PrimeEnergy Resources (PNRG) Q4 2024 earnings summary

Executive summary

• Net income rose to $55.4 million in 2024, up 97% from $28.1 million in 2023, driven by significant production growth despite lower commodity prices.

• Oil, NGL, and gas sales increased 107% year-over-year to $223.1 million, reflecting higher production volumes from new wells.

• Crude oil production grew 123% to 2.56 million barrels, NGLs rose 112% to 1.28 million barrels, and natural gas output increased 88% to 7.77 Bcf in 2024.

• The company invested $113 million in 48 new horizontal wells in West Texas, with further drilling and development planned for 2025 and beyond.

• Maintained a strong balance sheet with $2.5 million in cash, $4 million in long-term debt, and $202.9 million in equity at year-end.

Financial highlights

• Revenue for 2024 was $237.8 million, up from $132.8 million in 2023.

• Operating cash flow reached $115.9 million, compared to $109.0 million in the prior year.

• Average realized oil price was $75.80/bbl (down 1.35%), NGL $20.25/bbl (up 3.1%), and gas $0.43/Mcf (down 77.6%) year-over-year.

• Depreciation, depletion, and amortization expense increased 147% to $76.5 million, reflecting new wells placed on production.

• Tax expense rose to $15.8 million from $6.1 million, driven by higher pre-tax income.

Outlook and guidance

• 2025 capital budget set at $129 million for 43 horizontal wells, with flexibility to adjust based on commodity prices and cash flow.

• Plans to invest $224 million in horizontal drilling in West Texas over the next several years, targeting up to 100 future well locations.

• Focus remains on maintaining liquidity, financial flexibility, and a balanced portfolio approach to drilling.