Chord Energy (NasdaqGS:CHRD) Q4 2025 Earnings call February 26, 2026 11:00 AM ET Company ParticipantsBob Bakanauskas - VP of Investor RelationsCarlos Escalante - Senior AssociateDanny Brown - CEODarrin Henke - EVP and Chief Operating OfficerDerrick Whitfield - Managing DirectorNoel Parks - Managing Director and Energy ResearchOliver Huang - Director and E&P Research HoustonConference Call ParticipantsNeal Dingmann - Energy AnalystNicholas Pope - Managing Director and Senior Research AnalystNoah Hungness - E ...

Financial Data and Key Metrics Changes - In Q4 2025, Chord Energy reported adjusted free cash flow of $175 million, significantly exceeding expectations, with approximately 50% returned to shareholders [9] - Oil volumes in 2025 exceeded original guidance by over 1,000 barrels per day, while capital spending was approximately $60 million lower than anticipated [6][9] - The company achieved a $160 million improvement in free cash flow from controllable items, representing 23% of estimated free cash flow in 2026 [7] Business Line Data and Key Metrics Changes - Chord has successfully lowered its capital spending by nearly $100 million since merging with Enerplus in 2024 while increasing oil production by 6,000 barrels per day [6] - The company achieved its goal of converting 80% of its inventory to long laterals by the end of 2025, which has significantly reduced the cost of supply [10][11] Market Data and Key Metrics Changes - Chord's operational improvements and shift to longer laterals have resulted in a 22% reduction in future finding and development costs over the past few years [12] - The company anticipates generating approximately $700 million in free cash flow in 2026, based on benchmark prices of $64 per barrel of oil and $3.75 per MMBtu of natural gas [13] Company Strategy and Development Direction - Chord is focused on disciplined capital allocation and delivering strong returns on capital, with a commitment to organic well activity, lease acquisition, and selective M&A [8] - The company aims to maintain a low to no oil growth program in 2026, with average volumes projected between 157,000 and 161,000 barrels of oil per day and capital expenditures of $1.4 billion [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's resilience to weather commodity price cycles while generating meaningful free cash flow and shareholder returns [16][17] - The company is optimistic about its ability to continue improving its cost structure and operational efficiency, with a focus on margins and capital efficiency [19][20] Other Important Information - Chord has returned $6.7 billion of capital to shareholders since 2021, which is higher than its current market capitalization [8] - The company has a substantial inventory of low breakeven locations, with over 10 years of low-cost inventory available [11] Q&A Session Summary Question: Long-term plan consistency despite oil price fluctuations - Management indicated that the company has built a resilient organization capable of weathering commodity price cycles while maintaining its long-term plan [16][17] Question: Fixed cost mitigation strategies - Management highlighted an organization-wide effort to drive down costs through capital efficiency improvements and operational expense reductions [19] Question: Organic inventory improvements across the basin - Management noted improvements in inventory across the basin, with a focus on refining and enhancing the break-even costs of previously considered inventory [24][25] Question: Water disposal optimization and midstream spending - Management explained that increased spending on water disposal is due to moving into areas with slightly higher water production, which necessitates investment in water systems [71][73] Question: Impact of lateral length extensions on reserves - Management confirmed that the expectations for lateral length extensions have been captured in the reserves, with ongoing improvements expected [78] Question: Infill drilling implications from longer laterals - Management acknowledged potential benefits for infill drilling as longer laterals improve cost structures and reservoir drainage effectiveness [81][84]

Financial Data and Key Metrics Changes - Fourth quarter revenues exceeded $1 billion for the first time, up 33% from the prior year period, driven by growth in both E&M and T&D segments [6][16] - Full-year revenues increased 32% to $3.75 billion, primarily from the E&M business, with EBITDA rising 52% to $320 million compared to 2024 [7][17] - Fourth quarter EBITDA margin was 8.4%, up 70 basis points from 7.7% in the prior year period [16][17] Business Line Data and Key Metrics Changes - E&M segment revenues increased 44% to $791.6 million in the fourth quarter, with EBITDA rising 57% to $67.1 million [18][19] - T&D segment revenues were $227.7 million, up 6.8% from the previous year, but EBITDA was flat at $30.5 million due to project mix and higher SG&A expenses [19][20] Market Data and Key Metrics Changes - The backlog at the end of 2025 was $3.2 billion, up 16% from the same period last year, with T&D backlog increasing by 41% and E&M backlog by 13% [8][18] - The company sees robust project pipelines across diverse markets, including data centers, hospitality, and semiconductor sectors [9][18] Company Strategy and Development Direction - The company focuses on its "Forever Strategy," which emphasizes employee retention, customer value creation, and operational excellence [10][12] - Plans for geographic expansion through satellite projects are in place, with a recent entry into a new market supporting a large semiconductor company [11][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued growth due to favorable market trends and a strong backlog entering 2026 [24] - The company anticipates revenue guidance for 2026 in the range of $4.1 billion to $4.2 billion, reflecting strong demand drivers [23][24] Other Important Information - The company ended 2025 with approximately 9,400 employees, up from 8,700 at the end of 2024, indicating a focus on workforce expansion [11] - Capital expenditures increased to $66.8 million in 2025, up from $43.8 million in 2024, to support growth initiatives [22] Q&A Session Summary Question: Guidance and Margins - Inquiry about whether exceptional execution in 2025 would be repeatable in 2026 and if management is being conservative in their guidance [27] - Management confirmed that exceptional margin upside was due to diversified contributions from various markets and expressed confidence in achieving forecasted margins for 2026 [28][29] Question: Leverage and Free Cash Flow - Questions regarding the company's low leverage and thoughts on optimal leverage levels, as well as free cash flow conversion going forward [30] - Management emphasized the importance of a strong balance sheet for organic growth and M&A opportunities, indicating a target leverage of 1.5-2 times [32] Question: Capacity Constraints and Backlog - Inquiry about potential capacity constraints given the record backlog and lead times for projects [37] - Management reassured that they have sufficient skilled labor to complete projects and that 80% of the backlog typically burns off within 12 months [39][41] Question: Satellite Operations and Expansion - Questions about opportunities for satellite expansions in 2026 and specific geographies of interest [47] - Management indicated a selective approach to satellite operations and mentioned potential opportunities in the South and Southeast [49] Question: Labor Costs and M&A Strategy - Inquiry about labor cost management and the company's approach to M&A in the current market [58][60] - Management stated that they are successfully incorporating labor cost increases into pricing and are open to both larger and smaller M&A transactions [61][63]

Core Insights - Suncor Energy Inc. reported fourth-quarter 2025 adjusted operating earnings of 79 cents per share, surpassing the Zacks Consensus Estimate of 77 cents, driven by strong production growth in its upstream segment, although it declined from 89 cents in the previous year due to lower upstream price realizations [1][11] Financial Performance - Operating revenues reached $8.8 billion, exceeding the Zacks Consensus Estimate by 4%, primarily due to increased sales volumes in both upstream and downstream segments, despite a year-over-year decrease of approximately 1.3% [2][11] - The company distributed a total of C$1.5 billion to shareholders, including C$775 million in share repurchases and C$719 million in dividends [3] - Adjusted funds from operations were C$3.2 billion, with free cash flow amounting to C$1.7 billion [3] Production and Operational Highlights - Suncor achieved record upstream production of 909,000 barrels per day (bbls/d), a 3.9% increase from 875,000 bbls/d in the previous year, exceeding the consensus estimate of 894,000 bbls/d [4][5] - Total oil sands bitumen production increased to 992,700 bbls/d from 951,500 bbls/d year-over-year, driven by strong mining performance and record production at Fort Hills [6] - The company’s E&P volume increased by 10.6% to 63,600 bbls/d, although it slightly missed the consensus estimate of 64,000 bbls/d [7] Cost and Efficiency Metrics - Operating costs from Oil Sands operations decreased to C$25.90 per barrel from C$26.55 in the previous year, supported by increased power sales volumes [9] - Fort Hills reported an average fourth-quarter volume of 178,200 bpd, although it missed the consensus estimate of 189,000 bpd, with cash operating costs per barrel decreasing to C$31.60 [12] - Syncrude's cash operating costs per barrel also decreased to C$31.05 from C$32.80 year-over-year [13] Downstream Performance - Adjusted operating earnings for Refining and Marketing were C$893 million, significantly up from C$410 million in the same quarter last year, driven by higher benchmark crack spreads and increased refinery production [15] - Refined product sales totaled 640,400 bpd, an increase from 613,300 bpd in the prior year, supported by higher refinery production and strategic investments [16] - Refinery utilization was at 108%, up from 104% a year ago, reflecting strong operational performance [17] Financial Position and Guidance - Total expenses decreased by 9.8% to C$10.3 billion, while cash flow from operating activities was C$3.9 billion, down from C$5.1 billion in the prior year [18] - As of December 31, 2025, the company had cash and cash equivalents of C$3.65 billion and long-term debt of C$9 billion, with a debt-to-capitalization ratio of 16.7% [19] - For 2026, Suncor expects upstream production of 840,000-870,000 bbls/d and capital spending projected at $5.7 billion, with a commitment to return 100% of excess funds to shareholders [20]

Core Insights - The company is positioned as the only diagnostic imaging firm with a comprehensive portfolio of contrast media and radiopharmaceuticals, leveraging a D3 strategy that integrates smart devices and drugs with digital AI and cloud technology to enhance diagnostic accuracy and therapy delivery [1] - The company reported a strong vitality rate of 55% for new products, indicating that a significant portion of revenue is derived from recent innovations, which is a positive sign for customer satisfaction and market relevance [1] - Financial performance in 2025 exceeded expectations, with organic revenue growth of 3.5% and a record backlog of $21.8 billion, reflecting robust demand in the US and EMEA markets [13][15] Strategic Developments - The acquisition of IntelliRed is expected to generate approximately $270 million in revenue, growing in the low double digits, and will enhance the company's cloud-first imaging ecosystem [2][3] - The company has secured multiple large agreements, including a seven-year partnership with the University of Rochester Medical Center, which will advance diagnostics and precision medicine [3] - The Heartbeat business system is being implemented to improve operational efficiency and customer experience, contributing to margin expansion and productivity [10][12] Product and Market Performance - The company has seen strong performance in pharmaceutical diagnostics, with double-digit organic revenue growth, and mid-single-digit growth in imaging and advanced visualization solutions [4][18] - New product launches, such as the VividPioneer cardiovascular ultrasound system, are contributing to revenue growth and strengthening the company's market position [5][19] - The service business grew mid-single digits, supported by a growing installed base and the introduction of advanced products, which are expected to increase service agreement capture rates [8][60] Financial Metrics - In the fourth quarter, the company reported revenue of $5.7 billion, with product revenue growing 7.9% and service revenue increasing 5.5% [13] - Adjusted EPS for the fourth quarter was $1.44, reflecting a slight decline due to tariff impacts, but showing an 11% growth when excluding these effects [14] - For 2026, the company anticipates organic revenue growth of 3% to 4%, with adjusted EBIT margins expected to expand by 50 to 80 basis points [23][24] Future Outlook - The company is optimistic about the potential for additional margin expansion and revenue growth driven by new product introductions and strategic acquisitions [27][56] - The capital equipment environment remains healthy, with a positive outlook for investment in diagnostic imaging technologies, particularly in the US and European markets [75][78] - The company is taking a cautious approach to the Chinese market, anticipating a decline in 2026 but remaining open to potential upside as market conditions evolve [38][39]

Core Insights - B&G Foods, Inc. (BGS) is acquiring Del Monte Foods' broth and stock business for approximately $110 million, which includes the College Inn and Kitchen Basics brands, aimed at enhancing its presence in core grocery categories and supporting long-term cash flow growth [1][8] Acquisition Details - The acquisition follows a competitive bidding process as part of Del Monte's Chapter 11 restructuring and requires Bankruptcy Court approval, with an expected closing in the first quarter of 2026 [2] - B&G Foods anticipates the acquisition to be immediately accretive to profitability, projecting annual sales of $110 million to $120 million and adjusted EBITDA of $18 million to $22 million, contributing approximately 8-12 cents per share [3][8] Valuation Metrics - The purchase price reflects a valuation multiple of around 5.5 times EBITDA, which could decrease to approximately 4.8 times when accounting for anticipated tax benefits, with a net present value of these benefits estimated at $15 million [4] Strategic Focus - B&G Foods is concentrating on strengthening its business through portfolio simplification, operational efficiencies, and disciplined capital allocation, aiming to improve margins, enhance cash flow stability, and reduce balance sheet risk [5] Stock Performance - B&G Foods shares have decreased by 1.1% over the past month, outperforming the industry decline of 2.9%, but underperforming the broader Consumer Staples sector and the S&P 500, which gained 2.2% and 2.3%, respectively [6]

Financial Data and Key Metrics Changes - In Q3 2025, the company sold 239,000 ounces of gold at an average cost of $1,434 per ounce, with an all-in sustaining cost of just over $1,800 per ounce [6] - Adjusted net income was $147 million, or $0.19 per share, with adjusted EBITDA of $420 million [6] - The company ended the quarter with $348 million in cash, excluding $88 million from the sale of Nevada assets [6][7] - Year-to-date production reached 634,000 ounces, positioning the company to meet its 2025 production guidance of 785,000-915,000 ounces [7] Business Line Data and Key Metrics Changes - Greenstone's mining rates improved significantly, exceeding 185,000 tons per day in Q3, a 10% increase over Q2 and a 21% increase over Q1 [8] - Process grades at Greenstone improved by 13% in Q3 to 1.05 grams per ton, with mining rates in October exceeding 205,000 tons per day [9][10] - Valentine Mine's commissioning exceeded expectations, with throughput averaging over 6,200 tons per day in October, or 91% of nameplate capacity [10] Market Data and Key Metrics Changes - The company noted a lift in share price over the past few months, supported by a stronger gold price and steady operational delivery [12] - The company recognized a disconnect between its intrinsic value and current trading levels, indicating potential upside in share price [12] Company Strategy and Development Direction - The company is focused on creating shareholder returns through operational excellence, high-return organic growth, portfolio rationalization, and disciplined capital allocation [4][5] - The company plans to advance its phase two expansion studies at Valentine, aiming to increase throughput to between 4.5-5 million tons per year [11] - The strategy includes retiring debt and optimizing asset performance to enhance cash flow and earnings [5][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued improvement in production and cash flow, supported by contributions from both Greenstone and Valentine [12] - The company anticipates Valentine will reach nameplate capacity by Q2 2026, with production expected to be between 150,000-200,000 ounces in 2026 [11] - Management acknowledged the need to build confidence by delivering on commitments to realize significant upside potential in share price [13] Other Important Information - The company closed the sale of its Nevada assets for $115 million, including $88 million in cash, post-quarter end [5] - The company retired $139 million of debt during Q3 and commenced Q4 with an additional $25 million in October [5] Q&A Session Summary Question: Can you discuss key performance milestones at Valentine and the phase two expansion study? - Management highlighted that Valentine exceeded 70% of nameplate capacity in the first 66 days and over 90% in October, with a feasibility study for phase two expected to commence soon [16][17] Question: What is the strategy for deleveraging and future asset sales? - Management indicated a focus on portfolio optimization and anticipates being in a solid liquidity position by the end of next year, with potential asset sales being considered for shareholder value [18][19] Question: Can you provide details on free cash flow calculations and Valentine grades? - Management confirmed positive reconciliation from ore control at Valentine and noted that lower-grade materials were processed initially to practice before ramping up to higher grades [25][26] Question: What is the current stockpile situation at Greenstone? - Management reported over 8 million tons of stockpile, with high-grade material available for processing [33] Question: Will there be any capital returns to shareholders? - Management indicated that discussions about capital returns would occur in 2026, focusing on delivering production commitments and optimizing growth projects first [34][36]

Core Insights - Agnico Eagle Mines reported strong third-quarter results, with net income reaching $1.06 billion or $2.10 per share, driven by high gold prices and strong production [1][2] - The company established a new subsidiary, Avenir Minerals, to consolidate its investments in critical minerals, with an initial portfolio valued at approximately $80 million [7][8] Financial Performance - The third-quarter operating cash flow was $1.82 billion, and free cash flow was $1.19 billion, benefiting from increased production and higher gold prices [1] - Cash costs were reported at $994 per ounce, while all-in sustaining costs were $1,373 per ounce, with an average realized gold price of $3,476 per ounce [3] Production and Cost Guidance - Agnico reaffirmed its 2025 production target of 3.3–3.5 million ounces, with costs expected to be at the upper end of the range due to higher royalty-linked expenses [4] - The company anticipates capital spending for the year to be between $1.75 billion and $1.95 billion, excluding capitalized exploration costs of approximately $290–$310 million [4] Balance Sheet and Shareholder Returns - The company strengthened its balance sheet, increasing its cash position to $2.36 billion and reducing long-term debt to $196 million, resulting in a net cash position of $2.16 billion [5] - A quarterly dividend of 40 cents was declared, and over one million shares were repurchased for $150 million, reflecting a commitment to shareholder returns [5] Growth Pipeline and Exploration - Development projects are advancing at Canadian Malartic, Detour Lake, Upper Beaver, and Hope Bay, with exploration work on schedule and promising results, particularly at Hope Bay [6] - Engineering work at San Nicolas in Mexico is nearly 30% complete [6] Strategic Focus on Critical Minerals - Avenir Minerals will operate independently while Agnico maintains a right of first refusal on new projects, allowing the company to focus on gold while exploring opportunities in critical metals [8][9]

Core Insights - Canadian Natural Resources Limited (CNQ) has underperformed in the past year, with a stock decline of nearly 10%, compared to a modest 2.5% gain in the broader Oil/Energy sector. Despite this, CNQ maintains a higher valuation than the industry average, which is justified by its consistent free cash flow, healthy balance sheet, and reliable shareholder returns [1][6][16] Oil Sands Business - The oil sands segment is central to CNQ's success, providing steady production, low decline rates, and high-margin cash flow. In the latest quarter, CNQ's oil sands synthetic crude output averaged approximately 464,000 barrels per day, reflecting a 13% increase from the previous quarter [2][3] - The long-life, low-decline oil sands assets are crucial for CNQ's long-term growth strategy, ensuring stable production and cost efficiency even during price volatility [3][4] Financial Management - CNQ has demonstrated disciplined capital allocation, achieving 25 consecutive years of dividend increases, with dividends growing at a 21% compound annual rate since 2001. In the first half of 2025, CNQ returned about C$4.6 billion through dividends and buybacks, increasing payouts from C$1.775 per share in 2023 to an annualized C$2.35 in 2025 [5][7] - The company plans to return 100% of free cash flow to shareholders once net debt reaches C$12 billion, focusing on steady returns rather than aggressive expansion [7] Strategic Growth - CNQ is expanding its production base through organic developments and selective acquisitions, enhancing its presence in Alberta's oil sands and Montney regions [8] - The opening of the Trans Mountain Expansion (TMX) pipeline allows CNQ to access Pacific export routes, enabling increased shipments to Asia, particularly China, and capitalizing on supply gaps due to Russian sanctions [9] Valuation and Market Position - CNQ trades at a forward P/E of around 12, slightly above the industry average, indicating a modest premium for its quality and consistency. The company has one of the largest long-life, low-decline reserve bases in the Western Hemisphere, providing visibility into decades of steady production and cash generation [10][17] - Despite recent stock performance lagging behind peers, analysts have revised earnings estimates upward for 2025 and 2026, reflecting growing confidence in CNQ's profitability and operational resilience [15][17]

Core Insights - Vistra Corp. is a leading integrated power company with a balanced portfolio of generation, retail, and energy storage assets, focusing on disciplined capital allocation to enhance shareholder returns and financial flexibility [1][9] Financial Performance - In fiscal 2024, Vistra distributed approximately $305 million in dividends, and in the first half of 2025, it paid an additional $152 million in dividends [3] - As of August 1, 2025, Vistra repurchased shares totaling $5.4 billion, with $1.4 billion remaining under its share repurchase authorization expected to be fully utilized by the end of 2026 [3] - Vistra's return on equity (ROE) stands at 108.41%, significantly higher than the industry average of 10.35%, indicating effective utilization of shareholders' funds [9][10] Strategic Initiatives - The company is expanding its clean energy portfolio through strategic acquisitions, including the purchase of seven modern natural gas generation facilities with a total capacity of about 2,600 megawatts [4] - Vistra's disciplined capital allocation strategy not only mitigates risk but also positions the company for steady earnings growth [5] Market Position - Vistra stock has gained 54% over the past six months, outperforming the Zacks Utility-Electric Power industry's increase of 7.9% [12] - The Zacks Consensus Estimate indicates a projected earnings per share increase of 2.72% for 2025 and 0.71% for 2026 [8] Industry Context - Utilities like NextEra Energy and Duke Energy exemplify how disciplined capital allocation fosters sustainable growth, enhancing cash flow stability and ensuring steady shareholder returns [7] - A disciplined capital allocation strategy is crucial for utilities to strengthen financial stability, optimize cash flow, and fund high-return projects [6]