Group 1 - The article discusses Texas Pacific Land's (NYSE: TPL) potential to reach $1 billion in free cash flow, but the stock has declined by approximately 15% since the publication due to a significant drop in oil prices [1] - The author, Nikolaos Sismanis, has over five years of experience as an equities analyst, focusing on growth and income stocks with high expected returns and solid margins of safety [1] - The investing group Wheel of Fortune, to which the author contributes, aims to provide a comprehensive platform for investment ideas across various asset classes, sectors, and industries, including educational content and live discussions [1]

Grand Cayman, Cayman Islands--(Newsfile Corp. - May 29, 2025) - Tethys Petroleum Limited (TSXV: TPL) ("Tethys" or the "Company") today announced that it has filed its interim results for the three months ended March 31, 2025 with the Canadian securities regulatory authorities comprising its Audited Financial Statements together with Management's Discussion and Analysis and other required forms. Copies of the filed documents may be obtained via SEDAR at www.sedar.com or on Tethys' website at www.tethys-grou ...

Group 1 - The article promotes iREIT on Alpha as a source for in-depth research on various income alternatives including REITs, mREITs, Preferreds, BDCs, MLPs, and ETFs [1] - It highlights the positive feedback from users, with 438 testimonials, most rated 5 stars, indicating a strong user satisfaction [1] - The author discloses a beneficial long position in several companies, including TPL, LB, DHR, HD, and CSL, through stock ownership or derivatives [1] Group 2 - The article emphasizes that past performance does not guarantee future results, indicating a cautious approach to investment advice [2] - It clarifies that no specific investment recommendations are being made, and opinions expressed may not reflect the views of Seeking Alpha as a whole [2] - The article notes that the analysts contributing to Seeking Alpha may not be licensed or certified by any regulatory body, highlighting the diverse backgrounds of contributors [2]

Group 1 - The article promotes iREIT on Alpha as a source for in-depth research on various income alternatives including REITs, mREITs, Preferreds, BDCs, MLPs, and ETFs [1] - It highlights the positive feedback from users, with 438 testimonials, most rated 5 stars, indicating a strong reputation in the market [1] Group 2 - The article includes a disclosure from the analyst stating a beneficial long position in shares of TPL and LB, indicating potential investment interests [2] - It clarifies that the opinions expressed are personal and not influenced by compensation from any company mentioned [2] Group 3 - Seeking Alpha emphasizes that past performance does not guarantee future results, indicating a cautious approach to investment advice [3] - The platform notes that its analysts are third-party authors, which may include both professional and individual investors without formal licensing [3]

Join iREIT on Alpha today to get the most in-depth research that includes REITs, mREITs, Preferreds, BDCs, MLPs, ETFs, and other income alternatives. 438 testimonials and most are 5 stars. Nothing to lose with our FREE 2-week trial .As we have all found out by now, the trade war that kept us all so busy over the past few weeks has shifted into a much lower gear, as talks between theAnalyst’s Disclosure: I/we have a beneficial long position in the shares of TPL, LB either through stock ownership, options, or ...

Core Insights - Texas Pacific Land Corporation (TPL) recently reported its Q1 2025 earnings, indicating a strong performance and positive outlook for the company [1] Financial Performance - The company has shown significant growth in its earnings, reflecting a robust financial position [1] Investment Strategy - The company is perceived as a long-term investment opportunity, appealing to investors with a 5-10 year horizon [1]

Financial Data and Key Metrics Changes - For Q1 2025, consolidated revenues reached $196 million, with consolidated adjusted EBITDA at $169 million, resulting in an adjusted EBITDA margin of 86.4% [16] - Free cash flow was reported at $127 million, reflecting an 11% year-over-year increase [16] - Oil and gas royalty production averaged approximately 31,100 barrels of oil equivalent per day, marking a 25% increase year-over-year and a 7% growth sequentially [6][16] Business Line Data and Key Metrics Changes - Water segment revenues totaled $69 million, representing a 3% sequential growth and an 11% year-over-year increase [6] - The total of net permitted wells, net drilled but uncompleted wells (DUCs), and net completed but not producing wells (CUPs) reached 24.3, the highest recorded by the company, showing a 7% increase quarter-over-quarter and a 38% increase year-over-year [17] Market Data and Key Metrics Changes - The company noted that while oil prices have weakened, there has not yet been a widespread downturn in activity, although some operators have announced plans to reduce rigs and frac spreads [7] - The company expects overall Permian activity and production declines to be slower compared to other U.S. oil basins, with TPL's net production anticipated to outperform the basin overall [8] Company Strategy and Development Direction - The company aims to maximize shareholder value through potential acquisitions of high-quality royalties, surface, and water assets, as well as increasing buybacks [14] - TPL is positioned to withstand potential downturns in commodity prices due to its strong financial position, zero debt, and significant cash reserves [13][14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to maintain positive free cash flow even in a depressed pricing environment, highlighting the resilience of its revenue streams [13] - The company anticipates that produced water volumes will continue to grow rapidly over the next decade, driven by operators moving to deeper formations [26] Other Important Information - The company is advancing its desalination and beneficial reuse initiatives, with expectations for a new desalination unit to come online by the end of the year [18] - TPL's surface leases and easements revenue model is expected to benefit from renewal payment escalators, projected to exceed $200 million over the next decade [12] Q&A Session Summary Question: Insights on water fundamentals in the Delaware Basin - Management noted that higher water cuts are expected as operators move to deeper formations, predicting rapid growth in produced water volumes over the next decade [26] Question: Impact of pipeline projects on TPL - Management indicated that new pipeline projects would benefit the basin and TPL, providing compensation for barrels moved through these projects [27] Question: M&A landscape in the basin - Management highlighted ongoing opportunities in the M&A space, with no significant pullback from sellers despite potential widening of bid-ask spreads if commodity prices decrease [31]

Financial Data and Key Metrics Changes - For Q1 2025, consolidated revenues reached $196 million, with an adjusted EBITDA of $169 million, resulting in an adjusted EBITDA margin of 86.4% [14] - Free cash flow was reported at $127 million, reflecting an 11% year-over-year increase [14] - Oil and gas royalty production averaged approximately 31,100 barrels of oil equivalent per day, marking a 25% increase year-over-year [5][14] Business Line Data and Key Metrics Changes - Oil and gas royalty production saw a 7% growth quarter-over-quarter and a 25% growth year-over-year, driven by strong development in specific subregions [5] - Water segment revenues totaled $69 million, representing a 3% sequential growth and an 11% year-over-year growth [5] Market Data and Key Metrics Changes - The company noted that while oil prices have weakened, there has not yet been a widespread downturn in activity, although some operators have announced plans to reduce rigs [6] - The company expects that if oil prices remain below $60 for an extended period, more significant activity declines may occur in the latter half of the year [6] Company Strategy and Development Direction - The company aims to maximize shareholder value and is positioned to take advantage of opportunities that may arise, including acquiring high-quality royalties and ramping up buybacks [13] - TPL's royalty acreage is primarily operated by supermajors and large independents, which tend to exhibit more inertia in their development plans compared to mid-cap independents [7] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in TPL's ability to withstand potential downturns in oil prices due to its strong financial position and high-margin cash flow streams [12] - The company anticipates that renewal payments from easements will significantly increase, with estimates exceeding $200 million over the next decade [11] Other Important Information - TPL maintains a net cash position with zero debt and $460 million in cash and cash equivalents as of March 31 [12] - The company is advancing its desalination and beneficial reuse initiatives, with a new desalination unit expected to come online by the end of the year [17] Q&A Session Summary Question: Thoughts on macro oil and gas activity and impacts on business segments - Management noted that there is significant demand for water handling in the Delaware Basin, with expectations for produced water volumes to grow rapidly over the next decade [23][24] Question: Impact of pipeline projects on TPL - Management indicated that new pipeline projects would benefit the basin and TPL's mineral development, with compensation expected from barrels moved through these projects [25] Question: Perspective on the M&A landscape in the basin - Management stated that there are still opportunities in the M&A front, with no significant pullback from sellers observed, although a decrease in commodity prices could widen the bid-ask spread [29]

Company Overview - Texas Pacific Land Corporation owns approximately 873,000 surface acres of land, primarily in the Permian Basin, and has a total of approximately 207,000 net royalty acres[71]. Financial Performance - Total revenues increased by $21.8 million to $196.0 million for the three months ended March 31, 2025, compared to $174.1 million for the same period in 2024, representing a growth of approximately 12.5%[92]. - Net income for the three months ended March 31, 2025, was $120.7 million, an increase from $114.4 million in the same period of 2024, reflecting a growth of about 5.5%[92]. - Oil and gas royalty revenue rose to $111.2 million for the three months ended March 31, 2025, up from $92.1 million in 2024, marking an increase of $19.1 million or approximately 20.7%[96]. - Water sales revenue increased by $1.7 million to $38.8 million for the three months ended March 31, 2025, driven by a 14.0% increase in water sales volumes[102]. - Produced water royalties increased to $27.7 million for the three months ended March 31, 2025, compared to $23.0 million in 2024, reflecting a growth due to increased produced water volumes[103]. - Free cash flow for the three months ended March 31, 2025, was $126.6 million, compared to $114.5 million in the same period of 2024, indicating an increase of approximately 10.6%[111]. - Adjusted EBITDA for the three months ended March 31, 2025, was $169.4 million, compared to $152.0 million in 2024, representing an increase of about 11.5%[111]. Operating Activities - Net cash provided by operating activities for Q1 2025 was $156.7 million, an increase from $147.2 million in Q1 2024, driven by higher operating income and changes in working capital[85][86]. - Total operating expenses rose by $7.8 million to $45.9 million for the three months ended March 31, 2025, compared to $38.1 million in 2024[92]. - Salaries and related employee expenses increased to $7.4 million for the three months ended March 31, 2025, up from $6.5 million in 2024, primarily due to market compensation adjustments[99]. Capital Expenditures - Capital expenditures related to water sourcing assets increased by $6.7 million in Q1 2025, totaling $12.5 million in net cash used for investing activities, compared to $2.2 million in Q1 2024[87][88]. - The company has begun construction on a facility for a patented energy-efficient desalination process with an initial capacity of 10,000 barrels of water per day, with $12.7 million spent cumulatively as of March 31, 2025[83]. Market Conditions - Average WTI oil price for Q1 2025 was $71.78 per barrel, down 7% from $77.50 in Q1 2024; however, Henry Hub natural gas prices increased by 93% to $4.14 per mmbtu compared to $2.15 in the prior year[75][77]. - Average monthly horizontal permits in the Permian Basin increased to 619 in Q1 2025 from 592 in Q1 2024, while average monthly horizontal wells drilled slightly decreased to 518 from 521[77][78]. - The Permian Basin production is currently over 6.5 million barrels per day, the highest average daily production for any year prior to 2025[76]. Liquidity and Debt - As of March 31, 2025, the company had cash and cash equivalents of $460.4 million, with a target to maintain approximately $700 million[81]. - The company had no debt or credit facilities as of March 31, 2025, indicating a strong liquidity position[80]. Accounting Policies - No material changes to critical accounting policies or estimates from the 2024 Annual Report[113]. - Recent accounting pronouncements are detailed in Note 2 of the condensed consolidated financial statements[114]. - No material changes in market risk information disclosed in the 2024 Annual Report[115].

Financial Performance - Total revenues for Q1 2025 were $196.0 million, up 5.6% from $185.8 million in Q4 2024, and up 12.9% from $174.1 million in Q1 2024[6][10]. - Net income for Q1 2025 was $120.7 million, or $5.24 per diluted share, compared to $118.4 million in Q4 2024 and $114.4 million in Q1 2024[5][24]. - Operating income increased to $150,073 for the three months ended March 31, 2025, compared to $142,544 for the same period in 2024, representing a rise of 5.3%[27]. - EBITDA for the three months ended March 31, 2025, was $166,335, compared to $149,824 for the same period in 2024, indicating a growth of 11.0%[33]. - Adjusted EBITDA for the three months ended March 31, 2025, was $169,418, an increase from $152,044 in the same period of 2024, reflecting an increase of 11.5%[33]. - Free cash flow for Q1 2025 was $126.6 million, reflecting strong operational performance[8]. - Free cash flow for the three months ended March 31, 2025, was $126,556, compared to $114,484 for the same period in 2024, showing a growth of 10.6%[33]. - The company reported an income tax expense of $33,742 for the three months ended March 31, 2025, compared to $32,618 in the same period of 2024, indicating an increase of 3.4%[33]. Production and Revenue - Oil and gas royalty production reached a record 31.1 thousand Boe per day in Q1 2025, an increase from 29.1 thousand Boe per day in Q4 2024 and 24.8 thousand Boe per day in Q1 2024[6][10][22]. - Oil and gas royalty revenue increased by $14.3 million from Q4 2024, totaling $111.2 million in Q1 2025, driven by higher production and commodity prices[6][10][25]. - Oil and gas royalties revenue was $111,245 for the three months ended March 31, 2025, compared to $92,120 in the same period of 2024, marking a significant increase of 20.7%[29]. - Water sales revenue reached $38,813 for the three months ended March 31, 2025, up from $37,126 in the same period of 2024, reflecting a growth of 4.5%[29]. Expenses - Total operating expenses increased to $45.9 million in Q1 2025 from $43.2 million in Q4 2024, primarily due to higher water service-related expenses[7][11]. - Total operating expenses for the three months ended March 31, 2025, were $45,910, an increase from $43,240 in the same period of 2024, representing a rise of 6.2%[27]. Dividends and Shareholder Returns - The company declared a quarterly cash dividend of $1.60 per share, payable on June 16, 2025[12]. Other Highlights - TPL's royalty acreage had an estimated 5.9 net well permits and 24.3 net wells total, marking a company record[8]. - Average realized price for oil was $71.05 per barrel in Q1 2025, compared to $70.73 in Q4 2024 and $76.77 in Q1 2024[22][25]. - Total revenues for the three months ended March 31, 2025, were $195,983, an increase of 10.5% compared to $185,784 for the same period in 2024[27]. - Net income for the three months ended March 31, 2025, was $120,652, up from $118,360 in the prior year, reflecting a growth of 1.1%[27].