Matador Resources Company · NYSE:MTDR
Matador Resources — Q3 2023 Earnings Presentation
50 slides from Matador Resources's earnings presentation, Oct 25, 2023
Slide 1: Third Quarter 2023 Earnings Release
Third Quarter 2023 Earnings Release October 24, 2023
Slide 2: Investor Relations Contact and Disclosure Statements
Investor Relations Contact and Disclosure Statements Safe Harbor Statement – This presentation and statements made by representatives of Matador Resources Company (“Matador” or the “Company”) during the course of this presentation includes “forward- Investor Relations Contact looking statements” wit
Slide 3: Chairman's Remarks
Chairman’s Remarks October 24, 2023
Slide 4: MTDR Performance vs. Peers (Last 5 Years)
SLIDE A MTDR Performance vs. Peers (Last 5 Years) Since January 1, 2019 through October 20, 2023 close MTDR #1 PERFORMER +319% Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 0% Peer 9 Peer 10 4 Source: Bloomberg LP Note: Peers include CPE, CTRA, FANG, MGY, MRO, OVV, PR, SM, VTLE and XOP.
Slide 5: MTDR Shares Significantly Outperforming XOP and Oil since IPO
SLIDE B MTDR Shares Significantly Outperforming XOP and Oil since IPO! Since IPO (February 2, 2012) through October 20, 2023 close Announced Advance Deal +442% 2018 BLM New Mexico Oil and Gas Lease Sale Rodney Robinson (27 wells) Boros (34 wells) Voni (28 wells) “Stateline Wells” Turned On Initial S
Slide 6: Building Delaware Basin Position "Brick by Brick"
Building Delaware Basin Position “Brick by Brick” SLIDE C Now 150,800 Net Acres 2012 2017 2023 ~7,500 Net Acres ~114,000 Net Acres ~150,800 Net Acres 6 Wells 212 Wells 751 Wells EDDY LEA EDDY LEA EDDY LEA LOVING LOVING LOVING Matador Acreage Matador Acreage Matador Acreage Advance Acreage WARD WARD
Slide 7: Steadily Increasing Fixed Dividend
SLIDE D Steadily Increasing Fixed Dividend Returning Value to Consistent Growth Sustainable Shareholders Strong, Simple Balance Sheet 8x Since Q1 2021 Leverage Ratio < 1.0x(1) $127 Million Since 2021(2) Annualized Dividend $0.80 $0.60 $0.40 $0.20 $0.10 Q1 2021 Q4 2021 Q3 2022 Q1 2023 Q4 2023 (1) Def
Slide 8: Credit Facility Updates
SLIDE E Credit Facility Updates New Bank From March 31, 2023 to October 19, 2023 Today’s Borrowing Maximum Elected Revolver Borrowings Base Facility Amount Commitment Outstanding Advance Acquisition $2.5B $2.0B $1.325B $700MM +$250MM +$500MM +$75MM -$200MM $2.25B $1.5B $1.25B $500MM Today(1) 8 (1) A
Slide 9: "Horseshoe" Wells – Savings Achieved Through Operational Execution
“Horseshoe” Wells – Savings Achieved Through SLIDE F Successful Operational Execution ➢ Q4 2023: Two Horseshoe wells turned in line ➢ Increases value and potential of acreage portfolio ➢ Drilled wells in record time Previous Now Four Single-mile Wells Two Horseshoe Wells 24-Hour IP Rates JJ Wheat #2
Slide 10: Increasing Production
Increasing Production SLIDE G Q3 2023 2023 PRODUCTION UP ~145,000 135,096 Avg. Daily Production (BOE/d) 130,500 ~ 100,000 (1) (2) Early January 2023 Q3 2023 Guidance Q3 2023 Actual Q4 2023 Guidance (1) Midpoint of guidance as of and as provided on July 25, 2023. 10 (2) Midpoint of guidance as of and
Slide 11: San Mateo and Synergistic Midstream Assets Continue to Add Value
San Mate and – Synergistic Midstream Assets SLIDE H Continue to Add Value to Matador (1) Ranger Stebbins Gathering Assets (oil, natural gas and water) 2017 ~60 miles of three-stream pipelines Rustler Breaks 2023 ~525 miles of three-stream pipelines(1) Processing Capacity 2017 60 MMcf per day 2023 52
Slide 12: Operational and Financial Results
Operational and Financial Results October 24, 2023
Slide 13: Matador Resources Company Overview
Matador Resources Company Overview Market Snapshot NYSE Symbol MTDR Market Capitalization(1) $7.6 billion Avg. Daily Production – Q3 2023 135.1 MBOE/d HAYNESVILLE/ Net Debt / LTM Adj. EBITDA(2)(3) – Q3 2023 ~1.0x DELAWARE BASIN 150,800 net acres COTTON VALLEY Adj. Free Cash Flow(2) – Q3 2023 $144.6
Slide 14: Matador Resources Company – Company Highlights
Matador Resources Company – Company Highlights DELAWARE BASIN Interests Aligned with Stakeholders 150,800 Net Acres -Significant Insider Stock Ownership TWIN LAKES -90% Participation in Employee Stock Purchase Program (ESPP) ADVANCE Strong, Simple Balance Sheet FOCUS AREA Low Leverage and Continued
Slide 15: Significant 2023 Milestones – Timeline
Significant 2023 Milestones – Timeline ▪1 8 Rodney Robinson wells turning to sales in 1H 2023 ▪2 Close the Advance acquisition in 1H 2023 ▪3 8 Stateline wells turned to sales in 1H 2023 ▪4 21 wells turning to sales on Advance properties in 2H 2023 ▪5 9 Wolf wells turning to sales in 2H 2023, includi
Slide 16: Record Production
Record Production ▪ Record oil, natural gas and total production! − Record oil equivalent production - 135,096 BOE per day − Record oil production - 77,529 Bbl per day − Record natural gas production - 345.4 million cubic feet per day All-Time High! Better than Guidance by 140,000 130,683 135,096 +4
Slide 17: An Integrated E&P and Midstream Strategy: Progress in All Areas
An Integrated E&P and Midstream Strategy: Progress in All Areas Average Daily Total Production Average Daily Total Delaware Basin Production (BOE/d) (BOE/d) Q3 2023 BOE up 3% sequentially; Q3 2023 BOE up 4% sequentially; 160,000 up 28% YoY up 31% YoY 140,000 124,977 130,438 135,096 140,000 Oil Natur
Slide 18: Delivering Strong Well Results All Around the Delaware Basin
Delivering Strong Well Results All Around the Delaware Basin! TWIN LAKES DELAWARE BASIN ~49,700 gross / ~27,100 net acres 150,800 Net Acres CURRENT DELAWARE BASIN ACTIVITY ARROWHEAD RANGER ~60,200 gross / ~23,200 net acres ~61,400 gross / ~34,800 net acres ▪ Stateline: 8 wells turned to sales in Q2
Slide 19: Horizontal Wells Completed and Turned to Sales – Q3 2023
Horizontal Wells Completed and Turned to Sales – Q3 2023 ▪ During the third quarter of 2023, Matador turned to sales a total of 65 gross (27.9 net) horizontal wells across its various operating areas. This total was comprised of 29 gross (26.1 net) operated wells and 36 gross (1.8 net) non-operated
Slide 20: San Mateo Midstream Outperformed Expectations
San Mateo Midstream Outperformed Expectations! ▪ Adjusted EBITDA(1) and natural gas volumes were better than expected! − Adjusted EBITDA of $47.1 million is better than Forecast by 5% − Natural gas processing volumes of ~385 MMcf per day – RECORD QUARTER! − Natural gas gathering volumes of ~350 MMcf
Slide 21: Better Than Expected San Mateo Results in Q3 2023
Better Than Expected San Mateo Results in Q3 2023 (San Mateo is 51% Owned by Matador) San Mateo Average Natural Gas Gathering San Mateo Average Natural Gas Processing (MMcf/d) (MMcf/d) Q3 2023 up 6% sequentially; Record Quarter! Q3 2023 up 3% sequentially; Record Quarter! 450 up 23% YoY 450 up 38% Y
Slide 22: San Mateo – Synergistic Midstream Asset
San Mateo – Synergistic Midstream Asset ▪ San Mateo Value estimated at >$2.0 Billion(1) ▪ Building Pronto midstream business purchased in 2022 $250 Water San Mateo's Adjusted EBITDA ($ in millions)(2) Oil Natural Gas $198 $200 $185 $190 $154 $150 Natural Gas $113 $96 $100 Oil $62 $50 $31 Water $12 $
Slide 23: Full Year 2023 Guidance
Full Year 2023 Guidance October 24, 2023
Slide 24: Summary and 2023 Guidance (as Provided on October 24, 2023)
Summary and 2023 Guidance Expect to achieve mid-to-high end of (as Provided on October 24, 2023) production guidance! Actual July 25, 2023 October 24, 2023 %YoY Guidance Metric 2022 Results 2023 Guidance Range 2023 Guidance Range Change(1) Total Oil Production 21.9 million Bbl 26.8 to 27.5 million B
Slide 25: Expect to Achieve Mid-to-High End of Production Guidance
Expect to Achieve Mid-to-High End of Total Oil Equivalent, Oil and Natural Gas Production Guidance(1) Expect to achieve mid-to-high end of production guidance(1) 44,350 - 46,250 45,800 - 47,500 38,495 Total 114.0 - 120.0 (MBOE) 107.7 - 113.7 31,454 99.3 Natural Gas (Bcf) 81.7 26,400 - 27,300 26,800
Slide 26: 2023 Capital Investment Plan Summary
2023 Capital Investment Plan Summary(1) (As Provided on October 24, 2023) Full Year 2023E CapEx(2) – $1.235 to $1.385 billion 2023E Wells Turned to Sales July 2023 October 2023 Guidance(3) Guidance(1) Gross Net Drilling, Completing, Equipping $1.10 to $1.22 billion $1.10 to $1.22 billion Operated 11
Slide 27: 2023E Operating Cost Estimates (Unit Costs per BOE)
2023E Operating Cost Estimates (Unit Costs per BOE)(1) (As of and as Provided on October 24, 2023) 2022 Q3 2023 Q4 2023E 2023E 1 Production taxes, transportation and processing (“PTTP”) $7.33 $5.77 $6.50 to $7.00 $5.75 to $6.25 2 Lease operating (“LOE”) $4.08 $5.34 $5.40 to $5.80 $5.00 to $5.50 3 Pl
Slide 28: Q3 2023 & Q4 2023E Commodity Price Differentials
Q3 2023 & Q4 2023E Commodity Price Differentials Q3 2023 Q4 2023E Actual Actual Realized Commodity Prices Benchmark(1) Differential Guidance(2) Realized Price Differential Oil Prices, per Bbl $82.22 $82.49 +$0.27 -$0.25 to +$0.75 (Above Benchmark) Natural Gas Prices, per Mcf $2.66 $3.56 +$0.90 $0.00
Slide 29: ESG Stewardship
ESG Stewardship October 24, 2023
Slide 30: Committed to Environmental, Social and Governance (ESG) Stewardship
Committed to Environmental, Social and Governance (ESG) Stewardship Matador is committed to increasing the long-term value of its shares in a responsible manner. Matador’s aim has always been to reliably and profitably provide the energy that society needs in a manner that is safe, protects the envi
Slide 31: Committed to ESG Stewardship: Key Metrics
Committed to Environmental, Social and Governance (ESG)(1) Stewardship ENVIRONMENTAL Increased transportation on pipeline Continued reduction of Increased use of non-fresh water, per-barrel emissions(2) including recycled water 44% 61% >95% >70% reduction in direct reduction in of total water of wel
Slide 32: Appendix
ay, ¢ Matador fies RESOURCES COMPANY Appendix MIDR October 24, 2023
Slide 33: Steady Oil Production Growth
Steady Oil Production Growth Approaching 150,000 BOE/d! 144,000 - 146,500 Total 111,735 (MBOE/d) 351.0 Natural Gas 296.5 (MMcf/d) 86,750 Oil 62,316 (Bbl/d) (1) Q4 22 Q4 23E 33 (1) As of and as provided on October 24, 2023.
Slide 34: Steady Growth, Measured Pace: Total Proved Reserves
Steady Growth, Measured Pace Matador Total Proved Reserves Growth & BOE Per Share 455 MMBOE 500 3.8 BOE/Share 4.00 450 3.50 Total Proved Reserves, MMBOE 400 27% CAGR 3.00 350 BOE Per Share 2.50 300 250 2.00 200 1.50 150 1.00 100 0.50 50 0 (1) 0.00 IPO 2013 2014 2015 2016 2017 2018 2019 2020 2021 202
Slide 35: Matador's Strategic Bolt-On Acquisition of Advance Energy
Matador’s Strategic Bolt-On Acquisition of Advance Energy ACQUISITION DETAILS Advance Acquisition Highlights TWIN LAKES ➢ Price: $1.6 billion(1) ➢ Strategic bolt-on in the core of the Northern Delaware Basin ➢ Effective Date: 1/1/2023 ➢ 18,500 net acres → 99% Held-by-Production ➢ Closed: 4/12/2023 ➢
Slide 36: Matador + Advance: +30% Pro Forma Reserves Increase
Matador + Advance: +30% Pro Forma Reserves Increase(1) Total Proved Reserves: 463.1 million BOE (59% oil) pro forma at 12/31/2022 356.7 million BOE 55% Oil 356.7 Million BOE (Total Proved Reserves) +106.4 Million BOE (Total Proved Reserves) 106.4 million BOE 73% Oil Note: Oil and natural gas prices
Slide 37: Delaware Basin Extended Lateral Well Location Inventory
Delaware Basin Extended Lateral Well Location Inventory • Matador has identified up to 4,382 gross (1,468 net) remaining potential locations as of December 31, 2022, for future drilling in the Delaware Basin − Location counts assume extended lateral lengths whenever viable, and the total locations h
Slide 38: Q3 2023 Selected Operating and Financial Results
Q3 2023 Selected Operating and Financial Results September 30, 2023 June 30, 2023 September 30, 2022 Net Production Volumes:(1) Oil (MBbl) 7,133 6,947 5,535 Natural gas (Bcf) 31.8 29.7 24.9 Total oil equivalent (MBOE) 12,429 11,892 9,680 Average Daily Production Volumes:(1) Oil (Bbl/d) 77,529 76,345
Slide 39: Matador Resources and San Mateo Credit Facilities Increases in October 2023
Matador Resources and San Mateo Credit Facilities Increases in October 2023 Matador Credit Agreement Summary Bank group led by Truist Bank Last Elected Borrowings Letters of Credit Financial Covenant: Facility Maturity Borrowing Financial Covenant: Reserves Borrowing Outstanding Outstanding Maximum
Slide 40: Simple Balance Sheet – No Near-Term Debt Maturities
Simple Balance Sheet – No Near-Term Debt Maturities REPAYING RBL IS SIGNIFICANT LIQUIDITY ~$780 million at October 24, 2023 KEY OBJECTIVE IN 2023 Repaid $200 million since Advance acq. BORROWING BASE OF $2.5B ELECTED COMMITMENT INCREASED Increase effective October 19, 2023 $1.325 billion effective O
Slide 41: San Mateo Assets and Operations – "Three-Pipe" Offering
San Mateo(1) Assets and Operations – “Three-Pipe” Offering Eddy County, NM Assets Loving County, TX Assets Greater Stebbins Area 1 Mile Wolf Loving ~43 miles Reeves Loving Ward 1 Mile Rustler Breaks Eddy Lea Natural Gas Gathering and Processing ▪ 460 MMcf/d of designed natural gas cryogenic processi
Slide 42: Record Setting MAXCOM Results
Record Setting MAXCOM Results Over 5 Years of Operation 231 Matador Drilling Records and $35 Million Estimated Savings To Date Delaware Drilling Records ▪ Spud to Total Depth: 9.5 days ▪ Spud to Total Depth – 2 Mile Lateral: 9.7 Days ▪ Spud to Total Depth – 2.4 Mile Lateral: 15.7 Days ▪ Longest Well
Slide 43: Hedging Profile
Hedging Profile(1) Waha-Henry Hub Basis Swaps 5,000 4,600 4,500 4,000 3,500 Gas Volume Hedged (BBtu) 3,000 2,500 Swap at -$1.85 2,000 1,500 1,365 1,365 1,365 1,365 1,365 1,365 1,365 1,365 1,000 Swap Swap Swap Swap Swap Swap Swap Swap at at at at at at at at 500 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0
Slide 44: Adjusted EBITDA & Adjusted Free Cash Flow Reconciliations
Adjusted EBITDA & Adjusted Free Cash Flow Reconciliations Adjusted EBITDA Reconciliation – This presentation includes the non-GAAP financial measure of Adjusted EBITDA. Adjusted EBITDA is a supplemental non-GAAP financial measure that is used by management and external users of the Company’s consoli
Slide 45: Adjusted EBITDA Reconciliation – Matador Resources Company
Adjusted EBITDA Reconciliation – Matador Resources Company The following table presents the calculation of Adjusted EBITDA and the reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities, respectively. (In thousands) 3Q 2022
Slide 46: Adjusted EBITDA Reconciliation – San Mateo (100%)
Adjusted EBITDA Reconciliation – San Mateo (100%) The following table presents the calculation of Adjusted EBITDA and the reconciliation of Adjusted EBITDA to the GAAP financial measures of net income and net cash provided by (used in) operating activities, respectively, for San Mateo Midstream, LLC
Slide 47: Adjusted EBITDA Reconciliation San Mateo
Adjusted EBITDA Reconciliation San Mateo(1) The following table presents the calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income and net cash provided by (used in) operating activities, respectively, for San Mateo Midstream, LLC. Year End
Slide 48: Adjusted Free Cash Flow Reconciliation
Adjusted Free Cash Flow Reconciliation Matador Resources Company The following table presents the calculation of adjusted free cash flow and the reconciliation of adjusted free cash flow to the GAAP financial measure of net cash provided by operating activities. Three Months Ended (In thousands) Sep
Slide 49: Adjusted Net Income and Adjusted Earnings Per Diluted Common Share
Adjusted Net Income and Adjusted Earnings Per Diluted Common Share This presentation includes the non-GAAP financial measures of adjusted net income and adjusted earnings per diluted common share. These non-GAAP items are measured as net income attributable to Matador Resources Company shareholders,
Slide 50: PV-10 Reconciliation - Matador
PV-10 Reconciliation - Matador PV-10 is a non-GAAP financial measure and generally differs from Standardized Measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future income. PV-10 is not an estimate of the fair market value of th
Matador Resources Company — Q3 2023 Earnings Presentation on 6ix