Permian Resources Corporation · NYSE:PR
Permian Resources — Merger or Acquisition (August 2023)
20 slides from Permian Resources's merger presentation, Aug 21, 2023
Slide 1: A Premier Delaware Basin Independent
A Premier Delaware Basin Independent AUGUST 21, 2023 Exhibit 99.2
Slide 2: Important Information
Important Information No Offer or Solicitation This communication relates to a proposed business combination transaction (the “Transaction”) between Earthstone and Permian. This communication is for informational purposes only and does not constitute an offer to sell or the solicitation of an offer
Slide 3: Transaction Highlights
Complementary Core Northern Delaware Positions Adds significant core inventory that immediately competes for capital Enhances Position as Premier Delaware Basin Independent Combined business has >400,000 Permian net acres and ~300 MBoe/d1 Transaction Highlights 245 / 126 / 42 119 / 120 / 123 295 / 1
Slide 4: Transaction Overview
Transaction Overview Transaction Value: ~$4.5 Bn2 All stock consideration: 1.446 shares of Permian Resources per share of Earthstone Represents an ~8% premium to the exchange ratio based on 20-day VWAP as of August 18, 2023 Pro forma combined enterprise value of $14 Bn and market capitalization of $
Slide 5: Earthstone Acquisition Meets and Exceeds All Investment Criteria
63 / 80 / 72 245 / 126 / 42 119 / 120 / 123 188 / 192 / 190 233 / 204 / 183 202 / 202 / 203 295 / 192 / 0 236 / 220 / 172 Earthstone Acquisition Meets and Exceeds All Investment Criteria Purchased at near PDP value, while adding high-quality inventory Attractive valuation relative to recent private
Slide 6: Disciplined Acquisition Strategy Has Led to Enhanced Shareholder Value
Disciplined Acquisition Strategy Has Led to Enhanced Shareholder Value Grassroots / Bolt-On Acquisitions (<$200 MM) Successfully executing on the ground game and envision continued opportunity Significant opportunity to optimize ESTE’s existing position through acreage swaps and trades Recent Privat
Slide 7: Earthstone – High Quality Northern Delaware E&P Undervalued by the Market
Earthstone’s well productivity is ~5% higher than the Delaware Basin average Earthstone – High Quality Northern Delaware E&P Undervalued by the Market ESTE’s market valuation does not fully reflect the high-quality Northern Delaware Basin inventory and its strong go-forward plan Provides compelling
Slide 8: Significant Proven Delaware Basin Value with Material Upside
Eddy Lea West Eddy Hat Mesa East Lea Novo Significant Proven Delaware Basin Value with Material Upside Expanded Core Northern Delaware Position with Upside Hat Mesa Primary: 1st, 2nd and 3rd Bone Spring inventory immediately competes for capital Upside: 2nd Bone Spring Carb, 3rd Bone Spring Carb, Ha
Slide 9: Substantial Synergies Across Combined Platform
Substantial Synergies Across Combined Platform Combined team will be led by PR’s executive management team, but will include key contributors from all parties Identified tangible savings through enhanced production operations, personnel and contract services optimization and reduced midstream costs
Slide 10: Leveraging Delaware Scale and Optimized Operations to Drive Synergies
Leveraging Delaware Scale and Optimized Operations to Drive Synergies General & Administrative3 Lease Operating Expense2 Drilling Efficiencies1 Efficiency metrics reflect last twelve-month actuals for Delaware Basin wells. LOE reflects Q2’23 for the Delaware and excludes GP&T expense. Cash G&A metri
Slide 11: Strong Balance Sheet with Enhanced Credit Profile
63 / 80 / 72 245 / 126 / 42 119 / 120 / 123 188 / 192 / 190 233 / 204 / 183 202 / 202 / 203 295 / 192 / 0 236 / 220 / 172 Strong Balance Sheet with Enhanced Credit Profile Source: FactSet data as of August 18, 2023. Yield to worst for investment grade peers including Ovintiv, Marathon, Diamondback,
Slide 12: Framework for 2024 Capital Allocation
Framework for 2024 Capital Allocation Operational Overview Combined company operating 11 rigs, primarily focused on Delaware Basin Plan to continue Earthstone’s plan of having 1 of the 2 rigs currently in the Midland Basin shift to the Delaware Basin Preliminary 2024 Plan ~90% of capital allocated t
Slide 13: Business Combination Magnifies Operating Scale
Business Combination Magnifies Operating Scale PR ESTE Pro Forma PR Enterprise Value ($Bn) (2) $9.5 $4.5 $14.0 Total Production (MBoe/d) 166 133(1) ~300 Oil Mix (%) 51% 41% 46% Permian Net Acreage (000s) 180 223 403 (1) Source: Enverus. APA does not disclose Permian net acres. Lower Cost Structure L
Slide 14: Compelling Value Proposition Continues with Premier Assets & Increased Scale
Compelling Value Proposition Continues with Premier Assets & Increased Scale Market data as of August 18, 2023. Assumes an Earthstone equity value of $2.7 Bn as of 8/18/2023 and the assumption of $1.8 Bn in net indebtedness as of 6/30/2023 pro forma for the acquisition of Novo. Premier asset quality
Slide 15: Appendix
Appendix ca
Slide 16: Continuing The Plan For Organized, Thoughtful Sponsor Ownership
Continuing The Plan For Organized, Thoughtful Sponsor Ownership Average Daily Trading Value ($ MM) Similar Sponsor Ownership % Increased Liquidity & Trading Volume High-Quality Sponsors Significant CEO Ownership Sponsor Ownership (%)1 % of Total Equity Owned by CEO3,4 Pro Forma Ownership Structure1,
Slide 17: Continued Execution on Capital Return Strategy
Continued Execution on Capital Return Strategy Total Return of Capital Q2’23 ($’s in millions, except per share data) Adj. Free Cash Flow1,2 $80 Base Dividend ($ / Share) $0.05 Shares Outstanding3 566 Base Dividend $28 Adj. FCF less Base Dividend1 $51 Payout Ratio 50% Target Variable Return of Capit
Slide 18: Combined Company is Well Positioned for Additional Index Inclusion
Combined Company is Well Positioned for Additional Index Inclusion Market data as of August 18, 2023. S&P Index constituent data from FactSet as of August 18, 2023, Russell Index constituent data per FTSE Russell as of August 18, 2023. Total Market Capitalization1 ($Bn) S&P 500 ü ü ü ü ü ü ü ü ü ü S
Slide 19: Pro Forma Hedge Book Overview
Pro Forma Hedge Book Overview1 As of August 16, 2023. Hedge Position Detail
Slide 20: Reconciliation of Free Cash Flow and Adjusted Free Cash Flow
Reconciliation of Free Cash Flow and Adjusted Free Cash Flow Free cash flow and Adjusted free cash flow are non-GAAP financial measures Free Cash Flow Reconciliation1 Based on Cash Capital Expenditures Three Months Ended June 30, ($ in thousands) 2023 2022 Net cash provided by operating activities $
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