W&T Offshore (WTI) Q2 Revenue Falls 14%

Core Viewpoint - W&T Offshore reported a non-GAAP loss per share of $(0.08) for Q2 2025, outperforming analyst expectations, but GAAP revenue of $122.4 million fell short of estimates, reflecting a 14% year-over-year decline due to lower commodity prices and cost inflation [1][6][15] Financial Performance - Non-GAAP EPS was $(0.08), better than the $(0.17) consensus, but a 60% decline from $(0.05) in Q2 2024 [2] - GAAP revenue was $122.4 million, down 14.3% from $142.8 million in Q2 2024 [2] - Adjusted EBITDA decreased by 23.3% to $35.2 million compared to Q2 2024 [2] - Free cash flow (non-GAAP) dropped to $3.6 million, an 80.7% decline from $18.7 million in Q2 2024 [2] - Lease operating expenses rose 3.9% to $76.9 million, with a per-barrel cost of $25.20 [2][7] Production and Operations - Production increased to 33.5 thousand barrels of oil equivalent per day, a 10% rise from Q1 2025, but a 4% decline from Q2 2024 [5] - Realized oil prices averaged $63.55 per barrel, down from $80.29 in Q2 2024, while natural gas prices averaged $3.75 per thousand cubic feet, up from $2.50 in Q2 2024 [6] - The company executed nine workover projects to sustain production without new drilling, particularly in Mobile Bay [7][10] Business Strategy - W&T Offshore focuses on acquiring and optimizing producing assets rather than high-risk drilling projects [3] - The company aims to build scale through operational excellence, disciplined capital spending, and strategic acquisitions [4] - Recent acquisitions, particularly the Cox assets, have been integrated to support production ramp-up [12] Reserves and Financial Health - As of June 30, 2025, the company reported 123.0 million barrels in proved reserves, stable compared to 127.0 million barrels at year-end 2024 [11] - The present value of reserves remained at $1.2 billion [11] - The company ended Q2 2025 with $120.7 million in cash and $229.4 million in net debt, reflecting a $14.7 million reduction [9] Future Outlook - For Q3 2025, production is projected between 33.1 to 36.6 thousand barrels of oil equivalent per day, with full-year guidance at 32.8 to 36.3 thousand barrels [14] - Lease operating expenses for Q3 2025 are expected to range from $71.5 million to $79.3 million [14] - The company remains committed to acquisitions, cash discipline, and operational improvements, maintaining a $0.01 per share quarterly dividend [15]