Vitesse Energy, Inc. Q4 FY2024 earnings call

• Bob Gerrity noted the company returned capital to shareholders, increased dividends, and closed the acquisition of Lucero Energy Corp, which is immediately accretive to financial metrics and bolsters the dividend. - Brian Cree discussed 2024 production levels, Q1 2025 production expectations (14,000-15,000 Boe/day), reserves (proved reserves of 40.3 million Boe at year-end 2024, pro forma PV-10 value with Lucero included over $800M), and hedging strategies. - Jimmy Henderson reviewed 2024 financial results (adjusted EBITDA $156.8M, adjusted net income $35.7M), debt position (total debt $117M, net debt to adjusted EBITDA 0.7x), and provided 2025 guidance on production, CapEx, and acquisitions.

In 2024, Vitesse Energy's production was just over 13,000 barrels of oil equivalent per day. For 2025, the company anticipates production in the range of 17,000 to 18,000 barrels of oil equivalent per day, representing a ~35% increase from 2024 levels with an oil cut of 66% to 70%. Regarding hedging, 53% of oil production is hedged at a weighted average price of $71.16 per barrel at the midpoint of guidance, and 15% of natural gas production is hedged with a weighted average floor of $3.73 and ceiling of $4.88 per MMBtu.

• 2025 production expected to be 17,000-18,000 Boe/day. - Cash CapEx anticipated at $130M-$150M for 2025, with ~$20M of expected acquisitions. - 53% of oil production hedged at $71.16/bbl midpoint and 15% of natural gas production hedged with $3.73 floor and $4.88 ceiling per MMBtu.

• Commodity price fluctuations: Net realized oil and gas prices decreased between 2023 and 2024, impacting reserves and earnings. - Deal flow uncertainties: While seeing increased deal flow, acquisition plans are methodical. - Dividend sustainability: Dividend is supported by hedging and economic capital spending, but could be impacted by significant commodity price drops or increased leverage.

Q: Jeff Grampp asked about the acquisition side with oil in the 60s being a sweet spot for deals.

A: Bob Gerrity responded that oil in the 60s is a sweet spot for acquisitions as it benefits current assets and there's increased deal flow.

Q: Jeff Grampp inquired about the dividend philosophy.

A: Bob Gerrity stated the dividend is the focus, hedging is part of risk management, and the dividend is solid in a $55-$85 oil band.

Q: Bobby Brooks asked about M&A details and the $20M of expected acquisitions.

A: Bob Gerrity and Brian Cree responded that acquisitions can take various forms, including chunkier deals or smaller ones, and the $20M is a placeholder for potential acquisitions.

Q: John White asked about Lucero operated properties.

A: Brian Cree responded that Lucero assets are mostly operated, with a high average working interest compared to legacy Vitesse acreage.

Q: Noel Parks asked about basin infrastructure utilization.

A: Jimmy Henderson responded that the Bakken is in good shape for oil takeaway, but gas processing and NGL takeaway capacity could be improved.