Viper Energy, Inc. Q1 FY2025 earnings call

• First quarter was strong with oil and total production above high end of guidance ranges. • Dropdown transaction with Diamondback closed on May 1, expecting leverage below 1x even in sustained $50 per barrel WTI. • Decided to retain ~$25 million of incremental capital instead of trueing up dividend due to market volatility. • Production expected to remain durable, maintaining back half 2025 oil production guidance. • Symbiotic relationship with Diamondback, Viper's third-party production with well-capitalized operators. • Viper is well-positioned with a differentiated business model, now among largest US independent E&Ps.

• Maintaining back half 2025 oil production guidance despite potential commodity price weakness. • Expecting leverage to remain below 1x even in sustained $50 WTI. • Planning to use volatility to advantage, including share repurchases.

• Commodity price volatility and market volatility posing risks. • Potential sustained weakness in commodity prices affecting activity levels.

Q: On M&A and macro environment influence.

A: Kaes said they'll sift through volatility to see M&A opportunities.

Q: Reagan County activity assumptions post Double Eagle acquisition.

A: Modeling completions in 2026, may be pushed if market weak.

Q: Third-party opportunity set location.

A: Agnostic, will look at price and opportunity, sit through volatility.

Q: Hedging strategy and macro volatility.

A: Still comfortable, focus on fortress balance sheet, use deferred premium puts.

Q: Viper's exposure to Diamondback investor letter's 10% decrease.

A: Minimal impact now, but could change if weakness persists.

Q: Quarter-over-quarter activity change.

A: Activity increasing, especially Diamondback side, strong third-party activity.

Q: Endeavor dropdown growth volumes.

A: No changes expected, 2026 growth still on track.

Q: Smaller third-party operators and commodity volatility.

A: Anecdotes of smaller operators pushing completions, Viper's assets with large operators.

Q: Dividend and Endeavor dropdown accretion.

A: Dividend may increase in $60 oil, upgraded to investment grade.

Q: Cash tax and G&A guidance.

A: Cash tax down due to lower oil prices, G&A expected to come down per BOE.

Q: Share repurchases and balance sheet.

A: Appetite for buybacks if volatility continues, investment grade opens capital access.