Saturn Oil & Gas (SOIL) Q4 2024 earnings summary

Executive summary

• Achieved significant portfolio enhancement in 2024 through two core-up acquisitions, including the major South Saskatchewan acquisition, expanding drilling inventory and future development potential.

• Integrated new assets, formed three core areas, and executed a robust capital program, drilling 97 wells across Southeast Saskatchewan, West Saskatchewan, and Alberta.

• Achieved record Q4 2024 production of 41,051 boe/d and year-end exit rate of 41,908 boe/d, surpassing guidance.

• Innovations in drilling and completion, including first-ever 12-way monobore horizontal and open-hole multi-leg wells, drove record operational results.

• Returned $14.9 million to shareholders via repurchase of 6.7 million shares, reducing share count by over 3%.

Financial highlights

• 2024 petroleum and natural gas sales reached $908.3 million, up from $693.9 million in 2023.

• Adjusted EBITDA grew 33% year-over-year to $483.0 million; Q4 Adjusted EBITDA was $152.8 million, up 13% sequentially.

• Adjusted Funds Flow for 2024 was $380.1 million ($2.10/share), up 37% year-over-year; Q4 AFF was $129.2 million ($0.64/share), up 37% sequentially.

• Production averaged over 41,000 BOE/d in Q4, exceeding guidance and analyst expectations by 4%.

• Free funds flow for 2024 totaled $134 million (CAD 0.74/share), with a 39% free funds flow yield.

Outlook and guidance

• 2025 guidance maintained, with operating costs expected to average below CAD 20/BOE.

• Majority of 2025 capital program (70%) to be deployed in H2, with production peaking in Q1 and Q4, and free cash flow cresting in Q2.

• Q1 2025 capital expenditures expected at $70–$75 million for drilling ~22 wells; production expected to average 39,500–40,500 boe/d.

• Price protection in place for 50–60% of oil/liquids production for 12 months forward, and 30–40% up to 18 months.

• FX hedges lock in principal and interest on US debt through mid-2027, offsetting $20 million in net debt impact.