Matador Resources Company (NYSE: MTDR) (“Matador” or the
“Company”) today reported financial and operating results for the
fourth quarter and full year 2024, announced an increase to
Matador’s dividend and provided an update on its 2025 operating
plan. A slide presentation summarizing the highlights of Matador’s
fourth quarter and full year 2024 earnings release and 2025
operating plan is also included on the Company’s website at
www.matadorresources.com on the Events and Presentations page under
the Investor Relations tab.
Management Summary Comments
In summarizing the year, Joseph Wm. Foran, Matador’s Founder,
Chairman and CEO, noted, “Before I report that 2024 was another
record year for Matador, I want to express my appreciation to each
of our shareholders, office and field staff, board members,
management, vendors, banks, partners and other stakeholders for
their continued interest, friendship and support in making these
results happen. It has been a team effort. Building on our 2024
plans, our 2025 plan is again expected to yield record results. The
Matador team and I are excited to discuss not only our 2024
accomplishments with you but also the opportunities we have in
front of us for 2025.
Dividend Increase
“First, I am pleased to announce that Matador’s Board of
Directors (the ‘Board’) has approved a 25% increase in Matador’s
dividend policy, raising the dividend from $1.00 annually, or $0.25
per quarter, to $1.25 annually, or $0.3125 per quarter (see
Slide A). In accordance with this new dividend policy, the
Board formally declared a quarterly cash dividend of $0.3125 per
share of common stock payable on March 14, 2025 to shareholders of
record as of February 28, 2025. Matador believes that a steadily
increasing fixed dividend is the best way to comfortably return
cash to its shareholders while also continuing to build value
through growing our upstream and midstream businesses. Matador has
now raised its dividend six times in four years.
“Raising the dividend—and senior management buying the stock, of
which there are 30 ‘buys’ since 2021 and no ‘sells’—is the
sincerest way we know to express our confidence in the operational
and financial outlook for Matador going forward (see Slide A
and Slide T). The Board and I would now like to point out
some accomplishments that support this dividend increase. These
accomplishments include the successful integration of the Advance
and Ameredev acquisitions, which are performing as well or better
than Matador expected; the addition of 50,000 net acres to our
inventory; and the combination of Pronto Midstream, LLC (‘Pronto’)
with San Mateo Midstream, LLC (‘San Mateo’) in December 2024 (the
‘Pronto Transaction’), which resulted in Matador receiving $220
million in cash and the ability to earn up to $75 million in
additional performance incentives. Furthermore, this dividend
increase reflects the Board’s confidence in Matador’s ability to
generate increased adjusted free cash flow going forward. Matador
projects adjusted free cash flow will approach $1 billion in 2025
(assuming strip oil and natural gas pricing as of mid-February
2025). Meanwhile, Matador has in fact reduced—as pledged—its
leverage ratio from 1.3x at the time of the Ameredev transaction in
September 2024 to 1.05x at December 31, 2024.
2024 Accomplishments and 2023 Comparisons
- “In the fourth quarter of 2024, Matador achieved record
quarterly average daily production of 201,116 barrels of oil and
natural gas equivalent (‘BOE’) per day—the first time in Matador’s
history that it has produced an average of over 200,000 BOE per day
for an entire quarter. This production level is a 30% increase as
compared to average daily production of 154,261 BOE per day in the
fourth quarter of 2023 (see Slide B).
- “Matador also achieved in the fourth quarter of 2024 record
quarterly average daily oil production of 118,440 barrels per day
(an increase of 34%) and achieved record quarterly average daily
natural gas production of 496.1 million cubic feet per day (an
increase of 26%), compared to average daily oil production of
88,663 barrels per day and average daily natural gas production of
393.6 million cubic feet per day in the fourth quarter of
2023.
- “Matador also produced record annual average daily oil
production of 99,808 barrels per day (an increase of 32%) and
record annual average daily natural gas production of 425.7 million
cubic feet per day (an increase of 26%) in full-year 2024, compared
to average daily oil production of 75,457 barrels per day and
average daily natural gas production of 338.1 million cubic feet
per day in full-year 2023 (see Slide C).
- “With the assistance of its vendors, Matador decreased its cost
per completed lateral foot by as much as 11% during 2024 to $910
per completed lateral foot from its original expectations of $1,010
per completed lateral foot across its operating areas, primarily as
a result of increased operational efficiencies such as ‘U-Turn’
wells, ‘simul-frac’ completions and ‘trimul-frac’ completions
rather than forcing price reductions from vendors (see Slide
D and Slide E).
- “Matador added nearly 50,000 net acres in 2024 bringing
Matador’s total acreage in the Delaware Basin to approximately
200,000 net acres, of which approximately 79% are held by existing
production (see Slide F). As a result, Matador was able to
further high-grade its Delaware Basin inventory to 1,869 net
locations with a total net lateral length of approximately 18.3
million feet, or 3,680 miles, as of December 31, 2024, which is an
increase of 22% as compared to the total net lateral length of
Matador’s inventory of approximately 15.0 million feet, or 2,975
miles, as of December 31, 2023 (see Slide G).
- “Matador achieved record total proved oil and natural gas
reserves of 611.5 million BOE (an increase of 33%), with a
standardized measure of $7.4 billion (an increase of 21%) and a
PV-10 of $9.2 billion (an increase of 19%) at December 31, 2024, as
compared to proved oil and natural gas reserves of 460.1 million
BOE with a standardized measure of $6.1 billion and a PV-10 of $7.7
billion at December 31, 2023 (see comparison of commodity prices on
Slide H).
Balance Sheet Strength and Low Leverage
“Matador finished 2024 in the best financial shape in its
history with nearly $1.6 billion in RBL liquidity; just $595.5
million in borrowings under Matador’s reserves-based lending (RBL)
credit facility; and a leverage ratio of 1.05x. Current RBL
borrowings represent a 38% decrease from $955 million in borrowings
under Matador’s reserves-based credit facility and a reduction in
Matador’s leverage ratio from 1.3x at September 30, 2024 after
Matador closed the Ameredev acquisition to the 1.05x level today
(see Slide I).
2024 Production and Drilling Results
“Matador’s fourth quarter 2024 production would have been even
higher if it had not experienced significant third-party midstream
constraints for two-to-three months in its Antelope Ridge asset
area. Matador estimates that these third-party midstream
constraints, primarily occurring in Lea County, New Mexico,
resulted in approximately 3,000 BOE per day (67% oil) being
constrained during the fourth quarter of 2024. Importantly, these
midstream constraints were largely resolved by the third-party
midstream providers and such production was almost all back online
as of February 18, 2025. Fortunately, Matador’s controlled
midstream affiliates, San Mateo and Pronto, thankfully experienced
99% uptime during this time for their natural gas processing plants
and did not contribute to these constraints.
“Notably, Matador continued to advance operational efficiencies
to drive production higher and average well costs lower during
2024. In fact, Matador turned to sales a record five new ‘U-Turn’
wells during the fourth quarter of 2024 (see Slide J).
Matador estimates that these five U-Turn wells saved drilling days
and a total of $15 million, or approximately $3 million for each
U-Turn well, as compared to drilling ten vertical wellbores and ten
one-mile laterals. Initial results from the five U-Turn wells
indicate that these U-Turn wells are performing as good or better
than traditional two-mile straight lateral wells in the same area.
Capital savings realized by drilling U-Turn wells decrease project
payout times and reduce oil breakeven prices by as much as 20% in
certain areas. This focus on operational efficiencies and
synergies, along with marketing efforts and the quality of its
wells, has helped Matador lead its peer group in profitability (see
Slide K and Slide L).
Ameredev Acquisition in September 2024 Contributed to Record
Financial Results
“Matador’s mergers and acquisitions group continues to provide
substantial value and Adjusted EBITDA growth for Matador and its
shareholders. Matador’s key acquisition of Ameredev Stateline II,
LLC (‘Ameredev’) in September 2024 added 33,500 net acres, 371 net
locations and more than 25,000 BOE per day in production. Each of
Matador’s teams has been hard at work successfully integrating the
Ameredev properties (see Slide M). Matador estimates that it
has already experienced at least $4 million in drilling and
completion cost synergies and expects additional drilling and
completion cost synergies of over $150 million over the next five
years. In addition, Matador estimates that it has reduced lease
operating expenses on the Ameredev acreage by 35%, or more than $2
million per month, since Matador began operating the Ameredev
assets. We look forward to realizing the full value of these
efficiencies and synergies over the coming years.
“For full-year 2024, Matador achieved net income of $885.3
million (an increase of 5%) and Adjusted EBITDA of $2.30 billion
(an increase of 24%), compared to 2023 net income of $846.1 million
and Adjusted EBITDA of $1.85 billion for full-year 2023 (see
Slide N). Matador’s net cash provided by operating
activities was $2.25 billion for full-year 2024, which is a 20%
increase from $1.87 billion for full-year 2023. For full-year 2024,
Matador’s adjusted free cash flow was $807.3 million, which is a
75% increase from $460.0 million for full-year 2023. Matador exits
2024 as a leader among its peers in free cash flow generation, and
Matador is optimistic that it will generate significant free cash
flow again in 2025 (see Slide O).
2024 Midstream Achievements
“Matador’s midstream team also made significant strides in 2024.
As mentioned above, Matador contributed Pronto to San Mateo in
December 2024, including its interest in Pronto’s existing
processing plant (the ‘Marlan Plant’) with a designed inlet
capacity of 60 million cubic feet per day of natural gas and the
Marlan Plant expansion that adds an additional plant with a
designed inlet capacity of 200 million cubic feet of natural gas
per day (see Slide P). In addition to the financial benefits
mentioned above, this transaction also provides increased flow
assurance for Matador’s production in Lea County, New Mexico and
accelerates filling up the Marlan Plant to capacity. Furthermore,
the construction of Pronto’s new Marlan Plant expansion remains on
time and on budget and is expected to be online in the second
quarter of 2025 (see Slide Q).
2025 Outlook: Continued Record Results, Execution and
Efficiencies
“While we celebrate our 2024 results and accomplishments,
Matador remains focused on its continued growth, profitability and
increased efficiencies going forward in 2025. Accordingly, the
Matador team fully expects to produce record results again in 2025.
Matador aims at increasing its average daily BOE production by 20%
to an average of 205,000 BOE per day in full-year 2025, as compared
to an average of 170,751 BOE per day in full-year 2024. Matador
also expects to increase its yearly oil production by 22% in 2025
with average daily oil production of 122,000 barrels of oil per day
in full-year 2025, as compared to an average of 99,808 barrels of
oil per day in full-year 2024.
2025 Additional Natural Gas Opportunity
“Matador produced 496 million cubic feet of natural gas per day
in 2024 but Matador’s 2025 plan remains flexible and its
undeveloped acreage is sufficiently ‘gassy’ so that Matador can
adjust and produce more natural gas if market conditions warrant a
modification. As of December 31, 2024, Matador has 1.5 trillion
cubic feet of natural gas reserves, primarily in the Delaware Basin
(see Slide H).
“Significantly, Matador also retained its operating rights in
the Cotton Valley in Northeast Louisiana, which we refer to as our
‘gas bank’ and is 100% held-by-production (see Slide R). As
of December 31, 2024, the expected natural gas production from
Matador’s Cotton Valley inventory is not included in its reserve
report because Matador does not currently plan to drill the Cotton
Valley formation in the near future unless natural gas prices
improve and stabilize. Nevertheless, Matador’s reservoir engineers
consider the Cotton Valley to be a proven formation.
“Matador estimates that it has 37 net horizontal locations in
the Cotton Valley, which Matador’s reservoir engineers have
estimated to be capable of producing up to 200 to 300 billion cubic
feet of natural gas. Additionally, Matador anticipates that these
operated Cotton Valley locations would have extended lateral
lengths of approximately two miles, which would improve costs and
provide other efficiencies. Furthermore, this Cotton Valley natural
gas would have the benefit of using the same midstream
infrastructure that serves the Haynesville Shale, including
transportation to many of the Liquified Natural Gas (‘LNG’)
terminals along the Gulf Coast.
2025 Midstream Opportunities and Flow Assurance
“Matador is pleased to report its midstream business remains a
critical part of its success and is expected to continue providing
value to Matador’s shareholders in 2025 (see Slide S). All
of San Mateo’s three-pipe (oil, water and natural gas) systems work
together to build flow assurance for Matador and other customers.
Being aligned with Matador provides San Mateo the unique
perspective that allows it to provide flow assurance with a
producer mindset. This producer mindset has been recognized by San
Mateo’s third-party customers as many of these producers are repeat
customers and continue to expand their relationship with San Mateo.
San Mateo expects to achieve Adjusted EBITDA of $285 million in
2025, which is an increase of 13% as compared to Adjusted EBITDA of
$253.2 million in 2024.
“From an initial start in February 2017, San Mateo has grown to
operate approximately 590 miles of oil, natural gas and water
pipelines, 520 million cubic feet per day of designed natural gas
processing capacity and 16 saltwater disposal wells with
approximately 475,000 barrels per day of designed produced water
disposal capacity. San Mateo anticipates its processing capacity
will increase to 720 million cubic feet per day with the completion
of the Marlan Plant expansion early in the second quarter of
2025.
Closing Thoughts
“While each year brings its own challenges, we like our chances
and opportunities going forward. In fact, members of Matador’s
senior management have made 30 separate purchases of Matador stock
since 2021, and none of Matador’s senior management group have ever
sold a single Matador share (see Slide T). Perhaps even more
meaningful as an expression of confidence is the fact that Matador
has over 95% participation (including field personnel) in its
Employee Stock Purchase Plan (‘ESPP’). We also look forward to
discussing these results and opportunities and answering your
questions at our upcoming conference call tomorrow morning.”
Highlights
Fourth Quarter 2024 Operational and Financial Highlights
(for comparisons to prior year, please see the remainder of this
press release)
- Record quarterly average production of 201,116 BOE per day
(118,440 barrels of oil per day)
- Net cash provided by operating activities of $575.0
million
- Adjusted free cash flow of $415.5 million
- Net income of $214.5 million, or $1.71 per diluted common
share
- Adjusted net income of $229.9 million, or $1.83 per diluted
common share
- Adjusted EBITDA of $640.9 million
- San Mateo net income of $47.8 million
- San Mateo Adjusted EBITDA of $68.5 million
Full Year 2024 Operational and Financial Highlights
(for comparisons to prior year, please see the remainder of this
press release)
- Record annual average production of 170,751 BOE per day (99,808
barrels of oil per day)
- Net cash provided by operating activities of $2.25 billion
- Adjusted free cash flow of $807.3 million
- Net income of $885.3 million, or $7.14 per diluted common
share
- Adjusted net income of $928.0 million, or $7.48 per diluted
common share
- Adjusted EBITDA of $2.30 billion
- San Mateo net income of $175.6 million
- San Mateo Adjusted EBITDA of $253.2 million
2025 Guidance Highlights
- Oil production guidance of 120,000 to 124,000 barrels per
day
- Natural gas production guidance of 492.0 to 504.0 million cubic
feet per day
- Total production guidance of 202,000 to 208,000 BOE per
day
- Drilling, completing and equipping capital expenditures of
$1.28 to $1.47 billion
- Midstream capital expenditures of $120 to $180 million
Note: All references to Matador’s net income, adjusted net
income, Adjusted EBITDA and adjusted free cash flow reported
throughout this earnings release are those values attributable to
Matador Resources Company shareholders after giving effect to any
net income, adjusted net income, Adjusted EBITDA or adjusted free
cash flow, respectively, attributable to third-party
non-controlling interests, including in San Mateo Midstream, LLC
(“San Mateo”). Matador owns 51% of San Mateo. For a definition of
adjusted net income, adjusted earnings per diluted common share,
Adjusted EBITDA, adjusted free cash flow and PV-10 and
reconciliations of such non-GAAP financial metrics to their
comparable GAAP metrics, please see “Supplemental Non-GAAP
Financial Measures” below.
Operational and Financial Update
Record Fourth Quarter 2024 Oil, Natural Gas and Total Oil
Equivalent Production
Matador’s average daily oil and natural gas production was
201,116 BOE per day in the fourth quarter of 2024, which was the
highest in Matador’s history as noted above and was a 2% increase
as compared to the midpoint of Matador’s expected fourth quarter
production guidance of 198,000 BOE per day. The primary drivers
behind this outperformance were (i) increased production from new
wells turned to sales in the third quarter of 2024 in Matador’s
Rustler Breaks and Ranger asset areas and (ii) higher-than-expected
production from non-operated assets. Production from the newly
acquired Ameredev properties was 23,200 BOE per day, which was
better than Matador’s initial expectations despite additional
shut-in volumes from accelerated offset completions.
Production
Q4 2024 Average Daily Volume
Q4 2024 Guidance Range (1)
Difference (2)
Sequential (3)
YoY (4)
Total, BOE per day
201,116
197,000 to 199,000
+2% Better than Guidance
+17%
+30%
Oil, Bbl per day
118,440
118,500 to 119,500
<-1% Less than Guidance
+18%
+34%
Natural Gas, MMcf per day
496.1
472.0 to 476.0
+5% Better than Guidance
+16%
+26%
(1) Production range previously projected,
as provided on October 22, 2024.
(2) As compared to midpoint of guidance
provided on October 22, 2024.
(3) Represents sequential percentage
change from the third quarter of 2024.
(4) Represents year-over-year percentage
change from the fourth quarter of 2023.
Fourth Quarter 2024 Realized Commodity Prices
The following table summarizes Matador’s realized commodity
prices during the fourth quarter of 2024, as compared to the third
quarter of 2024 and the fourth quarter of 2023.
Sequential (Q4 2024 vs. Q3
2024)
YoY (Q4 2024 vs. Q4 2023)
Realized Commodity Prices
Q4 2024
Q3 2024
Sequential Change(1)
Q4 2024
Q4 2023
YoY Change(2)
Oil Prices, per Bbl
$70.66
$75.67
Down 7%
$70.66
$79.00
Down 11%
Natural Gas Prices, per Mcf
$2.72
$1.83
Up 49%
$2.72
$3.01
Down 10%
(1) Fourth quarter 2024 as compared to
third quarter 2024.
(2) Fourth quarter 2024 as compared to
fourth quarter 2023.
Fourth Quarter 2024 Operating Expenses
Matador expected increased lease operating expenses in the
fourth quarter of 2024 as a result of closing the Ameredev
acquisition in September 2024 and continued integration of the
acquired assets. However, Matador was able to offset certain of
these anticipated expense increases through savings from a range of
improvements relating to the wells acquired in the Ameredev
transaction, including field supervision expenses, chemical usage
and reduction in produced water disposal costs. Notably, in the
fourth quarter of 2024, Matador recycled approximately 1.2 million
barrels of water during fracturing operations on the 11 new
Firethorn and Pimento wells that were acquired as part of the
Ameredev acquisition. These actions to offset the expected increase
in lease operating expenses resulted in total lease operating
expenses of $5.37 per BOE for the fourth quarter of 2024, which is
a 2% sequential decrease from $5.50 per BOE in the third quarter of
2024, and an 11% improvement from the midpoint of Matador’s
expected fourth quarter 2024 guidance range of $5.75 to $6.25 per
BOE.
Matador’s general and administrative (“G&A”) expenses
increased 22% sequentially from $1.82 per BOE in the third quarter
of 2024 to $2.22 per BOE in the fourth quarter of 2024. This
increase is due in part to the value of employee stock awards that
are settled in cash, which are remeasured at each quarterly
reporting period according to accounting rules. These cash-settled
stock award amounts increased as Matador’s share price increased
14% from $49.42 at the end of the third quarter of 2024 to $56.26
at end of the fourth quarter of 2024. Matador’s full year 2024
G&A expenses decreased 11% from $2.29 per BOE in 2023 to $2.04
per BOE in 2024.
During the fourth quarter of 2024, Matador’s plant and other
midstream services operating expenses, which include the costs to
operate San Mateo’s and Pronto’s assets, were $2.75 per BOE,
consistent with $2.77 per BOE in the third quarter of 2024. The
fourth quarter 2024 plant and other midstream services operating
expenses were also consistent with Matador’s expected fourth
quarter 2024 range of $2.50 to $3.00 per BOE.
Fourth Quarter 2024 Capital Expenditures
For the fourth quarter of 2024, Matador’s capital expenditures
for drilling, completing and equipping wells (“D/C/E capital
expenditures”) were $325.5 million and midstream capital
expenditures were $65.2 million. D/C/E capital expenditures during
the fourth quarter of 2024 were higher than expected, but full-year
2024 D/C/E capital expenditures of $1.32 billion were within
Matador’s expected range of $1.15 billion to $1.35 billion. D/C/E
capital expenditures during the fourth quarter of 2024 were higher
than expected due to costs associated with the acceleration of
capital expenditures for certain non-operated properties and
facility upgrades related to the Ameredev properties. These
Ameredev facility upgrades contributed to the lower-than-expected
lease operating expenses noted above.
Midstream capital expenditures during the fourth quarter of 2024
were higher than expected due to acceleration of costs associated
with the Marlan Plant expansion, but full-year 2024 midstream
capital expenditures of $238.7 million were still within Matador’s
expected annual range of $200 million to $250 million. The
midstream capital expenditures during the fourth quarter of 2024
included payments related to the expansion of the Marlan Plant
until the closing of the Pronto Transaction on December 18,
2024.
Midstream Update
San Mateo’s operations in the fourth quarter of 2024 were
highlighted by record operating and financial results. San Mateo’s
natural gas gathering and oil gathering and transportation volumes
in the fourth quarter of 2024 were all-time quarterly highs. The
table below sets forth San Mateo’s throughput volumes, as compared
to the third quarter of 2024 and the fourth quarter of 2023.
Because the Pronto Transaction closed in mid-December 2024, it did
not significantly contribute to San Mateo’s financial results in
the fourth quarter of 2024.
Sequential (Q4 2024 vs. Q3
2024)
YoY (Q4 2024 vs. Q4 2023)
San Mateo Throughput Volumes
Q4 2024
Q3 2024
Change(1)
Q4 2024
Q4 2023
Change(2)
Natural gas gathering, MMcf per day
454
431
+5%
454
416
+9%
Natural gas processing, MMcf per day
434
424
+2%
434
413
+5%
Oil gathering and transportation, Bbl per
day
63,000
52,300
+20%
63,000
50,900
+24%
Produced water handling, Bbl per day
470,100
513,200
-8%
470,100
442,000
+6%
(1) Fourth quarter 2024 as compared to
third quarter 2024.
(2) Fourth quarter 2024 as compared to
fourth quarter 2023.
Proved Reserves, Standardized Measure and PV-10
The following table summarizes Matador’s estimated total proved
oil and natural gas reserves at December 31, 2024 and 2023.
At December 31,
% YoY Change
2024
2023
Estimated proved reserves:(1)(2)
Oil (MBbl)(3)
361,842
272,277
+33%
Natural Gas (Bcf)(4)
1,498.2
1,126.8
+33%
Total (MBOE)(5)
611,536
460,070
+33%
Estimated proved developed reserves:
Oil (MBbl)(3)
206,269
161,642
+28%
Natural Gas (Bcf)(4)
963.2
782.7
+23%
Total (MBOE)(5)
366,797
292,097
+26%
Percent developed
60.0
%
63.5
%
Estimated proved undeveloped reserves:
Oil (MBbl)(3)
155,573
110,635
+41%
Natural Gas (Bcf)(4)
535.0
344.0
+56%
Total (MBOE)(5)
244,740
167,973
+46%
Standardized Measure (in millions)(6)
$
7,376.6
$
6,113.5
+21%
PV-10 (in millions)(7)
$
9,233.8
$
7,704.1
+20%
Commodity prices:(2)
Oil (per Bbl)
$
71.96
$
74.70
(4)%
Natural Gas (per MMBtu)
$
2.13
$
2.64
(19)%
(1) Numbers in table may not total due to
rounding.
(2) Matador’s estimated proved reserves,
Standardized Measure and PV-10 were determined using index prices
for oil and natural gas, without giving effect to derivative
transactions, and were held constant throughout the life of the
properties. The unweighted arithmetic averages of
first-day-of-the-month prices for the period from January through
December 2024 were $71.96 per Bbl for oil and $2.13 per MMBtu for
natural gas and for the period from January through December 2023
were $74.70 per Bbl for oil and $2.64 per MMBtu for natural gas.
These prices were adjusted by property for quality, energy content,
regional price differentials, transportation fees, marketing
deductions and other factors affecting the price received at the
wellhead. Matador reports its proved reserves in two streams, oil
and natural gas, and the economic value of the natural gas liquids
(“NGL”) associated with the natural gas is included in the
estimated wellhead price on those properties where NGLs are
extracted and sold.
(3) One thousand barrels of oil.
(4) One billion cubic feet of natural
gas.
(5) One thousand barrels of oil
equivalent, estimated using a conversion factor of one barrel of
oil per six thousand standard cubic feet of natural gas.
(6) Standardized Measure represents the
present value of estimated future net cash flows from proved
reserves, less estimated future development, production, plugging
and abandonment and income tax expenses, discounted at 10% per
annum to reflect the timing of future cash flows. Standardized
Measure is not an estimate of the fair market value of Matador’s
properties.
(7) PV-10 is a non-GAAP financial measure.
For a reconciliation of PV-10 (non-GAAP) to Standardized Measure
(GAAP), please see “Supplemental Non-GAAP Financial Measures.”
PV-10 is not an estimate of the fair market value of our
properties.
The proved reserves estimates presented for each period in the
table above were prepared by the Company’s internal engineering
staff and audited by an independent reservoir engineering firm,
Netherland, Sewell & Associates, Inc. These proved reserves
estimates were prepared in accordance with the SEC’s rules for oil
and natural gas reserves reporting and do not include any unproved
reserves classified as probable or possible that might exist on
Matador’s properties.
Matador’s total proved oil and natural gas reserves increased
33% year-over-year from 460.1 million BOE (59% oil, 64% proved
developed, 97% Delaware Basin), consisting of 272.3 million barrels
of oil and 1.13 trillion cubic feet of natural gas, at December 31,
2023 to 611.5 million BOE (59% oil, 60% proved developed, 99%
Delaware Basin), consisting of 361.8 million barrels of oil and
1.50 trillion cubic feet of natural gas, at December 31, 2024.
Matador’s total proved oil and natural gas reserves at December 31,
2024 were an all-time high.
The Standardized Measure of Matador’s total proved oil and
natural gas reserves increased 21% from $6.11 billion at December
31, 2023 to $7.38 billion at December 31, 2024. The PV-10 (a
non-GAAP financial measure) of Matador’s total proved oil and
natural gas reserves increased 20% from $7.70 billion at December
31, 2023 to $9.23 billion at December 31, 2024. The increase in
both Standardized Measure and PV-10 of Matador’s proved oil and
natural gas reserves at December 31, 2024 resulted primarily from
the ongoing development and delineation of Matador’s Delaware Basin
properties and the Ameredev acquisition, partially offset by a
decrease in both oil and natural gas prices used to estimate proved
reserves at December 31, 2024, as compared to December 31, 2023. At
December 31, 2024, the oil and natural gas prices used to estimate
total proved reserves were $71.96 per barrel (a 4% decrease) and
$2.13 per MMBtu (a 19% decrease), respectively, as compared to
$74.70 per barrel and $2.64 per MMBtu, respectively, at December
31, 2023.
Full Year 2025 Guidance Summary
Matador’s full year 2025 guidance estimates are summarized in
the table below, as compared to the actual results for 2024.
Guidance Metric
Actual
2024 Results
2025 Guidance Range
% YoY
Change(1)
Oil Production
99,808 Bbl/d(2)
120,000 to 124,000 Bbl/d
+22%
Natural Gas Production
425.7 MMcf/d(3)
492.0 to 504.0 MMcf/d
+17%
Oil Equivalent Production
170,751 BOE/d(4)
202,000 to 208,000 BOE/d
+20%
D/C/E CapEx(5)
$1.32 billion
$1.28 to $1.47 billion
+4%
Midstream CapEx(6)
$238.7 million
$120 to $180 million
(37) %
Total D/C/E and Midstream CapEx
$1.56 billion
$1.40 to $1.65 billion
(2) %
(1) Represents percentage change from 2024
actual results to the midpoint of 2025 guidance range.
(2) One barrel of oil per day.
(3) One million cubic feet of natural gas
per day.
(4) One barrel of oil equivalent per day,
estimated using a conversion factor of one barrel of oil per six
thousand standard cubic feet of natural gas.
(5) Capital expenditures associated with
drilling, completing and equipping wells.
(6) Includes Matador’s share of estimated
capital expenditures for San Mateo and other wholly-owned midstream
projects. Pronto was wholly-owned by Matador until December 18,
2024, the date Pronto was contributed to San Mateo in the Pronto
Transaction. Excludes the acquisition cost of Ameredev’s midstream
assets in 2024.
The full year 2025 guidance estimates presented in the table
above are based upon the following key assumptions for 2025
drilling and completions activity and capital expenditures.
- Matador began 2024 operating seven drilling rigs in the
Delaware Basin and added an eighth operated drilling rig in late
January 2024 and a ninth operated drilling rig in the middle of
2024. The 2% decrease in total capital expenditures from $1.56
billion in 2024 to $1.53 billion in 2025 is the result of (i) a 37%
decrease in midstream capital expenditures, as a majority of the
costs related to the Marlan Plant expansion were incurred in 2024,
which is partially offset by (ii) a 4% increase in D/C/E capital
expenditures due to operating nine drilling rigs for full-year 2025
and the anticipated mix of wells that will be turned to sales in
2025, as compared to 2024.
- Matador estimates its 2025 D/C/E capital expenditures will be
$1.28 to $1.47 billion, as further detailed in the table
below.
D/C/E CapEx(1) Components
Actual
2024 Results
2025 CapEx Estimates
% YoY
Change(2)
Operated(3)
$1.19 billion
$1.16 to $1.32 billion
+4%
Non-Operated
$81 million
$70 to $90 million
-1%
Capitalized G&A and Interest
$45 million
$50 to $60 million
+22%
Total D/C/E CapEx
$1.32 billion
$1.28 to $1.47 billion
+4%
(1) Capital expenditures associated with
drilling, completing and equipping wells.
(2) Represents percentage change from 2024
actual results to the midpoint of 2025 guidance range.
(3) Includes $60 to $70 million of
artificial lift and other production-related capital expenditures
estimated in 2025.
- Matador anticipates full-year 2025 drilling and completion
costs per completed lateral foot to average between $865 to $895
per completed lateral foot, or a 3% decrease at the midpoint of the
2025 range as compared to $910 in 2024. As it has done in the past,
Matador expects to continue to seek to maximize and increase its
capital efficiencies across all operations. Matador anticipates
“Simul-Frac” and “Trimul-Frac” operations to account for over 80%
of completions in 2025 with Trimul-Frac alone accounting for
approximately 35% of anticipated 2025 completions, as compared to
15% in 2024. Notably, Matador expects that improved water and sand
logistics, casing design optimization, MaxCom well targeting, use
of existing infrastructure and increased operating efficiency
should reduce drilling and completion days on wells.
- Matador estimates 2025 midstream capital expenditures of $120
to $180 million. This estimate includes (i) $90 to $130 million for
Matador’s 51% share of San Mateo’s 2025 estimated capital
expenditures of approximately $176 to $255 million and (ii) $30 to
$50 million for other wholly-owned midstream projects, including
expansion of the 180 mile gas gathering, water gathering and oil
transportation and gathering pipeline system that Matador acquired
in connection with the Ameredev acquisition. San Mateo’s 2025
capital expenditures include finishing the Marlan Plant expansion
as well as the pipelines and related infrastructure required to
connect San Mateo’s three-stream pipeline system to Matador and
third-party customers.
2025 Production Estimates and Cadence
Oil, Natural Gas and Oil Equivalent
Production Growth and Anticipated Cadence
Matador expects full-year 2025 production of 120,000 to 124,000
barrels of oil per day and 492 to 504 million cubic feet of natural
gas per day, resulting in 202,000 to 208,000 BOE per day, which
would be an increase of 20% as compared to our record 2024
production of 170,751 BOE per day (99,808 barrels of oil per day).
The cadence of production is expected to be lumpy throughout 2025,
primarily due to completion timing and larger, more capital
efficient batches. As detailed further below, Matador expects
significant sequential increases in the second and fourth quarters
of 2025 while experiencing modest sequential decreases in the first
and third quarters of 2025.
First Quarter 2025 Estimated Oil, Natural Gas and Total Oil
Equivalent Production
As noted in the table below, Matador anticipates its average
daily oil equivalent production of 201,116 BOE per day in the
fourth quarter of 2024 to decrease to a midpoint of approximately
196,000 BOE per day in the first quarter of 2025 before increasing
to new production records again in the second quarter of 2025.
Q4 2024 and Q1 2025 Production
Comparison
Period
Average Daily Total Production,
BOE per day
Average Daily Oil Production, Bbl
per day
Average Daily Natural Gas
Production, MMcf per day
% Oil
Q4 2024
201,116
118,440
496.1
59%
Q1 2025E
195,000 to 197,000
114,000 to 115,000
486.0 to 492.0
59%
The decline in production from the fourth quarter of 2024 to the
first quarter of 2025 is due to the lumpiness of production as a
result of the timing of wells being turned to sales. Matador
expects to turn to sales between 35 and 40 operated wells during
the first quarter of 2025, of which only two operated wells had
been turned to sales in the first half of the quarter. The
remaining 33 to 38 wells are expected to be turned to sales in the
latter half of the first quarter of 2025, which will primarily
contribute to production beginning in the second quarter of 2025.
Among the wells expected to be turned to sales in the first quarter
of 2025 are the first three-mile lateral wells drilled by
Matador.
First Quarter 2025 Estimated Capital Expenditures
At February 18, 2025, Matador expects D/C/E capital expenditures
for the first quarter of 2025 will be approximately $340 to $400
million, which is a 14% increase as compared to $325 million for
the fourth quarter of 2024, primarily due to an increased number of
completions and increased non-operated capital expenditures.
Matador expects its proportionate share of midstream capital
expenditures to be approximately $65 to $95 million in the first
quarter of 2025, as compared to $65.2 million in the fourth quarter
of 2024. Midstream capital expenditures are expected to be higher
in the first quarter of 2025 as compared to the remainder of 2025
primarily due to costs associated with the completion of the Marlan
Plant expansion.
2025 Estimated Cash Taxes
Matador expects to make cash tax payments of approximately 5 to
10% of pre-tax book net income for the year ended December 31, 2025
at current commodity prices, as compared to cash tax payments of
approximately 2% of pre-tax book net income for the year ended
December 31, 2024. The Company’s cash tax payments will be
dependent upon a variety of factors that will impact taxable
income, including oil and natural gas prices, allowable deductions
and any legislative changes thereon, and any tax credits generated
that would offset tax liabilities in 2025.
Conference Call Information
The Company will host a live conference call on Wednesday,
February 19, 2025, at 9:00 a.m. Central Time to discuss its fourth
quarter and full year 2024 financial and operational results, as
well as its 2025 operating plan and market guidance. To access the
live conference call by phone, you can use the following link
https://register.vevent.com/register/BIa2657091ad6f4bdc9092002a18d1e2dc
and you will be provided with dial in details. To avoid delays, it
is recommended that participants dial into the conference call 15
minutes ahead of the scheduled start time.
The live conference call will also be available through the
Company’s website at www.matadorresources.com on the Events and
Presentations page under the Investor Relations tab. The replay for
the event will be available on the Company’s website at
www.matadorresources.com on the Events and Presentations page under
the Investor Relations tab for one year.
About Matador Resources Company
Matador is an independent energy company engaged in the
exploration, development, production and acquisition of oil and
natural gas resources in the United States, with an emphasis on oil
and natural gas shale and other unconventional plays. Its current
operations are focused primarily on the oil and liquids-rich
portion of the Wolfcamp and Bone Spring plays in the Delaware Basin
in Southeast New Mexico and West Texas. Matador also operates in
the Eagle Ford shale play in South Texas and the Haynesville shale
and Cotton Valley plays in Northwest Louisiana. Additionally,
Matador conducts midstream operations in support of its
exploration, development and production operations and provides
natural gas processing, oil transportation services, oil, natural
gas and produced water gathering services and produced water
disposal services to third parties.
For more information, visit Matador Resources Company at
www.matadorresources.com.
Forward-Looking Statements
This press release includes “forward-looking statements” within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended. “Forward-looking statements” are statements related to
future, not past, events. Forward-looking statements are based on
current expectations and include any statement that does not
directly relate to a current or historical fact. In this context,
forward-looking statements often address expected future business
and financial performance, and often contain words such as “could,”
“believe,” “would,” “anticipate,” “intend,” “estimate,” “expect,”
“may,” “should,” “continue,” “plan,” “predict,” “potential,”
“project,” “hypothetical,” “forecasted” and similar expressions
that are intended to identify forward-looking statements, although
not all forward-looking statements contain such identifying words.
Such forward-looking statements include, but are not limited to,
statements about guidance, projected or forecasted financial and
operating results, future liquidity, the payment of dividends,
results in certain basins, objectives, project timing, expectations
and intentions, regulatory and governmental actions and other
statements that are not historical facts. Actual results and future
events could differ materially from those anticipated in such
statements, and such forward-looking statements may not prove to be
accurate. These forward-looking statements involve certain risks
and uncertainties, including, but not limited to, the following
risks related to financial and operational performance: general
economic conditions; the Company’s ability to execute its business
plan, including whether its drilling program is successful; changes
in oil, natural gas and natural gas liquids prices and the demand
for oil, natural gas and natural gas liquids; its ability to
replace reserves and efficiently develop current reserves; the
operating results of the Company’s midstream oil, natural gas and
water gathering and transportation systems, pipelines and
facilities, the acquiring of third-party business and the drilling
of any additional salt water disposal wells; costs of operations;
delays and other difficulties related to producing oil, natural gas
and natural gas liquids; delays and other difficulties related to
regulatory and governmental approvals and restrictions; impact on
the Company’s operations due to seismic events; its ability to make
acquisitions on economically acceptable terms; its ability to
integrate acquisitions; disruption from the Company’s acquisitions
making it more difficult to maintain business and operational
relationships; significant transaction costs associated with the
Company’s acquisitions; the risk of litigation and/or regulatory
actions related to the Company’s acquisitions; availability of
sufficient capital to execute its business plan, including from
future cash flows, capital markets, available borrowing capacity
under its revolving credit facilities and otherwise; the operating
results of and the availability of any potential distributions from
our joint ventures; weather and environmental conditions; and the
other factors that could cause actual results to differ materially
from those anticipated or implied in the forward-looking
statements. For further discussions of risks and uncertainties, you
should refer to Matador’s filings with the SEC, including the “Risk
Factors” section of Matador’s most recent Annual Report on Form
10-K and any subsequent Quarterly Reports on Form 10-Q. Matador
undertakes no obligation to update these forward-looking statements
to reflect events or circumstances occurring after the date of this
press release, except as required by law, including the securities
laws of the United States and the rules and regulations of the SEC.
You are cautioned not to place undue reliance on these
forward-looking statements, which speak only as of the date of this
press release. All forward-looking statements are qualified in
their entirety by this cautionary statement.
Sequential and year-over-year quarterly comparisons of selected
financial and operating items are shown in the following table:
Three Months Ended
December 31,
September 30,
December 31,
2024
2024
2023
Net Production Volumes:(1)
Oil (MBbl)(2)
10,896
9,229
8,157
Natural gas (Bcf)(3)
45.6
39.3
36.2
Total oil equivalent (MBOE)(4)
18,503
15,776
14,192
Average Daily Production Volumes:(1)
Oil (Bbl/d)(5)
118,440
100,315
88,663
Natural gas (MMcf/d)(6)
496.1
427.0
393.6
Total oil equivalent (BOE/d)(7)
201,116
171,480
154,261
Average Sales Prices:
Oil, without realized derivatives (per
Bbl)
$
70.66
$
75.67
$
79.00
Oil, with realized derivatives (per
Bbl)
$
70.66
$
75.67
$
79.00
Natural gas, without realized derivatives
(per Mcf)(8)
$
2.72
$
1.83
$
3.01
Natural gas, with realized derivatives
(per Mcf)
$
2.81
$
1.94
$
2.92
Revenues (millions):
Oil and natural gas revenues
$
893.9
$
770.2
$
753.2
Third-party midstream services
revenues
$
37.7
$
38.3
$
35.6
Realized gain (loss) on derivatives
$
4.2
$
4.5
$
(3.1
)
Operating Expenses (per BOE):
Production taxes, transportation and
processing
$
4.70
$
4.61
$
5.31
Lease operating
$
5.37
$
5.50
$
5.06
Plant and other midstream services
operating
$
2.75
$
2.77
$
2.56
Depletion, depreciation and
amortization
$
15.85
$
15.39
$
15.51
General and administrative(9)
$
2.22
$
1.82
$
2.08
Total(10)
$
30.89
$
30.09
$
30.52
Other (millions):
Net sales of purchased natural gas(11)
$
9.9
$
20.4
$
7.2
Net income (millions)(12)
$
214.5
$
248.3
$
254.5
Earnings per common share
(diluted)(12)
$
1.71
$
1.99
$
2.12
Adjusted net income (millions)(12)(13)
$
229.9
$
236.0
$
238.4
Adjusted earnings per common share
(diluted)(12)(14)
$
1.83
$
1.89
$
1.99
Adjusted EBITDA (millions)(12)(15)
$
640.9
$
574.5
$
552.8
Net cash provided by operating activities
(millions)(16)
$
575.0
$
610.4
$
618.3
Adjusted free cash flow
(millions)(12)(17)
$
415.5
$
196.1
$
180.5
San Mateo net income (millions)(18)
$
47.8
$
49.8
$
43.7
San Mateo Adjusted EBITDA
(millions)(15)(18)
$
68.5
$
68.5
$
61.6
San Mateo net cash provided by operating
activities (millions)(18)
$
40.5
$
50.5
$
45.5
San Mateo adjusted free cash flow
(millions)(17)(18)
$
37.2
$
47.6
$
18.8
D/C/E capital expenditures (millions)
$
325.5
$
329.9
$
261.4
Midstream capital expenditures
(millions)(19)
$
65.2
$
48.9
$
86.2
(1) Production volumes and proved
reserves reported in two streams: oil and natural gas, including
both dry and liquids-rich natural gas.
(2) One thousand barrels of
oil.
(3) One billion cubic feet of
natural gas.
(4) One thousand barrels of oil
equivalent, estimated using a conversion ratio of one barrel of oil
per six thousand cubic feet of natural gas.
(5) Barrels of oil per day.
(6) Millions of cubic feet of
natural gas per day.
(7) Barrels of oil equivalent per
day, estimated using a conversion ratio of one barrel of oil per
six thousand cubic feet of natural gas.
(8) Per thousand cubic feet of
natural gas.
(9) Includes approximately $0.26,
$0.27 and $0.20 per BOE of non-cash, stock-based compensation
expense in the fourth quarter of 2024, the third quarter of 2024
and the fourth quarter of 2023, respectively.
(10) Total does not include the
impact of purchased natural gas or immaterial accretion
expenses.
(11) Net sales of purchased
natural gas reflect those natural gas purchase transactions that
the Company periodically enters into with third parties whereby the
Company purchases natural gas and (i) subsequently sells the
natural gas to other purchasers or (ii) processes the natural gas
at San Mateo’s cryogenic natural gas processing plants and
subsequently sells the residue natural gas and NGLs to other
purchasers. Such amounts reflect revenues from sales of purchased
natural gas of $46.7 million, $51.7 million and $43.4 million less
expenses of $36.8 million, $31.2 million and $36.2 million in the
fourth quarter of 2024, the third quarter of 2024 and the fourth
quarter of 2023, respectively.
(12) Attributable to Matador
Resources Company shareholders.
(13) Adjusted net income is a
non-GAAP financial measure. For a definition of adjusted net income
and a reconciliation of adjusted net income (non-GAAP) to net
income (GAAP), please see “Supplemental Non-GAAP Financial
Measures.”
(14) Adjusted earnings per
diluted common share is a non-GAAP financial measure. For a
definition of adjusted earnings per diluted common share and a
reconciliation of adjusted earnings per diluted common share
(non-GAAP) to earnings per diluted common share (GAAP), please see
“Supplemental Non-GAAP Financial Measures.”
(15) Adjusted EBITDA is a
non-GAAP financial measure. For a definition of Adjusted EBITDA and
a reconciliation of Adjusted EBITDA (non-GAAP) to net income (GAAP)
and net cash provided by operating activities (GAAP), please see
“Supplemental Non-GAAP Financial Measures.”
(16) As reported for each period
on a consolidated basis, including 100% of San Mateo’s net cash
provided by operating activities.
(17) Adjusted free cash flow is a
non-GAAP financial measure. For a definition of adjusted free cash
flow and a reconciliation of adjusted free cash flow (non-GAAP) to
net cash provided by operating activities (GAAP), please see
“Supplemental Non-GAAP Financial Measures.”
(18) Represents 100% of San
Mateo’s net income, Adjusted EBITDA, net cash provided by operating
activities or adjusted free cash flow for each period reported.
(19) Includes Matador’s share of
estimated capital expenditures for San Mateo and other wholly-owned
midstream projects. Pronto was wholly-owned by Matador until
December 18, 2024, the date Pronto was contributed to San Mateo in
the Pronto Transaction. Excludes Ameredev’s midstream assets in
2024 and Advance’s midstream assets in 2023.
Matador Resources Company and
Subsidiaries
CONSOLIDATED BALANCE SHEETS -
UNAUDITED
(In thousands, except par value and share
data)
December 31,
2024
2023
ASSETS
Current assets
Cash
$
23,033
$
52,662
Restricted cash
71,709
53,636
Accounts receivable
Oil and natural gas revenues
331,590
274,192
Joint interest billings
260,555
163,660
Other
62,584
35,102
Derivative instruments
15,968
2,112
Lease and well equipment inventory
38,469
41,808
Prepaid expenses and other current
assets
123,437
92,700
Total current assets
927,345
715,872
Property and equipment, at cost
Oil and natural gas properties, full-cost
method
Evaluated
12,534,290
9,633,757
Unproved and unevaluated
1,702,203
1,193,257
Midstream properties
1,683,334
1,318,015
Other property and equipment
47,532
40,375
Less accumulated depletion, depreciation
and amortization
(6,203,263
)
(5,228,963
)
Net property and equipment
9,764,096
6,956,441
Other assets
Derivative instruments
—
558
Other long-term assets
158,668
54,125
Total other assets
158,668
54,683
Total assets
$
10,850,109
$
7,726,996
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities
Accounts payable
$
147,139
$
68,185
Accrued liabilities
441,484
365,848
Royalties payable
227,865
161,983
Amounts due to affiliates
30,544
28,688
Advances from joint interest owners
83,338
19,954
Other current liabilities
64,987
40,617
Total current liabilities
995,357
685,275
Long-term liabilities
Borrowings under Credit Agreement
595,500
500,000
Borrowings under San Mateo Credit
Facility
615,000
522,000
Senior unsecured notes payable
2,114,908
1,184,627
Asset retirement obligations
114,237
87,485
Deferred income taxes
847,666
581,439
Other long-term liabilities
110,009
38,482
Total long-term liabilities
4,397,320
2,914,033
Shareholders’ equity
Common stock — $0.01 par value,
160,000,000 shares authorized; 125,101,268 and 119,478,282 shares
issued; and 125,048,396 and 119,458,674 shares outstanding,
respectively
1,251
1,194
Additional paid-in capital
2,533,247
2,133,172
Retained earnings
2,556,987
1,776,541
Treasury stock, at cost, 52,872 and 19,608
shares, respectively
(2,336
)
(45
)
Total Matador Resources Company
shareholders’ equity
5,089,149
3,910,862
Non-controlling interest in
subsidiaries
368,283
216,826
Total shareholders’ equity
5,457,432
4,127,688
Total liabilities and shareholders’
equity
$
10,850,109
$
7,726,996
Matador Resources Company and
Subsidiaries
CONSOLIDATED STATEMENTS OF INCOME -
UNAUDITED
(In thousands, except per share data)
Three Months Ended December
31,
Year Ended December
31,
2024
2023
2024
2023
Revenues
Oil and natural gas revenues
$
893,860
$
753,246
$
3,143,834
$
2,545,599
Third-party midstream services
revenues
37,703
35,636
141,027
122,153
Sales of purchased natural gas
46,720
43,388
194,097
149,869
Realized gain (loss) on derivatives
4,151
(3,121
)
12,724
(9,575
)
Unrealized (loss) gain on derivatives
(12,065
)
6,983
13,299
(1,261
)
Total revenues
970,369
836,132
3,504,981
2,806,785
Expenses
Production taxes, transportation and
processing
87,049
75,319
306,751
264,493
Lease operating
99,411
71,810
341,544
243,655
Plant and other midstream services
operating
50,916
36,400
171,492
128,910
Purchased natural gas
36,821
36,209
142,715
129,401
Depletion, depreciation and
amortization
293,234
220,055
974,300
716,688
Accretion of asset retirement
obligations
1,768
1,234
6,027
3,943
General and administrative
41,101
29,494
127,454
110,373
Total expenses
610,300
470,521
2,070,283
1,597,463
Operating income
360,069
365,611
1,434,698
1,209,322
Other income (expense)
Net loss on asset sales and impairment
—
—
—
(202
)
Interest expense
(59,970
)
(35,707
)
(171,687
)
(121,520
)
Other income
129
3,496
696
8,785
Total other expense
(59,841
)
(32,211
)
(170,991
)
(112,937
)
Income before income taxes
300,228
333,400
1,263,707
1,096,385
Income tax provision (benefit)
Current
779
4,964
27,059
13,922
Deferred
61,500
52,495
265,305
172,104
Total income tax provision
62,279
57,459
292,364
186,026
Net income
237,949
275,941
971,343
910,359
Net income attributable to non-controlling
interest in subsidiaries
(23,416
)
(21,402
)
(86,021
)
(64,285
)
Net income attributable to Matador
Resources Company shareholders
$
214,533
$
254,539
$
885,322
$
846,074
Earnings per common share
Basic
$
1.72
$
2.14
$
7.16
$
7.10
Diluted
$
1.71
$
2.12
$
7.14
$
7.05
Weighted average common shares
outstanding
Basic
124,953
119,192
123,568
119,139
Diluted
125,430
119,971
124,076
119,980
Matador Resources Company and
Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS -
UNAUDITED
(In thousands)
Three Months Ended December
31,
Year Ended December
31,
2024
2023
2024
2023
Operating activities
Net income
$
237,949
$
275,941
$
971,343
$
910,359
Adjustments to reconcile net income to net
cash provided by operating activities
Unrealized loss (gain) on derivatives
12,065
(6,983
)
(13,299
)
1,261
Depletion, depreciation and
amortization
293,234
220,055
974,300
716,688
Accretion of asset retirement
obligations
1,768
1,234
6,027
3,943
Stock-based compensation expense
4,891
2,884
14,982
13,661
Deferred income tax provision
61,500
52,495
265,305
172,104
Amortization of debt issuance cost and
other debt related costs
4,247
2,051
16,533
7,047
Other non-cash changes
(359
)
(7,276
)
(1,386
)
(7,262
)
Changes in operating assets and
liabilities
Accounts receivable, prepaid expenses and
other current assets
(62,155
)
86,529
(138,137
)
48,136
Lease and well equipment inventory
(2,347
)
7,189
(10,934
)
(3,034
)
Other long-term assets
977
(623
)
4,052
646
Accounts payable, accrued liabilities and
other current liabilities
(10,236
)
(24,754
)
33,748
2,810
Royalties payable
3,311
11,618
56,193
34,273
Advances from joint interest owners
28,279
(1,461
)
63,384
(32,402
)
Other long-term liabilities
1,835
(552
)
4,774
(402
)
Net cash provided by operating
activities
574,959
618,347
2,246,885
1,867,828
Investing activities
Drilling, completion and equipping capital
expenditures
(317,400
)
(337,332
)
(1,222,831
)
(1,192,800
)
Acquisition of Advance
—
(67,705
)
—
(1,676,132
)
Acquisition of Ameredev
—
—
(1,831,214
)
—
Acquisition of oil and natural gas
properties
(132,616
)
(67,069
)
(454,443
)
(187,655
)
Midstream capital expenditures
(64,692
)
(90,110
)
(283,881
)
(165,719
)
Expenditures for other property and
equipment
(1,734
)
(672
)
(5,691
)
(3,636
)
Proceeds from sale of assets and other
11,470
14,020
12,370
14,750
Proceeds from sale of equity method
investment
113,576
—
113,576
—
Net cash used in investing activities
(391,396
)
(548,868
)
(3,672,114
)
(3,211,192
)
Financing activities
Repayments of borrowings under Credit
Agreement
(889,500
)
(410,000
)
(3,969,500
)
(3,032,000
)
Borrowings under Credit Agreement
530,000
380,000
4,065,000
3,532,000
Repayments of borrowings under San Mateo
Credit Facility
(540,000
)
(31,000
)
(733,000
)
(171,000
)
Borrowings under San Mateo Credit
Facility
629,000
78,000
826,000
228,000
Cost to enter into or amend credit
facilities
(7,500
)
(651
)
(33,436
)
(9,296
)
Proceeds from issuance of senior unsecured
notes
—
—
1,650,000
494,800
Issuance costs of senior unsecured
notes
(2,084
)
—
(28,157
)
(8,503
)
Purchase of senior unsecured notes
—
—
(699,191
)
—
Proceeds from issuance of common stock
—
—
344,663
—
Dividends paid
(31,278
)
(23,710
)
(104,876
)
(77,175
)
Contribution related to Pronto
Transaction
171,500
—
171,500
—
Contributions related to formation of San
Mateo
1,300
14,500
23,800
38,200
Contributions from non-controlling
interest owners of less-than-wholly-owned subsidiaries
—
—
19,110
24,500
Distributions to non-controlling interest
owners of less-than-wholly-owned subsidiaries
(24,500
)
(17,150
)
(97,461
)
(78,253
)
Taxes paid related to net share settlement
of stock-based compensation
(2,437
)
(77
)
(16,956
)
(22,910
)
Other
(345
)
(15,267
)
(3,823
)
(16,031
)
Net cash (used in) provided by financing
activities
(165,844
)
(25,355
)
1,413,673
902,332
Increase (decrease) in cash and restricted
cash
17,719
44,124
(11,556
)
(441,032
)
Cash and restricted cash at beginning of
period
77,023
62,174
106,298
547,330
Cash and restricted cash at end of
period
$
94,742
$
106,298
$
94,742
$
106,298
Supplemental Non-GAAP Financial Measures
Adjusted EBITDA
This press release includes the non-GAAP financial measure of
Adjusted EBITDA. Adjusted EBITDA is a supplemental non-GAAP
financial measure that is used by management and external users of
the Company’s consolidated financial statements, such as securities
analysts, investors, lenders and rating agencies. “GAAP” means
Generally Accepted Accounting Principles in the United States of
America. The Company believes Adjusted EBITDA helps it evaluate its
operating performance and compare its results of operations from
period to period without regard to its financing methods or capital
structure. The Company defines, on a consolidated basis and for San
Mateo, Adjusted EBITDA as earnings before interest expense, income
taxes, depletion, depreciation and amortization, accretion of asset
retirement obligations, property impairments, unrealized derivative
gains and losses, non-recurring transaction costs for certain
acquisitions, certain other non-cash items and non-cash stock-based
compensation expense and net gain or loss on asset sales and
impairment. Adjusted EBITDA is not a measure of net income or net
cash provided by operating activities as determined by GAAP. All
references to Matador’s Adjusted EBITDA are those values
attributable to Matador Resources Company shareholders after giving
effect to Adjusted EBITDA attributable to third-party
non-controlling interests, including in San Mateo.
Adjusted EBITDA should not be considered an alternative to, or
more meaningful than, net income or net cash provided by operating
activities as determined in accordance with GAAP or as an indicator
of the Company’s operating performance or liquidity. Certain items
excluded from Adjusted EBITDA are significant components of
understanding and assessing a company’s financial performance, such
as a company’s cost of capital and tax structure. Adjusted EBITDA
may not be comparable to similarly titled measures of another
company because all companies may not calculate Adjusted EBITDA in
the same manner. The following table presents the calculation of
Adjusted EBITDA and the reconciliation of Adjusted EBITDA to the
GAAP financial measures of net income and net cash provided by
operating activities, respectively, that are of a historical
nature. Where references are pro forma, forward-looking,
preliminary or prospective in nature, and not based on historical
fact, the table does not provide a reconciliation. The Company
could not provide such reconciliation without undue hardship
because such Adjusted EBITDA numbers are estimations,
approximations and/or ranges. In addition, it would be difficult
for the Company to present a detailed reconciliation on account of
many unknown variables for the reconciling items, including future
income taxes, full-cost ceiling impairments, unrealized gains or
losses on derivatives and gains or losses on asset sales and
impairment. For the same reasons, the Company is unable to address
the probable significance of the unavailable information, which
could be material to future results.
Adjusted EBITDA – Matador Resources Company
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Unaudited Adjusted EBITDA
Reconciliation to Net Income:
Net income attributable to Matador
Resources Company shareholders
$
214,533
$
248,291
$
254,539
$
885,322
$
846,074
Net income attributable to non-controlling
interest in subsidiaries
23,416
24,386
21,402
86,021
64,285
Net income
237,949
272,677
275,941
971,343
910,359
Interest expense
59,970
36,169
35,707
171,687
121,520
Total income tax provision
62,279
85,321
57,459
292,364
186,026
Depletion, depreciation and
amortization
293,234
242,821
220,055
974,300
716,688
Accretion of asset retirement
obligations
1,768
1,657
1,234
6,027
3,943
Unrealized loss (gain) on derivatives
12,065
(35,118
)
(6,983
)
(13,299
)
1,261
Non-cash stock-based compensation
expense
4,891
4,279
2,884
14,982
13,661
Net loss on impairment
—
—
—
—
202
Expense (income) related to contingent
consideration and other
2,244
243
(3,298
)
5,420
(6,038
)
Consolidated Adjusted EBITDA
674,400
608,049
582,999
2,422,824
1,947,622
Adjusted EBITDA attributable to
non-controlling interest in subsidiaries
(33,550
)
(33,565
)
(30,202
)
(124,047
)
(98,075
)
Adjusted EBITDA attributable to Matador
Resources Company shareholders
$
640,850
$
574,484
$
552,797
$
2,298,777
$
1,849,547
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Unaudited Adjusted EBITDA
Reconciliation to Net Cash Provided by Operating
Activities:
Net cash provided by operating
activities
$
574,959
$
610,437
$
618,347
$
2,246,885
$
1,867,828
Net change in operating assets and
liabilities
40,336
(15,367
)
(77,946
)
(13,080
)
(50,027
)
Interest expense, net of non-cash
portion
55,723
33,469
33,656
155,154
114,473
Current income tax provision (benefit)
779
(21,096
)
4,964
27,059
13,922
Other non-cash and non-recurring
expense
2,603
606
3,978
6,806
1,426
Adjusted EBITDA attributable to
non-controlling interest in subsidiaries
(33,550
)
(33,565
)
(30,202
)
(124,047
)
(98,075
)
Adjusted EBITDA attributable to Matador
Resources Company shareholders
$
640,850
$
574,484
$
552,797
$
2,298,777
$
1,849,547
Adjusted EBITDA – San Mateo (100%)
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
Unaudited Adjusted EBITDA
Reconciliation to Net Income:
Net income
$
47,786
$
49,768
$
43,682
$
175,557
Depletion, depreciation and
amortization
9,746
9,514
9,179
37,667
Interest expense
9,870
9,116
8,683
37,368
Accretion of asset retirement
obligations
108
101
92
405
Non-recurring expense
960
—
—
2,160
Adjusted EBITDA
$
68,470
$
68,499
$
61,636
$
253,157
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
Unaudited Adjusted EBITDA
Reconciliation to Net Cash Provided by Operating
Activities:
Net cash provided by operating
activities
$
40,477
$
50,496
$
45,463
$
193,030
Net change in operating assets and
liabilities
17,561
9,164
7,757
21,825
Interest expense, net of non-cash
portion
9,472
8,839
8,416
36,142
Non-recurring expense
960
—
—
2,160
Adjusted EBITDA
$
68,470
$
68,499
$
61,636
$
253,157
Adjusted Net Income and Adjusted Earnings
Per Diluted Common Share
This press release includes the non-GAAP financial measures of
adjusted net income and adjusted earnings per diluted common share.
These non-GAAP items are measured as net income attributable to
Matador Resources Company shareholders, adjusted for dollar and per
share impact of certain items, including unrealized gains or losses
on derivatives, the impact of full cost-ceiling impairment charges,
if any, and non-recurring transaction costs for certain
acquisitions or other non-recurring income or expense items, along
with the related tax effect for all periods. This non-GAAP
financial information is provided as additional information for
investors and is not in accordance with, or an alternative to, GAAP
financial measures. Additionally, these non-GAAP financial measures
may be different than similar measures used by other companies. The
Company believes the presentation of adjusted net income and
adjusted earnings per diluted common share provides useful
information to investors, as it provides them an additional
relevant comparison of the Company’s performance across periods and
to the performance of the Company’s peers. In addition, these
non-GAAP financial measures reflect adjustments for items of income
and expense that are often excluded by industry analysts and other
users of the Company’s financial statements in evaluating the
Company’s performance. The table below reconciles adjusted net
income and adjusted earnings per diluted common share to their most
directly comparable GAAP measure of net income attributable to
Matador Resources Company shareholders.
Three Months Ended
Year Ended
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
(In thousands, except per share data)
Unaudited Adjusted Net Income and
Adjusted Earnings Per Common Share Reconciliation to Net
Income:
Net income attributable to Matador
Resources Company shareholders
$
214,533
$
248,291
$
254,539
$
885,322
Total income tax provision
62,279
85,321
57,459
292,364
Income attributable to Matador Resources
shareholders before taxes
276,812
333,612
311,998
1,177,686
Less non-recurring and unrealized charges
to income before taxes:
Unrealized loss (gain) on derivatives
12,065
(35,118
)
(6,983
)
(13,299
)
Expense (income) related to contingent
consideration and other
2,099
243
(3,298
)
10,281
Adjusted income attributable to Matador
Resources Company shareholders before taxes
290,976
298,737
301,717
1,174,668
Income tax expense(1)
61,105
62,735
63,361
246,680
Adjusted net income attributable to
Matador Resources Company shareholders (non-GAAP)
$
229,871
$
236,002
$
238,356
$
927,988
Weighted average shares outstanding -
basic
124,953
124,814
119,192
123,568
Dilutive effect of options and restricted
stock units
477
169
779
508
Weighted average common shares outstanding
- diluted
125,430
124,983
119,971
124,076
Adjusted earnings per share attributable
to Matador Resources Company shareholders (non-GAAP)
Basic
$
1.84
$
1.89
$
2.00
$
7.51
Diluted
$
1.83
$
1.89
$
1.99
$
7.48
(1)
Estimated using federal statutory tax rate
in effect for the period.
Adjusted Free Cash Flow
This press release includes the non-GAAP financial measure of
adjusted free cash flow. This non-GAAP item is measured, on a
consolidated basis for the Company and for San Mateo, as net cash
provided by operating activities, adjusted for changes in working
capital and cash performance incentives that are not included as
operating cash flows, less cash flows used for capital
expenditures, adjusted for changes in capital accruals. On a
consolidated basis, these numbers are also adjusted for the cash
flows related to non-controlling interest in subsidiaries that
represent cash flows not attributable to Matador shareholders.
Adjusted free cash flow should not be considered an alternative to,
or more meaningful than, net cash provided by operating activities
as determined in accordance with GAAP or an indicator of the
Company’s liquidity. Adjusted free cash flow is used by the
Company, securities analysts and investors as an indicator of the
Company’s ability to manage its operating cash flow, internally
fund its D/C/E capital expenditures, pay dividends and service or
incur additional debt, without regard to the timing of settlement
of either operating assets and liabilities or accounts payable
related to capital expenditures. Additionally, this non-GAAP
financial measure may be different than similar measures used by
other companies. The Company believes the presentation of adjusted
free cash flow provides useful information to investors, as it
provides them an additional relevant comparison of the Company’s
performance, sources and uses of capital associated with its
operations across periods and to the performance of the Company’s
peers. In addition, this non-GAAP financial measure reflects
adjustments for items of cash flows that are often excluded by
securities analysts and other users of the Company’s financial
statements in evaluating the Company’s cash spend.
The table below reconciles adjusted free cash flow to its most
directly comparable GAAP measure of net cash provided by operating
activities. All references to Matador’s adjusted free cash flow are
those values attributable to Matador shareholders after giving
effect to adjusted free cash flow attributable to third-party
non-controlling interests, including in San Mateo. Where references
are pro forma, forward-looking, preliminary or prospective in
nature, and not based on historical fact, the table does not
provide a reconciliation. The Company could not provide such
reconciliation without undue hardship because such adjusted free
cash flow numbers are estimations, approximations and/or ranges. In
addition, it would be difficult for the Company to present a
detailed reconciliation on account of many unknown variables for
the reconciling items, including the timing of receipts and
payments of cash. For the same reasons, the Company is unable to
address the probable significance of the unavailable information,
which could be material to future results.
Adjusted Free Cash Flow – Matador Resources Company
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
December 31, 2023
Net cash provided by operating
activities
$
574,959
$
610,437
$
618,347
$
2,246,885
$
1,867,828
Net change in operating assets and
liabilities
40,336
(15,367
)
(77,946
)
(13,080
)
(50,027
)
San Mateo discretionary cash flow
attributable to non-controlling interest in subsidiaries(1)
(28,439
)
(29,233
)
(26,078
)
(105,279
)
(82,163
)
Proceeds from contribution of Pronto to
San Mateo
219,760
—
—
219,760
—
Performance incentives received from Five
Point
1,300
12,250
14,500
23,800
38,200
Total discretionary cash flow
807,916
578,087
528,823
2,372,086
1,773,838
Drilling, completion and equipping capital
expenditures
317,400
293,716
337,332
1,222,831
1,192,800
Midstream capital expenditures
64,692
61,988
90,110
283,881
165,719
Expenditures for other property and
equipment
1,734
3,186
672
5,691
3,636
Net change in capital accruals
18,788
28,940
(62,957
)
81,902
(6,288
)
San Mateo accrual-based capital
expenditures related to non-controlling interest in
subsidiaries(2)
(10,227
)
(5,890
)
(16,846
)
(29,475
)
(42,073
)
Total accrual-based capital
expenditures(3)
392,387
381,940
348,311
1,564,830
1,313,794
Adjusted free cash flow
$
415,529
$
196,147
$
180,512
$
807,256
$
460,044
(1)
Represents Five Point Energy LLC’s (“Five
Point”) 49% interest in San Mateo discretionary cash flow, as
computed below.
(2)
Represents Five Point’s 49% interest in
accrual-based San Mateo capital expenditures, as computed
below.
(3)
Represents drilling, completion and
equipping costs, Matador’s share of San Mateo capital expenditures
plus 100% of other midstream capital expenditures not associated
with San Mateo. Pronto was wholly-owned by Matador until December
18, 2024, the date Pronto was contributed to San Mateo in the
Pronto Transaction.
Adjusted Free Cash Flow - San Mateo (100%)
Three Months Ended
Year Ended
(In thousands)
December 31, 2024
September 30, 2024
December 31, 2023
December 31, 2024
Net cash provided by San Mateo operating
activities
$
40,477
$
50,496
$
45,463
$
193,030
Net change in San Mateo operating assets
and liabilities
17,561
9,164
7,757
21,825
Total San Mateo discretionary cash
flow
58,038
59,660
53,220
214,855
San Mateo capital expenditures
8,649
14,037
39,633
57,112
Net change in San Mateo capital
accruals
12,223
(2,017
)
(5,253
)
3,041
San Mateo accrual-based capital
expenditures
20,872
12,020
34,380
60,153
San Mateo adjusted free cash flow
$
37,166
$
47,640
$
18,840
$
154,702
PV-10
PV-10 is a non-GAAP financial measure and generally differs from
Standardized Measure, the most directly comparable GAAP financial
measure, because it does not include the effects of income taxes on
future income. PV-10 is not an estimate of the fair market value of
the Company’s properties. Matador and others in the industry use
PV-10 as a measure to compare the relative size and value of proved
reserves held by companies and of the potential return on
investment related to the companies’ properties without regard to
the specific tax characteristics of such entities. PV-10 may be
reconciled to the Standardized Measure of discounted future net
cash flows at such dates by adding the discounted future income
taxes associated with such reserves to the Standardized
Measure.
(in millions)
At December 31,
2024
At December 31,
2023
Standardized Measure
$
7,376.6
$
6,113.5
Discounted future income taxes
1,857.2
1,590.6
PV-10
$
9,233.8
$
7,704.1
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250218777530/en/
Mac Schmitz Senior Vice President - Investor Relations (972)
371-5225 investors@matadorresources.com
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