Vitesse Energy(US:VTS)2024-11-05 19:09Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $37.6 million and adjusted net income of $7.6 million for Q3 2024, while GAAP net income was $17.4 million [15] - Cash CapEx and acquisition costs totaled $17.2 million for the quarter, with a year-to-date total of $87 million, leading to a revised annual CapEx guidance of $110 million to $120 million [16] - Operating cash flow net of working capital changes was $35.1 million, which covered the dividend and CapEx, allowing for a $10 million debt reduction [17] Business Line Data and Key Metrics Changes - Production averaged 13,009 barrels of oil equivalent (BOE) per day in Q3 2024, with a year-to-date production of 13,023 BOE per day [12] - The company had 20.2 net wells in its development pipeline, with 11.3 wells being drilled and completed as of September 30 [13] Market Data and Key Metrics Changes - The company hedged 54% of its remaining 2024 oil production at above $78 per barrel and 43% of its 2025 production at above $73 per barrel [14] Company Strategy and Development Direction - The company continues its return of capital strategy, having paid a dividend of $0.525 per share in September and declaring another for December [8] - The company reduced CapEx by 18% while maintaining production guidance, indicating a focus on capital efficiency [10] - The company is opportunistic in its capital allocation, flexibly adjusting CapEx to meet return hurdles [9] Management's Comments on Operating Environment and Future Outlook - Management noted that lower oil prices create more attractive near-term opportunities for acquisitions, while also emphasizing the high return from organic drilling [26] - The company expects a 7% production growth in 2025 with a CapEx of $105 million to $120 million [19] Other Important Information - The company amended its credit facility, extending the maturity date and reaffirming the borrowing base at $245 million, while reducing elected commitments to $235 million [18] Q&A Session Summary Question: CapEx dynamics and activity levels - Management explained that lower CapEx in Q3 was due to the timing of wells coming online, which were pushed to Q4 and early 2025 [22] Question: Organic CapEx visibility and trends - Management indicated that AFEs received in 2024 are nearly double those in 2023, allowing for more capital allocation to higher return opportunities [24] Question: Impact of wildfires in North Dakota - Management confirmed that wildfires did not significantly impact production volumes, attributing any production adjustments to well timing [29] Question: Trends in costs embedded in AFEs - Management noted that AFEs remained consistent, with expectations for drilling costs to decrease due to lower oil prices [30]