EQT (EQT) Q4 2023 earnings summary

Executive summary

• FY2023 sales volumes reached 2,016 Bcfe; adjusted EBITDA was $2.998B and free cash flow was $879M, with average NYMEX gas at $2.74/MMBtu.

• Record operational efficiencies and integration of Tug Hill and XcL Midstream supported performance; long-term supply deals are expected to improve differentials beginning in late 2027.

Financial highlights

• Q4 sales volumes were 564 Bcfe, realized price was $2.75/Mcfe, operating costs were $1.27/Mcfe, adjusted EBITDA was $840M and free cash flow was $236M.

• Q4 net income attributable to EQT was $502M, diluted EPS was $1.13, adjusted net income was $214M and adjusted EPS was $0.48.

• FY2023 net income attributable to EQT was $1.735B, diluted EPS was $4.22, adjusted net income was $946M and adjusted EPS was $2.29.

• FY2023 adjusted EBITDA was $2.998B versus $3.523B in 2022; free cash flow was $879M versus $1.939B, and adjusted operating cash flow was $2.795B.

• FY2023 capex was $1.917B, excluding $9M attributable to noncontrolling interests; capital efficiency was $0.95/Mcfe.

Outlook and guidance

• FY2024 sales volume guidance is 2,200–2,300 Bcfe; total operating costs are guided at $1.37–$1.49/Mcfe and total capex at $2.15–$2.35B.

• 2024 adjusted EBITDA guidance is $2.7–$3.0B at $2.50 NYMEX, $3.0–$3.3B at $2.75 and $3.3–$3.6B at $3.00/MMBtu; free cash flow guidance is $0.3–$0.5B, $0.5–$0.8B and $0.8–$1.1B at those prices, respectively.

• Planned 2024 capex includes $1.95–$2.05B for maintenance and $200–$300M for strategic growth; plans call for 2–3 rigs, 3–4 completion crews and 110–140 net wells turned in line.

• Q1 volume guidance is 525–575 Bcfe, including 10–15 Bcfe of lower sales from non-operated midstream constraints; 2024 free-cash-flow breakeven is estimated at ~$2.20/MMBtu NYMEX, inclusive of hedges.

• Guidance assumes Mountain Valley Pipeline enters service in April 2024; the low end of production guidance preserves flexibility if gas prices decline further.