EQT (EQT) Q3 2024 earnings summary

Executive summary

• Closed the Equitrans Midstream acquisition, creating a vertically integrated, large-scale natural gas producer and completing over 60% of integration tasks in three months, capturing $145 million in annualized synergies and de-risking more than 50% of total base plan synergies.

• Achieved net zero Scope 1 and 2 GHG emissions ahead of the 2025 goal, eliminating or offsetting over 900,000 metric tons of CO2e, and launched initiatives to generate carbon offsets at a cost below $3/ton.

• Announced and completed divestitures of non-operated Northeast Pennsylvania assets for $1.25 billion, supporting deleveraging and bringing total realized value from NEPA assets since 2021 to over $3.5 billion.

• Achieved record operational efficiency, including water delivery and completions, with production exceeding guidance despite curtailments.

• Strategic production curtailments in response to low natural gas prices reduced sales volume by up to 130 Bcfe year-to-date.

Financial highlights

• Q3 2024 sales volumes reached 581 Bcfe, 4% above the high end of guidance, with average realized price of $2.38/Mcfe and total operating revenues of $1.28 billion.

• Reported net loss attributable to EQT for Q3 2024 was $(301) million, compared to net income of $81 million in Q3 2023; adjusted EBITDA was $832 million, up from $521 million.

• Pro forma operating costs were $1.07 per Mcfe, below guidance, and capital expenditures were $558 million reported, $573 million pro forma, both below guidance.

• Free cash flow was $(121) million for Q3 2024, compared to $(445) million in Q3 2023.

• Net debt as of September 30, 2024 was $13.7 billion, up from $5.7 billion at year-end 2023, reflecting the Equitrans acquisition.

Outlook and guidance

• Q4 2024 production guidance is 555–605 Bcfe, with capital expenditures expected at $630–$730 million and per unit operating costs at $1.07–$1.21/Mcfe.

• Approximately 60% of 2025 production is hedged at an average floor price of $3.25/MMBtu.

• 2025 sales volumes expected to remain flat year-over-year at around 2,100 Bcfe post-asset sales.

• Forecasts $14.5 billion cumulative free cash flow from 2025–2029 at $3.50/MMBtu gas, with strong downside protection at lower prices.

• Guidance assumes 10–15 Bcfe of net operated production curtailments in Q4 2024.