Vital Energy(US:VTLE)2025-05-12 20:34Revenue and Sales Performance - Total oil, NGL, and natural gas sales revenues for Q1 2025 were $511.4 million, a 6% increase from $481.1 million in Q1 2024[134] - Oil sales volumes increased by 10% to 5,840 MBbl in Q1 2025 from 5,327 MBbl in Q1 2024[134] - NGL sales revenues rose by 31% to $61.7 million in Q1 2025, compared to $47.1 million in Q1 2024[134] - Natural gas sales revenues increased by 50% to $27.3 million in Q1 2025 from $18.2 million in Q1 2024[134] - Average daily oil equivalent sales volumes rose by 12% to 140,159 BOE/d in Q1 2025 from 124,719 BOE/d in Q1 2024[134] Costs and Expenses - Total costs and expenses increased by 53% to $526.3 million for the three months ended March 31, 2025, compared to $345.0 million in 2024[138] - Lease operating expenses decreased by 2% to $103.5 million, while per BOE sold decreased by 12% to $8.20 due to increased volumes sold[138][140] - Production and ad valorem taxes rose by 9% to $33.2 million, driven by increased oil, NGL, and natural gas sales revenues[138][141] - Gas gathering, processing, and transportation expenses surged by 184% to $6.8 million, attributed to increased processing agreements following a 2024 acquisition[138][143] - General and administrative expenses (excluding LTIP) fell by 18% to $19.7 million, primarily due to reduced workforce and professional expenses[138][144] - Depletion, depreciation, and amortization expenses increased by 14% to $189.9 million, with depletion expense per BOE sold remaining flat at $15.05[138][147] Impairments and Non-Operating Income - The company recorded a full cost impairment of $158.2 million for Q1 2025 due to the unamortized cost of evaluated oil and natural gas properties exceeding the full cost ceiling[126] - A full cost ceiling impairment of $158.2 million was recorded due to unamortized costs exceeding the full cost ceiling[138][149] - Non-operating income improved significantly, with a gain on derivatives of $44.2 million compared to a loss of $152.1 million in the prior year[150] Interest and Taxation - Interest expense rose by 16% to $50.4 million, influenced by increased borrowings related to a 2024 acquisition[152] - The effective tax rate decreased to 5.27% for the three months ended March 31, 2025, down from 19.23% in 2024, due to the application of the estimated annual effective tax rate[156] - As of March 31, 2025, the company had $241.7 million in net deferred tax assets, including approximately $190.8 million related to net operating loss carryforwards[158] Liquidity and Cash Flow - Total liquidity as of March 31, 2025, was $793.6 million, consisting of $28.6 million in cash and cash equivalents and $765.0 million available under the Senior Secured Credit Facility[165] - Net cash provided by operating activities increased by 121% to $350.985 million for the three months ended March 31, 2025, compared to $158.590 million in 2024[167] - The company experienced a net cash used in financing activities of $150.393 million for the three months ended March 31, 2025, compared to cash provided of $456.338 million in the same period in 2024[176] - As of March 31, 2025, the outstanding balance under the Senior Secured Credit Facility was subject to a weighted-average interest rate of 6.922%[169] - The company had outstanding borrowings under the Senior Secured Credit Facility of $735.0 million as of May 8, 2025, with available capacity reduced to $665.0 million[165] - The company anticipates a $136.1 million increase in cash flows from operating activities due to net changes in operating assets and liabilities for the three months ended March 31, 2025[168] Capital Investments - Capital investments for full-year 2025 are expected to be in the range of $835.0 million to $915.0 million[173] - Total capital investments for the three months ended March 31, 2025, were $252.671 million, a 16% increase compared to $217.900 million in 2024[174] Future Impairments - The company expects potential additional impairments of $200 million to $400 million in Q2 2025 if oil prices remain low[131]