Civitas Resources (CIVI) Q3 2024 earnings summary

Executive summary

• Reported Q3 2024 net income of $295.8M and adjusted EBITDAX of $910.1M, with sales volumes up 3% sequentially to 348 MBoe/d, driven by new wells and acquisitions in the Permian and DJ Basins.

• Returned $227M to shareholders in Q3, prioritizing share buybacks over variable dividends, and declared $144.9M in dividends.

• Efficiency gains led to accelerated drilling and completion activity, with 70 gross operated wells turned to sales in Q3.

• Resolved temporary production issues, with oil production rebounding in October and record-setting Blue 4AH well producing 165,000 barrels in 90 days.

• Strategic priorities for 2025 include generating free cash flow, reducing leverage, returning capital, and ESG leadership.

Financial highlights

• Q3 2024 revenue was $1.27B, with net income of $295.8M and adjusted EBITDAX of $910.1M.

• Adjusted free cash flow for Q3 was $366.3M; Q3 capital expenditures totaled $438.4M.

• Q3 variable return of capital was $104M, fully allocated to share buybacks.

• Q3 2024 average realized crude oil price was $75.46/Bbl; natural gas price was $0.17/Mcf.

• Operating cash flow for the nine months was $2.0B, up from $1.4B in the prior year period.

Outlook and guidance

• Q4 2024 oil volumes expected to rise 3% sequentially, with total sales volumes projected at 347–353 MBoe/d.

• Q4 capital expenditures forecasted at $245–$295M; free cash flow anticipated to be highest of the year.

• 2024 capital program expected to be funded by operating cash flows; all full-year targets for volumes, CapEx, and free cash flow on track.

• 2025 plan will focus on level-loading capital investments and maintaining flexibility amid commodity price volatility.

• Production expected to remain broadly flat, with free cash flow as the main driver of activity.