The following is a summary of the Highpeak Energy, Inc. (HPK) Q4 2023 Earnings Call Transcript:
Financial Performance:
Highpeak Energy reported a production milestone of over 50,000 barrels a day in 2023, indicating 86% growth from the previous year's average production rate.
Over $1 billion in annual revenue was generated in 2023, becoming free cash flow positive.
A one-times leverage ratio was achieved through debt refinancing.
The impact of lower commodity prices and reduced sales volumes was felt in Q4, but the quarter's EBITDAX hit a $1 billion annual run rate.
Quarterly dividend increased by 60% to over $0.04 per share, and a $75 million opportunistic share buyback was authorized.
Reported a Q4 EBITDAX margin of $53.20 per BOE, which improved by 68% than industry peers, yielding $110 million of free cash flow in H2 2023.
Business Progress:
Highpeak Energy adopted a disciplined approach, reducing its development plan from six rigs to two.
Acreage increased by over 18,000 acres in flat top's northern region.
Anticipation of improved capital efficiency in 2024, with primary focus on co-developing reserves and zones in Wolfcamp A and Lower Spraberry.
Strategy for 2024 includes enhancing free cash flow, reducing debt, and return value to shareholders through share repurchase programs.
A 25% year-over-year growth in proven reserves in 2023 was confirmed.
Majority of 2024's capital will be allocated for drilling, leading to potential savings on both CapEx and operations.
Implemented a solar farm, resulting in reduced operational expenses and lower carbon footprint.
Future strategy emphasizes on increasing efficiencies and reducing costs to enhance free cash flow.
The 2024 budget focuses on continued growth and expense management, framed by an 'under-promise and over-deliver' philosophy.
More details: HighPeak Energy IR
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