Matador Resources(MTDR) - 2025 Q2 - Quarterly Results

Production and Operational Performance - Matador achieved record production of 209,013 BOE/d in Q2 2025, a 30% year-over-year increase from 160,305 BOE/d in Q2 2024[23] - The full-year 2025 production guidance was increased to a range of 200,000 to 205,000 BOE/d, up from the previous range of 198,000 to 202,000 BOE/d[18] - Average daily oil equivalent production is expected to decline to approximately 199,750 BOE per day in Q3 2025, before increasing again in Q4 2025[37] - Net oil production volumes increased to 11,182 MBbl in Q2 2025 from 10,353 MBbl in Q1 2025, representing a 7.99% sequential growth and a 28.83% increase year-over-year from 8,689 MBbl in Q2 2024[50] - Natural gas production reached 47.0 Bcf in Q2 2025, up from 45.1 Bcf in Q1 2025, marking a 4.21% sequential increase and a 32.39% increase from 35.4 Bcf in Q2 2024[50] - Total oil equivalent production rose to 19,020 MBOE in Q2 2025, a 6.36% increase from 17,877 MBOE in Q1 2025 and a 30.25% increase from 14,588 MBOE in Q2 2024[50] Financial Performance - The company generated net cash provided by operating activities of $501 million and adjusted free cash flow of $133 million, reflecting an industry-leading free cash flow margin[5] - Net income for Q2 2025 was $150.2 million, a decrease of 37% sequentially from Q1 2025 and a 34% decrease year-over-year from Q2 2024[29] - Adjusted net income for Q2 2025 was $190.9 million, down 23% sequentially and 25% year-over-year[29] - Adjusted EBITDA for Q2 2025 was $594.2 million, an 8% decrease sequentially but a 3% increase year-over-year[29] - Revenues from oil and natural gas totaled $815.8 million in Q2 2025, down 10.34% from $909.9 million in Q1 2025 but up 5.06% from $776.3 million in Q2 2024[50] - Total revenues for the first half of 2025 were $1.909 billion, up 16.8% from $1.635 billion in the same period of 2024[58] Capital Expenditures and Investments - Matador's total capital expenditures for Q2 2025 were $402 million, with $345 million allocated to upstream and $56 million to midstream[9] - Capital expenditures for drilling, completing, and equipping in Q2 2025 were $345.3 million, 4% below the expected range[31] - Estimated capital expenditures for Q3 2025 are projected to be between $300 million and $370 million, a 3% decrease from Q2 2025[40] - The company reported a net cash used in investing activities of $1.007 billion for the first half of 2025, compared to $1.120 billion in the same period of 2024[59] Shareholder Returns and Equity - The company declared a quarterly base dividend of $0.3125 per share, representing an annualized yield of approximately 2.5%[13] - Matador repurchased 1.1 million shares at an average price of $40.37 per share, totaling $44 million under its $400 million share repurchase authorization[14] - Shareholders' equity increased to $5.73 billion as of June 30, 2025, compared to $5.46 billion as of December 31, 2024, representing a growth of 4.93%[57] Cost Management and Efficiency - Cash operating costs for Q2 2025 were $13.76 per BOE, a 13% reduction from Q1 2025 costs of $15.84 per BOE[10] - The company plans to continue evaluating its operated rig count to balance production growth with free cash flow generation for 2025 and beyond[7] - The company expects cash tax payments to decrease to a range of 0 to 5% of pre-tax book net income for 2025 due to the One Big Beautiful Bill Act[41] Debt and Liquidity - Matador's leverage ratio was less than 1.0x as of June 30, 2025, with liquidity exceeding $1.8 billion[11] - The company repaid $640 million under its Credit Agreement in Q2 2025, compared to $790 million in Q2 2024[59] - Cash and restricted cash at the end of Q2 2025 was $86.786 million, up from $63.903 million at the end of Q2 2024[59] San Mateo Midstream Performance - San Mateo Midstream increased processing capacity by 38% to 720 MMcf/d with the completion of the Marlan Plant expansion[5] - San Mateo's net income reached a record $66 million in Q2 2025, with an Adjusted EBITDA of $85.5 million, marking a 42% increase sequentially[33] - San Mateo's natural gas processing capacity increased to 720 MMcf per day, contributing to a 37% year-over-year increase in natural gas processing volumes[33] - San Mateo's adjusted free cash flow for Q2 2025 was $(14,935), compared to $(6,382) in Q1 2025 and $35,204 in Q2 2024[72]