Crescent Energy Co Q3 FY2024 earnings call

• Team executing on growth strategy through acquisitions and operational efficiencies, raising annual outlook for third consecutive quarter with reaffirmed production guidance and increased free cash flow.
• SilverBow integration has realized ~$65M annualized synergies within months of closing, increased total synergy target by over 20%.
• Uinta development program showing strong results, with initial JV in eastern extension of acreage having encouraging initial results.
• Portfolio optimization with divestment of ~$50 million of non-core assets, generating attractive returns and accelerating debt repayment.

Eagle Ford: Crescent reported strong results with record production of 219,000 barrels of oil equivalent per day this quarter (with only two months of SilverBow contribution). The integration of SilverBow has yielded approximately $65 million of annualized synergies, and the target for total synergies has been increased by over 20%. Additionally, 2023 acquisitions in the Western Eagle Ford have driven strong free cash flow with ~$70 million of annualized operational gains. Uinta: Development program focused on the Uteland Butte formation, with initial results from a small joint venture in the eastern extension of acreage showing encouraging signs, though still early in evaluation.

• Raised outlook for the year for the third consecutive quarter, reaffirming production guidance with more efficient capital spending and increased free cash flow.
• 2024 second half capital outlook updated to $425 million to $455 million, a 10% improvement from the SilverBow acquisition closing.
• 2025 focus on cash flow generation and attractive returns on invested capital, with balance sheet strong at net leverage 1.5x within 1x to 1.5x range and $1.5 billion liquidity with no near-term maturities.

• Commodity price volatility.
• Global geopolitical conflict.
• Business strategies and other factors that may cause actual results to differ from forward-looking statements.

Q: Neal Dingmann on testing the eastern extension of acreage in the Uinta A: Clay Rynd stated that testing the eastern extension is important for capital allocation, with a small JV in place to test it with no upfront capital required, initial results encouraging but will monitor data Q: Oliver Huang on maintenance CapEx A: Brandi Kendall said they don't provide formal '25 guidance yet, but pro-forma maintenance CapEx levels post SilverBow transaction remain in the 240,000-250,000 barrels of oil equivalent per day range with ~$1 billion of capital Q: Michael Scialla on M&A and Eagle Ford focus A: Clay Rynd said they're willing to invest across oil and gas, but bar is high, more transactions in oil due to market conditions, will look at opportunities in Eagle Ford Q: John Freeman on Simulfracs in the Eagle Ford A: David Rockecharlie said they're in planning and flexibility phase for 2025, but see significant benefit from Simulfrac and will aim to increase the percentage of activity using it Q: Arun Jayaram on oil cut and production guidance A: Brandi Kendall said 39% of Q3 production was oil, production guidance midpoint is in low to mid 250s barrels of oil equivalent per day range Q: John Abbott on acquisitions and decline rate A: David Rockecharlie said acquisitions include both low and high decline rate assets, and they work to bring higher decline assets into their business plan to maintain lower overall decline rate Q: Michael Furrow on rigs and D&C costs A: Brandi Kendall said no fundamental change in capital allocation priorities, buyback is a tool to buy stock when disconnected from intrinsic value, with $30 million bought back to date at $10.07 weighted average price