VTS - Earnings call 3 2023 | Vitesse Energy, Inc.

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Operator

Greetings, and welcome to the Vitesse Energy Third Quarter 2023 Earnings Call. [Operator Instructions] Please note, this conference is being recorded.

I will now turn the call -- conference over to Ben Messier, Director of Investor Relations and Business Development. Thank you.

You may begin.

Ben Messier

you thank and morning, for joining. Good will for the we yesterday market be which discussing results operating after and financial close. third released our we Today, quarter XXXX, of

our We filed Form the access You presentation yesterday. the our release of website. section XX-Q in can our Investor earnings SEC Relations with and

our Vitesse's Henderson. I'm with CEO, Gerrity, Jimmy Chairman here this our CFO, Bob and morning President; Brian Cree,

give provide you today's the call remarks, operations financial Bob, is opening will remarks questions. be will for Bob After quarter on executive to agenda the will Our Brian conclusion Jimmy answer follows. will an update. third prepared review any quarter. the as team available of our our After results.

that may subject today, your risks Litigation our answers some to Before Private forward-looking of forward-looking include the statements remarks are to our control harbor begin, we cover advised our including questions, let's within Act. These Securities safe of the beyond the the statements Reform which materially filings. meaning are uncertainties, to be risks language. and statements, required in actual contemplated statements. as forward-looking that could matters these by any disclaim applicable and to by Those forward-looking laws. expectations the different among release periodic earnings we results securities have from our that update others, described be these We obligation include, cause except be Please may

the discuss that may Reconciliations net be including issued to measures, flow. earnings in financial call, closest measures adjusted adjusted non-GAAP free conference adjusted to we measures debt debt, the certain EBITDA EBITDA, these release can yesterday. income, our net we ratio found During of GAAP cash net and

and call Gerrity. over I Bob Now CEO, turn to our the Chairman will

Robert Gerrity

we Brian guy I thrilled. for oil He's brings to and everybody. a and call. our successful is a Henderson, us desk, wonderful had he's ago, is Jimmy deep business, wonderful CFO career X Cree rare. a Thanks so the fit wonderfully. -- Jimmy being the on Good which in joined who And morning, set are skill and as a just months today much in his not With only

in So needle the he's really our moved capacity. improving

So welcome, Jimmy.

our is last third me. top our The the paid priority. that the dividend week, $X.XX heard Not return first it time the be And our from declared of in this per time cash quarter in paid We fourth payment heard you of of dividend it is dividend me, quarter earlier company. of our won't share cash from to be test you've And fixed Board December. a capital $X.XX September.

look larger development lot to a continue dividend. deals our near-term at of drilling that and to continue supportive We asset be acquisitions of

the to third hurdles. several we meet our impactful high quarter, complete able very were return that acquisitions During

we limited budget. discussed, parameters whatever a buy within stringent previously by we're our economic we As not and can

We are put themselves. opportunity only to in place when limited protect hedges We and these opportunities returns present economics. by the

With to turn partner Brian and this President Cree, my and going that, -- of President Vice to Vitesse. I'm over longtime

So Brian?

Brian Cree

Thanks. morning, everyone. Good

will result acquired internal program through flow to 'XX half that both the million are expected QX and primarily across rates in approximately These the and in provide near-term our Bob hurdle interest additional to material and drilling mentioned, our third exceeded CapEx, in acquisition we and cash As increases XXXX. $XX during additional acquisitions oil of quarter of gas second production XXXX.

process production already to turned either started have of in on in or acquisitions these with associated the the fourth quarter. being producing are wells The

acquisition. the revenue So will than CapEx receipt shorter and our spend time typical between be

our locations to -- we remains see consistent our model. assets. pace on see continue core of of of existing business to inventory our development we The conversion undeveloped Additionally, organic

the completing that development pipeline provide we wells had that were of as or by another opportunities, operators. and for net XX, September to like Since we X.X phase into in drilling our XX completion permitted net of our have XXXX, insight either wells and been drilling

hedging. touch on little bit a to want I

months, Over oil first now our the production XXXX We we our estimated $XX close have per our of approximately the fourth XX% XXXX. half last oil year hedged XXXX of XX% added for hedges XXXX XXXX to production X oil and for the barrel. of for remainder all estimated full of at to of quarter and

Thanks for your time.

it Jimmy. to Henderson, turn highlights. Great CFO, aboard, Now to Jimmy I'll new have Welcome here. our over financial to review you our

James Henderson

a this certainly continue in all back to that's be for involved everyone here. I'm be to that and Brian, and good in great the feel investment, banking kind tell research to and Thanks, listening of wonderful Vitesse continue today. I and story. we arenas morning, with you to exciting many reconnect so to And happy the important Bob, the been industry is thanks, the as in provides words. It is vital It's resource. in

thank since I to want get Texas and the last to lastly, the Vitesse Series me the win to up speed exciting especially Rangers And I joined. in making World feel me helping on night. team the congratulations for welcome

financial can earnings on the quarterly a to status. our on details and and our filed release I'll XX-Q, last refer financial quick review quarter of our year-to-date assume and for Now night the the results to all which the for results. were you all

But were just items. details repeating bother in that highlight those all to a few won't I documents. So included the

and future continued supports continue obviously activities the Brian cornerstones through of dividend. the return with strategy. described, of acquisitions, our flows program Bob cash As which to be capital strengthen Both both and several our dividend we've our

BOE with results for our of oil. over XX% day consistent the being fairly that As remain in the production quarter, about XX,XXX levels just at per

increase we XX,XXX in acquisitions reported, per year production the the with to of XX,XXX due expect BOE primarily day next that to fourth to increases further announced. quarter in year this to XXXX, we previously we recent As

those net of numbers was reconciliation $X.X at press was EBITDA in GAAP million, $XX.X can sequentially the see loss that was last Likewise, a million filed $XX.X income adjusted flat million. you night. net release adjusted and income the of and we

outspend the $XX.X funded and which CapEx approximately as acquisition acquisition expect facility. in remaining XX. QX these us dividend drawn and this We as million. were $XX credit September disclosed We CapEx put we further of our at quarter continue million costs do as we to Cash weeks of a couple through well and ago. We'll cash operating costs on the as our as fund fund flow costs in

With over turn that today. to Q&A Thank it might that, you operator let me have for any the all. we

Operator

Partners, proceed. Gap] [Audio please Instructions] [Operator

Unknown Analyst

his Congratulations new Mr. on the Henderson and congratulations for quarter, position. to

James Henderson

I appreciate John. it. Thanks,

Unknown Analyst

You as they and all said were more they some properties want your acquisitions? put press in acquisition the to Do on those in you producing all Bakken? Were quarter. provide said out you you're release, in activity accelerated the you -- details

Brian Cree

is the developed said, Thanks, John. of years, And together and [Audio Yes, of we Brian, the to is This were the latter pipeline that can transactions that. different just we've as part and it kind toward quarter. they but fortunate we've middle be produced weren't acquisition come XX see last something really over lumpy. And third I'll several always assets. handle the Gap]

are Although typically tell would that process our what near-term that drilling about Gap], is of is process. [Audio along or I you development we're wells further that AFEs the because buying in -- program

to online quarter. them will the more the with rates started latter were of of on fourth toward the wells the quarter of return, come to that kind of so we really part And come especially the given happy and

just online indicate. they than acquisition typical they though were acquisitions, even near-term So coming faster our were development would

Unknown Analyst

all the them in And of Bakken?

Brian Cree

Yes.

those Williston of Basin. the All in were

Operator

line question next of Northland Our with from the Markets. Schafer Capital comes Donovan

Donovan Schafer

very how quarter? all account, like somewhat is thinking I just that I the a just of that price it with picture. want how material XX What XXx? the gas small have line part piece they as for When to take over production you -- But a overall wide realizations. can last start still off natural significant into know you the by swings months like asking been to gas about top this price of the were natural small even being last be guys.

I realizations transportation net you the about know I do I in So per to have Mcf mean, being quarter. it $X.XX expense. of ask

it, a that maybe or not comparison, else So understand doesn't What want that the elsewhere. what it an Just trying report say, it just kind to my lower? expenses? of of mind treat I wrap way but apples-to-apples there's you someone be transportation producing a to basin, around someone see like net to if kind what who to compare of it peer like and to makes if drove I would compare maybe let's it

James Henderson

Thanks Yes. the for question, Donovan. Yes.

realized the be I winter, impacts think to that unfortunately, NGL storage and have [Audio as of that expect in gas were reduced one meaning that thing, couple especially. prices only natural NGL a and oil a to of certainly the -- So high out not summer. we NGLs cold of East and as assuming that does natural continue That's the get the very seasonal includes and go our we levels the coming low through component And Gap] biggest of on quarter to that. the Coast, price we the gas third the continue and one improve crude it is practices

should the fourth quarter-over-quarter So certainly quarter. improve that here in

producers other of net not The that as price, we all our component is, out and do. transportation you gathering, downstream mentioned, cost,

how Some here. revenue ahead. just the we show paid, that that we part net are at way a the received of That's really But separate the as price. handled that's a G&T well it's

different a that item others might make the line So income that adjustment I'd in to it as have statement. show as

that other the The those lot are price is a fixed costs netback operator. by our affects way that of

percentage which NGLs fee have net fixed or And higher versus percentage So the fee they of a have price. like to. down, contract, obviously, gone type most of proceeds that people as fixed gas prices becomes goes of a

has higher at than more of impact prices. prices it does so it lower at an And

we're be. But doesn't you with hopefully, So need where helpful. if follow that get you to that's to up happy you

Donovan Schafer

additions That's recent ask book update want between hedge the then Okay. release the the with helpful. development yesterday acquisitions. And then about just and very near-term I the to release

think So X hedges the really only it of the like I between -- -- correct, positions the notes if the are those change to XXXX. looks addition hedge was in only my

it's the acquisitions. in the maybe not a something volume maybe I'm total terms It's sort -- it's tied guessing that the of quantity or at huge of addition But XX% these to like point. of of

you're underwrote out we at saying, okay, sort certain of and strip. looking things So a

an strip how that how just compare thing does Or of slot it where these? it -- some you in am conceptually First, that smaller of up kind the curve -- about some to I way? time how pick that thinking $XX what volume to 'XX does underwrote then 'XX? sorry, prices opportunistic And right when were the was for price, period hedges of

Brian Cree

take This at Donovan. is crack a I'll Thanks, Brian. that.

there. You had several in questions

and September a after into early It's right? see run-up mean, of of combination oil acquisitions. So starting opportunistic? kind nice both, did those I a made is in shortly of had October, it we prices we

so prices at to for out. we the expected that was those part production a acquisitions associated much with is Gap] [Audio And those opportunity XXXX prices than it had of higher at. underwritten And great us lock the acquisitions years in from

kind so to starting part XXXX. of as process the still of backwardation out hedges. in get And lot of it's our in into of normal just market There's a you lock

advantage days took $XX of couple that an pulled that. on we of So uplift we so above and a over in the we trigger XXXX, got saw

I actually 'XX comment expected quite our 'XX your and and a for hedges Gap] just want on add 'XX. [Audio about did touch to increase production. 'XX few We

where price to of second a up hedged $XX. from average expected Now to over stood closer to XX% our at we production, of little the at is end -- close the that we and $XX, quarter, bit which we're increased

expectation opportunistic. book, So think we'll mid- again, it's from up, be I it. go we advantage prices both upper of a and it hedge handled on kind to see look you we a like that's historically kind we at before in my When how how take lock combination we'll basis. to of can of that is in that that's see it. our go-forward we've And hedges those $XXs And of

Donovan Schafer

drilling it's directional ground as larger on -- if seen you well of the kind opportunity changes of versus type or general Just you're a something opportunities the or deals. guess, going what still, for near-term near-term of state out potential more I one or kind as those you development the what or Sometimes -- there kind other can market, of and you Gap] affairs comment The or are just set package and lot In while? of time in to game a versus both of both sets, were the forward? state assessing M&A seeing in opportunity have not? trends [Audio things better

Robert Gerrity

this Bob. is Donovan, Yes,

because the price seen -- Gap] deal [Audio flow of stable, the We years. in this is oil biggest fairly is are but most we've seeing has been this the

those it's About company correlate reviewing great. that nice us Now analyzing real in deals. There's deals. closing always doesn't a half form opportunities. board of to that and engaged the closing said, some of and mortgage But is

very busy. close to again, going that we're [Audio we're promise So Gap]... But I those can't things

Donovan Schafer

great. Well, follow have if other I'll right. All questions. I any up

Operator

Partners. next of comes line question Global with Alliance Our from Jeff the Grampp

Jeffrey Grampp

I curious of things, maybe Gap]? cost well a of specifically, guys an was are there leading-edge how just on cost seeing? What -- the terms side in [Audio AFE does what update compared to you

Brian Cree

year, basins difference other first cost between -- we think but in Sure. I add. XQ to nice most we've second take and call, a on crack as years. AFEs. the inflation mentioned our he wants We to anything starting I'll some about seen Bakken, much that the let on of Bob Jeff. X.X see last This quarter see trend this to the a the is quarter, back as that lower But we Thanks, were the small Brian. calls. of add the as over our at didn't and But talked have nice

would don't I that, trend know that say that it's consistent. the but quarter, been into improved necessarily I I third think

we oil of to think go up. started the back price I see

to are completion AFEs in their and we're oil. are costs receiving we've have going of price that been happy with correlation to drilling terms the in. But Your think costs I where coming some of the

a doing operators are job. good Our

as I it for us and actual benefits while the of takes one costs being get sometimes interest don't a as working see the a to My quickly of that non-operated the the you sense all is is it's operators owner don't saw cost inflation the that the I trends operators in there seeing that costs very think XXXX. the And we we're of the managing seeing good But a is are do. job think certainly out field. in we're doing

is the quarter third XXXX kind of of that a continuation think I second quarter.

Jeffrey Grampp

for Great. an test? opinion looking to of one you tangentially on given that obviously guys follow-up, that Hess guard the aspirations, the as how change. And it. is your operators, soon. will positive, how relates it Got just acreage nonevent thinking I larger to guess, a of the, your M&A prospectively, have at about you are negative it underlying to own And guys on there curious impact opportunities going be my related there's changing Do Hess

Robert Gerrity

from Well, have for they're it's they've the conversation. that last been what been Jeff, you and must topic good DJ, week, a because in conference our a think in of big Chevron we We very operator. the know done

that got the us, Hess or of a thing Usually, we thing. predict that on and if beneficial because but like good wells, bad and a do it's But a are haven't yet. We we under I do like -- it's lot we Chevron, M&A shuffle, for head smaller Jeff, in seen we our can't when assets a happens, swivel.

yet. know don't we out, looking we're So

Jeffrey Grampp

know No, ask. early. it's Yes. I'd I I thought

Operator

to closing there the to further this management questions remarks. back gentlemen, no like call and time. I'd at for turn are Ladies

Robert Gerrity

Well, does interest appreciate in that answering thanks, Ben any a months. you. couple and in a everybody, See we you questions you your have. time. terrific job of really support. And Thank your Bye-bye. for

Operator

you. Thank concludes This today's conference.

disconnect Thank you this may participation. time. your You for lines at your

Vitesse Energy (VTS) 2 Nov 232023 Q3 Earnings call transcript