Expand Energy Corporation(EXE) - 2024 Q4 - Annual Report

Merger and Acquisitions - Expand Energy Corporation completed the Southwestern Merger on October 1, 2024, issuing approximately 95.7 million shares valued at approximately $7.9 billion to Southwestern's shareholders [259][264]. - The Southwestern Merger was completed on October 1, 2024, resulting in the assumption of approximately$3.7 billion of Southwestern's senior notes and the termination of its existing credit facility, which was repaid in full for approximately $585 million [285]. - The total consideration for the Southwestern Merger was$8.473 billion, including $585 million in cash and$7.871 billion in common stock issued [418]. - The company completed the Southwestern Merger on October 1, 2024, recording estimated fair values of acquired proved natural gas and oil properties at approximately $10.0 billion [354]. - The Marcellus Acquisition was completed for approximately$2.77 billion, consisting of $2 billion in cash and 9.4 million shares of common stock, acquiring high-quality producing assets [422]. Financial Performance - Revenues for the year ended December 31, 2024, were$4.235 billion, a decrease from $8.721 billion in 2023 [361]. - The company reported a net loss of$714 million for 2024, compared to a net income of $2.419 billion in 2023 [361]. - For the year ended December 31, 2024, natural gas revenues were$2,686 million, oil revenues were $69 million, and NGL revenues were$214 million [335]. - Pro forma revenues for the year ended December 31, 2024, are projected at $8.193 billion, with a net loss available to common stockholders of$607 million [431]. - Basic earnings per share for the year ended December 31, 2024, is projected at $(4.55), compared to$18.21 for 2023 [440]. Capital Expenditures and Investments - For the year ending December 31, 2025, the company plans to invest between $2.9 billion and$3.1 billion in capital expenditures, utilizing 11 to 15 rigs to complete 240 to 270 gross wells [286]. - The company has made total capital contributions of $296 million to a natural gas gathering pipeline and carbon capture project, expected to be operational by Q4 2025 [273]. - The company’s capital expenditures for 2024 were$1.557 billion, a decrease from $1.829 billion in 2023 [363]. Debt and Liquidity - As of December 31, 2024, Expand Energy had$2.8 billion in liquidity, including $317 million in cash and$2.5 billion in unused borrowing capacity under its Credit Facility [276]. - The company assumed $2.028 billion in long-term debt from the Southwestern Merger, which included various senior notes [444]. - The company’s total debt as of December 31, 2024, was$5.686 billion, with maturities of $389 million in 2025 and$2.15 billion in 2029 [444]. - The company has a revolving credit facility of $2.5 billion available for borrowings as of December 31, 2024 [446]. Operational Metrics - Average natural gas production for the year ended December 31, 2024, was 3,611 MMcf per day, with an average realized price of$2.75 per Mcf [304]. - The company completed 81 operated wells in 2024, a decrease from 166 in 2023 and 216 in 2022 [293]. - Total natural gas, oil, and NGL sales in 2024 decreased by $578 million to$2,969 million compared to 2023, primarily due to lower average prices and the Eagle Ford divestitures [305]. Expenses and Costs - The company incurred total operating expenses of $5.038 billion in 2024, compared to$5.579 billion in 2023 [361]. - Gathering, processing, and transportation expenses increased by $182 million to$1,035 million in 2024, primarily driven by a $404 million increase related to the Southwestern Merger [308]. - General and administrative expenses increased by$59 million to $186 million in 2024, attributed to increased compensation and corporate expenses following the Southwestern Merger [314]. - Depreciation, depletion, and amortization increased by$202 million to $1,729 million in 2024, primarily due to the Southwestern Merger [316]. Shareholder Information - The company declared a base quarterly dividend of$0.575 per share on February 26, 2025, payable on March 27, 2025 [278]. - Common stock dividends paid were $388 million in 2024, down from$487 million in 2023 and $1.2 billion in 2022 [301]. - Expand Energy's total common stock shares increased to 231,769,886 as of December 31, 2024, up from 130,789,936 in 2023 [365]. Environmental and Sustainability Goals - The company aims for net zero greenhouse gas emissions by 2035 and to maintain 100% responsibly sourced gas certification across its portfolio [262]. Ratings and Financial Health - Expand Energy's investment grade rating was upgraded to 'BBB-' by S&P and Fitch on October 1 and 2, 2024, respectively, leading to more permissive financial covenants [265]. - The company received investment grade ratings of 'BBB-' from both S&P Global Ratings and Fitch Ratings on October 1 and 2, 2024, respectively, with a stable outlook [284].