Texas Pacific Land (US:TPL)2025-11-05 21:20Financial Performance - Total revenues for the nine months ended September 30, 2025, were $586.6 million, up 12.7% from $520.0 million in the same period of 2024[113]. - Net income for the nine months ended September 30, 2025, was $358.0 million, representing an increase of 6.9% compared to $335.6 million for the same period in 2024[113]. - Cash provided by operating activities for the nine months ended September 30, 2025, was $432.2 million, an increase of 18.7% compared to $364.1 million for the same period in 2024[103][104]. - EBITDA for the nine months ended September 30, 2025, was $499,167,000, compared to $441,538,000 for the same period in 2024, reflecting a year-over-year increase of about 13.1%[146]. - Free cash flow for the nine months ended September 30, 2025, was $379,476,000, compared to $337,319,000 in the same period of 2024, marking an increase of about 12.5%[146]. - Net income for Q3 2025 was $121,238,000, an increase from $106,594,000 in Q3 2024, representing a growth of approximately 13.4%[146]. Revenue Sources - Oil and gas royalty revenue for the nine months ended September 30, 2025, was $315.0 million, up from $276.4 million in the same period of 2024, an increase of 14.0%[128]. - Total oil and gas royalties for the nine months ended September 30, 2025, reached $314.9 million, compared to $276.4 million in the same period of 2024, a 14.0% increase[129]. - Oil and gas royalty revenue for the three months ended September 30, 2025, was $108.7 million, an increase of 15.2% from $94.4 million for the same period in 2024[118]. - Water sales revenue increased by $8.4 million to $44.6 million in Q3 2025, driven by a 14.3% increase in pricing[124]. - Produced water royalties increased to $32.3 million in Q3 2025 from $27.7 million in Q3 2024, reflecting a 19.8% increase[125]. - Easements and other surface-related income increased to $61.6 million for the nine months ended September 30, 2025, up from $43.6 million in 2024, a 39.0% increase[129]. Expenses and Investments - Total operating expenses for the nine months ended September 30, 2025, were $143.7 million, an increase of 16.4% compared to $123.4 million for the same period in 2024[113]. - Cash used in investing activities decreased to $137.6 million for the nine months ended September 30, 2025, from $225.8 million in the same period of 2024, a reduction of 39.0%[105]. - The company invested approximately $14.1 million to enhance water sourcing assets during the nine months ended September 30, 2025[102]. - General and administrative expenses decreased to $3.4 million in Q3 2025 from $10.4 million in Q3 2024, a reduction of 67.3%[121]. - Salaries and related employee expenses rose to $21.7 million for the nine months ended September 30, 2025, compared to $20.1 million in 2024, an increase of 7.9%[130]. - Depreciation, depletion, and amortization for the nine months ended September 30, 2025, was $27.3 million, significantly up from $3.6 million in the same period of 2024, an increase of 658.3%[132]. Cash Flow and Liquidity - As of September 30, 2025, the Company had cash and cash equivalents of $531.8 million, with a target balance of approximately $700 million for capital allocation[92]. - The Company has no debt or off-balance sheet arrangements as of September 30, 2025, and believes its cash flows and liquidity will be sufficient for ongoing capital expenditures and working capital needs for at least the next 12 months[91]. - Cash used in financing activities decreased to $134.2 million for the nine months ended September 30, 2025, from $335.0 million in the same period of 2024, a decrease of 60.0%[107]. Market Conditions - Average WTI oil prices for the nine months ended September 30, 2025, decreased by approximately 14% compared to the same period last year, while Henry Hub natural gas prices increased by approximately 64%[86]. - For the three months ended September 30, 2025, the average WTI Cushing oil price was $65.78 per barrel, down from $76.43 in 2024, and the average Henry Hub natural gas price was $3.03 per mmbtu, up from $2.11 in 2024[88]. - Average monthly horizontal permits in the Permian Basin decreased from 683 in 2024 to 589 in 2025, while average monthly horizontal wells drilled decreased from 492 to 428 in the same period[88]. - The Permian Basin currently accounts for over 6.6 million barrels per day of oil production, which is higher than any previous year prior to 2025[87]. Acquisitions and Developments - The Company acquired approximately 8,147 acres of land in Martin County, Texas, for an aggregate purchase price of $31.4 million in September 2025[93]. - On November 3, 2025, the Company acquired approximately 17,306 net royalty acres for an aggregate purchase price of $474.1 million, with a deposit of $71.1 million held in escrow as of September 30, 2025[94]. - The company is developing a patented energy-efficient desalination and treatment process to recycle produced water, with an initial capacity of 10,000 barrels per day, expected to be operational by the end of 2025[101]. Accounting and Compliance - There have been no material changes to critical accounting policies or estimates from the previous year[148]. - The company continues to follow GAAP in preparing its financial statements, ensuring consistency and reliability in financial reporting[147]. - No material changes in market risk information have been disclosed since the last annual report[150].