Wall Street expects a year-over-year decline in earnings on lower revenues when Callon Petroleum (CPE) reports results for the quarter ended December 2023. While this widely-known consensus outlook is important in gauging the company's earnings picture, a powerful factor that could impact its near-term stock price is how the actual results compare to these estimates.The stock might move higher if these key numbers top expectations in the upcoming earnings report. On the other hand, if they miss, the stock m ...

Financial Data and Key Metrics Changes - For the third quarter, total production averaged 102,000 BOE per day, with oil sales averaging about 58,000 barrels per day. The shortfall in oil volumes was attributed to extreme temperatures and related power issues, impacting production in the Delaware Basin [6][27] - The company generated nearly $50 million in adjusted free cash flow this quarter, allowing for debt reduction and share repurchase initiatives [26][27] - Total long-term debt was approximately $1.9 billion, down more than $300 million from the prior period, with expectations for higher free cash flows in the fourth quarter to continue reducing debt [27][28] Business Line Data and Key Metrics Changes - The company added quality assets in the Permian and extended its runway of high-return long-lateral development locations, with a focus on the Delaware acquisition [1] - The Delaware West area, which is gas-weighted, saw higher gas-to-oil ratios than expected, impacting overall oil production [7][17] - The company expects to turn 14 gross wells in line in the fourth quarter, primarily in oilier areas, which will benefit the 2024 production mix [23] Market Data and Key Metrics Changes - The company anticipates fourth quarter oil production in the range of 56,000 to 59,000 barrels per day, with total production expected to be between 100 to 103 BOE per day, comprised of approximately 79% liquids [23] - The company is focused on maximizing free cash flow and reducing debt while also planning to use up to 40% of adjusted free cash flow for share repurchases in the fourth quarter [28] Company Strategy and Development Direction - The company is focused on maximizing free cash flow, reducing costs, and returning cash to shareholders through a share buyback program [44] - The strategy includes a shift to a fit-for-purpose design in operations, optimizing costs through various initiatives, including reducing casing strings and improving cycle times [9][30] - The company plans to prioritize high-value developments while maintaining a disciplined approach to capital investments [34] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of learning from operational experiences, particularly in the Delaware West area, to optimize future development plans [17][73] - The company expects to continue improving capital efficiency and free cash flow conversion of EBITDA, with a forecasted average DC&F cost per well down over 15% versus 2023 [34][106] - Management acknowledged the ongoing challenges in the operating environment but remains optimistic about the company's ability to adapt and improve [99] Other Important Information - The company has implemented a cash return program for shareholders and is serious about achieving debt reduction goals [28] - The leadership team has been strengthened, with a focus on enhancing operational practices and creating sustainable efficiencies [29] Q&A Session Summary Question: What are the primary drivers for capital allocation moving forward? - Management emphasized a balanced approach between investing in asset base, debt reduction, and share repurchase programs [13] Question: Can you provide insights on the Delaware West area and future development? - Management noted that the Delaware West area is gas-weighted, and while it remains attractive, adjustments will be made in development strategies based on recent learnings [16][17] Question: How does the company view consolidation in the industry? - Management acknowledged the trend of consolidation and indicated that having a robust inventory and improving balance sheet positions the company well for future opportunities [77][99] Question: What are the expectations for LOE trends into 2024? - Management highlighted that reducing failure rates in artificial lift systems is a significant focus for improving LOE [107]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 001-14039 Callon Petroleum Company (Exact Name of Registrant as Specified in Its Charter) Delaware 64- ...

Financial Data and Key Metrics Changes - The company reported a 7% sequential increase in production, exceeding the midpoint of guidance, while capital spending was at the low end of guidance [37] - The company achieved initial debt milestone ahead of schedule and is set to initiate a $300 million stock buyback program [5][41] Business Line Data and Key Metrics Changes - The company placed 32 wells online during the second quarter, including three in the Eagle Ford, with the 3rd bone spring wells performing well and delivering similar oil EURs to Wolfcamp A results [42][43] - Improvements in drilling and completions were noted, with a 14% reduction in time from spud to rig release due to better bit design [44] Market Data and Key Metrics Changes - The company is experiencing a reduction in service costs, with spot market items like steel casing and sand priced down by 15% to 20% [60] - An expected incremental $15 million in savings in the second half from service costs and structural design modifications [61] Company Strategy and Development Direction - The company is focused on capital efficiency and cost reductions, leveraging previous infrastructure investments and optimizing artificial lift systems [49][50] - The strategic focus is now solely on the Permian Basin, aiming to streamline operations and enhance free cash flow [50][52] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational improvements and the potential for increased free cash flow through innovation and cost reductions [48][52] - The company anticipates a strong production trajectory in the fourth quarter, despite temporary disruptions in the third quarter [59] Other Important Information - The company has undergone a portfolio transformation, divesting from Eagle Ford assets and focusing on a nearly 150,000 net acres in the Delaware and Midland Basins [39] - The new COO, Russell Parker, emphasized the importance of efficiency and innovation in driving the company's future success [47] Q&A Session Summary Question: Cash return and buyback program - Management indicated that they plan to use around 50% of free cash flow for share repurchases and will also focus on debt reduction, targeting a $300 million buyback alongside $400 million in debt repayment [9][12] Question: Cost reduction opportunities - The new COO highlighted that meaningful cost reductions are expected over time, leveraging past infrastructure investments and improving production efficiency [13][14] Question: Maintenance capital cost scenarios for 2024 - Management stated it is premature to provide specific scenarios for 2024, but they expect capital efficiency to improve [18][19] Question: Completion approach and productivity - The COO discussed the new completion techniques leading to improved productivity in the 3rd bone spring shale, with ongoing optimization efforts [19][21] Question: Infrastructure downtime and mitigation - Management confirmed that recent disruptions have passed and they are exploring options to mitigate future downtime [28]

This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements include all statements regarding the Company's expectations and plans with respect to the Delaware Basin acquisition and Eagle Ford disposition; the Company's expectations and plans with respect to its share repurchase program; wells anticipated to be drilled and placed on production; future levels of developm ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2023 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 001-14039 Callon Petroleum Company (Exact Name of Registrant as Specified in Its Charter) Delaware 64-08443 ...

Neal Dingmann Operator Joe Gatto Joe Gatto Terrific. And then with regard to the acquisition, could you just speak to how it came together, and if it was your or the seller's preference for Callon stock? Derrick Whitfield Operator Joe Gatto Joe Gatto Your next question comes from Paul Diamond with Citi. Joe Gatto Understood. Thanks for the clarity. And just another quick kind of housekeeping one. As far as your hedging strategy, does the – those transaction really shift any of that kind of 30,000 foot strat ...

Prior Period Performance Obligations | --- | --- | --- | |----------------------------------------------------------------------------------------------------------------|--------------------------------------------|--------------------------------| | Cash flows from operating activities: \nNet income (loss) | Three Months Ended \n2023 \n$220,638 | March 31, \n2022* \n($7,715) | | Adjustments to reconcile net income (loss) to net cash provided by operating activities: | | | | Depreciation, depletion and amo ...

• Revisions to Previous Estimates. Net negative revisions of previous estimates of 31.6 MMBoe primarily consist of: ◦ 44.4 MMBoe reduction due to PUD locations that were reclassified to unproved reserve categories, all of which were in the Permian. Certain PUDs were moved outside of their five-year development window as we continue to refine our future development plans for the Permian, including increased application of our "Life of Field" codevelopment model. This development model focuses on optimization ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended September 30, 2022 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from ____________ to ____________ Commission File Number 001-14039 Callon Petroleum Company (Exact Name of Registrant as Specified in Its Charter) | --- | --- ...