false 0001792849 0001792849 2024-08-05 2024-08-05 0001792849 hpk:CommonStockCustomMember 2024-08-05 2024-08-05 0001792849 hpk:WarrantCustomMember 2024-08-05 2024-08-05
 


 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
 

 
FORM 8-K
 

 
CURRENT REPORT
 
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of report (Date of earliest event reported): August 5, 2024
 
 
 
 

 
 
HighPeak Energy, Inc.
(Exact name of registrant as specified in its charter)
 
 

 
Delaware
333-235313
84-3533602
(State or other jurisdiction
of incorporation)
(Commission File Number)
(IRS Employer
Identification No.)
     
421 W. 3rd St., Suite 1000
Fort Worth, Texas 76102
(address of principal executive offices) (zip code)
     
(817) 850-9200
(Registrant’s telephone number, including area code)
 
 
 

 
Check the appropriate box below if the Form 8-K is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
 
Written communication pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
   
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
   
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
   
Pre-commencements communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
 
Securities registered pursuant to Section 12(b) of the Act:
 
Title of Each Class
 
Trading Symbol(s)
 
Name of Each Exchange on Which Registered
Common Stock
 
HPK
 
The Nasdaq Stock Market LLC
Warrant
 
HPKEW
 
The Nasdaq Stock Market LLC
 
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
 
 


 
 

 
 
Item 2.02   Results of Operations and Financial Condition.
 
On August 5, 2024, the Company issued a press release announcing its financial and operating results for the second quarter ended June 30, 2024. A copy of the press release is attached as Exhibit 99.1 to this Current Report on Form 8-K and is incorporated by reference into this Item 2.02 by reference.
 
The information in this Current Report on Form 8-K, including Exhibit 99.1, is being furnished pursuant to Item 2.02 of Form 8-K and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act unless specifically identified therein as being incorporated therein by reference.
 
Item 7.01   Regulation FD Disclosure.
 
The information set forth under Item 2.02 is incorporated by reference as if fully set forth herein.
 
Item 9.01.  Financial Statements and Exhibits.
 
(d)   Exhibits
 
Exhibit
No.
 
Description
     
99.1
 
104
 
Cover Page Interactive Data File (embedded within the Inline XBRL document)
 
2

 
 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
HIGHPEAK ENERGY, INC.
 
       
Date: August 5, 2024
     
 
By:
/s/ Steven W. Tholen
 
 
Name:
Steven W. Tholen
 
 
Title:
Chief Financial Officer
 
 
3
 
 

Exhibit 99.1

 

 

ex_708632img001.jpg

 

HighPeak Energy, Inc. Announces Second Quarter 2024 Financial and Operating Results

 

Fort Worth, Texas, August 5, 2024 (GLOBE NEWSWIRE) - HighPeak Energy, Inc. (“HighPeak” or the “Company”) (NASDAQ: HPK) today announced financial and operating results for the quarter and the six months ended June 30, 2024, and provided updated 2024 guidance.

 

 

Highlights

Second Quarter 2024

 

 

Sales volumes averaged 48,531 barrels of crude oil equivalent per day (“Boe/d”), consisting of 89% liquids (crude oil and NGL), representing a 15% increase over the second quarter 2023.

 

 

Lease operating expenses were $6.79 per Boe compared with $8.39 per Boe in the second quarter 2023.

 

 

Net income was $29.7 million, or $0.21 per diluted share, and EBITDAX (a non-GAAP financial measure defined and reconciled below) was $215.8 million, or $1.51 per diluted share. Adjusted net income (a non-GAAP financial measure defined and reconciled below) was $39.4 million, or $0.28 per diluted share.

 

 

Generated free cash flow (a non-GAAP financial measure defined and reconciled below) of $13.4 million, which marks the fourth consecutive quarter of positive free cash flow.

 

 

The Company reduced long-term debt by $30 million, paid a quarterly dividend of $0.04 per share and continued to execute its share buyback plan by repurchasing over 413,000 shares during the second quarter.

 

 

Recent Events

 

 

Increased 2024 average production guidance by over 4% to a range of 45,000 to 49,000 Boe/d, up from 43,000 to 47,000 Boe/d.

 

 

Reduced 2024 lease operating expense guidance range to $6.50 to $7.50 per Boe, down from $7.50 to $8.50 per Boe, a reduction of 12.5% at the midpoint.

 

 

On August 5, 2024, the Company’s Board of Directors declared a quarterly dividend of $0.04 per common share outstanding payable in September 2024.

 

 

Statement from HighPeak Chairman and CEO, Jack Hightower:

 

HighPeak continued its steadfast commitment to its core values – operating with discipline, strengthening the balance sheet and remaining focused on maximizing value for its shareholders. Our operations team continues to find ways to optimize productivity and efficiency, and combined with our continued strong well performance, we have experienced a meaningful uptick in production – with current volumes averaging over 52,000 Boe per day thus far in the third quarter. In addition, we have been able to drive lease operating costs lower than expected, leading to updating our 2024 development outlook in both areas.

 

Through our four years as a public company, we have assembled and continue to add to a great acreage position. We have 137 thousand acres consisting of undrilled inventory of over 2,600 locations of which more than 1,100 provide a minimum 10% return at $50 per barrel. We then focused on quickly growing our production to a material level of scale while delineating a deep inventory of highly economic locations. In the last year, we transitioned to a measured degree of growth while optimizing our field-wide operations and developing life-of-field infrastructure to sustain efficient and cost-effective operations moving forward. As we follow the natural progression of realizing value for our shareholders, we will continue to strive for excellence in all areas. The scarcity of remaining economic locations amidst the current market consolidation trend reinforces our belief that we are sitting in a prime position to maximize the value of our assets. Our strategic process is progressing nicely, and we remain very excited about what the future holds for HighPeak.

 

1

 

Updated 2024 Development Outlook

 

    

Original

   

Updated

 

Production (Boe/d)

           

●     Average production rate

  43,000 47,000     45,000 49,000  

Unit Measures ($/Boe)

           

●     Lease Operating Expenses

 

$7.50

- $8.50    

$6.50

- $7.50  

Capex ($MM)

           

●     Total Capital Expenditures

 

$500

- $585    

$540

- $580  

 

 

Second Quarter 2024 Operational Update

 

HighPeak’s sales volumes during the second quarter of 2024 averaged 48,531 Boe/d, a 15% increase over second quarter of 2023. Second quarter sales volumes consisted of approximately 89% liquids (crude oil and NGL).

 

The Company ran two drilling rigs and one frac crew during the second quarter, drilled 13 gross (13.0 net) horizontal wells and completed 25 gross (18.6 net) producing horizontal wells and 1 gross (1.0 net) salt-water disposal well. At June 30, 2024, the Company had 22 gross (18.5 net) horizontal wells in various stages of drilling and completion.

 

HighPeak President, Michael Hollis, commented, “The HighPeak team beat expectations again and because of their laser-focus on optimization and cost controls, we are able to raise production and lower operating cost guidance. As we mentioned last quarter, our capex burn-rate is first half weighted. This can be seen in the number of second quarter turn-in-lines and additional infrastructure projects located in our extension areas. We have tightened the capex range and expect to exit the year within our original budget.”

 

Mr. Hollis continued, “Contributing to this beat and raise for production, the recent outperformance of our wells to the east and on our newly added northern acreage further strengthens our already robust depth of inventory. The scarcity of sub $50 per barrel breakeven inventory in the lower 48, puts HighPeak Energy in a lucrative position with the current consolidation happening across the industry.”

 

 

Second Quarter 2024 Financial Results

 

HighPeak reported net income of $29.7 million for the second quarter of 2024, or $0.21 per diluted share, and adjusted net income of $39.4 million, or $0.28 per diluted share. The Company reported EBITDAX of $215.8 million, or $1.51 per diluted share.

 

Second quarter average realized prices were $81.39 per barrel (“$/Bbl”) of crude oil, $20.32 per barrel of NGL and $0.13 per Mcf of natural gas, resulting in an overall realized price of $62.33 per Boe, or 77.3% of the weighted average of NYMEX crude oil prices, excluding the effects of derivatives. HighPeak’s cash costs for the third quarter were $12.25 per Boe, including lease operating expenses of $6.79 per Boe, workover expenses of $0.63 per Boe, production and ad valorem taxes of $3.76 per Boe and G&A expenses of $1.07 per Boe. The Company’s cash margin was $50.07 per Boe, or 80.3% of the overall realized price per Boe for the quarter, excluding the effects of derivatives.

 

HighPeak’s second quarter 2024 capital expenditures to drill, complete, equip, provide facilities and for infrastructure were $164.0 million. 

 

2

 

Dividends

 

During the second quarter of 2024, HighPeak’s Board of Directors approved a quarterly dividend of $0.04 per share, or $5.0 million in dividends paid to stockholders during the quarter. In addition, in August 2024, the Company’s Board of Directors declared a quarterly dividend of $0.04 per share, or approximately $5.0 million in dividends, to be paid on September 25, 2024 to stockholders of record on September 3, 2024.

 

 

Conference Call

 

HighPeak will host a conference call and webcast on Tuesday, August 6, 2024, at 10:00 a.m. Central Time for investors and analysts to discuss its results for the second quarter of 2024. Conference call participants may register for the call here. Access to the live audio-only webcast and replay of the earnings release conference call may be found here. A live broadcast of the earnings conference call will also be available on the HighPeak Energy website at www.highpeakenergy.com under the “Investors” section of the website. A replay will also be available on the website following the call.

 

When available, a copy of the Company’s earnings release, investor presentation and Quarterly Report on Form 10-Q may be found on its website at www.highpeakenergy.com.

 

 

Conference Participation

HighPeak Energy will participate virtually in the upcoming Seaport Research Partners Annual Summer Investor Conference on August 20th-21st, 2024. HighPeak will also participate in-person in the upcoming Pickering Energy Partners Annual Energy Conference in Austin, Texas, on September 17th-18th, 2024.

 

 

About HighPeak Energy, Inc.

 

HighPeak Energy, Inc. is a publicly traded independent crude oil and natural gas company, headquartered in Fort Worth, Texas, focused on the acquisition, development, exploration and exploitation of unconventional crude oil and natural gas reserves in the Midland Basin in West Texas. For more information, please visit our website at www.highpeakenergy.com.

 

 

Cautionary Note Regarding Forward-Looking Statements

 

The information in this press release contains forward-looking statements that involve risks and uncertainties. When used in this document, the words “believes,” “plans,” “expects,” “anticipates,” “forecasts,” “intends,” “continue,” “may,” “will,” “could,” “should,” “future,” “potential,” “estimate” or the negative of such terms and similar expressions as they relate to HighPeak Energy, Inc. (“HighPeak Energy,” the “Company” or the “Successor”) are intended to identify forward-looking statements, which are generally not historical in nature. The forward-looking statements are based on the Company's current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond the Company's control. For example, the Company’s review of strategic alternatives may not result in a sale of the Company, a recommendation that a transaction occur or result in a completed transaction, and any transaction that occurs may not increase shareholder value, in each case as a result of such risks and uncertainties.

 

3

 

These risks and uncertainties include, among other things, the results of the strategic review being undertaken by the Company’s Board and the interest of prospective counterparties, the Company’s ability to realize the results contemplated by its 2024 guidance, volatility of commodity prices, product supply and demand, the impact of a widespread outbreak of an illness, such as the coronavirus disease pandemic, on global and U.S. economic activity, competition, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, the ability to obtain approvals from third parties and negotiate agreements with third parties on mutually acceptable terms, litigation, the costs and results of drilling and operations, availability of equipment, services, resources and personnel required to perform the Company's drilling and operating activities, access to and availability of transportation, processing, fractionation, refining and storage facilities, HighPeak Energy's ability to replace reserves, implement its business plans or complete its development activities as scheduled, access to and cost of capital, the financial strength of counterparties to any credit facility and derivative contracts entered into by HighPeak Energy, if any, and purchasers of HighPeak Energy's oil, natural gas liquids and natural gas production, uncertainties about estimates of reserves, identification of drilling locations and the ability to add proved reserves in the future, the assumptions underlying forecasts, including forecasts of production, expenses, cash flow from sales of oil and gas and tax rates, quality of technical data, environmental and weather risks, including the possible impacts of climate change, cybersecurity risks and acts of war or terrorism. These and other risks are described in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K and other filings with the SEC. The Company undertakes no duty to publicly update these statements except as required by law.

 

Reserve engineering is a process of estimating underground accumulations of hydrocarbons that cannot be measured in an exact way. The accuracy of any reserve estimate depends on the quality of available data, the interpretation of such data and price and cost assumptions made by reserve engineers. Reserves estimates included herein may not be indicative of the level of reserves or PV-10 value of oil and natural gas production in the future. In addition, the results of drilling, testing and production activities may justify revisions of estimates that were made previously. If significant, such revisions could impact HighPeak’s strategy and change the schedule of any further production and development drilling. Accordingly, reserve estimates may differ significantly from the quantities of oil and natural gas that are ultimately recovered.

 

 

Use of Projections

 

The financial, operational, industry and market projections, estimates and targets in this press release and in the Company’s guidance (including production, operating expenses and capital expenditures in future periods) are based on assumptions that are inherently subject to significant uncertainties and contingencies, many of which are beyond the Company’s control. The assumptions and estimates underlying the projected, expected or target results are inherently uncertain and are subject to a wide variety of significant business, economic, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the financial, operational, industry and market projections, estimates and targets, including assumptions, risks and uncertainties described in “Cautionary Note Regarding Forward-Looking Statements” above. These projections are speculative by their nature and, accordingly, are subject to significant risk of not being actually realized by the Company. Projected results of the Company for 2024 are particularly speculative and subject to change. Actual results may vary materially from the current projections, including for reasons beyond the Company’s control. The projections are based on current expectations and available information as of the date of this release. The Company undertakes no duty to publicly update these projections except as required by law.

 

 

Drilling Locations

 

The Company has estimated its drilling locations based on well spacing assumptions and upon the evaluation of its drilling results and those of other operators in its area, combined with its interpretation of available geologic and engineering data. The drilling locations actually drilled on the Company’s properties will depend on the availability of capital, regulatory approvals, commodity prices, costs, actual drilling results and other factors. Any drilling activities conducted on these identified locations may not be successful and may not result in additional proved reserves. Further, to the extent the drilling locations are associated with acreage that expires, the Company would lose its right to develop the related locations.

 

4

 

HighPeak Energy, Inc.

Unaudited Condensed Consolidated Balance Sheet Data

(In thousands)

 

   

June 30, 2024

   

December 31, 2023

 

Current assets:

               

Cash and cash equivalents

  $ 157,911     $ 194,515  

Accounts receivable

    87,561       94,589  

Inventory

    7,817       7,254  

Prepaid expenses

    3,073       995  

Derivative instruments

    2,278       31,480  

Total current assets

    258,640       328,833  

Crude oil and natural gas properties, using the successful efforts method of accounting:

               

Proved properties

    3,654,399       3,338,107  

Unproved properties

    75,690       72,715  

Accumulated depletion, depreciation and amortization

    (942,594 )     (684,179 )

Total crude oil and natural gas properties, net

    2,787,495       2,726,643  

Other property and equipment, net

    3,518       3,572  

Derivative instruments

    227       16,059  

Other noncurrent assets

    6,577       5,684  

Total assets

  $ 3,056,457     $ 3,080,791  
                 

Current liabilities:

               

Current portion of long-term debt, net

  $ 120,000     $ 120,000  

Accrued capital expenditures

    48,905       39,231  

Accounts payable - trade

    40,452       63,583  

Revenues and royalties payable

    27,860       29,724  

Other accrued liabilities

    22,490       19,613  

Derivative instruments

    12,599       13,054  

Advances from joint interest owners

    5,308       262  

Accrued interest

    825       1,398  

Operating leases

    422       528  

Total current liabilities

    278,861       287,393  

Noncurrent liabilities:

               

Long-term debt, net

    979,266       1,030,299  

Deferred income taxes

    213,038       197,068  

Asset retirement obligations

    13,911       13,245  

Derivatives

    775       65  

Operating leases

    165        

Commitments and contingencies

               
                 

Stockholders' equity

               

Common stock

    13       13  

Additional paid-in capital

    1,182,302       1,189,424  

Retained earnings

    388,126       363,284  

Total stockholders' equity

    1,570,441       1,552,721  

Total liabilities and stockholders' equity

  $ 3,056,457     $ 3,080,791  

 

5

 

 

HighPeak Energy, Inc.

Unaudited Condensed Consolidated Statements of Operations

(in thousands, except per share data)

 

   

Three Months Ended March 31,

   

Six Months Ended June 30,

 
   

2024

   

2023

   

2024

   

2023

 

Operating revenues:

                               

Crude oil sales

  $ 274,590     $ 236,390     $ 556,959     $ 452,086  

NGL and natural gas sales

    676       4,370       6,071       12,468  

Total operating revenues

    275,266       240,760       563,030       464,554  

Operating costs and expenses:

                               

Crude oil and natural gas production

    32,798       34,934       63,069       67,876  

Production and ad valorem taxes

    16,596       13,259       30,998       25,556  

Exploration and abandonments

    167       480       665       2,644  

Depletion, depreciation and amortization

    127,693       93,011       258,543       174,142  

Accretion of discount

    242       120       481       238  

General and administrative

    4,735       2,516       9,420       5,018  

Stock-based compensation

    3,775       3,984       7,573       8,038  

Total operating costs and expenses

    186,006       148,304       370,749       283,512  

Other expense

    2,000       7,502       2,001       7,502  

Income from operations

    87,260       84,954       190,280       173,540  

Interest income

    2,400       163       4,792       193  

Interest expense

    (42,991 )     (39,284 )     (86,625 )     (66,256 )

Derivative loss, net

    (2,702 )     (4,363 )     (55,745 )     (1,243 )

Income before income taxes

    43,967       41,470       52,702       106,234  

Income tax expense

    14,250       9,644       16,547       24,151  

Net income

  $ 29,717     $ 31,826     $ 36,155     $ 82,083  
                                 

Earnings per share:

                               

Basic net income

  $ 0.21     $ 0.26     $ 0.26     $ 0.67  

Diluted net income

  $ 0.21     $ 0.25     $ 0.25     $ 0.64  
                                 

Weighted average shares outstanding:

                               

Basic

    125,341       111,227       125,341       111,227  

Diluted

    129,248       115,978       129,265       117,127  
                                 

Dividends declared per share

  $ 0.04     $ 0.025     $ 0.08     $ 0.05  

 

6

 

 

HighPeak Energy, Inc.

Unaudited Condensed Consolidated Statements of Cash Flows

(in thousands)

 

   

Six Months Ended June 30,

 
   

2024

   

2023

 

CASH FLOWS FROM OPERATING ACTIVITIES:

               

Net income

  $ 37,435     $ 82,083  

Adjustments to reconcile net income to net cash provided by operations:

               

Provision for deferred income taxes

    14,690       24,151  

Loss on derivative instruments

    55,745       1,244  

Cash paid on settlement of derivative instruments

    (10,456 )     (7,261 )

Amortization of debt issuance costs

    4,119       5,704  

Amortization of original issue discounts on long-term debt

    4,906       8,627  

Stock-based compensation expense

    7,573       8,038  

Accretion expense

    481       238  

Depletion, depreciation and amortization expense

    258,543       174,142  

Exploration and abandonment expense

    229       2,186  

Changes in operating assets and liabilities:

               

Accounts receivable

    7,038       (4,378 )

Prepaid expenses, inventory and other assets

    (2,900 )     3,941  

Accounts payable, accrued liabilities and other current liabilities

    (3,633 )     64,961  

Net cash provided by operating activities

    373,770       363,676  

CASH FLOWS FROM INVESTING ACTIVITIES:

               

Additions to crude oil and natural gas properties

    (311,897 )     (678,968 )

Changes in working capital associated with crude oil and natural gas property additions

    (5,226 )     74,736  

Acquisitions of crude oil and natural gas properties

    (7,415 )     (7,789 )

Proceeds from sales of properties

    48        

Deposit and other costs related to pending acquisitions

          (397 )

Other property additions

    (122 )     (103 )

Net cash used in investing activities

    (324,612 )     (612,521 )

CASH FLOWS FROM FINANCING ACTIVITIES:

               

Repayments under Term Loan Credit Agreement

    (60,000 )      

Repurchased shares under buyback program

    (14,551 )      

Dividends paid

    (10,086 )     (5,554 )

Dividend equivalents paid

    (1,068 )     (569 )

Debt issuance costs

    (58 )     (1,399 )

Proceeds from exercises of warrants

    1       1,728  

Borrowings under Prior Credit Agreement

          255,000  

Proceeds from exercises of stock options

          148  

Stock offering costs

          (748 )

Net cash (used in) provided by financing activities

    (85,762 )     248,606  

Net decrease in cash and cash equivalents

    (36,604 )     (239 )

Cash and cash equivalents, beginning of period

    194,515       30,504  

Cash and cash equivalents, end of period

  $ 157,911     $ 30,265  

 

7

 

 

HighPeak Energy, Inc.

Unaudited Summary Operating Highlights

 

   

Three Months Ended June 30,

   

Six Months Ended June 30,

 
   

2024

   

2023

   

2024

   

2023

 

Average Daily Sales Volumes:

                               

Crude oil (Bbls)

    37,073       35,483       38,516       33,506  

NGLs (Bbls)

    6,018       3,681       5,583       3,482  

Natural gas (Mcf)

    32,640       18,256       30,187       16,444  

Total (Boe)

    48,531       42,207       49,130       39,728  
                                 

Average Realized Prices (excluding effects of derivatives):

                               

Crude oil per Bbl

  $ 81.39     $ 73.21     $ 79.45     $ 74.55  

NGL per Bbl

  $ 20.32     $ 20.77     $ 22.45     $ 23.71  

Natural gas per Mcf

  $ 0.13     $ 0.70     $ 0.68     $ 1.37  

Total per Boe

  $ 62.33     $ 62.68     $ 62.97     $ 64.60  
                                 

Margin Data ($ per Boe):

                               

Average price

  $ 62.33     $ 62.68     $ 62.97     $ 64.60  

Lease operating expenses

    (6.79 )     (8.39 )     (6.54 )     (8.48 )

Expense workovers

    (0.63 )     (0.71 )     (0.51 )     (0.96 )

Production and ad valorem taxes

    (3.76 )     (3.45 )     (3.47 )     (3.55 )
    $ 51.15     $ 50.13     $ 52.45     $ 51.61  

 

 

HighPeak Energy, Inc.

Unaudited Earnings Per Share Details

 

   

Three Months Ended June 30,

   

Six Months Ended June 30,

 
   

2024

   

2023

   

2024

   

2023

 

Net income as reported

  $ 29,717     $ 31,826     $ 36,155     $ 82,083  

Participating basic earnings

    (2,860 )     (2,942 )     (3,466 )     (7,590 )

Basic earnings attributable to common shareholders

    26,857       28,884       32,689       74,493  

Reallocation of participating earnings

    36       46       37       123  

Diluted net income attributable to common shareholders

  $ 26,893     $ 28,930     $ 32,726     $ 74,616  
                                 

Basic weighted average shares outstanding

    125,341       111,227       125,341       111,227  

Dilutive warrants and unvested stock options

    1,753       2,592       1,770       3,741  

Dilutive unvested restricted stock

    2,154       2,159       2,154       2,159  

Diluted weighted average shares outstanding

    129,248       115,978       129,265       117,127  
                                 

Net income per share attributable to common shareholders:

                               

Basic

  $ 0.21     $ 0.26     $ 0.26     $ 0.67  

Diluted

  $ 0.21     $ 0.25     $ 0.25     $ 0.64  

 

8

 

 

HighPeak Energy, Inc.

Unaudited Reconciliation of Net Income to EBITDAX, Discretionary Cash Flow and Net Cash Provided by Operations

(in thousands)

 

   

Three Months Ended June 30,

   

Six Months Ended June 30,

 
   

2024

   

2023

   

2024

   

2023

 

Net income

  $ 29,717     $ 31,826     $ 36,155     $ 82,083  

Interest expense

    42,991       39,284       86,625       66,256  

Interest income

    (2,400 )     (163 )     (4,792 )     (193 )

Income tax expense

    14,250       9,644       16,547       24,151  

Depletion, depreciation and amortization

    127,693       93,011       258,543       174,142  

Accretion of discount

    242       120       481       238  

Exploration and abandonment expense

    167       480       665       2,644  

Stock based compensation

    3,775       3,984       7,573       8,038  

Derivative related noncash activity

    (2,606 )     (703 )     45,289       (6,017 )

Other expense

    2,000       7,502       2,001       7,502  

EBITDAX

    215,829       184,985       449,087       358,844  

Cash interest expense

    (38,472 )     (31,911 )     (77,600 )     (51,925 )

Other (a)

    220       (7,583 )     1,778       (7,767 )

Discretionary cash flow

    177,577       145,491       373,265       299,152  

Changes in operating assets and liabilities

    24,754       28,179       505       64,524  

Net cash provided by operating activities

  $ 202,331     $ 173,670     $ 373,770     $ 363,676  

 

(a)

 

includes interest and other income net of current tax expense, other expense and operating portion of exploration and abandonment expenses.

 

 

HighPeak Energy, Inc.

Unaudited Reconciliation of Net Income to Adjusted Net Income

(in thousands, except per share data)

 

   

Three Months Ended June 30, 2024

   

Six Months Ended June 30, 2024

 
   

Amounts

   

Amounts per

Diluted Share

   

Amounts

   

Amounts per

Diluted Share

 

Net income

  $ 29,717     $ 0.21     $ 36,155     $ 0.25  

Derivative loss, net

    2,702       0.02       55,745       0.39  

Stock-based compensation

    3,775       0.03       7,573       0.05  

Other expense

    2,000       0.01       2,001       0.01  

Deferred tax asset revision

    2,999       0.02       2,999       0.02  

Income tax adjustment for above items *

    (1,780 )     (0.01 )     (13,717 )     (0.10 )

Adjusted net income

  $ 39,413     $ 0.28     $ 90,756     $ 0.64  

 

 * Assuming a 21% tax rate, excluding the deferred tax asset revision item

 

 

9

 

 

HighPeak Energy, Inc.

Unaudited Cash Margin Reconciliation

(in thousands, except per Boe data)

 

   

Three Months Ended June 30,

   

Six Months Ended June 30,

 
   

2024

   

2023

   

2024

   

2023

 
                                 

Crude oil, NGL and natural gas sales revenue

  $ 275,266     $ 240,760     $ 563,030     $ 464,554  

Less: Lease operating expenses

    (29,998 )     (32,226 )     (58,509 )     (60,946 )

Less: Workover expenses

    (2,800 )     (2,708 )     (4,560 )     (6,930 )

Less: Production and ad valorem taxes

    (16,596 )     (13,259 )     (30,998 )     (25,556 )

Less: General and administrative expenses

    (4,735 )     (2,516 )     (9,420 )     (5,018 )

Cash Margin

  $ 221,137     $ 190,051     $ 459,543     $ 366,104  

Divide by: Sales volumes (MBoe)

    4,416.4       3,840.8       8,941.7       7,190.8  

Cash Margin per Boe, excluding effects of derivatives

  $ 50.07     $ 49.48     $ 51.39     $ 50.91  
                                 

Cash Margin

  $ 221,137     $ 190,051     $ 459,543     $ 366,104  

General and administrative expenses

  $ 4,735     $ 2,516     $ 9,420     $ 5,018  

Cash Operating Margin

  $ 225,872     $ 192,567     $ 468,963     $ 371,122  

Divide by: Sales volumes (MBoe)

    4,416.4       3,840.8       8,941.7       7,190.8  

Cash Operating Margin per Boe, excluding effects of derivatives

  $ 51.14     $ 50.14     $ 52.45     $ 51.61  

 

 

HighPeak Energy, Inc.

Unaudited Free Cash Flow Reconciliation

(in thousands)

 

   

Three Months Ended

June 30, 2024

   

Six Months Ended

June 30, 2024

 
                 

Net cash provided by operating activities

  $ 202,331     $ 373,770  

Changes in operating assets and liabilities

    (24,754 )     (505 )

Discretionary cash flow

    177,577       373,265  

Less: Additions to crude oil and natural gas properties (excluding acquisitions)

    (164,199 )     (311,897 )

Free cash flow

  $ 13,378     $ 61,368  

 

 

Investor Contact:

 

Ryan Hightower

Vice President, Business Development

817.850.9204

rhightower@highpeakenergy.com

 

Source: HighPeak Energy, Inc.

 

10
v3.24.2.u1
Document And Entity Information
Aug. 05, 2024
Document Information [Line Items]  
Entity, Registrant Name HighPeak Energy, Inc.
Document, Type 8-K
Document, Period End Date Aug. 05, 2024
Entity, Incorporation, State or Country Code DE
Entity, File Number 333-235313
Entity, Tax Identification Number 84-3533602
Entity, Address, Address Line One 421 W. 3rd St., Suite 1000
Entity, Address, City or Town Fort Worth
Entity, Address, State or Province TX
Entity, Address, Postal Zip Code 76102
City Area Code 817
Local Phone Number 850-9200
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity, Emerging Growth Company true
Entity, Ex Transition Period false
Amendment Flag false
Entity, Central Index Key 0001792849
CommonStock Custom [Member]  
Document Information [Line Items]  
Title of 12(b) Security Common Stock
Trading Symbol HPK
Security Exchange Name NASDAQ
Warrant Custom [Member]  
Document Information [Line Items]  
Title of 12(b) Security Warrant
Trading Symbol HPKEW
Security Exchange Name NASDAQ

HighPeak Energy (NASDAQ:HPK)
Historical Stock Chart
From Oct 2024 to Oct 2024 Click Here for more HighPeak Energy Charts.
HighPeak Energy (NASDAQ:HPK)
Historical Stock Chart
From Oct 2023 to Oct 2024 Click Here for more HighPeak Energy Charts.