Company Overview - Amplify Energy (AMPY) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended December 2024, with earnings expected to be $0.25 per share, reflecting a decrease of 76.6% compared to the previous year [1][3] - Revenues are projected to reach $80.09 million, which is a 1.4% increase from the same quarter last year [3] Earnings Expectations - The earnings report is scheduled for release on March 5, 2025, and could influence the stock price significantly depending on whether the actual results exceed or fall short of expectations [2] - The consensus EPS estimate has been revised 30.77% higher in the last 30 days, indicating a reassessment by analysts [4] Earnings Surprise Prediction - The Zacks Earnings ESP (Expected Surprise Prediction) model indicates that the Most Accurate Estimate for Amplify Energy is the same as the Zacks Consensus Estimate, resulting in an Earnings ESP of 0% [10][11] - Despite a Zacks Rank of 1 (Strong Buy), the lack of a positive Earnings ESP makes it challenging to predict an earnings beat [11] Historical Performance - In the last reported quarter, Amplify Energy had an earnings surprise of +68.75%, reporting $0.54 per share against an expectation of $0.32 [12] - Over the past four quarters, the company has surpassed consensus EPS estimates twice [13] Industry Context - W&T Offshore (WTI), another company in the oil and gas exploration and production sector, is expected to report a loss of $0.18 per share for the same quarter, indicating a year-over-year change of -200% [17] - W&T Offshore's revenues are expected to decline by 2.7% to $128.77 million, but it has an Earnings ESP of 22.22%, suggesting a higher likelihood of beating the consensus EPS estimate [18]

Core Viewpoint - Amplify Energy Corp. is set to report its fourth quarter 2024 financial and operating results on March 5, 2025, after U.S. market close, with a conference call scheduled for March 6, 2025, to discuss these results [1]. Company Overview - Amplify Energy Corp. is an independent oil and natural gas company involved in the acquisition, development, exploitation, and production of oil and natural gas properties [2]. - The company's operations are primarily located in Oklahoma, the Rockies (Bairoil), federal waters offshore Southern California (Beta), East Texas/North Louisiana, and the Eagle Ford (Non-op) [2]. Investor Relations - Key contacts for investor relations include Jim Frew, SVP & Chief Financial Officer, and Michael Jordan, Director of Finance and Treasurer [3].

Group 1 - Monteverde & Associates PC is investigating Amplify Energy Corp. regarding its proposed merger with Juniper Capital, where Amplify shareholders will retain approximately 61% of the outstanding equity [1] - Monteverde & Associates PC has a successful track record in recovering millions of dollars for shareholders and is recognized as a Top 50 Firm by ISS Securities Class Action Services Report [1] - The firm operates from the Empire State Building in New York City and specializes in class action securities litigation [2][3] Group 2 - The firm encourages shareholders with concerns to contact them for additional information free of charge [3] - Monteverde & Associates PC emphasizes that no company, director, or officer is above the law, highlighting their commitment to shareholder rights [3] - The firm has a history of litigating and recovering money for shareholders, including cases that have reached the U.S. Supreme Court [2][4]

Core Viewpoint - Amplify Energy Corp. has entered into a definitive merger agreement with Juniper Capital to combine with certain Juniper portfolio companies, enhancing its oil-weighted producing assets and leasehold interests in the DJ and Powder River Basins [1] Strategic Rationale and Benefits - The transaction will add approximately 19 million barrels of oil equivalent (MMBoe) of Proved Developed Reserves, with a present value (PV10) exceeding $330 million [2] - Amplify will gain around 287,000 net acres in the DJ and Powder River Basins, with over 115,000 acres being operated and held-by-production, allowing for opportunistic development over time [2] Operating Metrics and Corporate Efficiency - The acquired assets had an average daily production of approximately 7,900 net barrels of oil equivalent (Boe) in Q3 2024, with 81% being oil and 90% liquids [3] - The integration of these assets is expected to improve operating metrics and corporate efficiency with minimal incremental overhead costs [3] Organic Growth Opportunities - Amplify has identified hundreds of potential high-quality drilling locations to complement its existing development inventory, targeting formations in the DJ and Powder River Basins [4] Accretion and Synergies - The transaction is anticipated to be significantly accretive to free cash flow in 2025 and over a five-year horizon, with expected material synergies from optimizing overhead and income tax savings [5] Future Consolidation Opportunities - The merger creates a new core area for future consolidation opportunities, allowing for potential accretive acquisitions from smaller private companies or non-core assets of larger operators [6] Management and Board Changes - Edward Geiser and Josh Schmidt from Juniper Capital will join Amplify's Board of Directors, while Amplify's management team will lead the combined company [8]

Core Viewpoint - Amplify Energy Corp. has entered into a definitive merger agreement with Juniper Capital to combine with certain Juniper portfolio companies, significantly enhancing its asset base and operational scale in the oil sector [1] Strategic Rationale and Benefits - The transaction will add approximately 19 million barrels of oil equivalent (MMBoe) of proved developed reserves, with a present value (PV10) of over $330 million, and approximately 287,000 net acres in the DJ and Powder River Basins [2] - Over 115,000 of the net acres are operated and held-by-production, with a high average working interest of approximately 90%, allowing for opportunistic development over time [2] Operating Metrics and Corporate Efficiency - In Q3 2024, the acquired assets had an average daily production of approximately 7,900 net barrels of oil equivalent (Boe), with 81% being oil and 90% liquids [3] - The assets are expected to improve operating metrics across the combined company due to strong margins and low operating costs, with minimal incremental overhead costs anticipated from integration [3] Organic Growth Opportunities - Amplify has identified hundreds of potential high-quality drilling locations to complement its existing development inventory, targeting formations in the DJ and Powder River Basins [4] Accretion and Synergies - The transaction is expected to be significantly accretive to free cash flow in 2025 and over a five-year horizon, with material synergies anticipated from optimizing overhead and income tax savings [5] Future Consolidation Opportunities - The large acreage position in premier Rocky Mountain Basins provides a core area for future consolidation opportunities, allowing for accretive bolt-on acquisitions from smaller private companies or non-core assets of larger operators [6] Management and Board Changes - Edward Geiser and Josh Schmidt from Juniper Capital will join Amplify's Board of Directors, while Amplify's management team will lead the combined company [8]

Group 1 - Amplify Energy Corp. will participate in a fireside chat hosted by Jeff Grampp on January 23, 2025, at 12:00 p.m. ET [1] - A replay of the fireside chat will be available for at least 30 days on the investor relations section of the Company's website [1] - Amplify Energy is an independent oil and natural gas company focused on the acquisition, development, exploitation, and production of oil and natural gas properties [2] Group 2 - The Company's operations are concentrated in Oklahoma, the Rockies (Bairoil), federal waters offshore Southern California (Beta), East Texas/North Louisiana, and the Eagle Ford (Non-op) [2] - For further information, the Company provides contact details for its investor relations team, including the Senior Vice President and Chief Financial Officer, Jim Frew, and the Director of Finance and Treasurer, Michael Jordan [3]

Core Viewpoint - Amplify Energy (AMPY) reported third-quarter 2024 results that exceeded earnings expectations, but underlying issues such as rising capital expenditures, increasing debt, and declining production levels raise concerns about the company's financial health and operational efficiency [1][2]. Financial Performance - Amplify's capital expenditures are projected to reach the high end of its annual guidance of $60-$65 million, primarily due to accelerated non-operated development costs, which could negatively impact free cash flow, reported at $3.6 million for Q3 2024, a decline from previous periods [5][6]. - The company's total production for Q3 averaged 19,000 barrels of oil equivalent per day (BOE/d), reflecting a sequential decline of 1,300 BOE/d, attributed to planned shut-ins and facility upgrades [6]. - Amplify's net debt increased to $120 million by the end of the quarter, with interest expenses rising to $3.8 million, indicating a growing financial burden that may limit the company's operational flexibility [7]. Growth Opportunities - The Beta development program continues to yield positive results, with the newly completed C59 well achieving an initial production rate of 590 barrels per day, exceeding expectations [9]. - Amplify has secured extensive hedges covering 75-80% of its forecasted crude production for 2024 and 2025, with a weighted average price of $69.39 per barrel for 2025, providing a stable revenue stream [10]. - The company has demonstrated consistent free cash flow generation, achieving positive free cash flow in 17 out of the last 18 quarters, which underscores its financial resilience [11]. Valuation Perspective - From a valuation standpoint, Amplify Energy appears attractive, trading below its five-year median and at a significant discount compared to peers like W&T Offshore and Ring Energy, which have comparable market caps [12]. Market Sensitivity - Amplify Energy is sensitive to fluctuations in oil prices, which directly affect its cash flow and profitability. Recent declines in crude prices below $70 due to concerns over global demand and economic conditions pose risks to the company's earnings [14]. Investment Outlook - While Amplify's Beta development enhances long-term production potential and its ability to generate positive free cash flow strengthens financial flexibility, the current challenges suggest it may not be the ideal time to invest in the company. Existing shareholders may consider maintaining their positions [15].

Financial Data and Key Metrics Changes - The company reported net income of approximately $22.7 million for Q3 2024, compared to $7.1 million in the prior quarter, primarily due to a non-cash unrealized gain on commodities derivatives [26] - Adjusted EBITDA for Q3 2024 was $25.5 million, in line with expectations [27] - Lease operating expenses (LOE) were approximately $33.3 million, a decrease of $3 million from the previous quarter, driven by optimization initiatives [16][28] - Free cash flow for Q3 2024 was $3.6 million, with positive free cash flow generated in 17 of the last 18 quarters [32][33] Business Line Data and Key Metrics Changes - Total production averaged approximately 19,000 BOE per day in Q3 2024, a decrease of 1,300 BOE per day from Q2 2024 [15] - The production commodity mix for the quarter was 43% oil, 17% NGLs, and 40% natural gas [16] - The company invested approximately $18.2 million in capital during Q3 2024, with about 66% allocated to Beta facility projects and development drilling [31] Market Data and Key Metrics Changes - The company is participating in 14 gross new development wells and 2 gross recompletion projects in East Texas and Eagle Ford [20] - The C59 well achieved an initial production (IP30) gross oil rate of approximately 590 barrels of oil per day [22] - The company expects to generate a run rate adjusted EBITDA of over $3 million per year from Magnify Energy Services after just over one year of operations [18] Company Strategy and Development Direction - The company is focused on maximizing shareholder value by retaining ownership of Wyoming assets while evaluating monetization proposals [10] - The development program at Beta is expected to deliver outstanding returns on investment and significant incremental free cash flow [12] - The company is refining its development program schedule and plans to provide an updated plan in Q1 2025 [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong early results from the Beta development program and the potential for transformative growth [38] - The company anticipates that taxes as a percentage of revenue will remain within the previously announced guidance range for 2024 [30] - Management is optimistic about the combination of Beta and non-operated development opportunities enhancing flexibility and market performance [39] Other Important Information - The company issued its second annual sustainability report, highlighting significant progress in emissions reduction and corporate governance [12] - The borrowing base was reduced by $5 million while elected commitments were increased by $10 million, improving liquidity [34] - The company executed crude oil swaps for 2025 and 2026 at weighted average prices of $69.39 and $68.12 per barrel, respectively [36] Q&A Session Summary Question: Can you provide insights on the Beta development and potential new locations? - Management indicated that the C59 well proved up a significant portion of the southern acreage, with expectations for a decent number of locations to be discussed in future reports [41][44] Question: What drove the cost difference in well drilling? - The C59 well's higher cost was attributed to additional drilling days and challenges faced during the process, but management remains comfortable with the $5 million to $6 million range for future wells [46][48] Question: What is the expected timeline for monetization opportunities in Haynesville? - Management expects to realize monetization opportunities between now and the middle of Q1 2025, with potential values in the range of several million dollars [61][62] Question: When might the company consider returning capital to shareholders? - Management indicated that a return to capital could be considered in 2025, depending on development activity and free cash flow generation [63] Question: How many currently permitted locations are there at Beta? - The company currently has 7 to 10 permits at Beta, with ongoing efforts to secure more [66] Question: What is the status of non-operated interests in East Texas? - Management noted that they are participating in wells in East Texas and Eagle Ford, with visibility into future activity expected to improve [74]

Core Industry Insights - The Zacks Oil and Gas - Exploration and Production - United States industry is facing increasing challenges, including potential U.S. policy changes that may boost domestic oil production, leading to higher supply and lower prices [1] - China's slowing oil demand, despite government stimulus, could further weaken global prices, particularly if OPEC+ production cuts do not sufficiently address the demand shortfall [1][4] - The rise of renewable energy and electric vehicle adoption is expected to challenge long-term oil consumption, with China projected to see its oil imports peak earlier than anticipated [1][6] - Geopolitical tensions in the Middle East could lead to rapid price increases if conflicts disrupt critical supply routes [1][5] Industry Overview - The Zacks Oil and Gas - US E&P industry comprises companies focused on the exploration and production of oil and natural gas, with cash flow heavily influenced by commodity prices [2] - The industry is characterized by historically volatile prices, which significantly impact production growth rates and returns [2] Key Trends - Potential Increase in U.S. Oil Production: A Republican-led administration may implement policies to increase hydrocarbon production, potentially leading to a significant rise in U.S. oil output and downward pressure on prices [3] - Impact of Weakening Chinese Consumption: Slower demand growth from China could keep global oil prices subdued due to ample supply and restrained demand [4] - Growing Renewables and EVs Threaten Oil Demand: The shift towards renewable energy and electric vehicles is expected to reduce reliance on fossil fuels, with China's oil imports projected to plateau by 2026 [6] Industry Performance - The Zacks Oil and Gas - US E&P industry currently ranks 237, placing it in the bottom 6% of over 250 Zacks industries, indicating challenging near-term prospects [7][8] - The industry's earnings estimates for 2024 have decreased by 27.7% over the past year, with 2025 estimates down 26.5% [9] - The industry has underperformed compared to the S&P 500 and the broader Zacks Oil – Energy sector, declining by 1.8% over the past year while the S&P 500 gained 32.2% [11] Valuation Metrics - The industry is currently trading at an EV/EBITDA ratio of 5.99X, significantly lower than the S&P 500's 17.30X but above the sector's 3.35X [13] Notable Companies - **Civitas Resources**: Focused on the DJ Basin and Permian Basin, with a balanced production mix and projected 53.1% revenue growth for 2024 [14][15] - **Northern Oil and Gas**: Operates in key U.S. basins with a unique nonoperating model, indicating 18.3% revenue growth for 2024 [18][19] - **California Resources**: Independent producer with a focus on carbon capture, expected EPS growth rate of 11.8% over three to five years [20][21] - **Amplify Energy**: Diversified operations across five U.S. basins, with a projected 3.1% revenue growth for 2024 [23][24]

Group 1: Earnings Performance - Amplify Energy reported quarterly earnings of $0.54 per share, exceeding the Zacks Consensus Estimate of $0.32 per share, compared to a loss of $0.34 per share a year ago, representing an earnings surprise of 68.75% [1] - The company posted revenues of $69.86 million for the quarter ended September 2024, missing the Zacks Consensus Estimate by 11.43%, and down from $76.77 million year-over-year [2] Group 2: Stock Performance and Outlook - Amplify Energy shares have increased approximately 13.5% since the beginning of the year, while the S&P 500 has gained 21.2% [3] - The current consensus EPS estimate for the upcoming quarter is $0.40 on revenues of $82.34 million, and for the current fiscal year, it is $0.65 on revenues of $317.01 million [7] Group 3: Industry Context - The Oil and Gas - Exploration and Production - United States industry is currently ranked in the bottom 8% of over 250 Zacks industries, indicating potential challenges for stocks in this sector [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, suggesting that investors should monitor these revisions closely [5][6]