Ring Energy(REI)2025-05-09 20:11Financial Performance - Ring Energy reported average daily sales volumes of 18,392 Boe/d, exceeding the midpoint of guidance, with 12,074 Bo/d of crude oil sold[4] - The company achieved a net income of $9.1 million, representing a 60% increase from Q4 2024, and an Adjusted EBITDA of $46.4 million[4] - Average realized price for crude oil was $70.40 per barrel, a 2% increase from Q4 2024, while total revenues decreased by 5% to $79.1 million[4] - Net income for Q1 2025 was $9,110,738, compared to $5,657,519 in Q4 2024, representing a 61% increase[30] - For Q1 2025, the company reported a net income of $9,110,738, translating to a diluted earnings per share of $0.05, compared to $5,657,519 and $0.03 in Q4 2024[44] - Adjusted Net Income for Q1 2025 was $10,678,022, or $0.05 per diluted share, down from $12,341,668 and $0.06 in Q4 2024[44] - Adjusted EBITDA for Q1 2025 was $46,437,553, with an Adjusted EBITDA margin of 59%, compared to $50,932,732 and 61% in Q4 2024[47] - The company reported a net interest expense of $9,408,728 for Q1 2025, down from $9,987,731 in Q4 2024[47] - The company reported a net income of $9,110,738 for Q1 2025, compared to $5,657,519 in Q4 2024, reflecting a positive trend in profitability[59] Capital Expenditures and Guidance - Capital expenditures for Q1 2025 were $32.5 million, which is 14% lower than Q4 2024, and within the company's guidance[4] - Updated full-year guidance indicates a 36% reduction in capital spending, now expected to be between $85 million and $113 million[20] - Capital spending for Q2 2025 is estimated to be between $14 million and $22 million, with a midpoint of $18 million[22] - The company plans to drill 2 to 3 new horizontal and vertical wells in Q2 2025, and 11 to 13 wells in 2H 2025[22] - The company anticipates spending on infrastructure upgrades and well reactivations as part of its capital program[22] Liquidity and Financial Position - The company maintained liquidity of $141.1 million at the end of Q1 2025, with $460 million in borrowings outstanding on its credit facility[18] - As of March 31, 2025, total assets increased to $1,505,610,274 from $1,408,099,474 as of December 31, 2024, representing a growth of approximately 6.9%[34] - Total liabilities increased to $629,644,216 as of March 31, 2025, from $549,459,492 as of December 31, 2024, reflecting an increase of approximately 14.6%[34] - The company’s additional paid-in capital rose to $808,627,109 as of March 31, 2025, compared to $800,419,719 as of December 31, 2024, an increase of approximately 1.0%[34] - The company’s retained earnings increased to $67,132,440 as of March 31, 2025, from $58,021,702 as of December 31, 2024, representing an increase of approximately 15.5%[34] - The company’s cash and cash equivalents decreased to $1,100,851 as of March 31, 2025, from $1,866,395 as of December 31, 2024, a decline of approximately 41.0%[36] Production and Sales Volumes - Sales volumes for Q1 2025 included 66% oil, 18% natural gas liquids, and 16% natural gas, reflecting a shift in product mix compared to previous quarters[6] - Total oil sales volumes for Q2 2025 are projected to be between 13,700 and 14,700 Bo/d, with a midpoint of 14,200 Bo/d[22] - Total sales volumes (Boe/d) for 2H 2025 are expected to range from 19,000 to 21,000, with a midpoint of 20,500 Bo/d[22] - Average daily sales volumes for oil in Q1 2025 were 12,074 Bbls/d, down from 12,916 Bbls/d in Q4 2024[32] - The oil mix as a percentage of total sales remained stable at 66% for both Q1 2025 and Q4 2024[32] Operating Expenses - Lease operating expenses were reported at $11.89 per Boe, which was within the company's guidance range[9] - Operating expenses per Boe for lease operating expenses were $11.89 in Q1 2025, up from $11.24 in Q4 2024[32] - All-in cash operating costs for Q1 2025 totaled $40,272,071, a decrease of 4.0% from $41,962,588 in Q4 2024[65] - All-in cash operating costs per Boe increased to $24.33 in Q1 2025 from $23.20 in Q4 2024, reflecting a 4.9% rise[65] - General and Administrative Expense (G&A) for Q1 2025 was $8,619,976, an increase of 7% from $8,035,977 in Q4 2024[53] Cash Flow and Investments - Cash provided by operating activities for the three months ended March 31, 2025, was $28,371,008, down from $47,279,681 in the previous quarter, a decrease of approximately 40.0%[36] - The company reported a net cash used in investing activities of $102,607,297 for the three months ended March 31, 2025, compared to $37,688,306 in the previous quarter, indicating a significant increase in investment outflows[36] - Adjusted Cash Flow from Operations for Q1 2025 was $38,156,007, compared to $42,206,005 in Q4 2024, indicating a decline of 10%[51] - Adjusted Free Cash Flow for Q1 2025 increased to $5,815,786, up 23% from $4,732,143 in Q4 2024[49] Hedging and Risk Management - The company has approximately 1.7 million barrels of oil hedged at an average downside protection price of $64.44 for the remainder of 2025[11] - The company has hedged 151,763 barrels of oil for Q2 2025 at a weighted average swap price of $68.53 per barrel[38] - The total hedged volume for natural gas in Q2 2025 is 513,900 MMBtu, with a weighted average swap price of $3.60[38] - The company has a hedged volume of 464,100 barrels of oil for Q2 2025 under two-way collars, with a weighted average put price of $60.00 and call price of $69.85[38] Other Financial Metrics - Consolidated EBITDAX for the last four quarters ending March 31, 2025, was $247,797,658, with a Leverage Ratio of 1.90, well below the maximum allowed of 3.00[60] - The company’s leverage ratio covenant remains strong at 1.90, indicating effective debt management and financial stability[60] - Changes in operating assets and liabilities resulted in a positive adjustment of $9,784,999 in Q1 2025, contrasting with a negative adjustment of $(5,073,676) in Q4 2024[51] - Unrealized losses on changes in the fair value of derivatives amounted to $375,196 in Q1 2025, compared to a loss of $6,999,552 in Q4 2024[47]