Cardinal Energy (CJ) Q2 2024 earnings summary

Executive summary

• Achieved average production of 22,376 boe/d in Q2 2024, up 3% sequentially and 6% year-over-year, despite curtailing 250 boe/d of uneconomic natural gas.

• Adjusted funds flow rose 55% from Q1 2024 to $81.8 million, driven by higher production, stronger oil prices, and lower net operating expenses.

• Net income for Q2 2024 was $40.7 million, a 47% increase year-over-year.

• Maintained a strong financial position, reducing net debt by 17% to $99.2 million and keeping net debt to adjusted funds flow at 0.4x.

Financial highlights

• Petroleum and natural gas revenue reached $169.4 million, up 24% year-over-year.

• Adjusted funds flow per share was $0.51 (basic and diluted), up 46% year-over-year.

• Netback per boe improved 32% year-over-year to $43.04.

• Net operating expenses per boe decreased 10% sequentially and 4% year-over-year to $23.65.

• Free cash flow for Q2 2024 was $63.1 million, more than double the prior year.

Outlook and guidance

• Reaffirmed commitment to the 6,000 bbl/d Reford SAGD project, on schedule and budget for late 2025 commissioning.

• Plans to drill 21 conventional oil wells in 2024, with 12 scheduled for Q3/Q4.

• Forecasts adjusted funds flow in 2024 and 2025 will fully fund shareholder returns and SAGD development under current strip pricing.