Vitesse Energy(VTS) - 2025 Q2 - Quarterly Results

Second Quarter 2025 Overview Second Quarter 2025 Highlights Vitesse Energy reported strong Q2 2025 results, highlighted by significant production increase, a legal settlement, and continued shareholder returns Key Financial and Operational Metrics | Metric | Value | | :--- | :--- | | Net Income | $24.7 million | | Adjusted Net Income | $18.4 million | | Adjusted EBITDA | $61.1 million | | Cash Flow from Operations | $66.0 million | | Free Cash Flow | $21.9 million | | Production | 18,950 Boe/day (65% oil) | | Total Debt | $106.0 million | | Net Debt to Adjusted EBITDA Ratio | 0.43x | - The company resolved a legal dispute with a key operator, resulting in a one-time cash payment of $24 million and new arrangements for gas production sales starting July 1, 2025[5][6] - A quarterly cash dividend of $0.5625 per common share was declared, scheduled to be paid on September 30, 2025[4][5] Management Comments Management emphasized successful Lucero asset integration, lawsuit settlement, and strategic use of free cash flow for debt reduction and hedging - CEO Bob Gerrity highlighted key achievements in Q2: full integration of Lucero assets, successful lawsuit settlement, selective capital investment, and using free cash flow for debt reduction[3] - The company took advantage of increased oil prices to add hedges for 2025 and 2026 at levels that support the dividend[3] Financial and Operating Performance Financial and Operating Results Q2 2025 production significantly increased due to the Lucero acquisition, contributing to higher total revenue and net income - Production averaged 18,950 Boe/day, a 27% sequential increase, mainly driven by the Lucero acquisition, with oil constituting 65% of production[8] - A litigation settlement resulted in a one-time cash payment of $24 million, which was recorded in the consolidated statements of operations[6] Financial Metrics (Q2 2025 vs Q2 2024) | Financial Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Total Revenue ($ millions) | $81.8 | $66.6 | +23% | | Daily Production (Boe/day) | 18,950 | 13,504 | +40% | | Avg. Realized Oil Price (per Bbl) | $59.50 | $74.63 | -20% | | Avg. Realized Gas Price (per Mcf) | $4.17 | $1.11 | +276% | | G&A Expense ($ millions) | $0.3 | $4.7 | -93% | - General and administrative expenses were significantly lower at $0.3 million, or $0.18 per Boe, due to the offset of approximately $7.1 million in previously expensed litigation costs[10] Liquidity and Capital Expenditures Vitesse maintained strong liquidity as of June 30, 2025, with substantial credit facility availability and strategic capital investments Liquidity and Capital Expenditures (as of June 30, 2025) | Metric | Value | | :--- | :--- | | Cash | $2.0 million | | Revolving Credit Facility Borrowings | $106.0 million | | Total Liquidity | $146.0 million | | Q2 Development Capital Expenditures | $35.6 million | | Q2 Acquisition Costs | $0.1 million | Operations Update By Q2 2025 end, Vitesse held interests in a substantial portfolio of drilling, completion, and permitted development projects - As of June 30, 2025, the Company had an interest in 282 gross (7.9 net) wells that were drilling or in completion[12] - The company also held interests in another 418 gross (15.1 net) locations that were permitted for development[12] Commodity Hedging Vitesse strategically hedged a significant portion of its expected oil and natural gas production to enhance cash flow predictability and support its dividend - Based on 2025 guidance, Vitesse has hedged approximately 71% of its remaining 2025 oil production at a weighted average price of $69.83/Bbl[17] - Approximately 49% of remaining 2025 natural gas production is hedged at a weighted average floor price of $3.73/MMBtu[17] Commodity Hedging Positions | Instrument | Settlement Period | Volume Hedged | Weighted Average Price | | :--- | :--- | :--- | :--- | | WTI Crude Oil Swaps | Q3 2025 - Q4 2026 | 2,016,504 Bbls | ~$67.60/Bbl | | Henry Hub Gas Collars | Q3 2025 - Q1 2027 | 7,456,000 MMbtu | Floor ~$3.75 / Ceiling ~$5.20 | Outlook and Corporate Information 2025 Annual Guidance Vitesse reiterated its full-year 2025 guidance for annual production and total capital expenditures 2025 Annual Guidance | Guidance Metric | 2025 Range | | :--- | :--- | | Annual Production (Boe/day) | 15,000 - 17,000 | | Oil as % of Production | 64% - 68% | | Total Capital Expenditures ($ millions) | $80 - $110 | Conference Call and Investor Events The company scheduled an earnings conference call and management participation in two investor conferences for August 2025 - An earnings conference call is scheduled for Tuesday, August 5, 2025, at 11:00 a.m. Eastern Time[21][22] - Management will participate in the EnerCom Denver Energy Conference on August 18-19 and the Midwest IDEAS Conference on August 27[27] Financial Statements and Non-GAAP Reconciliations Condensed Consolidated Statements of Operations For Q2 2025, Vitesse reported increased total revenues, operating income, and a significant rise in net income year-over-year Condensed Consolidated Statements of Operations (Three Months Ended June 30) | Income Statement (Three Months Ended June 30) | 2025 ($ thousands) | 2024 ($ thousands) | | :--- | :--- | :--- | | Total Revenue | $81,755 | $66,598 | | Total Operating Expenses | $63,099 | $49,784 | | Operating Income | $18,656 | $16,814 | | Net Income | $24,659 | $10,928 | | Net Income per Share (Diluted) | $0.60 | $0.33 | Condensed Consolidated Balance Sheets As of June 30, 2025, Vitesse's balance sheet showed increased total assets, decreased total liabilities, and higher total equity Condensed Consolidated Balance Sheets | Balance Sheet | June 30, 2025 ($ thousands) | Dec 31, 2024 ($ thousands) | | :--- | :--- | :--- | | Total Current Assets | $67,977 | $50,911 | | Total Assets | $951,504 | $810,893 | | Revolving Credit Facility | $106,000 | $117,000 | | Total Liabilities | $279,629 | $310,559 | | Total Equity | $671,875 | $500,334 | Non-GAAP Financial Measures and Reconciliations The company provided reconciliations for key non-GAAP metrics for Q2 2025, including Adjusted Net Income, Adjusted EBITDA, and Free Cash Flow Non-GAAP Financial Metrics (Q2 2025) | Non-GAAP Metric | Value | | :--- | :--- | | Adjusted Net Income | $18,421 thousand | | Adjusted EBITDA | $61,132 thousand | | Free Cash Flow | $21,904 thousand | | Net Debt | $104,038 thousand | | Net Debt to Adjusted EBITDA Ratio | 0.43x | - Adjusted EBITDA for the quarter includes a $24 million benefit from the resolution of a legal dispute with a key operator[42]