DENVER, July 31, 2025 /PRNewswire/ -- SM Energy Company (the "Company") (NYSE: SM) today reported operating and financial results for the second quarter 2025 and provided certain full year and third quarter 2025 guidance. Highlights include: Midland Basin South Texas Uinta Basin (Pre/Post-hedge(1)) Record Net Quarterly Production: 19.0 MMBoe, or 209.1 MBoe/d, exceeded expectations at 5% above the mid-point of guidance, with oil making up 55% (115.7 MBbls/d). Strong performance from the Company's Uinta Basin ...

Core Viewpoint - Sierra Madre Gold and Silver Ltd. has successfully closed the second tranche of its brokered private placement, raising a total of $19,500,600 from the offering [1][3]. Group 1: Offering Details - The second tranche consisted of 2,500,000 units sold at a price of $0.70 per unit, generating gross proceeds of $1,750,000 [1]. - Each unit includes one common share and one half of a common share purchase warrant, with each warrant allowing the purchase of one common share at $0.85 for 12 months [2]. - The offering was facilitated by Beacon Securities Limited as the lead agent, along with Canaccord Genuity Corp. as part of the syndicate [1]. Group 2: Use of Proceeds - The net proceeds from the offering will be utilized to expand the capacity of the Guitarra mine, conduct exploration programs at the East District, and for working capital and general corporate purposes [3]. Group 3: Compensation and Fees - In connection with the closing of the second tranche, the company paid the agents a cash fee of $61,250 and issued 87,500 compensation options, each allowing the purchase of one common share at the issue price for 12 months [4]. Group 4: Company Overview - Sierra Madre Gold and Silver Ltd. focuses on the Guitarra mine in Mexico and the Tepic property, with the Guitarra mine being a permitted underground mine that restarted commercial production in January 2025 [7]. - The Tepic Project covers over 2,600 hectares and hosts low-sulphidation epithermal gold and silver mineralization with an existing historic resource [8].

Core Viewpoint - Sierra Madre Gold and Silver Ltd. has successfully closed the first tranche of its brokered private placement offering, raising gross proceeds of $17,750,600 from the issuance of 25,358,000 units at a price of $0.70 per unit, part of a larger offering of up to 27,858,000 units for total proceeds of up to $19,500,600 [1][3]. Group 1: Offering Details - The first tranche consists of 25,358,000 units, each unit comprising one common share and one half of a common share purchase warrant, with each warrant allowing the purchase of one common share at $0.85 for 12 months [2]. - The company intends to use the net proceeds from the offering to expand the Guitarra mine's capacity, conduct exploration programs, and for working capital [3]. - Certain directors and officers subscribed for 686,000 units, totaling $480,200, which is classified as a related party transaction under Multilateral Instrument 61-101 [4]. Group 2: Agent Compensation - The company paid the agents a cash fee of $1,171,933 and issued 1,674,190 compensation options, each allowing the purchase of one common share at the issue price for 12 months [5]. - Additionally, a corporate financing fee of $26,500 was paid to the agents, along with 38,010 corporate finance fee compensation options [5]. Group 3: Regulatory Compliance - The units were offered to Canadian residents (excluding Quebec) and in the United States under available exemptions from registration requirements, with no hold period for Canadian subscribers [6]. - The offering remains subject to final acceptance by the TSX Venture Exchange [6]. Group 4: Company Overview - Sierra Madre Gold and Silver Ltd. focuses on the Guitarra mine in Mexico and the Tepic property, with the Guitarra mine being a permitted underground mine that restarted commercial production in January 2025 [9]. - The Tepic Project hosts low-sulphidation epithermal gold and silver mineralization with an existing historic resource [10].

Core Viewpoint - SM Energy (SM) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended June 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is expected to be released on July 31, with a consensus EPS estimate of $1.23, reflecting a year-over-year decrease of 33.5%. Revenues are projected to be $780.12 million, which is a 22.9% increase from the previous year [3][2]. - The consensus EPS estimate has been revised 6.67% higher in the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for SM Energy is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -2.64%, suggesting a bearish outlook from analysts [12]. - The stock currently holds a Zacks Rank of 3 (Hold), complicating predictions of an earnings beat [12]. Historical Performance - In the last reported quarter, SM Energy exceeded the consensus EPS estimate of $1.6 by delivering earnings of $1.76, resulting in a surprise of +10.00%. Over the past four quarters, the company has consistently beaten consensus EPS estimates [13][14]. Industry Context - In the broader context of the Zacks Oil and Gas - Exploration and Production - United States industry, Comstock Resources (CRK) is expected to report earnings of $0.09 per share for the same quarter, indicating a year-over-year increase of 145% with revenues projected at $415.32 million, up 68.3% [18][19].

Core Viewpoint - Sierra Madre Gold and Silver Ltd. is increasing its private placement offering to issue up to 27,858,000 units at a price of $0.70 per unit, aiming for gross proceeds of up to $19,500,600 [1][2]. Group 1: Offering Details - The offering will consist of units, each comprising one common share and half a common share purchase warrant, with warrants allowing the purchase of additional shares at $0.85 for 12 months [3]. - The offering is available to Canadian residents, excluding Quebec, under the Listed Issuer Financing Exemption, with no hold period for Canadian subscribers [4]. - The expected closing date for the offering is around July 24, 2025, pending necessary regulatory approvals [7]. Group 2: Company Background - Sierra Madre Gold and Silver Ltd. focuses on precious metals development and exploration, particularly at the Guitarra mine in Mexico, which has resumed commercial production as of January 2025 [8]. - The Tepic Project, covering over 2,600 hectares, contains low-sulphidation epithermal gold and silver mineralization with an existing historic resource [9]. - The management team has extensive experience in raising capital for mining companies, having collectively raised over $1 billion [9].

Group 1 - SM Energy Company plans to release its second quarter 2025 financial and operating results after market hours on July 31, 2025 [1] - The release will include an earnings report, a pre-recorded webcast, and an associated presentation, all available on the Company's website [1] - A Q&A session with SM Energy management is scheduled for August 1, 2025, at 8:00 a.m. Mountain time/10:00 a.m. Eastern time [2] Group 2 - SM Energy is an independent energy company focused on the acquisition, exploration, development, and production of crude oil, natural gas, and NGLs in Texas and Utah [2] - Important information about SM Energy is routinely posted on its website [2] - Investor contact information includes Pat Lytle, with a provided email and phone number for inquiries [3]

Core Insights - SM Energy is an independent exploration and production firm focused on the Permian Basin, Uinta Basin, and South Texas region, owning approximately 111,000 net acres in the Midland Basin and 63,300 net acres in the Uinta Basin, along with 155,000 net acres in South Texas [1] Financial Performance - SM Energy reported first-quarter 2025 revenues of $844.5 million and net income of $182.3 million, showing significant improvement from the prior-year quarter, driven by increased daily oil production and operational efficiency [3] - The company aims for a 30% increase in oil production and a 20% increase in total production for 2025, which is expected to enhance financial performance [4] Asset Integration - Successful integration of Uinta Basin assets contributed to a 63% increase in daily oil production compared to the first quarter of 2024, with drilling and completion efficiency exceeding expectations [5] - The Uinta Basin wells are expected to contribute to a higher oil mix, particularly in the second half of 2025, driving sustained growth [5] Financial Strategy - SM Energy is strategically using free cash flows to reduce its debt burden, aiming for a leverage ratio of about 1, which will strengthen its balance sheet [6] - The company can generate free cash flows even at a flat $55 per barrel oil price, supporting capital expenditures and prioritizing debt reduction [7] Market Position - Despite strong financial performance, SM Energy's stock has underperformed compared to the broader Zacks Exploration and Production industry, with shares falling 36.9% over the past year [8] - The company faces vulnerability to commodity price volatility, with potential adjustments needed if oil prices fall below $55 per barrel [11] Dividend Considerations - SM Energy's current dividend yield lags behind industry peers, as the company prioritizes debt reduction over aggressive shareholder return measures [12]

Company Performance - SM Energy's stock closed at $25.34, reflecting a -2.28% change from the previous day's closing price, underperforming the S&P 500's daily loss of 0.79% [1] - Prior to the recent trading session, SM Energy shares had gained 4.05%, which lagged behind the Oils-Energy sector's gain of 6.03% and the S&P 500's gain of 5.22% [1] Earnings Expectations - Analysts expect SM Energy to report earnings of $1.22 per share, indicating a year-over-year decline of 34.05% [2] - The Zacks Consensus Estimate for revenue is projected at $781.71 million, representing a 23.19% increase from the previous year [2] Full-Year Estimates - For the full year, Zacks Consensus Estimates predict earnings of $5.85 per share and revenue of $3.28 billion, reflecting year-over-year changes of -13.97% and +21.91%, respectively [3] - Recent changes to analyst estimates for SM Energy may indicate shifting business dynamics, with positive revisions suggesting analyst optimism [3] Valuation Metrics - SM Energy is currently trading at a Forward P/E ratio of 4.44, significantly lower than the industry average Forward P/E of 10.83, suggesting it is trading at a discount [6] - The Oil and Gas - Exploration and Production - United States industry, to which SM Energy belongs, ranks in the bottom 39% of all industries according to the Zacks Industry Rank [6] Zacks Rank System - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a strong track record, with 1 rated stocks delivering an average annual return of +25% since 1988 [5] - SM Energy currently holds a Zacks Rank of 3 (Hold), with a 3.18% increase in the Zacks Consensus EPS estimate over the last 30 days [5]

Group 1 - SM Energy Company will participate in the TD Cowen 23rd Annual Calgary Energy, Power & Utilities Conference on July 8, 2025, with CEO Herb Vogel engaging in a panel discussion and one-on-one meetings with investors [1] - The conference will not be webcast, indicating a more personal engagement approach with investors [1] Group 2 - SM Energy is an independent energy company focused on the acquisition, exploration, development, and production of crude oil, natural gas, and NGLs in Texas and Utah [3] - The company regularly updates important information on its website, providing transparency and accessibility to stakeholders [3]

Summary of Conference Call Company Overview - The company has focused on identifying, owning, and developing high return assets while maintaining a leadership position in sustainability and stewardship [1][2] - The company operates primarily in the Lower 48 states and emphasizes operational execution and capital efficiency [2] Key Highlights Operational Performance - The company has a strong track record in geoscience and engineering, which has allowed it to identify and exploit overlooked opportunities in various basins [2][3] - In Howard County, the number of horizontal wells increased from 79 to over 4,900 in less than a decade, demonstrating significant growth and attractive economics [4] - The Austin Chalk play in Webb and Dimmit Counties saw breakeven prices drop from $80 per barrel to $44, showcasing the impact of technology and improved understanding of the geology [5][6] Uinta Basin Development - The Uinta Basin is viewed as the next significant opportunity, with extensive data from over 8,500 vertical wells aiding in derisking [7][8] - The company has about 200 horizontal wells in the lower cube of the Uinta Basin, with competitive margins similar to the Permian Basin [9] - The integration of operations in the Uinta Basin has led to improved capital efficiency and record pumping times [17][18] Technology and Optimization - The company employs advanced technology and data analysis to optimize well designs, resulting in better performance compared to peers [10][12] - Cumulative oil production per 10,000 feet of lateral was reported to be 32% better in Howard County and 42% better in the Austin Chalk compared to peer-operated wells [13] Financial Strategy - The company aims to maximize free cash flow while managing capital allocation across different basins [24][30] - Hedging strategies have been enhanced, with over 40% of oil hedged for the next year to mitigate risks associated with commodity price volatility [26][29] - The company plans to focus on debt repayment before resuming stock buybacks, with a target of achieving a 1x leverage ratio [22][50] Industry Context - The company is navigating a challenging macroeconomic environment with lower oil prices and economic uncertainty, but maintains its operational budget [23][24] - There is a measured approach to capital allocation, with potential shifts towards gas-focused plays if market conditions improve [30][32] Additional Insights - The company has seen slight cost deflation in specific service areas, but labor costs remain unchanged [55] - The use of simul frac technology is being maximized where feasible, particularly in the Uinta Basin [58][59] - The company has a strong ESG score, ranking number one among oil-focused operators [21] Conclusion - The company is well-positioned to capitalize on its operational strengths and technological advancements while navigating the current market challenges. The focus on capital efficiency, debt reduction, and strategic hedging will be crucial for future growth and shareholder value creation.