Vitesse Energy(US:VTS)2025-05-06 15:00Financial Data and Key Metrics Changes - For Q1 2025, production averaged just under 15,000 barrels of oil equivalent per day, a 16% increase from Q4 2024 [9] - EBITDA for the quarter was $39.9 million, adjusted net income was $8 million, and GAAP net income was $2.7 million [14] - Total debt at the end of Q1 was $117 million, with a net debt to adjusted annualized EBITDA ratio of 0.7 times [14] - The company revised its 2025 production guidance to a range of 15,000 to 17,000 barrels per day, with an anticipated oil cut of 64% to 68% [14] Business Line Data and Key Metrics Changes - The acquisition of Lucero has expanded the development pipeline, which now includes 25 net wells, with 9.5 net wells either drilling or completing [9] - The company has deferred the completion of 1.9 net wells due to recent commodity price volatility [10] - Approximately 61% of oil production is hedged at a weighted average price of $70.75 per barrel [11] Market Data and Key Metrics Changes - The company has chosen not to close on $20 million of acquisitions due to market conditions [10] - The overall pipeline of development wells is higher than ever, primarily due to the Lucero acquisition [9] Company Strategy and Development Direction - The company aims to invest capital at the highest rates of return possible, allowing for capital returns to shareholders through all cycles [7] - The board reaffirmed the annual dividend at a rate of $2.25 per share, reflecting confidence in the business model [8] - The company is actively looking for acquisition opportunities that meet their return hurdles, especially in a volatile market [21][45] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to maintain dividends despite current pricing environments [32] - The company is prepared to adapt its capital expenditures based on market conditions to protect long-term shareholder returns [15] - There is an ongoing assessment of operator behavior and AFE quality, with no significant changes noted [40] Other Important Information - G&A expenses increased due to the Lucero acquisition, with a projected run rate of about $4 per BOE [54] - Litigation costs are expected to continue into the second quarter due to an upcoming trial [56] Q&A Session Summary Question: What drives the guidance range? - Management indicated that the timing of well completions and potential acquisitions are key factors influencing the guidance range [18][19] Question: How does the company view buybacks in the current environment? - The focus remains on maintaining the fixed dividend, with buybacks considered in the context of capital investment and cash flow [23][25][27] Question: How is the Lucero acquisition performing? - The integration of Lucero assets is proceeding as expected, with performance aligning with initial underwriting [34] Question: What is the outlook for capital expenditures? - The company has a wide CapEx range to allow flexibility for attractive acquisitions, with $10 million currently underwritten for base case acquisitions [48][51] Question: Are there any early signs from operators regarding AFE quality? - Management noted no significant changes in AFE quality, with a trend towards longer laterals being observed [40] Question: Is the company looking at other basins for acquisitions? - The company is receiving inquiries from stressed private companies and is actively looking at other basins for potential acquisitions [44][45]