Riley Exploration Permian, Inc. Reports First Quarter 2024 Earnings: Comprehensive Review

  • Income: The reported figure of $100 million is lower than the estimate of $105.85 million.

  • Net income: It achieved $19 million, below the $34.63 million estimate.

  • Earnings per share (EPS): It registered at $0.94 per diluted share, well below the expected $1.64.

  • Free cash flow: $23 million was generated, demonstrating strong financial health and operational efficiency.

  • Debt reduction: Reduced total debt by $15 million, increasing the company’s financial stability.

  • Oil production: It increased to 14.2 MBbl/d, an increase of 4% from the previous quarter, reflecting improved operating results.

  • Dividends: It paid $0.36 per share, bringing the total to $7 million, demonstrating its commitment to returning value to shareholders.

Riley Exploration Permian, Inc. (REPX) released financial and operating results for the first quarter ended March 31, 2024 as part of a recent 8-K filing. The company, a leading player in the oil and natural gas sector with operations primarily in and around New Mexico, has experienced a number of achievements and challenges during this period.

Riley Exploration Permian, Inc. Reports  First Quarter 2024 Earnings: Comprehensive ReviewRiley Exploration Permian, Inc. Reports  First Quarter 2024 Earnings: Comprehensive Review

Riley Exploration Permian, Inc. Reports First Quarter 2024 Earnings: Comprehensive Review

Informations about company

Riley Exploration Permian, Inc. engages in the exploration, development and production of crude oil, natural gas and liquid natural gas. The company’s strategic focus is on the use of advanced extraction and production technologies to maximize production in the Permian Basin, one of the most prolific hydrocarbon-producing regions in the United States.

First quarter 2024 performance highlights

The company reported net income of $19 million, or $0.94 per diluted share, for the first quarter of 2024. These results represent a decline compared to the same quarter last year, but demonstrate resilience in the volatile market environment. Total revenues for the quarter were $100 million, driven by average oil production of 14.2 MBbl/d and total equivalent production of 20.4 MBoe/d.

Riley Permian also highlighted improved operational efficiencies that led to reduced cycle times and cost savings. Notably, the company generated $56 million in operating cash flow and achieved free cash flow of $23 million. These financial metrics are key because they reflect a company’s ability to generate excess cash that can be used for debt reduction, dividends, or reinvestment in core business operations.

Strategic acquisitions and debt management

During the quarter, Riley Permian continued to execute on its growth strategy through strategic acquisitions, including the purchase of oil and gas properties in Eddy County, New Mexico. This acquisition increases the company’s development resources and is expected to positively impact future production volumes. Additionally, the company reduced its total debt by $15 million, strengthening its balance sheet and increasing financial flexibility.

Financial condition and future prospects

Riley Permian’s balance sheet remains strong, with total assets of $956 million as of March 31, 2024. The company’s efforts to manage debt levels have been evident, with a noticeable reduction in total debt to $342 million compared to the prior quarter.

Looking ahead, Riley Permian provided guidance for the second quarter of 2024, expecting to maintain production levels and effectively manage capital expenditures. The company’s focus on operational efficiency and cost management is likely to support its financial performance in the coming quarters.

Comment of the Management Board

Our company had a strong start to the year, achieving operational and financial results in the first quarter, said Bobby D. Riley, CEO and chairman of the board. We have seen improvements in cycle times and efficiency in our development activities, which have led to tangible savings. We continue to prioritize generating free cash flow that allows for debt reduction and direct return to shareholders in the form of dividends. Finally, we recently completed a previously announced acquisition in New Mexico, adjacent to our existing New Mexico assets, which will add valuable development resources to the region.

To recap, first quarter 2024 Riley Exploration Permian, Inc. reflects a strategic combination of operational excellence and prudent financial management. Despite some challenges, the company’s focus on increasing efficiency and strengthening its asset base bodes well for its long-term growth trajectory. Investors and stakeholders can look forward to continued progress as the company navigates the dynamic energy landscape.

Detailed financial data and further information can be found in the full 8-K.

Read the full 8k profit publication. (here) published by Riley Exploration Permian Inc for more details.

This article first appeared on GuruFocus.