Matador Resources Company · NYSE:MTDR
Matador Resources — Q4 2023 Earnings Presentation
62 slides from Matador Resources's earnings presentation, Feb 21, 2024
Slide 1: Fourth Quarter and Year-End 2023 Earnings Release
Fourth Quarter and Year-End 2023 Earnings Release February 20, 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 Resources Company (“Matador” or the “Company”) during the course of this presentation includes “forward-looking Investor Relations Contact statements” with
Slide 3: Chairman's Remarks
Chairman’s Remarks February 20, 2024
Slide 4: Driving Profitability Through Operational Excellence
SLIDE A Driving Profitability Through Operational Excellence MTDR Leads Peer Group in Oil and Natural Gas Revenue Per BOE(1) and Netbacks per BOE(1)(2) $70 $50 $60 $40 $50 $30 $40 $30 $20 $20 $10 $10 $0 $0 Oil and Natural Gas Revenue per BOE(1) Netbacks per BOE(1)(2) Source: Bloomberg LP and company
Slide 5: Expecting Oil Growth of ~10% from Q4 2023 to Q4 2024
SLIDE B Expecting Oil Growth of ~10% from Q4 2023 to Q4 2024(1) Avg. Daily Oil Production (Bbl/d) (2) 97,500 88,663 Q4 2023 Q4 2024E (1) As of and as provided on February 20, 2024. 5 (2) At the midpoint of fourth quarter 2024 estimated average oil production of 97,000 – 98,000 barrels of oil per day
Slide 6: Peer Leading Well Productivity
SLIDE C 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. 6 Note: Includes all operated horizontal wells turned to production since January 1, 2020. P
Slide 7: Matador Resources Company – Company Highlights
SLIDE D 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 RUS
Slide 8: Record Production in 2023
SLIDE E Record Production in 2023 2023 Production Records Quarterly: 154,261 BOE/d Annual: 131,813 BOE/d 154,261 Avg. Daily Production (BOE/d) ~100,000 Early January 2023 Q4 2023 Actual 8
Slide 9: Increasing Capital Efficiencies
SLIDE F Increasing Capital Efficiencies LOE PER BOE D&C CAPEX PER FOOT DOWN DOWN $5.75 $1,175 Drilling and Completion Capital Expenditures Barrel of Oil Equivalent (BOE), $/BOE Lease Operating Expenses (LOE) per Per Completed Lateral Length(1), $/ft $1,150 $5.50 $5.50 $1,125 $1,125 $5.25 $1,100 $5.2
Slide 10: 29% Growth in Total Proved Reserves Year-over-Year
SLIDE G 29% Growth in Total Proved Reserves Year-over-Year 460.1 Million BOE 356.7 Million BOE +103 MMBOE Year-End 2022 Year-End 2023 SEC Price SEC Price Oil: $90.15/Bbl Oil: $74.70/Bbl Gas: $6.36/MMBtu Gas: $2.64/MMBtu Note: Oil and natural gas prices noted are in $/Bbl and $/MMBtu, respectively. P
Slide 11: Strong Well Results from the Advance Acquisition
Strong Well Results from the Advance Acquisition SLIDE H 21 Dagger Lake South Wells Turning to Sales in Q2 2024 21 Margarita Wells Ranger Selected 24-hour IP Test Results Average 1,600 BOE/d (21 wells) (84% oil) Stebbins #16H 2,593 BOE/d (3rd Bone Spring Carbonate) (86% oil) Margarita Highlights ➢ 2
Slide 12: Building Delaware Basin Position “Brick by Brick”
Building Delaware Basin Position “Brick by Brick” SLIDE I Now 152,200 Net Acres 2012 2017 2023 ~7,500 Net Acres ~114,000 Net Acres ~152,200 Net Acres 6 Wells 212 Wells 774 Wells EDDY LEA EDDY LEA EDDY LEA LOVING LOVING LOVING Matador Acreage Matador Acreage Matador Acreage WARD WARD Note: All acreag
Slide 13: Record Third-Party Revenues
SLIDE J Record Third-Party Revenues San Mateo Midstream Services Revenues (Non-Matador) 26% Year-Over-Year ($ 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 2023 434 MMcf/d – 94% of N
Slide 14: Profitable (and Consistent) Production Growth at a Measured Pace
SLIDE K 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 (BOE/d) 86,176 80,000 75,175 66,203 60,000 52,128 38,936 40,000 27,890 24,955 20,000 16,082 11,740 5,6
Slide 15: Simul-Frac and Trimul-Frac Operations
SLIDE L 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 Currently Testing “Trimul-Frac!” Introduced Completed Lateral Footage per day Simul-frac 2020 2021 2022 2023 Tri-Frac 15
Slide 16: U-Turn Wells – What's Next?
SLIDE M U-Turn Wells – What’s Next? Exploring the Possibility of Drilling Up to 20 U-Turn Wells in 2024 and 2025 Sixteen One-Mile Wells Eight U-Turn wells Note: Graphic is illustrative of potential development. Expectations are as of and as provided on February 20, 2024. 16
Slide 17: Midstream Assets Continue to Add Value and Flow Assurance
SLIDE N Midstream Assets Continue to Add Value and Flow Assurance ~540 miles of three-stream pipelines(1) 1 Ranger Stebbins Pronto to San Mateo Connection 1 (Expected Online Q1 2024) Bi-Directional Flow 2 2 3 Marlan Plant Expansion Rustler Breaks (Expected Online H1 2025) Adds 200 MMcf/d of Capacity
Slide 18: MTDR Shares Significantly Outperforming Since IPO!
SLIDE O MTDR Shares Significantly Outperforming Since IPO! Since IPO (February 2, 2012) through February 16, 2024 close Matador Has Outperformed S&P 500 and Russell 2000 since IPO! MTDR all time high @ $73.78! MTDR +394% S&P 500 +279% R2000 +154% 0% Oil (-19%) XOP (-36%) MTDR all time low @ $1.11 du
Slide 19: Operational and Financial Results
Operational and Financial Results February 20, 2024
Slide 20: Matador Resources Company Overview
Matador Resources Company Overview Market Snapshot NYSE Symbol MTDR Market Capitalization(1) $7.1 billion Avg. Daily Production – Q4 2023 154.3 MBOE/d Net Debt / LTM Adj. EBITDA(2)(3) – Q4 2023 ~0.9x DELAWARE BASIN HAYNESVILLE/ 152,200 net acres COTTON VALLEY Adj. Free Cash Flow(2) – Q4 2023 $181 mi
Slide 21: 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 turned to sales on Advance properties in 2H 2023 ▪5 9 Wolf wells turned to sales in 2H 2023, including
Slide 22: 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) Q4 2023 BOE up 14% sequentially; Q4 2023 BOE up 15% sequentially; 160,000 up 38% YoY 154,261 160,000 up 41% YoY 149,831 135,096 140,000 140,000
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: 2023 Capital Investment Plan Summary
2023 Capital Investment Plan Summary $1.31 billion – At Midpoint of Guidance Range(1) Full Year 2023 CapEx(2)(3) – $1.31 billion 2023 Wells Turned to Sales Guidance Range(1) Actual Gross Net At Drilling, Completing, Equipping $1.10 to $1.22 billion $1.16 billion midpoint Operated 119 94.1 Operated D
Slide 25: Horizontal Wells Completed and Turned to Sales – Q4 2023
Horizontal Wells Completed and Turned to Sales – Q4 2023 ▪ During the fourth quarter of 2024, Matador turned to sales a total of 55 gross (30.8 net) horizontal wells across its various operating areas. This total was comprised of 39 gross (29.5 net) operated wells and 16 gross (1.3 net) non-operated
Slide 26: Horizontal Wells Completed and Turned to Sales – Full Year 2023
Horizontal Wells Completed and Turned to Sales – Full Year 2023 ▪ During full year 2023, Matador completed and turned to sales 245 gross (100.4 net) horizontal wells, including 119 gross (94.0 net) operated wells and 126 gross (6.4 net) non-operated wells ‒ Average lateral length for operated wells
Slide 27: 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. 27 (1) Ratio of Total Proved Developed Reserves to Total Proved Re
Slide 28: 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 29: 2023 Accomplishments – Advance Transaction
2023 Accomplishments – Advance Transaction 2023 Advance Ranger Highlights Stebbins 18,500 Net Acres(1) 203 Rustler Breaks Net Locations(2) 106.4 MMBOE Reserves(2) Stateline Matador Acreage Significant Acquired Advance Acreage Existing Pipeline Future Pipeline Wolf Midstream Value Note: All acreage a
Slide 30: 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 < 1.0x(1) $150 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 as
Slide 31: Record Production
Record Production ▪ Record oil, natural gas and total production! − Record oil equivalent production - 154,261 BOE per day − Record oil production - 88,663 Bbl per day − Record natural gas production - 393.6 million cubic feet per day All-Time High! Better than Guidance by 160,000 154,261 Oil Natura
Slide 32: Better Than Expected San Mateo Results in Q4 2023
Better Than Expected San Mateo Results in Q4 2023 San Mateo Average Natural Gas Gathering San Mateo Average Natural Gas Processing (MMcf/d) (MMcf/d) Record Quarter! Record Quarter! 450 450 416 413 400 385 400 373 352 350 333 331 350 328 350 305 300 300 250 250 200 200 150 150 100 100 50 50 0 0 4Q22
Slide 33: San Mateo Midstream Outperformed Expectations!
San Mateo Midstream Outperformed Expectations! ▪ Adjusted EBITDA(1),natural gas and water volumes were better than expected! − Adjusted EBITDA(1) of $62 million is better than Guidance by 4% – RECORD QUARTER! − Natural gas processing volumes of ~413 MMcf per day – RECORD QUARTER! − Natural gas gathe
Slide 34: Operating Plan and Market Update
Operating Plan and Market Update February 20, 2024
Slide 35: 2024 Guidance
2024 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% Oil Equivalent Production 131,813 BOE/d 153,000 to 159,000 BOE/d + 18% D/C/E CapEx(3) $1.16
Slide 36: 2024 Capital Investment Plan Summary
2024 Capital Investment Plan Summary(1) Full Year 2024E CapEx(2) – $1.425 billion – Midpoint (Added 8th operated drilling rig in late January 2024) Actual % YoY 2024 Guidance 2023 Results Change(3) Drilling, Completing, Equipping(2) $1.16 million $1.10 to $1.30 billion +3% Operated D/C/E(4) $1.05 bi
Slide 37: Q1 2024 Guidance
Q1 2024 Guidance(1) Guidance Metric Q1 2024 Guidance Range Oil Production 83,000 to 84,000 Bbl/d Natural Gas Production 372.0 to 375.0 MMcf/d Oil Equivalent Production 145,000 to 146,500 BOE/d D/C/E CapEx(2) $350 to $420 million Midstream CapEx(3) $70 to $90 million Total D/C/E and Midstream CapEx $
Slide 38: Wells Turned to Sales – 2024 Full Year & Q1 Guidance
Wells Turned to Sales – 2024 Full Year & Q1 Guidance(1) ▪ During full year 2024, Matador expects to turn to sales 128 gross (94.0 net) operated horizontals wells ▪ In 2024, Matador expects to continue to focus its operations on longer laterals of two miles and greater ‒ Matador estimates its average
Slide 39: 2024E Operating Cost Estimates
2024E Operating Cost Estimates(1) ($/BOE) 2023 Q4 2023 2024E 1 Production taxes, transportation and processing (“PTTP”) $5.50 $5.31 $5.50 to $6.50 2 Lease operating (“LOE”) $5.06 $5.06 $5.25 to $5.75 3 Plant and other midstream services operating (“POMS”) $2.68 $2.56 $2.25 to $2.75 4 Depletion, depr
Slide 40: Q4 2023 & Q1 2024E Commodity Price Differentials
Q4 2023 & Q1 2024E Commodity Price Differentials Q4 2023 Q1 2024E Actual Actual Realized Commodity Prices Benchmark(1) Differential Guidance(2) Realized Price Differential Oil Prices, per Bbl $78.53 $79.00 +$0.47 -$0.50 to +$0.50 (At Benchmark) Natural Gas Prices, per Mcf $2.92 $3.01 +$0.09 $0.00 to
Slide 41: Growing Midstream and Upstream Businesses Together
Growing Midstream and Upstream Businesses Together Record Adjusted EBITDA(1) - $200 Million $250 $225 San Mateo's Adjusted EBITDA ($ in millions)(1) $198 $200 $200 Natural Gas $185 Oil Natural Water Gas $154 $150 $113 Oil $96 $100 $62 Water $50 $31 $12 $0 (3) 2016 2017 2018 2019 2020 2021 2022 2023
Slide 42: Marlan Plant and Marlan II Expansion
Marlan Plant and Marlan II Expansion Marlan II Marlan I 200 MMcf/d Expansion 60 MMcf/d Processing Capacity + Integrated with Marlan I Plant Nitrogen Rejection Unit Pronto to San Marlan Plant Initiate Plant Mateo Connector Expansion Expansion Operational Operational H2 2023 H1 2024 H2 2024 H1 2025 Pr
Slide 43: ESG Stewardship
ESG Stewardship February 20, 2024
Slide 44: 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 45: 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 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 46: Appendix
ay, {Matador fies RESOURCES COMPANY Appendix MIDR NYSE
Slide 47: Steady Growth, Measured Pace
Steady Growth, Measured Pace 460.1 MMBOE 500 3.83 BOE/share 4.00 450 Total Proved Reserves, MMBOE 3.50 400 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 48: Q4 and Year-End 2023 Selected Operating and Financial Results
Q4 and Year-End 2023 Selected Operating and Financial Results Three Months Ended Year Ended December 31, September 30, December 31, December 31, December 31, 2023 2023 2022 2023 2022 Net Production Volumes:(1) Oil (MBbl) 8,157 7,133 5,733 27,542 21,943 Natural gas (Bcf) 36.2 31.8 27.3 123.4 99.3 Tot
Slide 49: Matador Resources and San Mateo Credit Facilities Increased in 2023
Matador Resources and San Mateo Credit Facilities Increased in 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 Net Debt
Slide 50: Simple Balance Sheet – No Near-Term Debt Maturities
Simple Balance Sheet – No Near-Term Debt Maturities Debt Maturities ($ in millions) As of December 31, 2023 $2,750 $2,500 Senior Notes $2.5 billion borrowing base(1) Revolver Borrowings Outstanding $2,250 Letters of Credit $2,000 $1,750 $1,500 $1.325 billion elected commitment $1,250 $1,000 $699 mil
Slide 51: 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 Wolf Loving ~43 miles Reeves Loving Rustler Breaks Ward Eddy Lea Natural Gas Gathering and Processing ▪ 460 MMcf/d of designed natural gas cryogenic processing capacity fo
Slide 52: Record Setting MAXCOM Results
Record Setting MAXCOM Results Over 5 Years of Operation 262 Matador Drilling Records and $40 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 53: Hedging Profile
Hedging Profile Waha-Henry Hub Basis Swaps 4,000 3,500 Gas Volume Hedged (MMBtu) 3,000 2,730 2,730 2,760 2,760 2,700 2,730 2,760 2,760 2,500 2,000 1,500 Swap Swap Swap Swap Swap Swap Swap Swap at at at at at at at at -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 -$0.59 1,000 500 0 Q1 2024 Q2 2024
Slide 54: San Mateo – Midstream Assets Continue to Add Value to Matador
San Mate and – Midstream Assets Continue to Add Value to Matador (1) Ranger Stebbins Gathering Assets (oil, natural gas and water) 2017 ~ 60 miles of three-stream pipelines 2023 ~540 miles of three-stream pipelines(1) Processing Capacity 2017 60 MMcf per day Rustler Breaks 2023 520 MMcf per day(2) S
Slide 55: 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 56: 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 2021 2Q 202
Slide 57: Adjusted EBITDA Reconciliation – Matador Resources Company, Consolidated
Adjusted EBITDA Reconciliation Matador Resources Company, Consolidated The following table presents our 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. (In thousands) 2021 2
Slide 58: 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. Three
Slide 59: 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 60: 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 Year Ended Decembe
Slide 61: 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 62: PV-10 Reconciliation
PV-10 Reconciliation 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 net revenues. PV-10 is not an estimate of the fair market value of the Co
Matador Resources Company — Q4 2023 Earnings Presentation on 6ix