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DENVER, May 1, 2025 /PRNewswire/ -- SM Energy Company (the "Company") (NYSE: SM) today reported operating and financial results for the first quarter 2025 and provided certain full year and second quarter 2025 guidance.
Highlights include:
President and Chief Executive Officer Herb Vogel comments: "We took the reins of the Uinta Basin operations on January 1 and are pleased to report a very successful first quarter that exceeded our expectations. With a production margin consistent with our Midland Basin assets, the Uinta Basin adds a third core area and supports a step-change in scale.
Our long-term strategy is to be a premier operator of top-tier assets, focusing on our portfolio of low breakeven cost assets that endure through commodity price cycles and on returning capital to stockholders through our fixed dividend and share repurchase program. As we are in a period of market uncertainty, we are well positioned with a strong balance sheet nearing our one-times leverage target and our high-quality and long-duration drilling inventory, where we look forward to the upside opportunity presented by further delineation and optimization at each of our core areas."
NEW OFFICER APPOINTMENT
The Company announces the appointment of Blake McKenna as Senior Vice President – Strategic Planning and Corporate Reserves. Mr. McKenna most recently co-founded and served as President and Chief Operating Officer at XCL Resources. Prior to XCL Resources, Mr. McKenna was with Vitesse Energy and EOG Resources, serving in roles of increasing responsibility. Mr. McKenna has more than 18 years of experience in the energy industry.
FIRST QUARTER 2025 RESULTS
NET PRODUCTION BY OPERATING AREA | ||||
First Quarter 2025 | ||||
Midland Basin | South Texas | Uinta Basin | Total | |
Oil (MBbl / MBbl/d) | 4,664 / 51.8 | 1,670 / 18.6 | 2,997 / 33.3 | 9,332 / 103.7 |
Natural Gas (MMcf / MMcf/d) | 15,992 / 177.7 | 17,634 / 195.9 | 2,751 / 30.6 | 36,376 / 404.2 |
NGLs (MBbl / MBbl/d) | 5 / — | 2,356 / 26.2 | — / — | 2,361 / 26.2 |
Total (MBoe / MBoe/d) | 7,335 / 81.5 | 6,965 / 77.4 | 3,456 / 38.4 | 17,756 / 197.3 |
Note: Totals may not calculate due to rounding. |
REALIZED PRICES BY OPERATING AREA
| ||||
First Quarter 2025 | ||||
Midland Basin | South Texas | Uinta Basin | Total (Pre/Post-hedge)(1) | |
Oil ($/Bbl) | $72.13 | $70.30 | $68.27 | $70.56 / $70.87 |
Natural Gas ($/Mcf) | $3.52 | $3.09 | $3.44 | $3.30 / $3.50 |
NGLs ($/Bbl) | nm | $25.85 | nm | $25.86 / $24.87 |
Per Boe | $53.55 | $33.41 | $61.95 | $47.29 / $47.73 |
Note: Totals may not calculate due to rounding. |
For additional operating metrics and regional detail, please see the Financial Highlights section below and the accompanying slide deck.
NET INCOME AND NET INCOME PER SHARE
First quarter 2025 net income was $182.3 million, or $1.59 per diluted common share, compared with net income of $131.2 million, or $1.13 per diluted common share, for the same period in 2024. The primary drivers of the increased net income were higher daily production volumes and higher realized pricing, including the effect of net derivative settlements, partially offset by higher operating costs and DD&A expenses per unit. Operating costs were driven higher in the first quarter 2025 due to the acceleration of certain workover activity in the Uinta Basin and South Texas, as well as the increased cost of fuel gas used in our Uinta Basin operations due to higher natural gas prices, which is offset in production revenue.
NET CASH PROVIDED BY OPERATING ACTIVITIES
First quarter 2025 net cash provided by operating activities of $483.0 million before net change in working capital of $31.6 million totaled $514.5 million,(1) compared with net cash provided by operating activities of $276.0 million before net change in working capital of $97.7 million that totaled $373.7 million(1) for the same period in 2024. The $140.9 million, or 38%, increase in the current year period is primarily due to increased net daily production and realized prices driving higher operating revenues, partially offset by increased operating costs and cash paid for interest.
ADJUSTED EBITDAX(1) AND ADJUSTED NET INCOME(1)
First quarter 2025 Adjusted EBITDAX(1) was $588.9 million, up $179.9 million, or 44%, from $409.0 million in the same period in 2024.
First quarter 2025 Adjusted net income(1) was $202.0 million, or $1.76 per diluted common share, which compares with Adjusted net income(1) of $164.1 million, or $1.41 per diluted common share, for the same period in 2024.
CAPITAL EXPENDITURES AND ACTIVITY
First quarter 2025 capital expenditures of $413.9 million adjusted for a change in capital expenditure accruals of $26.9 million totaled $440.8 million.(1) This includes approximately $15.0 million in production equipment capital spend that was accelerated into the first quarter, as well as $5.0 million in highly economic non-operated capital expenditures in the Midland Basin.
Capital activity during the quarter included drilling 41 net wells, of which 10 were in the Uinta Basin, 21 were in the Midland Basin, and 10 were in South Texas, and adding 41 net flowing completions, of which 24 were in the Uinta Basin, 12 were in the Midland Basin, and 5 were in South Texas. 4 Midland Basin net completions scheduled to come online in the first quarter, were brought online during the first week of April.
ADJUSTED FREE CASH FLOW(1)
First quarter 2025 cash flow from operations before net change in working capital totaled $514.5 million,(1) and capital expenditures before changes in accruals totaled $440.8 million,(1) delivering Adjusted free cash flow of $73.8 million.(1)
RETURN OF CAPITAL TO STOCKHOLDERS
Return of capital to stockholders during the quarter totaled $22.9 million through the payment of the Company's $0.20 per share quarterly fixed dividend on February 3, 2025.
FINANCIAL POSITION, LIQUIDITY, AND NET DEBT-TO-ADJUSTED EBITDAX(1)
On March 31, 2025, the outstanding principal amount of the Company's long-term debt was $2.77 billion, including $37.5 million drawn on the Company's senior secured revolving credit facility, and cash and cash equivalents were approximately zero. Subsequent to quarter end, the Company's borrowing base and commitments under its senior secured revolving credit facility were reaffirmed at $3.0 billion and $2.0 billion, respectively, providing the Company with available liquidity of $2.0 billion.
At March 31, 2025, Net debt-to-Adjusted EBITDAX(1) was reduced to 1.3 times. As a result of the Uinta Basin acquisition closing on October 1, 2024, trailing twelve-month Adjusted EBITDAX(1) only includes two quarters of Uinta Basin financial activity.
COMMODITY DERIVATIVES
As of April 24, 2025, commodity derivative positions for the second through fourth quarters of 2025 include:
SWAPS AND COLLARS:
BASIS SWAPS:
A detailed schedule of these and additional derivative positions are provided in the accompanying slide deck.
2025 OPERATING PLAN AND GUIDANCE
The Company is unable to provide a reconciliation of forward-looking non-GAAP capital expenditures because components of the calculation are inherently unpredictable, such as changes to, and timing of, capital accruals. The inability to project certain components of the calculation would significantly affect the accuracy of a reconciliation.
UPDATED GUIDANCE FULL YEAR 2025:
GUIDANCE SECOND QUARTER 2025:
UPCOMING EVENTS
EARNINGS Q&A WEBCAST AND CONFERENCE CALL
May 2, 2025 – Please join SM Energy management at 8:00 a.m. Mountain time/10:00 a.m. Eastern time for the first quarter 2025 financial and operating results Q&A session. This discussion will be accessible via:
CONFERENCE PARTICIPATION
FORWARD LOOKING STATEMENTS
This release contains forward-looking statements within the meaning of securities laws. The words "anticipate," "deliver," "demonstrate," "establish," "estimate," "expects," "goal," "generate," "maintain," "objectives," "optimize," "plan," "target," and similar expressions are intended to identify forward-looking statements. Forward-looking statements in this release include, among other things: the potential for upside opportunity in our core operating areas, assumptions and projections for the second quarter and full year 2025 regarding guidance for production, production growth and oil mix as a percentage of total production (including net production and percentage oil increases attributable to the Company's Uinta Basin assets), capital expenditures (including the expected spend on non-operated projects), operating costs (including lease operating expenses, transportation costs and taxes), general and administrative expenses, exploration expenses and DD&A, and the projected impacts thereon, the number of wells expected to be drilled and completed, the percent of future production that is hedged, the allocation of activity and capital expenditures among our operating areas and activities, and the Company's long-term strategy and operational plan, including plans to deliver low breakeven and high-return wells that endure commodity price cycles, return capital to stockholders through dividends, debt reduction to a target of one times leverage, and share repurchases, and increasing scale. These statements involve known and unknown risks, which may cause SM Energy's actual results to differ materially from results expressed or implied by the forward-looking statements. Future results may be impacted by the risks discussed in the Risk Factors section of SM Energy's most recent Annual Report on Form 10-K, and such risk factors may be updated from time to time in the Company's other periodic reports filed with the Securities and Exchange Commission. The forward-looking statements contained herein speak as of the date of this release. Although SM Energy may from time to time voluntarily update its prior forward-looking statements, it disclaims any commitment to do so, except as required by securities laws.
FOOTNOTE 1
Indicates a non-GAAP measure or metric. Please refer to the "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" section in Financials Highlights, and the corresponding reconciliations to the most directly comparable GAAP financial measures, for additional information.
ABOUT THE COMPANY
SM Energy Company is an independent energy company engaged in the acquisition, exploration, development, and production of crude oil, gas, and NGLs in the states of Texas and Utah. SM Energy routinely posts important information about the Company on its website. For more information about SM Energy, please visit its website at www.sm-energy.com.
SM ENERGY INVESTOR CONTACT
Patrick Lytle, [email protected], 303-864-2502
SM ENERGY COMPANY | |||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||
March 31, 2025 | |||
Condensed Consolidated Balance Sheets | |||
(in thousands, except share data) | March 31, | December 31, | |
ASSETS | 2025 | 2024 | |
Current assets: | |||
Cash and cash equivalents | $ 54 | $ — | |
Accounts receivable | 382,955 | 360,976 | |
Derivative assets | 60,640 | 48,522 | |
Prepaid expenses and other | 28,173 | 25,201 | |
Total current assets | 471,822 | 434,699 | |
Property and equipment (successful efforts method): | |||
Proved oil and gas properties | 14,688,382 | 14,301,502 | |
Accumulated depletion, depreciation, and amortization | (7,869,420) | (7,603,195) | |
Unproved oil and gas properties, net of valuation allowance of $32,680 and $32,680, respectively | 760,128 | 764,924 | |
Wells in progress | 537,457 | 481,893 | |
Other property and equipment, net of accumulated depreciation of $62,709 and $61,737, respectively | 45,055 | 47,585 | |
Total property and equipment, net | 8,161,602 | 7,992,709 | |
Noncurrent assets: | |||
Derivative assets | 3,533 | 3,973 | |
Other noncurrent assets | 150,708 | 145,266 | |
Total noncurrent assets | 154,241 | 149,239 | |
Total assets | $ 8,787,665 | $ 8,576,647 | |
LIABILITIES AND STOCKHOLDERS' EQUITY | |||
Current liabilities: | |||
Accounts payable and accrued expenses | $ 764,773 | $ 760,473 | |
Derivative liabilities | 33,423 | 7,058 | |
Other current liabilities | 24,527 | 22,419 | |
Total current liabilities | 822,723 | 789,950 | |
Noncurrent liabilities: | |||
Revolving credit facility | 37,500 | 68,500 | |
Senior Notes, net | 2,709,584 | 2,708,243 | |
Asset retirement obligations | 147,929 | 145,313 | |
Net deferred tax liabilities | 569,551 | 545,295 | |
Derivative liabilities | 17,421 | 7,142 | |
Other noncurrent liabilities | 79,224 | 74,947 | |
Total noncurrent liabilities | 3,561,209 | 3,549,440 | |
Stockholders' equity: | |||
Common stock, $0.01 par value - authorized: 200,000,000 shares; issued and outstanding: 114,462,218 and 114,461,934 shares, respectively | 1,145 | 1,145 | |
Additional paid-in capital | 1,508,865 | 1,501,779 | |
Retained earnings | 2,894,870 | 2,735,494 | |
Accumulated other comprehensive loss | (1,147) | (1,161) | |
Total stockholders' equity | 4,403,733 | 4,237,257 | |
Total liabilities and stockholders' equity | $ 8,787,665 | $ 8,576,647 |
SM ENERGY COMPANY | |||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||
March 31, 2025 | |||
Condensed Consolidated Statements of Operations | |||
(in thousands, except per share data) | For the Three Months Ended March 31, | ||
2025 | 2024 | ||
Operating revenues and other income: | |||
Oil, gas, and NGL production revenue | $ 839,620 | $ 559,596 | |
Other operating income | 4,924 | 274 | |
Total operating revenues and other income | 844,544 | 559,870 | |
Operating expenses: | |||
Oil, gas, and NGL production expense | 225,073 | 137,375 | |
Depletion, depreciation, and amortization | 269,900 | 166,188 | |
Exploration (1) | 11,763 | 18,581 | |
General and administrative (1) | 39,339 | 30,178 | |
Net derivative loss (2) | 17,216 | 28,145 | |
Other operating expense, net | 4,965 | 1,008 | |
Total operating expenses | 568,256 | 381,475 | |
Income from operations | 276,288 | 178,395 | |
Interest expense | (44,373) | (21,873) | |
Interest income | 113 | 6,770 | |
Other non-operating expense | (27) | (24) | |
Income before income taxes | 232,001 | 163,268 | |
Income tax expense | (49,732) | (32,069) | |
Net income | $ 182,269 | $ 131,199 | |
Basic weighted-average common shares outstanding | 114,515 | 115,642 | |
Diluted weighted-average common shares outstanding | 114,948 | 116,456 | |
Basic net income per common share | $ 1.59 | $ 1.13 | |
Diluted net income per common share | $ 1.59 | $ 1.13 | |
Net dividends declared per common share | $ 0.20 | $ 0.18 | |
(1) Non-cash stock-based compensation included in: | |||
Exploration expense | $ 1,452 | $ 1,125 | |
General and administrative expense | 5,637 | 3,893 | |
Total non-cash stock-based compensation | $ 7,089 | $ 5,018 | |
(2) The net derivative loss line item consists of the following: | |||
Net derivative settlement gain | $ (7,751) | $ (13,274) | |
Net loss on fair value changes | 24,967 | 41,419 | |
Total net derivative loss | $ 17,216 | $ 28,145 |
SM ENERGY COMPANY | |||||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||||
March 31, 2025 | |||||||||||
Condensed Consolidated Statements of Stockholders' Equity | |||||||||||
(in thousands, except share data and dividends per share) | |||||||||||
Additional Paid-in Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | ||||||||
Common Stock | |||||||||||
Shares | Amount | ||||||||||
Balances, December 31, 2024 | 114,461,934 | $ 1,145 | $ 1,501,779 | $ 2,735,494 | $ (1,161) | $ 4,237,257 | |||||
Net income | — | — | — | 182,269 | — | 182,269 | |||||
Other comprehensive income | — | — | — | — | 14 | 14 | |||||
Net cash dividends declared, $0.20 per share | — | — | — | (22,893) | — | (22,893) | |||||
Issuance of common stock upon vesting of RSUs, net of shares used for tax withholdings | 284 | — | (3) | — | — | (3) | |||||
Stock-based compensation expense | — | — | 7,089 | — | — | 7,089 | |||||
Balances, March 31, 2025 | 114,462,218 | $ 1,145 | $ 1,508,865 | $ 2,894,870 | $ (1,147) | $ 4,403,733 |
Additional Paid-in Capital | Accumulated Other Comprehensive Loss | Total Stockholders' Equity | |||||||||
Common Stock | Retained Earnings | ||||||||||
Shares | Amount | ||||||||||
Balances, December 31, 2023 | 115,745,393 | $ 1,157 | $ 1,565,021 | $ 2,052,279 | $ (2,607) | $ 3,615,850 | |||||
Net income | — | — | — | 131,199 | — | 131,199 | |||||
Other comprehensive income | — | — | — | — | 8 | 8 | |||||
Net cash dividends declared, $0.18 per share | — | — | — | (20,707) | — | (20,707) | |||||
Issuance of common stock upon vesting of RSUs, net of shares used for tax withholdings | 1,147 | — | (22) | — | — | (22) | |||||
Stock-based compensation expense | 1,839 | — | 5,018 | — | — | 5,018 | |||||
Purchase of shares under Stock Repurchase Program | (712,235) | (7) | (33,088) | — | — | (33,095) | |||||
Balances, March 31, 2024 | 115,036,144 | $ 1,150 | $ 1,536,929 | $ 2,162,771 | $ (2,599) | $ 3,698,251 |
SM ENERGY COMPANY | |||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||
March 31, 2025 | |||
Condensed Consolidated Statements of Cash Flows | |||
(in thousands) | For the Three Months Ended March 31, | ||
2025 | 2024 | ||
Cash flows from operating activities: | |||
Net income | $ 182,269 | $ 131,199 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Depletion, depreciation, and amortization | 269,900 | 166,188 | |
Stock-based compensation expense | 7,089 | 5,018 | |
Net derivative loss | 17,216 | 28,145 | |
Net derivative settlement gain | 7,751 | 13,274 | |
Amortization of deferred financing costs | 2,550 | 1,371 | |
Deferred income taxes | 26,259 | 27,391 | |
Other, net | 1,515 | 1,102 | |
Net change in working capital | (31,564) | (97,688) | |
Net cash provided by operating activities | 482,985 | 276,000 | |
Cash flows from investing activities: | |||
Capital expenditures | (413,868) | (332,365) | |
Acquisition of proved and unproved oil and gas properties | (14,892) | (3) | |
Other, net | — | 80 | |
Net cash used in investing activities | (428,760) | (332,288) | |
Cash flows from financing activities: | |||
Proceeds from revolving credit facility | 856,500 | — | |
Repayment of revolving credit facility | (887,500) | — | |
Repurchase of common stock | — | (32,768) | |
Dividends paid | (22,892) | (20,834) | |
Other, net | (279) | (22) | |
Net cash used in financing activities | (54,171) | (53,624) | |
Net change in cash, cash equivalents, and restricted cash | 54 | (109,912) | |
Cash, cash equivalents, and restricted cash at beginning of period | — | 616,164 | |
Cash, cash equivalents, and restricted cash at end of period | $ 54 | $ 506,252 | |
Supplemental schedule of additional cash flow information: | |||
Operating activities: | |||
Cash paid for interest, net of capitalized interest | $ (82,311) | $ (32,986) | |
Net cash refunded for income taxes | $ 84 | $ 3,292 | |
Investing activities: | |||
Changes in capital expenditure accruals | $ 26,931 | $ (26,569) |
DEFINITIONS OF NON-GAAP MEASURES AND METRICS AS CALCULATED BY THE COMPANY
To supplement the presentation of its financial results prepared in accordance with U.S. generally accepted accounting principles (GAAP), the Company provides certain non-GAAP measures and metrics, which are used by management and the investment community to assess the Company's financial condition, results of operations, and cash flows, as well as compare performance from period to period and across the Company's peer group. The Company believes these measures and metrics are widely used by the investment community, including investors, research analysts and others, to evaluate and compare recurring financial results among upstream oil and gas companies in making investment decisions or recommendations. These measures and metrics, as presented, may have differing calculations among companies and investment professionals and may not be directly comparable to the same measures and metrics provided by others. A non-GAAP measure should not be considered in isolation or as a substitute for the most directly comparable GAAP measure or any other measure of a company's financial or operating performance presented in accordance with GAAP. Reconciliations of the Company's non-GAAP measures to the most directly comparable GAAP measure is presented below. These measures may not be comparable to similarly titled measures of other companies.
Adjusted EBITDAX: Adjusted EBITDAX is calculated as net income before interest expense, interest income, income taxes, depletion, depreciation, and amortization expense, exploration expense, property abandonment and impairment expense, non-cash stock-based compensation expense, derivative gains and losses net of settlements, gains and losses on divestitures, gains and losses on extinguishment of debt, and certain other items. Adjusted EBITDAX excludes certain items that the Company believes affect the comparability of operating results and can exclude items that are generally non-recurring in nature or whose timing and/or amount cannot be reasonably estimated. Adjusted EBITDAX is a non-GAAP measure that the Company believes provides useful additional information to investors and analysts, as a performance measure, for analysis of the Company's ability to internally generate funds for exploration, development, acquisitions, and to service debt. The Company is also subject to financial covenants under the Company's Credit Agreement, a material source of liquidity for the Company, based on Adjusted EBITDAX ratios. Please reference the Company's first quarter 2025 Form 10-Q and the most recent Annual Report on Form 10-K for discussion of the Credit Agreement and its covenants.
Adjusted free cash flow: Adjusted free cash flow is calculated as net cash provided by operating activities before net change in working capital less capital expenditures before changes in accruals. The Company uses this measure as representative of the cash from operations, in excess of capital expenditures that provides liquidity to fund discretionary obligations such as debt reduction, returning cash to stockholders or expanding the business.
Adjusted net income and Adjusted net income per diluted common share: Adjusted net income and Adjusted net income per diluted common share excludes certain items that the Company believes affect the comparability of operating results, including items that are generally non-recurring in nature or whose timing and/or amount cannot be reasonably estimated. These items include non-cash and other adjustments, such as derivative gains and losses net of settlements, impairments, net (gain) loss on divestiture activity, gains and losses on extinguishment of debt, and accruals for non-recurring matters. The Company uses these measures to evaluate the comparability of the Company's ongoing operational results and trends and believes these measures provide useful information to investors for analysis of the Company's fundamental business on a recurring basis.
Net debt: Net debt is calculated as the total principal amount of outstanding senior notes plus amounts drawn on the revolving credit facility less cash and cash equivalents (also referred to as total funded debt). The Company uses net debt as a measure of financial position and believes this measure provides useful additional information to investors to evaluate the Company's capital structure and financial leverage.
Net debt-to-Adjusted EBITDAX: Net debt-to-Adjusted EBITDAX is calculated as Net Debt (defined above) divided by Adjusted EBITDAX (defined above) for the trailing twelve-month period (also referred to as "leverage ratio" or "Adjusted EBITDAX multiple"). A variation of this calculation is a financial covenant under the Company's Credit Agreement. The Company and the investment community may use this metric in understanding the Company's ability to service its debt and identify trends in its leverage position. The Company reconciles the two non-GAAP measure components of this calculation.
Post-hedge: Post-hedge is calculated as the average realized price after the effects of commodity net derivative settlements. The Company believes this metric is useful to management and the investment community to understand the effects of commodity net derivative settlements on average realized price.
SM ENERGY COMPANY | |||||||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||||||
March 31, 2025 | |||||||||
Production Data | |||||||||
For the Three Months Ended | Percent Change Between | ||||||||
March 31, | December 31, | March 31, | 1Q25 & 4Q24 | 1Q25 & 1Q24 | |||||
2025 | 2024 | 2024 | |||||||
Realized sales price (before the effect of net derivative settlements): | |||||||||
Oil (per Bbl) | $ 70.56 | $ 69.34 | $ 76.09 | 2 % | (7) % | ||||
Gas (per Mcf) | $ 3.30 | $ 2.19 | $ 2.18 | 51 % | 51 % | ||||
NGLs (per Bbl) | $ 25.86 | $ 24.49 | $ 22.94 | 6 % | 13 % | ||||
Equivalent (per Boe) | $ 47.29 | $ 43.68 | $ 42.39 | 8 % | 12 % | ||||
Realized sales price (including the effect of net derivative settlements): (1) | |||||||||
Oil (per Bbl) | $ 70.87 | $ 70.54 | $ 76.52 | — % | (7) % | ||||
Gas (per Mcf) | $ 3.50 | $ 2.50 | $ 2.57 | 40 % | 36 % | ||||
NGLs (per Bbl) | $ 24.87 | $ 24.01 | $ 22.28 | 4 % | 12 % | ||||
Equivalent (per Boe) | $ 47.73 | $ 44.85 | $ 43.40 | 6 % | 10 % | ||||
Net production volumes: (2) | |||||||||
Oil (MMBbl) | 9.3 | 9.8 | 5.8 | (5) % | 61 % | ||||
Gas (Bcf) | 36.4 | 39.1 | 31.1 | (7) % | 17 % | ||||
NGLs (MMBbl) | 2.4 | 2.8 | 2.2 | (15) % | 7 % | ||||
Equivalent (MMBoe) | 17.8 | 19.1 | 13.2 | (7) % | 34 % | ||||
Average net daily production: (2) | |||||||||
Oil (MBbl per day) | 103.7 | 106.9 | 63.7 | (3) % | 63 % | ||||
Gas (MMcf per day) | 404.2 | 424.8 | 342.3 | (5) % | 18 % | ||||
NGLs (MBbl per day) | 26.2 | 30.3 | 24.4 | (13) % | 8 % | ||||
Equivalent (MBoe per day) | 197.3 | 208.0 | 145.1 | (5) % | 36 % | ||||
Per Boe data: | |||||||||
Lease operating expense | $ 6.13 | $ 5.35 | $ 5.54 | 15 % | 11 % | ||||
Transportation costs | $ 3.92 | $ 4.10 | $ 2.07 | (4) % | 89 % | ||||
Production taxes | $ 2.07 | $ 1.79 | $ 1.90 | 16 % | 9 % | ||||
Ad valorem tax expense | $ 0.55 | $ (0.03) | $ 0.89 | 1,933 % | (38) % | ||||
General and administrative (3) | $ 2.22 | $ 2.19 | $ 2.29 | 1 % | (3) % | ||||
Net derivative settlement gain | $ 0.44 | $ 1.17 | $ 1.01 | (62) % | (56) % | ||||
Depletion, depreciation, and amortization | $ 15.20 | $ 13.61 | $ 12.59 | 12 % | 21 % |
(1) Indicates a non-GAAP measure or metric. Please refer above to the section "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" for additional information. | |||||||||
(2) Amounts and percentage changes may not calculate due to rounding. | |||||||||
(3) Includes non-cash stock-based compensation expense per Boe of $0.32, $0.32, and $0.29 for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. |
SM ENERGY COMPANY | |||||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||||
March 31, 2025 | |||||
Adjusted EBITDAX Reconciliation (1) | |||||
(in thousands) | |||||
Reconciliation of net income (GAAP) and net cash provided by operating activities (GAAP) to Adjusted EBITDAX (non-GAAP): | For the Three Months Ended March 31, | For the Trailing Twelve Months Ended March 31, | |||
2025 | 2024 | 2025 | |||
Net income (GAAP) | $ 182,269 | $ 131,199 | $ 821,363 | ||
Interest expense | 44,373 | 21,873 | 163,159 | ||
Interest income | (113) | (6,770) | (25,246) | ||
Income tax expense | 49,732 | 32,069 | 213,593 | ||
Depletion, depreciation, and amortization | 269,900 | 166,188 | 913,017 | ||
Exploration (2) | 10,311 | 17,456 | 51,861 | ||
Stock-based compensation expense | 7,089 | 5,018 | 27,092 | ||
Net derivative (gain) loss | 17,216 | 28,145 | (60,887) | ||
Net derivative settlement gain | 7,751 | 13,274 | 63,193 | ||
Other, net | 391 | 597 | (24) | ||
Adjusted EBITDAX (non-GAAP) | $ 588,919 | $ 409,049 | $ 2,167,121 | ||
Interest expense | (44,373) | (21,873) | (163,159) | ||
Interest income | 113 | 6,770 | 25,246 | ||
Income tax expense | (49,732) | (32,069) | (213,593) | ||
Exploration (2)(3) | (10,311) | (9,539) | (50,661) | ||
Amortization of deferred financing costs | 2,550 | 1,371 | 8,635 | ||
Deferred income taxes | 26,259 | 27,391 | 173,854 | ||
Other, net | 1,124 | (7,412) | (35,276) | ||
Net change in working capital | (31,564) | (97,688) | 77,332 | ||
Net cash provided by operating activities (GAAP) | $ 482,985 | $ 276,000 | $ 1,989,499 |
(1) See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above. | |||||
(2) Stock-based compensation expense is a component of the exploration expense and general and administrative expense line items on the unaudited condensed consolidated statements of operations. Therefore, the exploration line items shown in the reconciliation above will vary from the amount shown on the unaudited condensed consolidated statements of operations for the component of stock-based compensation expense recorded to exploration expense. | |||||
(3) For the three months ended March 31, 2024, and for the trailing twelve months ended March 31, 2025, amount excludes certain capital expenditures related to unsuccessful exploration activities. |
SM ENERGY COMPANY | |||
FINANCIAL HIGHLIGHTS (UNAUDITED) | |||
March 31, 2025 | |||
Reconciliation of Net Income to Adjusted Net Income (1) | |||
(in thousands, except per share data) | |||
For the Three Months Ended March 31, | |||
2025 | 2024 | ||
Net income (GAAP) | $ 182,269 | $ 131,199 | |
Net derivative loss | 17,216 | 28,145 | |
Net derivative settlement gain | 7,751 | 13,274 | |
Other, net | 391 | 597 | |
Tax effect of adjustments (2) | (5,604) | (9,117) | |
Adjusted net income (non-GAAP) | $ 202,023 | $ 164,098 | |
Diluted net income per common share (GAAP) | $ 1.59 | $ 1.13 | |
Net derivative loss | 0.15 | 0.24 | |
Net derivative settlement gain | 0.07 | 0.11 | |
Other, net | — | 0.01 | |
Tax effect of adjustments (2) | (0.05) | (0.08) | |
Adjusted net income per diluted common share (non-GAAP) | $ 1.76 | $ 1.41 | |
Basic weighted-average common shares outstanding | 114,515 | 115,642 | |
Diluted weighted-average common shares outstanding | 114,948 | 116,456 | |
Note: Amounts may not calculate due to rounding. |
(1) See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above. | |||
(2) The tax effect of adjustments for the three months ended March 31, 2025, and 2024, was calculated using a tax rate of 22.1% and 21.7%, respectively. These rates approximate the Company's statutory tax rates for the respective periods, as adjusted for ordinary permanent differences. |
SM ENERGY COMPANY | |
FINANCIAL HIGHLIGHTS (UNAUDITED) | |
March 31, 2025 | |
Reconciliation of Total Principal Amount of Debt to Net Debt (1) | |
(in thousands) | |
As of March 31, 2025 | |
Principal amount of Senior Notes (2) | $ 2,736,026 |
Revolving credit facility (2) | 37,500 |
Total principal amount of debt (GAAP) | 2,773,526 |
Less: Cash and cash equivalents | 54 |
Net Debt (non-GAAP) | $ 2,773,472 |
(1) See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above. | |
(2) Amounts as of March 31, 2025, are from Note 5 - Long-Term Debt in Part I, Item 1 of the Company's Form 10-Q. |
Adjusted Free Cash Flow (1) | |||
(in thousands) | |||
For the Three Months Ended March 31, | |||
2025 | 2024 | ||
Net cash provided by operating activities (GAAP) | $ 482,985 | $ 276,000 | |
Net change in working capital | 31,564 | 97,688 | |
Cash flow from operations before net change in working capital (non-GAAP) | 514,549 | 373,688 | |
Capital expenditures (GAAP) | 413,868 | 332,365 | |
Changes in capital expenditure accruals | 26,931 | (26,569) | |
Capital expenditures before changes in accruals (non-GAAP) | 440,799 | 305,796 | |
Adjusted free cash flow (non-GAAP) | $ 73,750 | $ 67,892 | |
(1) See "Definitions of Non-GAAP Measures and Metrics as Calculated by the Company" above. |
SOURCE SM Energy Company
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