Headwater Exploration (HWX) Q4 2024 earnings summary

Executive summary

• Achieved record average production of 21,559 boe/d in Q4 2024, up 8% year-over-year, and 20,310 boe/d for the full year, up 13% year-over-year.

• Generated record net income of $188.0 million for 2024, up from $156.1 million in 2023.

• Returned $0.40 per share ($95.0 million) to shareholders in 2024; increased quarterly dividend to $0.11 per share effective April 2025.

• Proved developed producing reserves rose 32% to 29.2 mmboe; total proved plus probable reserves up 31% to 67.9 mmboe.

Financial highlights

• 2024 sales, net of blending: $592.6 million, up from $482.8 million in 2023.

• Adjusted funds flow from operations: $336.6 million ($1.42 per basic share), up from $288.3 million ($1.22 per share) in 2023.

• Free cash flow for 2024: $113.7 million.

• Capital expenditures: $222.9 million in 2024, up from $233.8 million in 2023.

• Working capital at year-end: $78.7 million; no outstanding bank debt.

Outlook and guidance

• Focus remains on total shareholder returns through growth and capital returns.

• Positive working capital and credit facility provide flexibility for organic expansion, acquisitions, and enhanced oil recovery.

• Plans for further secondary recovery expansion in Marten Hills West, targeting 2,000 bbls/d supported by year-end 2025.

• Ongoing development in Clearwater E, Greater Pelican, Greater Nipisi, Greater Peavine-Seal, and Handel areas.