Matador Resources Company · NYSE:MTDR
Matador Resources — Q1 2024 Earnings Presentation
55 slides from Matador Resources's earnings presentation, Apr 24, 2024
Slide 1: First Quarter 2024 Earnings Release
First Quarter 2024 Earnings Release April 23, 2024
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 Investor Relations Contact Resources Company (“Matador” or the “Company”) during the course of this presentation includes “forward- looking statements” wit
Slide 3: Chairman’s Remarks
Chairman’s Remarks April 23, 2024
Slide 4: 3-Year Indexed Price Performance
SLIDE A 3-Year Indexed Price Performance 3-Year Indexed Price Performance 350 300 +186% MTDR 250 +139% MTDR Peers 200 150 +39% WTI +27% S&P 500 100 50 0 Apr-21 Aug-21 Dec-21 Apr-22 Aug-22 Dec-22 Apr-23 Aug-23 Dec-23 Apr-24 (1) MTDR MTDR Peers WTI S&P 500 Note: Market data as of April 12, 2024. 4 (1)
Slide 5: Profitable (and Consistent) Production Growth at a Measured Pace
SLIDE B Profitable (and Consistent) Production Growth at a Measured Pace 93,000 75,457 Daily Oil Production 60,119 (Bbl/d) 48,876 43,526 38,312 30,524 21,510 12,306 13,924 9,095 5,844 3,317 (1) 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024E Note: CAGR = Compound Annual Growth Rate
Slide 6: Q1 2024 – Exceeding Expectations
SLIDE C Q1 2024 – Exceeding Expectations Better than Expected Total Production (149,760 BOE/d) Better than Expected Oil Production (84,777 Bbl/d) Lower than Expected Drilling and Completing Capital Expenditures and LOE Costs Debt-to-EBITDA Ratio Remains Below 1.0x (0.75x at 3/31/2024) 6
Slide 7: Midstream Assets Continue to Add Value and Flow Assurance
SLIDE D Midstream Assets Continue to Add Value and Flow Assurance ~595 miles of three-stream pipelines(1) 1 Ranger Stebbins Pronto to San Mateo Connection 1 2 (Online Q1 2024) Bi-Directional Flow 3 2 Marlan Plant Expansion Rustler Breaks (Expected Online H1 2025) Adds 200 MMcf/d of Capacity 3 Pronto
Slide 8: Simul-Frac and Trimul-Frac Operations
SLIDE E Simul-Frac and Trimul-Frac Operations Estimated Savings - $35 million Since 2021 “Simul-Frac” – Saves ~$250,000 per well “Trimul-Frac” – Saves ~$350,000 per well Successful Completed Lateral Footage per day “Trimul-Frac” Testing! Introduced Simul-frac 2020 2021 2022 2023 Q1 2024 8
Slide 9: Credit Facility Amendment Term Extended to 2029
Credit Facility Amendment SLIDE F Term Extended to 2029 Led By Five New Banks Elected Commitment $1.5 B $1.325 B $1.25 B $775 MM (1) YE 2022 Q1 2023 Q4 2023 Q1 2024 9 (1) Increased as of March 22, 2024.
Slide 10: MTDR $347 Million Equity Offering
SLIDE G MTDR $347 Million Equity Offering 2.7x over subscribed Quality Long-Term Investors Participated in the Offering MTDR stock traded back above the $347,300,000 $68.55 pre-deal price on April 3rd, just 7 days post offering! Common Stock Offering 5,250,000 shares $66.15 per share March 202
Slide 11: MTDR $900 Million 6.50% Senior Notes Due 2032
SLIDE H MTDR $900 Million 6.50% Senior Notes Due 2032 Upsized by $100 million 4.5x over subscribed Quality Long-Term Investors Participated in the Offering Notable Investor Feedback “Commitment to a strong balance sheet with a leverage $900,000,000 target of less than 1.0x” “Uniquely attractiv
Slide 12: Operational and Financial Results
Operational and Financial Results April 23, 2024
Slide 13: Q1 2024 Highlights
Q1 2024 Highlights Stronger-Than-Expected Quarterly Production 149,764 BOE per day: Beat Guidance!(1) Expect 2024 oil, natural gas and total production to achieve high end of previously announced guidance ranges(1) Increased Operational Efficiencies First “Trimul-Frac” test in Delaware Bas
Slide 14: Matador Resources Company Overview
Matador Resources Company Overview Market Snapshot NYSE Symbol MTDR Market Capitalization(1) $8.1 billion Avg. Daily Production – Q1 2024 149.8 MBOE/d Net Debt / LTM Adj. EBITDA(2)(3) – Q1 2024 ~0.75x DELAWARE BASIN HAYNESVILLE/ 152,200 net acres COTTON VALLEY Adj. Free Cash Flow(2) – Q1 2024 $31.2
Slide 15: Matador Resources Company – Company Highlights
Matador Resources Company – Company Highlights DELAWARE BASIN 152,200 Net Acres Core Delaware Basin E&P Assets Large Multi-Year Drilling Inventory TWIN LAKES Top 10 Producer in New Mexico(1) #8 in Total Production(1) RANGER ARROWHEAD Profitable Midstream Business Providing Flow Assurance RUSTLER BRE
Slide 16: Driving Profitability Through Operational Excellence
Driving Profitability Through Operational Excellence MTDR Leads Peer Group in Oil and Natural Gas Revenue Per BOE(1) and Netbacks per BOE(1)(2) $45 $60 $40 $50 $35 $30 $40 $25 $30 $20 $20 $15 $10 $10 $5 $0 $0 Oil and Natural Gas Revenue per BOE(1) Netbacks per BOE(1)(2) Source: Bloomberg LP and comp
Slide 17: Peer Leading Well Productivity
Peer Leading Well Productivity MTDR Leads Peer Group in Estimated Ultimate Recovery (EUR) for Wells Turned to Production Since 2020 Average Oil EUR (MBbl) Source: Enverus data accessed February 2024. 17 Note: Includes all operated horizontal wells turned to production since January 1, 2020. Producti
Slide 18: Continuing to Build Our Delaware Basin Position!
Continuing to Build Our Delaware Basin Position! The “Brick-by-Brick” Approach 2012 2017 2023 ~7,500 Net Acres ~114,000 Net Acres ~152,200 Net Acres 6 Wells 212 Wells 756 Wells EDDY LEA EDDY LEA EDDY LEA LOVING LOVING LOVING Matador Acreage Matador Acreage Matador Acreage WARD WARD Note: All acreage
Slide 19: Steadily Increasing Fixed Dividend
Steadily Increasing Fixed Dividend Returning Value to Consistent Growth Sustainable Shareholders Strong, Simple Balance Sheet 8x Since Q1 2021 Leverage Ratio of 0.75x(1) $176 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) Defined a
Slide 20: Q1 2024 Guidance vs. Q1 2024 Actuals
Q1 2024 Guidance(1) vs. Q1 2024 Actuals Oil, natural gas and total production were all better than expected! Continued better-than-expected production from Stateline wells Outperformance by non-operated assets Less shut-in production than anticipated D/C/E capital expenditures were $35 mil
Slide 21: 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) Q1 2024 BOE down 3% sequentially; Q1 2024 BOE down 3% sequentially; 180,000 up 40% YoY up 43% YoY 154,261 160,000 149,831 Oil Natural Gas 149,7
Slide 22: Horizontal Wells Completed and Turned to Sales – Q1 2024
Horizontal Wells Completed and Turned to Sales – Q1 2024 During the first quarter of 2024, Matador turned to sales a total of 46 gross (12.6 net) horizontal wells across its various operating areas. This total was comprised of 12 gross (9.4 net) operated wells and 34 gross (3.2 net) non-operated w
Slide 23: Delivering Strong Well Results All Around the Delaware Basin!
Delivering Strong Well Results All Around the Delaware Basin! DELAWARE BASIN Twin Lakes ~27,100 net acres 152,200 Net Acres Michael K Wolfcamp A-XY, 2nd Bone Spring A #204H 24-hr IP: 2,543 BOE/d (69% oil) #121H 24-hr IP: 1,702 BOE/d (82% oil) Margarita Arrowhead Ranger Average 1,600 BOE/d (84% oil)
Slide 24: Delaware Basin Horizontal Well Location Inventory
Delaware Basin Horizontal Well Location Inventory • Matador has identified up to 4,640 gross (1,627 net) remaining potential locations(1) for future drilling on its Delaware Basin acreage Almost all intervals assume 160-acre well spacing (none less than 100-acre spacing at same true vertical depth
Slide 25: San Mateo – System Overview
San Mate and – System Overview ~595 miles of three-stream pipelines(1) Ranger Stebbins Gathering Assets (oil, natural gas and water) 2017 ~ 60 miles of three-stream pipelines 2024 ~ 595 miles of three-stream pipelines(1) Processing Capacity 2017 60 MMcf per day Rustler Breaks 2024 520 MMcf per day(2
Slide 26: San Mateo Midstream Outperformed Expectations in Q1 2024!
San Mateo Midstream Outperformed Expectations in Q1 2024! Adjusted EBITDA(1) and oil, natural gas and water volumes were better than expected! Adjusted EBITDA(1) of $58 million is better than expected and up 19% year-over-year Natural gas processing volumes of ~399 MMcf per day Natural gas g
Slide 27: Better Than Expected San Mateo Results in Q1 2024
Better Than Expected San Mateo Results in Q1 2024 San Mateo Average Natural Gas Gathering San Mateo Average Natural Gas Processing (MMcf/d) (MMcf/d) Record Quarter! 450 450 416 425 413 399 400 385 400 373 352 350 333 331 350 350 300 300 250 250 200 200 150 150 100 100 50 50 0 0 1Q23 2Q23 3Q23 4Q23 1
Slide 28: Growing Midstream and Upstream Businesses Together
Growing Midstream and Upstream Businesses Together $250 $225 Natural Gas San Mateo's Adjusted EBITDA ($ in millions)(2) $198 $200 $200 Oil Water Natural $154 Gas $150 $113 Oil $96 $100 $62 Water $50 $31 $12 $0 2016 2017 2018 2019 2020 2021 2022 2023 2024 (2) Guidance Matador owns 51% of San Mateo(3)
Slide 29: Full Year 2024 Guidance
Full Year 2024 Guidance April 23, 2024
Slide 30: 2024 Guidance (As Provided on February 20, 2024)
2024 Guidance(1) Expect to achieve high end (As Provided on February 20, 2024) of production guidance!(1) Actual %YoY Guidance Metric 2024 Guidance Range 2023 Results Change(2) Oil Production 75,457 Bbl/d 91,000 to 95,000 Bbl/d + 23% Natural Gas Production 338.1 MMcf/d 370.0 to 386.0 MMcf/d + 12% Oi
Slide 31: 2024 Capital Investment Plan Summary
2024 Capital Investment Plan Summary(1) (As Provided on February 20, 2024) Full Year 2024E CapEx(2) – $1.425 billion – Midpoint 2024 Guidance 2024E Wells Turned to Sales Drilling, Completing, Equipping $1.20 to $1.30 billion Gross Net Operated D/C/E $0.99 to $1.17 billion Operated 128 94.0 Non-Op $7
Slide 32: Q2 2024 Guidance
Q2 2024 Guidance(1) Guidance Metric Q1 2024 Actuals Q2 2024 Guidance Range Oil Production 84,777 Bbl/d 92,500 to 93,500 Bbl/d +10% Natural Gas Production 389.9 MMcf/d 384.0 to 387.0 MMcf/d -1% Oil Equivalent Production 149,760 BOE/d 156,500 to 158,000 BOE/d +5% D/C/E CapEx(2) $350.7 million $330 to
Slide 33: 2024E Operating Cost Estimates
2024E Operating Cost Estimates ($/BOE) 2023 Q1 2024 2024E(1) 1 Production taxes, transportation and processing (“PTTP”) $5.50 $5.15 $5.50 to $6.50 2 Lease operating (“LOE”) $5.06 $5.60 $5.25 to $5.75 3 Plant and other midstream services operating (“POMS”) $2.68 $2.91 $2.25 to $2.75 4 Depletion, depr
Slide 34: Q1 2024 & Q2 2024E Commodity Price Differentials
Q1 2024 & Q2 2024E Commodity Price Differentials Q1 2024 Q2 2024E Actual Actual Realized Commodity Prices Benchmark(1) Differential Guidance(2) Realized Price Differential Oil Prices, per Bbl $76.91 $77.58 +$0.67 $0.00 to +$1.00 (Above Benchmark) Natural Gas Prices, per Mcf $2.10 $2.96 +$0.86 -0.50
Slide 35: ESG Stewardship
ESG Stewardship April 23, 2024
Slide 36: 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 37: Committed to Environmental, Social and Governance (ESG) Stewardship
Committed to Environmental, Social and Governance (ESG)(1) Stewardship ENVIRONMENTAL Increased transportation on pipeline Continued reduction of Meaningful use of non-fresh water, Operated Produced Water on Pipe per-barrel emissions(2) including recycled water 400 Barrels Transported via Pipline Pip
Slide 38: Appendix
ay, ¢ Matador ier RESOURCES COMPANY Appendix April 23, 2024 NYSE
Slide 39: Profitable (and Consistent) Production Growth at a Measured Pace
Profitable (and Consistent) Production Growth at a Measured Pace Expect 23% Oil 160,000 Increase in 2024(1) 156,000 140,000 131,813 Daily Oil, Gas and BOE Production 120,000 105,465 100,000 86,176 (BOE/d) 80,000 75,175 66,203 60,000 52,128 38,936 40,000 27,890 24,955 20,000 16,082 11,740 5,699 - (1)
Slide 40: Strong Well Results from the Advance Acquisition
Strong Well Results from the Advance Acquisition 21 Dagger Lake South Wells Turning to Sales in Q2 2024 21 Margarita Wells Ranger Selected 24-hour IP Test Results Average 1,600 BOE/d (21 wells) (84% oil) Stebbins #16H 2,593 BOE/d (3rd Bone Spring Carbonate) (86% oil) Margarita Highlights 21 gross
Slide 41: Steady Growth, Measured Pace
Steady Growth, Measured Pace 460.1 MMBOE 500 3.83 BOE/share 4.00 450 3.50 Total Proved Reserves, MMBOE 400 3.00 350 26% CAGR BOE Per Share 2.50 300 250 2.00 200 1.50 150 1.00 100 0.50 50 0 0.00 IPO 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Q4 2023 2023 Oil Gas BOE/Share Note: The reserves es
Slide 42: Year-End 2023 Total Proved Reserves – 460.1 Million BOE
Year-End 2023 Total Proved Reserves – 460.1 Million BOE Reserves By Reserves By Category Commodity 63% 59% Developed Undeveloped Oil Natural Gas 63% Developed(1) 59% Oil 29% Reserves Growth Increase YoY Note: As of December 31, 2023. 42 (1) Ratio of Total Proved Developed Reserves to Total Proved Re
Slide 43: U-Turn Wells – What’s Next?
U-Turn Wells – What’s Next? Exploring the Possibility of Drilling Up to 20 U-Turn Wells in 2024 and 2025 16 One-Mile Wells 8 U-Turn wells Note: Graphic is illustrative of potential development. Expectations are as of and as provided on February 20, 2024. 43
Slide 44: Record Setting MAXCOM Results
Record Setting MAXCOM Results Over 6 Years of Operation 270 Matador Drilling Records and $43 Million Estimated Savings To Date Delaware Drilling Records Spud to Total Depth – 1 Mile Lateral: 9.5 Days Spud to Total Depth – 2 Mile Lateral: 8.3 Days Spud to Total Depth – 2.4 Mile Lateral: 15.7 Da
Slide 45: San Mateo Third-Party Volumes and Revenues Continue to Grow
San Mateo Third-Party Volumes and Revenues Continue to Grow San Mateo Midstream Services Revenues (Non-Matador) 26% Year-Over-Year ($ in millions) Increase in 2023 $80 $71 $60 $56 $44 $39 $37 $40 $20 $7 $0 $0 2017 2018 2019 2020 2021 2022 2023 Record Single Day Natural Gas Processing Volume in Q4 20
Slide 46: Hedging Profile
Hedging Profile Waha-Henry Hub Basis Swaps 5,000 4,500 4,000 Gas Volume Hedged (MMBtu) 3,500 3,000 2,730 2,730 2,730 2,730 2,730 2,730 2,730 2,500 2,000 1,500 Swap Swap Swap Swap Swap Swap Swap at at at at at at at -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 1,000 500 0 Q2 2024 Q3 2024 Q4 2024
Slide 47: Matador Resources and San Mateo Credit Facilities
Matador Resources and San Mateo Credit Facilities RBL Extended & Commitments Increased in March 2024 Matador Credit Agreement Summary Bank group led by PNC Bank Last Elected Borrowings Letters of Credit Financial Covenant: Facility Maturity Borrowing Financial Covenant: Reserves Borrowing Outstandin
Slide 48: Simple Balance Sheet – No Near-Term Debt Maturities
Simple Balance Sheet – No Near-Term Debt Maturities Debt Maturities ($ in millions) As of April 23, 2024 $2,500 $2.5 billion borrowing base Senior Notes $2,250 Revolver Borrowings Outstanding $2,000 Letters of Credit $1,750 $1.5 billion elected $1,500 commitment $1,250 $900 $1,000 million $750 $500
Slide 49: Q1 2024 Selected Operating and Financial Results
Q1 2024 Selected Operating and Financial Results Three Months Ended March 31, 2024 December 31, 2023 March 31, 2023 Net Production Volumes:(1) Oil (MBbl) 7,715 8,157 5,305 Natural gas (Bcf) 35.5 36.2 25.8 Total oil equivalent (MBOE) 13,628 14,192 9,599 Average Daily Production Volumes:(1) Oil (Bbl/d
Slide 50: 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 51: 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 and net cash provided by operating activities, respectively. (In thousands) 1Q 2023 2Q 202
Slide 52: Adjusted EBITDA Reconciliation – San Mateo (100%)
Adjusted EBITDA Reconciliation – San Mateo(1) (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 operating activities, respectively, for San Mateo Midstream, LLC. (In t
Slide 53: 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 operating activities, respectively, for San Mateo Midstream, LLC. Year Ended Decembe
Slide 54: 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) Mar
Slide 55: 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,
Matador Resources Company — Q1 2024 Earnings Presentation on 6ix