Kimbell Royalty Partners (KRP) Q2 2024 earnings summary

Executive summary

• Q2 2024 oil, natural gas, and NGL revenues reached $77.1 million, with net income of $15.2 million and consolidated Adjusted EBITDA of $65.8 million.

• Run-rate average daily production was 24,110 Boe/d, exceeding guidance midpoint, with 91 active rigs representing a 16% U.S. land rig market share.

• Declared a $0.42 per common unit distribution, equating to a 75% payout ratio and a 10.2% annualized yield.

• Kimbell maintains a diversified, high-margin asset base with interests in over 129,000 gross wells across 17 million gross acres.

• Since IPO, $1.8 billion invested in M&A, growing run-rate average daily production by ~8x and returning 61% of IPO price via distributions.

Financial highlights

• Total revenues for Q2 2024 were $77.1 million; net income attributable to common units was $8.4 million ($0.11 per unit).

• Consolidated Adjusted EBITDA was $65.8 million; cash available for distribution on common units was $46.1 million.

• Cash G&A expense was $5.1 million ($2.34 per Boe), a record low.

• Net debt as of June 30, 2024, was $265.8 million, with $284.2 million undrawn credit facility capacity.

• Market capitalization was $1.59 billion; enterprise value $2.16 billion.

Outlook and guidance

• Affirmed 2024 guidance with daily production midpoint at 24,000 Boe/d and full-year net production guidance of 22.5–25.5 Mboe/d.

• Management remains confident in robust development and value creation, especially with strong rig activity in the Permian.

• Noted potential upside from two large 20% interest wells expected online in late 2024 or early 2025.

• Board intends to continue allocating a portion of cash available for distribution to debt repayment in future quarters.

• Management expects to pursue further acquisitions of mineral and royalty interests to drive long-term growth.