Ring Energy, Inc. · AMEX:REI
Ring Energy — FY2022 Earnings Presentation
35 slides from Ring Energy's earnings presentation, Mar 10, 2023
Slide 1: Value Focused Proven Strategy
www.ringenergy.com NYSE American: REI VALUE FOCUSED PROVEN STRATEGY Exhibit 99.2
Slide 2: Forward-Looking Statements and Cautionary Note Regarding Hydrocarbon Disclosures
www.ringenergy.com NYSE American: REI Forward-Looking Statements and Cautionary Note Regarding Hydrocarbon Disclosures Forward –Looking Statements This Presentation includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Se
Slide 3: Value Focused Proven Strategy Supporting Sustainable Returns
www.ringenergy.com NYSE American: REI Value Focused Proven Strategy Supporting Sustainable Returns KEY TAKEAWAYS Added Size & Scale - accretive acquisition of Stronghold assets Closed on August 31, 2022 Delivered Record Results1 - net sales, cash flow from operations, and Adj. EBITDA 2022 year-over-
Slide 4: Independent Oil & Gas Company Focused on Conventional Permian Assets in Texas
www.ringenergy.com NYSE American: REI Independent Oil & Gas Company Focused on Conventional Permian Assets in Texas 2022 SEC Proved Reserves1,2 138.1 MMBoe/PV10 $2,774MM Proved Developed 65% Gross / Net Acres3 Permian Basin 124,216 / 102,174 400+ Proved Locations Generated Free Cash Flow for 13 Cons
Slide 5: Corporate Strategy: Value Focused for Sustainable Returns
www.ringenergy.com NYSE American: REI Corporate Strategy Value Focused for Sustainable Returns Attract and Retain Highly Qualified People Pursue Operational Excellence with a Sense of Urgency Invest in High-Margin, High RoR Projects Focus on FCF2 and Strengthen Balance Sheet Pursue Strategic A&D to
Slide 6: 2022 Highlights: Proven Strategy Leads to Record Results
www.ringenergy.com NYSE American: REI 1. Includes four months of Stronghold acquisition which closed on August 31, 2022 as well as conversion from 2-stream to 3-stream financial reporting of oil, natural gas and NGL production beginning July 1, 2022 2. Adjusted EBITDA, Free Cash Flow and Cash Flow f
Slide 7: Enhancing Value for Shareholders: Executing Strategy Improves Key Metrics
www.ringenergy.com NYSE American: REI Enhancing Value for Shareholders Executing Strategy Improves Key Metrics1 1. Adjusted EBITDA, Free Cash Flow, PV-10 and Cash Flow from Operations are Non-GAAP financial measures. See Appendix for reconciliation to GAAP measures 2. PV-10 is a Non-GAAP financial m
Slide 8: Enhancing Value for Shareholders: Executing Strategy Improves Key Metrics
www.ringenergy.com NYSE American: REI Enhancing Value for Shareholders Executing Strategy Improves Key Metrics 8 1. ROCE is a Non-GAAP financial measure. See Appendix for reconciliation to GAAP measure 2. All in cash costs includes LOE, severance and ad-valerum taxes, operating expenses leases, cash
Slide 9: 2023 Outlook: Proven Strategy Leads to Shareholder Value
www.ringenergy.com NYSE American: REI 0 5,000 10,000 15,000 Oil Sales BOPD Focus on FCF and Strengthening Balance Sheet Pursue Operational Excellence with a Sense of Urgency Invest in High-Margin, High ROR Projects Capex $135 to $170 Million Mid-point $152.5 Million Net Sales 17,800 to 18,800 Boe/d
Slide 10: Proved Reserves and Inventory SEC YE 2022
www.ringenergy.com NYSE American: REI Proved Reserves1 and Inventory SEC YE 2022 1. Reserves as of 1/1/23 utilizing SEC prices, YE 2022 SEC Pricing Oil $90.15 per bbl Gas $6.358 per Mcf 2. PV-10 is a Non-GAAP financial measure. See Appendix for reconciliation to GAAP measure 3. Includes all location
Slide 11: Compelling Value Proposition
www.ringenergy.com NYSE American: REI Compelling Value Proposition Proven Strategy Leads to Shareholder Value1,2 1. Peers include: Amplify, Berry, Crescent, Highpeak, Permian Resources and Vital Energy 2. Source information for data obtained from Peer Reports and Capital IQ 3. Adjusted EBITDA and PV
Slide 12: Value Proposition 2023 and Beyond
www.ringenergy.com NYSE American: REI Value Proposition 2023 and Beyond ❖ Trading at a discount to peer average ❖ Delivering higher returns than peer average ❖ Value focused strategy is proven by record 2022 results ❖ Disciplined and capital efficient budget is focused on maintaining production leve
Slide 13: Committed to ESG
www.ringenergy.com NYSE American: REI Committed to ESG Critical to Sustainable Success Progressing our ESG Journey ▪ Created ESG Task Force to monitor Company’s adherence to ESG standards and formally communicate to CEO and the Board on ongoing basis ▪ Established Target Zero 365 (TZ-365) Safety & E
Slide 14: Financial Overview
Financial Overview
Slide 15: Sustainable Value Focused Results
www.ringenergy.com NYSE American: REI Sustainable Value Focused Results Executing Disciplined Strategy 8,790 8,519 12,364 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2020 2021 2022 B o e /d Net Sales $20.7 $30.6 $107.5 $0 $20 $40 $60 $80 $100 $120 2020 2021 2022 $ M ill io n Adjusted Net Income1
Slide 16: Historical Metrics: Quarterly Analysis of FCF
www.ringenergy.com NYSE American: REI Historical Metrics Quarterly Analysis of FCF1 $24.0 $35.6 $47.4 $56.0 $56.3 -$11.3 -$19.7 -$41.8 -$40.3 -$42.6 -$3.4 -$3.2 -$3.1 -$5.9 -$8.2 $9.3 $12.6 $2.5 $9.7 $5.5 -$50 -$40 -$30 -$20 -$10 $0 $10 $20 $30 $40 $50 $60 $70 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Q4 2022
Slide 17: Reducing Debt & Increasing Liquidity
www.ringenergy.com NYSE American: REI Reducing Debt & Increasing Liquidity Disciplined Capital Spending & Sustainably Generating FCF is the Key $8 $5 $6 $5 $10 $10 $17 $20 $0 $5 $10 $15 $20 $25 Q1'21 Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 $ M ill io n Debt Paydown Stronghold Acquisition $313 MM o
Slide 18: Asset Overview
Asset Overview ENERGY
Slide 19: Company Overview Operating Statistics
www.ringenergy.com NYSE American: REI Company Overview Operating Statistics Q4 2022 Net Production (MBoe/d) 17.9 Oil (Bo/d) ~ 68% Gas (Mcf/d) ~ 17% NGLs (Bbls/d) ~ 15% 12.2 18.3 2.6 LOE ($ per Boe) $10.6 YE22 PD Reserves1 PV10 ($MM) $1,907 YE22 PD Reserves1 (MMBoe) 90 Net Acreage (thousand) ~102 Cap
Slide 20: Core Assets in NWS and CBP
www.ringenergy.com NYSE American: REI Core Assets in NWS and CBP 62% 66% 56% 31% 29% 42%1 7% 5% 2% 0 2,000 4,000 6,000 8,000 10,000 12,000 14,000 2020 2021 2022 N et S al e s B o e /d NWS CBP DLWR Record Sales Focus investments on growing core asset areas in NWS & CBP 58% 56% 65% 42% 44% 35% 0 20,00
Slide 21: Assets Overview: New Drill Inventory Performance
www.ringenergy.com NYSE American: REI 0 5,000 10,000 15,000 20,000 25,000 30,000 2020 2021 2022 C u m 1 8 0 -D ay /w e ll A vg ., B O E Assets Overview New Drill Inventory Performance 0 10 20 30 40 50 Vertical Horizontal SP U D t o O n lin e R an ge p e r W e ll Ty p e (D ay s) Shorter Cycles Times
Slide 22: Asset Overview: Inventory of High Quality, High-Return, Short Cycle Opportunities
www.ringenergy.com NYSE American: REI Asset Overview Inventory of High Quality, High-Return, Short Cycle Opportunities Recent Hz Well Results – NWS 1. Vertical completion no lateral length noted 2. Peak IP 60 (Boepd) based on rolling 60-day average Recent Recompletion Results – CBP South Recent Hz W
Slide 23: San Andres Reservoir: Proven, Conventional, Top Tier Returns
www.ringenergy.com NYSE American: REI San Andres Reservoir Proven, Conventional, Top Tier Returns San Andres Hz Delaware Hz Midland Hz High ROR Oil Play ✓ ✓ ✓ Low D&C Costs ✓ Lower 1st Year Decline ✓ Low Lease Acquisition Cost ✓ Long life wells ✓ Oil IPs >750 Bbl/d ✓ ✓ Multiple Benches ✓ ✓ > 85% Oil
Slide 24: Appendix
Appendix ENERGY
Slide 25: 2023 Guidance
www.ringenergy.com NYSE American: REI 70% 23% 7% D,C&E Recomp/Cap Workovers Land/Non-op/Other CAPEX Allocation Mid Point $152.5 million 2023 Guidance Grow Production, Generate FCF, Pay Down Debt Sales Volumes Q1 2023 FY 2023 Total (Boe/d) 17,800 – 18,300 17,800 – 18,800 Oil (%) 68% 66-70% Gas (%) 17
Slide 26: Financial Overview: Derivative Summary
www.ringenergy.com NYSE American: REI Financial Overview Derivative Summary (1) The two-way collars for February and March of 2023 include 2x1 collars where the put volumes of 236,000 are two times the call volumes of 118,000. (2) The WAHA basis swaps in place for the calendar year of 2023 consist o
Slide 27: Income Statement and Operational Stats
www.ringenergy.com NYSE American: REI Income Statement and Operational Stats Income Statement Operational Stats (1) Beginning July 1, 2022, revenues were reported on a three-stream basis, separately reporting crude oil, natural gas, and natural gas liquids volumes and sales. For periods prior to Jul
Slide 28: Balance Sheet and Cash Flow Statement
www.ringenergy.com NYSE American: REI Balance Sheet and Cash Flow Statement Balance Sheet (Unaudited) December 31, December 31, 2022 2021 ASSETS Current Assets Cash and cash equivalents $ 3,712,526 $ 2,408,316 Accounts receivable 42,448,719 24,026,807 Joint interest billing receivable 983,802 2,433,
Slide 29: Non-GAAP Disclosure
www.ringenergy.com NYSE American: REI Non-GAAP Disclosure Certain financial information included in this Presentation are not measures of financial performance recognized by accounting principles generally accepted in the United States (“GAAP”). These non-GAAP financial measures are “Adjusted Net In
Slide 30: Non-GAAP Reconciliations
www.ringenergy.com NYSE American: REI Non-GAAP Reconciliations Adjusted Net Income December 31, September 30, December 31, December 31, December 31, 2022 2022 2021 2022 2021 Net Income (Loss) $ 14,492,669 $ 75,085,891 $ 24,112,210 $ 138,635,025 $ 3,322,892 Share-based compensation 2,198,043 1,543,03
Slide 31: Management Team
www.ringenergy.com NYSE American: REI Add Photo Add Photo Add Photo Add Photo Add Photo Paul D. McKinney Chairman & Chief Executive Officer 39+ years of domestic & international oil & gas industry experience Executive & board roles include CEO, President, COO, Region VP and public & private board di
Slide 32: Refreshed Board of Directors
www.ringenergy.com NYSE American: REI Paul D. McKinney Chairman & Chief Executive Officer 35+ years of domestic & international oil & gas industry experience Executive & board roles include CEO, President, COO, Region VP and public & private board directorships Anthony D. Petrelli Lead Independent D
Slide 33: Vertical Well Performance & Costs
www.ringenergy.com NYSE American: REI 1 10 100 1,000 10,000 100,000 0 100 200 300 C u m P ro d u ct io n , B O E Days Online 2022 Target Area 1 Vertical R/C Avg Historical 2019-2021 well RC performance Southern Central Basin Platform Vertical Well Performance & Costs ~530 Avg ~410 Avg ~420 Avg Moder
Slide 34: Maximizing Operational Margin: Leading Low-Cost Operator
www.ringenergy.com NYSE American: REI 0 50 100 150 200 2018 2019 2020 2021 2022 NWS CBP CTRs in NWS & CBP HZ Reduce Operating Costs Maintains Solid PDP Reserve Base that Generates Consistent FCF Increases reserves by reducing operating & well repair costs and extending well life ▪ ~50% long-term red
Slide 35: Analyst Coverage and Company Contact
ANALYST COVERAGE Alliance Global Partners (A.G.P.) Jeff Grampp (713) 349-1067 jgrampp@allianceg.com ROTH Capital Partners John M. White (949) 720-7115 jwhite@roth.com Truist Financial Neal Dingmann (713) 247-9000 neal.dingmann@truist.com Tuohy Brothers Investment Noel Parks (215) 913-7320 nparks@tuo