Riley Exploration Permian (REPX) Q2 2024 earnings summary

Executive summary

• Achieved or exceeded key operational and financial metrics for Q2 2024, including net income of $33.5 million on $105.4 million revenue, strong free cash flow, and reduced debt.

• Closed an asset acquisition in Eddy County, NM for $17.6–$18.1 million, adding producing properties and development locations.

• Expanded power joint venture, increasing ownership to 50% and broadening scope to sell electricity and ancillary services to ERCOT, with new capacity expected online in 2025.

• Raised $25.4 million in net proceeds from a common stock issuance to fund the acquisition and JV investment.

• Added experienced executives to the leadership team, enhancing operational and financial expertise.

Financial highlights

• Generated $38.3 million of free cash flow in Q2 and $126 million over the last 12 months; adjusted EBITDAX was $73.3 million with a margin up to 71%.

• Q2 operating cash flow was $58 million; lease operating expense was $8.50/Boe; cash G&A expense was $3.39/Boe.

• Reduced debt by $20–$75 million year-over-year and paid over $28 million in dividends in the last 12 months.

• Oil revenue reached $106 million in Q2, up $9 million quarter-over-quarter; oil production was 14.7 MBbls/d.

• Shareholders' equity increased to $489 million as of June 30, 2024.

Outlook and guidance

• Updated guidance forecasts 13% year-over-year oil production growth and over 20% reduction in spending; full-year 2024 free cash flow forecasted at ~$115 million, a 65% year-over-year increase.

• Q3 2024 production guidance: 21.0–23.0 MBoe/d (oil: 14.8–15.3 MBbls/d); full-year 2024: 21.0–22.5 MBoe/d (oil: 14.5–15.2 MBbls/d).

• Full-year 2024 E&P capex expected at $100–110 million; Power JV investment at $21–22 million.

• Plans to continue debt reduction and maintain flexibility for potential inorganic growth opportunities.

• Management expects Q3 and Q4 daily production to remain consistent with Q2 despite a temporary midstream disruption in New Mexico.