless total has focus year cash share

multiple. to of turning our a has past create Permian believe positioned from Resources well rerating of business As the you the improvements is X TSR can investors. our years, shareholder the value with come of in that outsized Even value quality to for continue see, XX, our in we majority rather industry-leading to Slide the than

have by and cost for you for will which investors. in structure, creation it and low turn value Our higher Thank underpinned leading potential operator today, back now Q&A. an returns go-forward to long-dated industry-leading tuning inventory, turn we for breakevens is the together driven

Operator

question-and-answer we Ladies the now [Presentation]. begin and session. will gentlemen,

of question line RBC the Hanold comes Markets. Scott first from from Your Capital

Scott Hanold

Can duration? what's the of you of similarities. color economics on you of a forward? XXXX You And the . discussed in plan confidence you formations give provide little sustainability a that little -- to now like move around that a about target terms visibility and in lot as bit your co-development into your regional in right

William Hickey

of inventory development. Yes. everything states, little in a But I'd years up lot really, were for I basically same follow bit the And kind Texas that across scale see drilling It Mexico, it's We've a shockingly blocks kind will mean we've we've up say I same changed. previous the you'll able some there. a replace basins may X been the at just zones allocation has and mean be the creep zone. it's size position zones. for the New really, slides average our of M&A of Midland We row done similar both set for in pad larger filled in not years. to Basin now. and of

with So little sit we degradation of of half was from today. high confident kind we're that what XX-year very the inventory still doing showing first

Scott Hanold

very at of lower And the great. of deals forward? and inventory to on And scale all in like deals those next bigger the in this do replace is that that scale strategy the left as larger It cost. my how you the kind in that's going leads Like you're seems stuff. scale, enhance targeted? sort getting of terms your kind M&A similar view duration inventory, trend M&A? much when is larger And enhance could is look and be sector to replacing you what the of of quality you see the Delaware, Yes, question your

Hays Mabry

and I think pretty the see attractive as XXXX. landscape we of we into think M&A kind backdrop I a overall, head interesting market

people if do pretty of years looks COVID, similar years find it to the couple the been before last kind have of think which can and fruitful and deals. right the I

scale, on I of focused we've more deals. terms been kind of smaller think in the

we think and quality done find we've better I And on deal I to think was inventory in we the have announced ] the deals QX. deal tend cash the those side represent values. [ biggest higher Jaw Oxiburia

not as the I the have very heavy on think on Delaware, things. the to especially private seen, the production side deals probably lives bigger of side be in and we've long inventory

We've at mean, the deals, it. so to one think bigger believe I focus the over of better quality, found been And more and we'd looked our hundreds the That's them. smaller. the business of And truly made long the I has quite dollars term. deals. on and at a kind right few fit happy smaller look be millions was our we if of we right that of

excited I everything. end think is see but on never you bigger, and going but we'd same what the to more probably bring, we're something we know value can to the be at and forward, you market looking the do going assume smaller

Operator

question Securities. from next from Neal Dingmann Truist your comes And line the of

Neal Dingmann

my question maybe first you the Well, operational around for just efficiencies.

recent continue be You of guys are you continues continued do this yourself quarters? driver quarter assets that now to wondering, and I'm able just is to in of to integration really new what just sort do of in help? a part and the does driven of Or [indiscernible] by the this quarter

William Hickey

leverage where M&A us and kind the as of But to got that say highly try to showcase structure every a did what that's of culture been for the us That's synergies the allows just M&A, M&A immediately better see I'd they that's before. a allows that's apply quarter are buy return a cost We've what first makes higher our people ingrained really, to say, skilled that. team of month kind at really that here. long And of deals rate that we've acquisition. structure working built say us we've better. the after motivated, around PR. as time. highly quick in M&A to I day wouldn't I'd the to culture doing you can cost

on margin, it and probably power. think gives some us some scale I the purchasing

think kind a think was a cultural really optimize day-to-day being cost focused of with of PR of I the culture to what of being lot focused benefit in on really drives out one hyper is days, that and kind one Midland, I -- Midland minutes really we kind There's in in the basin thing But side the from finding and to grinding basin. hours, and in ways culmination granted of on a being on value lot drilling lower and just performance. completions the the

Neal Dingmann

is, thinking on then, second for or for have have And James, one to a to a just maybe pay one you just return. out yield wondering trade haven't point. you I'm shareholder Great XXX% of all you gone dividend. XX%

up that think see of -- the what how free how this is sort if you do year by flow shareholder do you going value when do cash taken think appropriate to return next it wondering going who the Just to you is strategy? you see year, do you --

Hays Mabry

first obviously I Yes. And I shareholder per our dividend program. got returns lot a -- our November. paid at we mean to in our base base dividend of think we $X.XX share all core set the

So I think really all about we're that. excited

like we the dividend yield. I think strong

dividend breakeven good. on to it down the cash reflects I at the said sustainable. think, think it really stock feels today. proposition call, of ], post I a really, think of feels flow I sustainable Like XX that's kind value and PR I really [

I going annual key don't dividend continue basis. of think to to the a growing base business high-quality forward, growing dividend. have a We on our #X goal healthy, look, an I a to criteria is is that's think think sustainably increase base kind

opportunity So set kind us. beyond is the going capital on that, I of And that post in think of allocation then to depend that's I first our base front dividend priority. think

in every the to acquisition side be making we on last is over that where month that's soon I we're cash and side. there think on the balance And of looking debt I could think the I be some down been months highest time every and what is is share return the think all that every shareholders, interesting going the of the or week, strategic it's kind And the what going we're drive kind sheet on at opportunities day, of go. to putting paying could that. buyback for of cash and couple think rest

Operator

your TD from Daoud line from Gabe next Cowen. And of comes question the

Gabriel Daoud

just for started about, facility with on I -- million of first level ask CapEx, absolute guess it's the I is an I couple I get about items $XXX to guess, basis. us was hoping a spend to wanted

annually is basis? a foot. numbers go-forward there point Just a $XXX that's get curious level that a you targeting D&C use And good now? on that per then expect some to if foot a number Are at your to Or this year. you to

William Hickey

a ], where is Great integration. think maybe kind slightly kind Earthstone we million lot remember, [ questions. think was right there around That's Cool. if that of were the $XXX a Facilities, spend associated million of you yes, we with of onetime last be we'll $XXX off this kind where year. year, I above of of

you ] right, I move continue it, plus, Obviously, think to get, see we it that's inventory of do a years think just I So is any if maybe run and some And rate. our think right further that as but call rate. probably of that as the likely year, that [ to based our it, could and now call $XXX X can prosecute run million then. probably that there's kind once between base to case, million X be out, to no you own midterm history, drop that happen acquisitions I acquisitions call around. do developing the kind short on didn't $XXX low acquisitions acquisition

side, today. cutting-edge And XXX-foot cost then real-time D&C the is

there in got seeing guide we on of today. the in budget looking at were that field we're we we've there, based the I put are what achievable, today what kind XXX we to time the and were confidence real So are and -- as we is say

Gabriel Daoud

Awesome.

Okay.

fair that as you think the lower probably move it we throughout I year. move So say to could would be

William Hickey

Yes.

not that, me. said You

find time, deflation -- same kind at that equation. the play. we've get I There's continue if better. kind factors out probably to can at squeezed trust other of tariffs. But I I like lot to talking People will the are my of we of it feels the think ways a side team lot of of a about

$XXX is I it's it where clear here. So or can from stand today. ago. think X X as cut to costs I quite on was as not hopefully, months ways right based But guide the And maybe find we go

Gabriel Daoud

Okay.

to equipment it that's level fair. And follow-up. a just Okay. a activity quick and Is relative assume No, just of just pretty you to Understood. were. given then static fair where

maybe statement? Is this in no fair year. that lumpiness real the a program So

William Hickey

a say there's of percent, probably guide weighted think the back lumpiness. of like then weighted, low to I for year and bit the first a for is by couple end on front could half high little half the the half of is half of like I that, slightly probably would CapEx end half and the half of drop the first guidance production the slightly that. a Something is couple of you of move back And something back percent probably the year. the production and

Operator

line JPMorgan. And your Zach from Parham the next comes of question from

Zachary Parham

on follow-up a some on other D&C questions cost. of Just the

down last gains You're that's XXX of drivers now, have were those efficiency the on you foot kind D&C versus you what into the year? just at in How and where cost side? from much over over the 'XX. that's foot detail a been reductions XXX a costs Can coming of

William Hickey

kind to efficiency the to over balance cost with XX%, high happy being level, deflation. do unit it. going just say real of per is slightly come I'd I'd XX% side Yes, maybe from probably more say real the

the side, On drilling weighted. efficiency it's

continued and You and as of we've want however equation. dollars, can cut the times days every And well. talked days Basin days drilling side per the our you see it, about the Basin a on you drilling $XX,XXX, call on kind Midland Delaware to we've much gross pull a about and you of day this $XXX,XXX to save on But days, affect rate, that time it, directly side, cut a spread lot. it basis

to of side, like you're like deflation little then and add all you just come get of it, services. sands kind Simul-fracs down, come and used On of, casings the call bit, down to helped together the that really on quoting. numbers stuff material kind a tangible bit little true it's a

Zachary Parham

Got X% thinking it. how turn it's longer asset just And the It in about kind But fitting you that update on then over the of into term? portfolio. that about seems of an how are like year. the the Midland fits asset maybe line this and portfolio into

Hays Mabry

-- I asset. we've our kind a a Basin. of obviously turned where our our of spent little be focused that's out to good the majority the Delaware we're Kevin, backyard. the time, of on majority think very of in That's capital. majority That's it

But of I leading team good a PR team a in lot we asset Basin. that of done acquired years and line when with that in better kind I in will. fine really kind the it if our position. a costs ago, has operators couple bringing secret really of a think applied has the sauce, job our made Midland taken think you Frankly, the

a it's today. think well It I cash little portfolio focus not our longer activity. flow the if for to us, something term, but included that. to an in I optimize that of there's over provides area And fits do it position little think bit It's stream. longer the and think I the capital nice of a

we'd Kevin I we to think open portfolio. But ] it. in like the be think [ I obviously

different price optionality, gas hold about. has that environment haven't good work. of has our leverage you worse. gas prices anything But good think to Permian really gas real makes not kind amount tell a it's of that excited team I in-basin kind done obviously, plus of of do attractive probably a kind be pricing think But more and to requires to I business something that it to truth, such

it to think in do -- be business sitting as it, is. portfolio if there's to what it that's to with we make I happy every pretty open happy something we'd Obviously, better. do way our it we're day, it but where make today. it the And with stands a

Operator

MacCurdy from And your next Pickering Kevin Energy question of line comes the from Partners.

Kevin MacCurdy

it are year-over-year. shorter and some who I using you're to than cycle your is lines efficiency It your turning slightly taking think This efficiency looks times increase peers banking from and production of gains keeping those gains different XXXX flattish. in like

and wonder could on thought how you if you reached decision levels process you the I And activity did? just your share

William Hickey

I'll you capital at of at the drilling fast the we allocation same an When rig you've months of at seen especially months and all, the look what better we're I'd pays what prices for that about but us. last time, we've over payback incremental it. decisions, of how beginning it's of it. more in moved structure say program, where itself is or I all-in of our -- with add kind position cash than the return offset as rig, also of to cost past, think just first the this against And it, the kind you're of making respect in But of program a because net XX kind the the it. has talked have commodity

biggest we than business to this I really high it's the like of there's the tweener we XX% from a levels, we of but it from to of had We than call about, cost as the kind just feels kind landed. wouldn't the back the than much profile it of growth, the more I kind growth, return acquisitions we could have or structure X% 'XX, I'd profile were today dial this but up more in a little where year that. easily a -- And meaningful level bit, show as year-over-year, the the we business, given look of a are at dial we're QX plan little pad ago, returns than program, a justifies it earning it it's better of we've we think like end, return for growth, lot bit -- of tailwind with that's overall the less of and at talked being

Hays Mabry

year-over-year, growth. feels thinking Really, of the deck the the adjusted is in think think share thing we I per growth I about got XX% really we've we're it the healthy. focus And debt on other and way share which per way

kind today So metric, like lot like of the the you macro our kind the we fits talked I think environment. about of business folks our is share a of with per on if position that and

Kevin MacCurdy

answer. think separates peers. that I appreciate And I from you growth yes, the your certainly

For I have again XXXX to on this are you a how wanted you can flow. that's taxes of year? your thoughts And any free on taxes the meaningful think cash long touch cash the you to taxes? defer of because guys the able minimal piece I cash continue majority of do follow-up, mitigate kind in a How to

Guy Olefin

Yes. this is Guy.

probably of stone that in we for a just 'XX 'XX paid just a learned of improved continue what And our ultimately cash I with So call, 'XX, to and carryover planning. our optimize tax is nominal we lot resulted really of taxes kind optimization in planning Earthstone. and that

closer be cash taxpayer. full we As go 'XX to forward, and cash taxes will more meaningful in a 'XX

now. So we're all that through going

a But X improvement or relative change. what 'XX X to months we was will meaningful that ago. So thought

Operator

Instructions] [Operator

question the Derrick comes of Capital. next line from Your Texas from Whitfield

Unknown Analyst

it that via expanded could across with Kind grassroots the to the coming forward quarters, think acres acres of continue net larger leasing grassroots last have add X you year to reasonable is you per X,XXX that looking position, the via of to bolt-ons? X,XXX Over leasing, added guys your in really majority negating XQ. need XX,XXX for

William Hickey

High pretty that end sounds high. of

I a long like confident, time, and it's we've been doing think lumpy. we're this

would we replicate base acre did a year of X,XXX, period. probably that good in acres be what really QX in the think X,XXX, But would the year. a really -- a could I'd X,XXX we say probably couple better kind a X,XXX in XX,XXX case. is have acre full be quarters I I an year think of good

the QX. in certainly and who we've Midland it deals do run or confident I done some bit we're through that I we've think the knows. have opportunities. these you just in day largely our or doing years, like here minus think acre to team being way can out acres, you ground in I team the But set the outsized we drill think which that continue come kind probably X,XXX like schedule saw know of drill the we closer of couple kind the to quarters opportunity the in tied plus rate. at minus is an I plus on our done of X,XXX for mean every incredible last But looking scale

year look a think probably I every but So year. that, could really like good not

Unknown Analyst

And I wanted for to capital my ask question. follow-up, efficiency sense. a Makes

take with introduced the XXXX. love efficiency you've on in free peers your cash XXXX, measure crude I'd new measure, in achieved a a view XXXX flow your deliver respect of would if evaluated seen share if guess per of it. One you in a would have share level similar allow flow a they recently per And it, that capital free have if for I you what cash you where price for similar to price on is that secondly, it?

Hays Mabry

mean I us, this. at I like actually think Yes. we looking for

better one cash running about see the per I think every as flow day business thing really our it kind we share. we talk that's is as free important quality and getting year-over-year business that is as our arbiter of of ultimate

that call price, feel trying business, to capital or which our generated talked free year, And cash I of plus to think we basis. billion, crude call the generally were change a, on we in efficiency step the absolute think is metric operational that flow. kind mid-XXs, call the could we've it, the shows context in do $X.X I that cash generate if that it, the last of this year of $XX free $XX flow absolute perspective, about that the like we board. kind and quality same, across the from seen low an in a that But of is we minus. efficiencies think we

Operator

from the comes Goldman Sachs. line Mehta from question of next your And Neil

Neil Mehta

guess time James team, thanks and picture question. here. I for big the

despite the stock deck discount. in show the still at You trade multiyear a outperformance, does X-turn

So in Resources a Permian lot is, big the is Midland. about of think I the differently Permian better start pure-play do to you to context -- guess superior question including other stories. what more needs in the brother thinking understand the market your of And and

Hays Mabry

I is think ton spend don't be time I the market frank, to guessing we thinking. of what think, a

question we that than to are. closer that probably answering You're better and

spend make business our how where better. say focus we of can our I'd we all on tenant

not to had think if to person to the had I I'm this. do speculate, best and I probably

a Resources a is Permian one, relatively it's think new story. I still combination of,

Like this decade, well two and out. they've doing I year across closer want over it quarter doing think probably tremendously street, to you about a talk in, to one year the and quarter been into guys for out, year if the well

think multiple relatively still I the the story. business is of the it and that run new we're quality they the like they run a -- both deserved by for duration So

Resources, X.X-year and a lot it's investors. think or still doing Permian so we're of for a I mark

quality will So people think the see hopefully, uplift out lot trust. -- quarter over we continue people multiple execution. think built as shareholders. see a year kind the I time, for created of a We've and come think lot today, out to business value of of we've our in, I obviously, of And see quarter but

on to a Slide reconciling So which investors date, I X other XX, peer is still get which think the been I shown is strong multiple thing so people Slide relatively think running the hard to occasionally compared years has low that XX, the have with that is set. a time only outperformance from we

I'd And we I works for free share So will and itself. else take think we're focused on grow think cash now, of flow say all out itself really think everything care us, time. over I per how it

Neil Mehta

just then lengths. And on answer. lateral follow-up Great a

moving You're to feet. X,XXX from feet XX,XXX

laterals. this how those to talk Just -- what you about extend your continue continue higher. do what's And approach drive to to

William Hickey

acreage the this the this is is up way say I'd position Yes, year. just set

we've deeper Basin, laterals targeted benches kind as think the just X-mile kind Delaware of Delaware always length. the optimal in Wolfcamp least Basin lateral I of at type

this -- economics few step-up just of as XX,XXX-foot there's actually laterals that's of drilling very, sub drive as shallower X-mile when so few in is to we'll XXXX some as think we're very does and XXXXX the well some from year that do. benches what I laterals a the incremental well

see up I seen shift couple of chart on the targeting operational Basin. Midland a or XX,XXX think I'd do efficiencies if change from bit in the big Delaware if verdict targeting little that later. feet XX,XXX most translating you'll out is the end Basin, to years synergies to you've the Midland the closer feet say to still a Basin Delaware

foot it. But per -- bet we a lot than Midland. wouldn't probably fluid I more So productivity Delaware basin against makes

deliverability and And so lengths, of food is start point, kind you push the if lateral some constrained it at to hurts really, economics. your really

So I'd we're of the economics. sense say our acreage confidence that just have of and miles, drill drilling looking day, position every at that the do the that's I the stuff it's but go could easily team if makes needed, more

Operator

from Wang Oliver the from comes TPH. of question line next Your

Unknown Analyst

look like the it budget that portion, of sounds facilities kind to of and XXXX XX%, infrastructure the at wanted back related. non-D&C is that most Just

color respect to of can sort the of any within budget? magnitude CapEx all non-op the you just that provide But with

Hays Mabry

our is years, Yes. of business. -- million over and awesome spends We've less small. say focusing the a I non-op kind done coring operated it's job think . I'd on than year. non up $XX the pretty an

Unknown Analyst

gas quarter, sense. put just for optimizing speaking realizations. on maybe slide makes out a And you That gas netbacks. follow-up, Last all a towards the on Okay. focusing

offer front been Just that to kind of wondering progress to if of up any that to. you're updates on there's speak kind able

Hays Mabry

mean, definitely I a still say I'd priority. No. it's

of kind all gas the board marketing think say on takes hydrocarbons of our that a time. side, the I of across priority. I'd better just is

moves end in guide our oil needle free think up at saw really on And side made I last the the flow crude from by we real $X.XX, kind I $X.XX, the a $X.XX us cash the there, of at realizations of some guidance X% the you different places on day. progress think our barrel year. midpoint

our like side, probably lot a year. I to frank, looks think, be it gas think did our we're the year gas this to going last the On I sell -- way

in at couple I different us but longer-term XXXX to takes probably than ways of think think that a change that real see some Waha, looking access to that as the time. and allow longer-haul just plate could markets of things is got beyond kind we access the we'll we're deals, on step different

think focus for I very us. our So is strategy in gas

next than in over our more very is 'XX that but the think of I will in kind 'XX decade priorities optimizing the you'll XXXX. list, at you and realizations I . think top see strategic of the

Operator

UBS. from next from the Josh And of your question comes Silverstein line

Joshua Silverstein

in getting make acquisitions? turn to the Do see year. it to end sense the you this sheet of for of closer and rerating potentially use level by a does mentioned in and stock? stay benefit Xx to half to Or this the buyback You balance getting from leverage a cash that

Hays Mabry

definitely about as issues business balance We're opportunity solving in a environments. positioning be creation and be our kind sheet, normal a well. everyone balance sheet, I implications think say all value agree, there's of because well I think optimize trades, a to positions if because as have stock not acquisition we the of aggressive how think it's downturn. as powder sheet dry balance in for I'd And having I think for you would a along, that market opportunistic right And buyback, be able if be well also kind comes to to at of stronger the

or And or to to where cycle Xx. years. is I at acquisitions a there's said last X majority business view certainly think the buybacks, much Xx quickly. but trade it's We've the that at business delever been at going the don't I strong life during fortunate we're we're So going this XX than year, better of stock X.Xx cash, absent generating any extra comfortable positioning. very no more position so onetime. it's a our

Joshua Silverstein

net pretty almost of Got guys acres. questions at And on royalty then it. chunky you position now a the have XX,XXX A here. couple royalty side,

And targeting year, acreage? about are we're drilling for program is thinking thinking the this as how enhance on acreage drilling you much to that potentially more royalty Just then royalty about returns? M&A,

James Walter

Yes.

of the think can look we on spend dollars the working I been And have say think all-in at Look, all I'd of what's achieve. the acquisition total we return acquisitions on interest. I'd lens say we we the majority

a I where a can. lot we buying resources it's at often landscape active deals. competitive capital. of we under perceived think lower and royalties That's where But royalties Permian of competitive I cost look market pretty definitely think we're the

success I had interest it. royalties working think alongside we've packages most the where is that come with buying

that's likely base then be to and announced think that been kind of saw year Maria last comes you the in deal we the think -- case. ] Draw it [ And towards highest not, the I more of say high on rate I'd tend I probably when package the and the be that have. the kind that we more of we activity, with And development to entry have those royalties often advantage. activity than goes return to

[indiscernible]. XXXX at see XX, our You'll XX% on XX% of kind has guidance about a

those more to definitely higher higher packages. return, we're allocating NRI capital So

Operator

line John And your of Wolfe the from Abbott from next comes question Research.

John Abbott

do you there further change we lateral to to want of things major foot that lateral are need I per you the the cost a back tariffs, Well, foot a do other more there really efficiencies achieve go $XXX here, risk technological change in time? this ignoring point per to to could at mentioned at Or see see costs? just potentially from in

James Walter

There's a mean, meaningful a is really from kind small become small in flat of the and big sourcing, say really, cutting drilling Yes. I water there's savings the of capital for if to Look, continued water our here, on I costs side. changes budget. recycled case I'd has to time bull was make changes reduce on water part

marginal side, the completion could then ran year or QX to have flat over that the we and every big you saw be costs predecessor follow of for drilling two. then company improvements to one very breakthroughs the year. that it's always a those or of QX PR changes kind going We On yes, time, quarter-over-quarter. step last of And kind once from there's

that like a actually, the you out of BHA or are those So technological or you a like that, swap fluids of discover has change. more a something meaningful or changes new find

you can Obviously, you ways win. are those can -- ways there's lose So the to. all

$XXX the kind the year. And we so landed for hence, of being where

John Abbott

to And Okay. want CapEx for year-over-year. X% mean, to go back I then is I production production.

mean there that I backward a are your but lateral seen of benefits cost in maintaining efficiencies operations. dated we we've curve, foot. oil So got to per

you of more you managing does let possibly like about to to or . sort it sense when make like think versus number? a a number, when production think efficiencies production continue managing about production So

William Hickey

capital which think is of what about the environment. backdrop the returns macro kind and of combination the phenomenal of as think of what the a it, this you allocation drives at reinvestment we what I say that think about think kind it -- referenced. a it's we're It's I getting we're strip I'd in the both, production kind just ultimately on market we that really number getting -- and and a returns depends as forward? function are backwardated even is go kind are rate,

of think were I the kind of we corporate oil a price. about of potentially as our at than an But move kind better is last materially think I oversupplied year level a through year. do they market of there at backdrop returns even kind talked are you a lower

with the feels per debt for really We're an this a got in adjusted focused call that the talk of more going bit. can't we I some as is metric about enough, mid-single really forward. a are a on growth. about to think we share I of X% lot per low I maybe you'll kind organic of positing see and talk digits production storm clouds share little market. are think what growth kind it, business think And on good us kind that ground organic And of overall. growth, of that kind think backdrop, But viewed I we basis to middle on

Operator

And next from Partners. line Leo from Mariani of question ROTH the your comes Capital

Leo Mariani

lower being waiting But Obviously, multiple at that of year sense balance generating lot a blow multiple are time. which is in feather flow, cash itself and up a the great instead just better know little profiles in buyback bit given things and to fact it put takes M&A than totally of more maybe leverage I the guys is the doesn't time, kind of of a end shape unpredictable. the the low. for lot your prepared make care shape Why the you spoke clearly in here. and But a that bit sheet of over same and to in hopefully, you comments free peers at seems about the your

Hays Mabry

today. a buyback want we're Yes. relative when to we buck dislocated always a going real more dollars think feel although our Ian, see truly is buyback your or kind a you shot, be market think dislocations And I I better about think bang for like it, to real on we've talked undervalued get and you very, for downturn. doesn't it call us, strategy rifle of to broadly peers,

a, our are right ultimately a think over juicy value balance a or spent mass enough. and think acquisition them opportunity rating right that for we're it, of or term, shareholder an the call in prepared better good to wait that's than patient for I we one share the that long and for sheet that and buybacks opportunity kind or in So more drive putting the opportunity we We to think dollars kind prudent of to I to on do be something just be the buyback think future else? approach

Leo Mariani

fourth Okay. your in And a then down costs, out, just turning little to bit controllable here they quarter. pointed ticked cash the you as

. there cash drivers Is Or kind kind cost it more you the controllable them on? are matter are efforts costs. success just in of come guys simply what expecting of reduce down at just the kind you to XXXX? scale? you to reduction a on of working guess had some in XQ and of guys Maybe your to are cost that again of some the guidance, I Looking XXXX talk tangible are

William Hickey

Yes.

got to months it there's our We've and the bought a redraw that into north room a were from So asset. we big the down $XX , that so one able at lower per is few on And highlighted hands I'd we continue acquisitions which it. the to some to after cost there. made, say it was of win I cut just out of quickly getting of we BOE we think

some you forward-looking you XXXX. So kind as of those tailwinds of QX have compare to

start way where expect development more you'll That's up just contracts, of We also to I sets a year-over-year. midstream to our some the just of kind GP&T have of we think we're our program relative -- function lower our share. protecting per material any is controllable our generate to flow we I'd business. to cash free and look, say overall, free to But than change margin flow think ability protecting to the cash important cash cost drilling

et lead keep ultimately business free keep better G&A to a chipping will cetera, Industry-leading of on more and flow. it. So at the pushing LOE cetera, side, away kind we'll cash et

Operator

from your Diamond line from the . Citi. And comes of question Paul next

Paul Diamond

one. Just a quick

on kind go-forward the M&A of think or similar mentioned about hundred You opportunities, side side set or high couple [ Maria that? of Should we the of to the of opportunity ] range. dollar on million kind Draw thinking low

Hays Mabry

did the of or a I and I doing by kind small $XXX-something the high $XXX today the lot Maria -- those area hundreds. than doing we've of a in Draw million hundred million We the smaller And did $XX,XXX of draw think acquisitions. couple kind of that. and on by deal done million little that think we end, a size deals Eddy deal. we're year, we're acquisitions the dozen ] [ of Last kind then County are

that's think right I range outcomes. of probably So of the kind potential

big it's as $X think as and on kind I as side transaction of the XX,XXX. cash billion small kind of

Paul Diamond

Compared any the similar You've Understood. I years seen that X.X evolution have similar bid-ask appreciate How activity. the spread, marketer to times Colgate in clarity. And kind then if net just or a talking merger. bit evolve? seen about ago, of ground you game. that negotiation

Hays Mabry

Permian, saw was say being And opportunities running ground go We pretty just the running up XX efforts rigs rigs in think I doubles from set from kind similar to had on opportunity kind started and been big the company out XXXX. X I the XXXX. of in probably acquiring heart was at that underway the doubled we kind for that back deals. boots the scale and our is predecessor Colgate of us. the a lot has here relationship opens of change to business. part in that since X, rate game the that and merger big ground Midland But only continual of Colgate I'd we and of X, a we've of success the the of it's The the

been a to of long of for times pretty return, cost rate steady kind negotiate time. think I So break has

Operator

And the Hungness of line Noah your next question America. comes Bank of from from

Noah Hungness

on Congrats a great quarter.

I question, ask to dividend. on just first wanted the my For base

have capital more to efficient. become program continued have your costs guys You capital your

production were also cash we capacity flow seems what expecting. is is than your and lower go costs increasing. And like your cash higher free it Your

reasoning your was results? base when dividend flat keeping what So behind you your announced

William Hickey

Yes. based in I is mean first November. the -- reason our got we all $X.XX dividend we paid

quo. So we we dividend annually, the kind kind first it this right we felt it that of the probably messaged out, to I that status kind the revisit rolled -- it plan just kind of did our November indirectly of do with was And of when annual like think revisit we paid. but we that

a quarter. I nice next to increase. higher should we're when and think the And was of only a dividend out, done felt X larger is it we it had frankly, been had we But the business could it certainly just it year support like yield this. it I'd this dividend, and excited just say kind and than revisit time have rolled

thinking just sense simple made kind So pretty that to X end. quarter just didn't like a seem it it of make change

Noah Hungness

laterals. drilling creative potentially like thoughts sense. of basin Yes. just guys would some any you like levels to of That your do then And solutions success. implementing I the And to in so know seen your that? on had have thoughts We've makes on peers

William Hickey

Yes.

land think Like for it. up So part, map, simple straight not it our see I team kind kind for fortunate scan, longer position our Having you look at and sets land two I our on well we're of just most that, a two the what team can or well than said wells, part that how the you proven time call done require or or does development. of acreage think curved wells go a I'd that very any if we've incremental make three kind the want it cane U-turn drilled of And there's to say over program. very, it's it times like does candy curve. we've you of little that date. that's four three four drilling costs has if or it our to sense, very

see on plot. Some of us a it even you don't DVD

step I have don't be that but will And makes are primarily of think do driven like when don't simul-frac, in be will kind that it's program, it the efficiency, highlighting And that places change that have do is we need that think we so efficient where the something something many of capital it. we to part it. sense, a necessarily huge confidence I it it we'll just we

Operator

this There Walter back are I further James hand at now time. for questions call to the any no remarks. will Mr. closing

James Walter

same, primary following a today. structure continue to that in in record to for term. Resources everyone, Having thanks, to build dialing and Due gotten start over the the XXXX, with great long the consistent the to shareholder our we on remains maximize value plan off you, joining goal story. the Thank call for delivering everyone track lowest for for cost today Basin. results of again Thanks Permian to our Delaware the and

Operator

This participating. you call. concludes for today's Thank

disconnect. all may You

Permian Resources (PR) 26 Feb 252024 Q4 Earnings call transcript