Matador Resources Company · NYSE:MTDR
Matador Resources — Q2 2024 Earnings Presentation
56 slides from Matador Resources's earnings presentation, Jul 24, 2024
Slide 1: Second Quarter 2024 Earnings Release
Second Quarter 2024 Earnings Release July 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 July 23, 2024
Slide 4: Core Delaware Basin Net Acreage and Inventory Growth
SLIDE A Core Delaware Basin Net Acreage and Inventory Growth Average Production: 3,317 Bbl/d 21,510 Bbl/d 95,488 Bbl/d 2012 2017 June 30, 2024(1) ~7,500 Net Acres ~114,000 Net Acres ~191,900 Net Acres Inventory: 39 Gross / 25 Net 4,630 Gross / 1,958 Net 5,038 Gross / 1,998 Net(2) Average Lateral: 4,
Slide 5: Quality Inventory Depth
SLIDE B Quality Inventory Depth 10 to 15-year inventory with an average estimated rate-of-return better than 50%(1)(2) % of 2024 Drilling Program Average 9,200’ Brushy Canyon 2% Lateral Length Avalon 3% 1st Bone Spring 13% 2nd Bone Spring Carb 2nd Bone Spring 30% 3rd Bone Spring Carb 9% 3rd Bone Spr
Slide 6: Profitable (and Consistent) Production Growth at a Measured Pace
SLIDE C Profitable (and Consistent) Production Growth at a Measured Pace 95,000 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 7: Matador + Ameredev: +31% Pro Forma Reserves Increase
SLIDE D Matador + Ameredev: +31% Pro Forma Reserves Increase Total Proved Reserves: 602.1 million BOE (59% oil) for Combined Company(1) Estimated Reserves 484.4 million BOE to Production Life 59% Oil ~10-12 Years(2) 484.4 Million BOE (Total Proved Reserves) +117.7 Million BOE (Total Proved Reserves)
Slide 8: MTDR Performance vs. Peers Since Ameredev Announcement
SLIDE E MTDR Performance vs. Peers Since Ameredev Announcement Since June 13, 2024 through July 19, 2024 close MTDR #1 PERFORMER MTDR +12% Peer 1 +12% Peer 2 +11% Peer 3 +9% Peer 4 +8% Peer 5 +7% Peer 6 +6% Peer 7 +6% Peer 8 +4% Peer 9 +1% Peer 10 +1% 0% Peer 11 (-1%) Peer 12 (-1%) Source: Bloomberg
Slide 9: Matador's Proposed Acquisition of Ameredev
SLIDE F Matador’s Proposed Acquisition of Ameredev ACQUISITION DETAILS Pending Ameredev Acquisition Overview TWIN LAKES Price: $1.905 billion(1) Strategic bolt-on in the Northern Delaware Basin 33,500 contiguous net acres 82% Held-by-Production Effective Date: 6/1/2024 Includes ~19% stak
Slide 10: Advance Acquisition in April 2023 Exceeding Expectations
SLIDE G Advance Acquisition in April 2023 Exceeding Expectations 21 Dagger Lake South Wells Turned to Sales in Q2 2024 Margarita Highlights 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) 21 gross (20
Slide 11: Record Setting MAXCOM Results
SLIDE H Record Setting MAXCOM Results Over 6 Years of Operation 294 Matador Drilling Records and $49 Million Estimated Savings To Date Delaware Drilling Records Spud to Total Depth – 2 Mile Lateral: 8.3 Days Spud to Total Depth – 2.5 Mile Lateral: 14.0 Days Longest Well: 25,256’ Total Measured
Slide 12: U-Turn Wells – Savings Through Operational Efficiencies
SLIDE I U-Turn Wells – Savings Through Operational Efficiencies First two U-Turn wells drilled in 2023 ‒ Total savings of $10 million(1) Expected to turn to sales five U-Turn wells in 2024 ‒ Total estimated savings of $15 million(2) PREVIOUS NOW Four Single-Mile Lateral Wells Two U-Turn Wells $3
Slide 13: Matador Acquisition of Ameredev
Matador Acquisition of Ameredev July 23, 2024
Slide 14: Matador + Ameredev Combination Further Enhances Shareholder Value
Matador + Ameredev Combination Further Enhances Shareholder Value + MTDR Pro Forma Standalone Enterprise $10.3 billion (1) $12.2 billion +$1.9B Value Net Acres (2) 158,400 191,900 +33,500 net acres (Delaware) Avg. Daily 160,305 BOE/d (3) 185,805 BOE/d (4) +25,500 BOE/d Production (3) % Oil 60% 60% F
Slide 15: Ameredev Acquisition Enhances MTDR's Peer Leading EURs
Peer Leading Productivity Ameredev Acquisition Enhances MTDR’s Peer Leading Estimated Ultimate Recoveries (EURs) for Wells Turned to Production Since 2020 + Pro Forma(1) Average Oil EUR (MBbl) AMEREDEV MTDR MTDR Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 Peer 6 Peer 7 Peer 8 II + AMEREDEV PRO FORMA Source:
Slide 16: Ameredev Acquisition Enhances Status as Top Producer in New Mexico
Ameredev Acquisition Enhances Status as Top Producer in New Mexico Matador estimated to be the 7th Largest Producer in New Mexico Pro Forma for Ameredev Acquisition 450,000 600,000 400,000 550,000 350,000 300,000 Q4 2023 BOE/Day 250,000 #7 Producer 200,000 #8 Producer 150,000 100,000 50,000 #20 Prod
Slide 17: Firm Commitments to Finance Ameredev Acquisition
Firm Commitments to Finance Ameredev Acquisition Matador Credit Facility $2.5 Billion $250 Million Term Loan A $1.0 $750 Million Elected Billion(1) Commitment Increase $1.5 Billion $1.5 Billion $1.5 Billion Elected Elected Commitment Commitment Current Elected Commitment Commitments Total Commitment
Slide 18: Operational and Financial Results
Operational and Financial Results July 23, 2024
Slide 19: Q2 2024 Highlights
Q2 2024 Highlights Announced Ameredev Acquisition for $1.905B(1) Adds to Matador’s 10 to 15 years of high-quality inventory Increases Matador’s Delaware Basin acreage position to over 190,000 net acres Significant increase in Matador’s proved reserves to ~602 million BOE Includes strategic
Slide 20: Matador Resources Company Overview
Matador Resources Company Overview Market Snapshot NYSE Symbol MTDR Market Capitalization(1) $8.0 billion Avg. Daily Production – Q2 2024 160.3 MBOE/d Net Debt / LTM Adj. EBITDA(2)(3) – Q2 2024 ~0.7x DELAWARE BASIN HAYNESVILLE/ 191,900 net acres COTTON VALLEY Adj. Free Cash Flow(2) – Q2 2024 $167.0
Slide 21: Matador Resources Company – Company Highlights
Matador Resources Company – Company Highlights DELAWARE BASIN 191,900 Net Acres Core Delaware Basin E&P Assets Large Multi-Year Drilling Inventory TWIN LAKES Top 10 Producer in New Mexico #7 in Total Production RANGER ARROWHEAD Profitable Midstream Business ANTELOPE RIDGE Providing Flow Assurance RU
Slide 22: 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) $60 $45 $40 $50 $35 $40 $30 $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 23: 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 0.7x(1) ~$200 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 24: Highlights – Q2 2024 Record Production
Highlights – Q2 2024 Record Production • Record oil, natural gas and total production! - Record oil equivalent production - 160,305 BOE per day - Record oil production - 95,488 Bbl per day - Record natural gas production - 388.9 million cubic feet per day Better than Guidance by +2% Average Daily To
Slide 25: Q2 2024 Guidance vs. Q2 2024 Actuals
Q2 2024 Guidance(1) vs. Q2 2024 Actuals Oil, natural gas and total production were all better than expected! Better-than-expected production from Margarita and Dagger Lake South wells Accelerated production from H2 2024 – >1,000 Bbl/d of oil accelerated into Q2 from Dagger Lake South wells O
Slide 26: 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) Q2 2024 BOE up 7% sequentially; 200,000 Q2 2024 BOE up 8% sequentially; 200,000 up 23% YoY up 25% YoY Oil Natural Gas 180,000 Oil Natural Gas 1
Slide 27: Horizontal Wells Completed and Turned to Sales – Q2 2024
Horizontal Wells Completed and Turned to Sales – Q2 2024 During the second quarter of 2024, Matador turned to sales a total of 102 gross (41.1 net) horizontal wells across its various operating areas. This total was comprised of 47 gross (38.6 net) operated horizontal wells and 55 gross (2.5 net)
Slide 28: Delivering Strong Well Results All Around the Delaware Basin!
Delivering Strong Well Results All Around the Delaware Basin! DELAWARE BASIN Michael K Wolfcamp A-XY, 2nd Bone Spring 191,900 Net Acres Twin Lakes A #204H 24-hr IP: 2,543 BOE/d (69% oil) #121H 24-hr IP: 1,702 BOE/d (82% oil) Boros B Upper and Lower Avalon #101H 24-hr IP: 1,658 BOE/d (78% oil) #102H
Slide 29: 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 30: San Mateo – Synergistic Midstream Assets Continue to Add Value
an Mate and – Synergistic Midstream Assets Continue to Add Value to Matador ~700 miles of three-stream pipelines(1) Ranger Gathering Assets Stebbins ~595 miles of three-stream pipelines(2) (oil, natural gas and water) Oil Gathering ~400,000 acre joint development area with a subsidiary of Plains All
Slide 31: San Mateo Midstream Outperformed Expectations!
San Mateo Midstream Outperformed Expectations! Adjusted EBITDA(1) was better than expected! Adjusted EBITDA(1) of $58 million is better than expected in Q2 and up 36% year-over-year Natural gas processing volumes of ~355 MMcf per day Natural gas gathering volumes of ~393 MMcf per day Water
Slide 32: San Mateo Results in Q2 2024
San Mateo Results in Q2 2024 San Mateo Average Natural Gas Gathering San Mateo Average Natural Gas Processing (MMcf/d) (MMcf/d) 450 425 450 416 413 399 393 400 385 400 373 355 350 350 331 350 300 300 250 250 200 200 150 150 100 100 50 50 0 0 2Q23 3Q23 4Q23 1Q24 2Q24 2Q23 3Q23 4Q23 1Q24 2Q24 San Mate
Slide 33: Growing Midstream and Upstream Businesses Together
Growing Midstream and Upstream Businesses Together $250 $232.5 $225 San Mateo's Adjusted EBITDA ($ in millions)(1) $198 $200 $200 Natural Gas $154 $150 $113 Oil $96 $100 $62 Water $50 $31 $12 $0 2016 2017 2018 2019 2020 2021 2022 2023 2024 2024 Original Revised Guidance (2) Guidance(3) Matador owns
Slide 34: Full Year 2024 Guidance
Full Year 2024 Guidance July 23, 2024
Slide 35: 2024 Guidance (As Updated on July 23, 2024)
2024 Guidance Excludes Ameredev Acquisition (As Updated on July 23, 2024) Actual February 20, 2024 %YoY July 23, 2024 %YoY Guidance Metric 2023 Results 2024 Guidance Range Change(1) 2024 Guidance Range Change(1) Total Oil Production 75,457 Bbl/d 91,000 to 95,000 Bbl/d + 23% 93,500 to 96,500 Bbl/d +
Slide 36: 2024 Capital Investment Plan Summary
2024 Capital Investment Plan Summary(1) Excludes Ameredev Acquisition (As Provided on February 20, 2024) Full Year 2024E CapEx(2)(3) – $1.425 billion – Midpoint 2024E Wells Turned to Sales 2024 Guidance Gross Net Drilling, Completing, Equipping(2) $1.10 to $1.30 billion Operated 132 97.9 Operated D/
Slide 37: Q3 2024 Guidance
Excludes Ameredev Acquisition Q3 2024 Guidance(1) Guidance Metric Q2 2024 Actuals Q3 2024 Guidance Range Oil Production 95,488 Bbl/d 96,500 to 97,500 Bbl/d +2% Natural Gas Production 388.9 MMcf/d 399.0 to 405.0 MMcf/d +3% Oil Equivalent Production 160,305 BOE/d 163,000 to 165,000 BOE/d +2% D/C/E Cap
Slide 38: 2024E Operating Cost Estimates
Excludes Ameredev Acquisition 2024E Operating Cost Estimates(1) ($/BOE) 2023 Q1 2024 Q2 2024 2024E(1) 1 Production taxes, transportation and processing (“PTTP”) $5.50 $5.15 $5.27 $5.25 to $6.25 2 Lease operating (“LOE”) $5.06 $5.60 $5.42 $5.25 to $5.75 3 Plant and other midstream services operating
Slide 39: Q2 2024 & Q3 2024E Commodity Price Differentials
Excludes Ameredev Acquisition Q2 2024 & Q3 2024E Commodity Price Differentials Q2 2024 Q3 2024E Actual Actual Realized Commodity Prices Benchmark(1) Differential Guidance(2) Realized Price Differential Oil Prices, per Bbl $80.66 $81.20 +$0.54 -$0.25 to +$0.75 Natural Gas Prices, per Mcf $2.27 $2.00
Slide 40: Hedging Profile – 2024 and 2025
Hedging Profile – 2024 and 2025(1) WTI Oil Collars Waha-Henry Hub Differential Swaps ~45% hedged for 2H 2024(2) 5,000 5,000 4,500 4,500 4,140 4,140 4,095 - 4,050 4,000 4,000 Oil Volume Hedged (MBbl) 3,500 3,500 Gas Volume Hedged (MMBtu) 3,000 3,000 2,760 2,760 2,700 2,730 2,760 2,760 Swap 2,500 2,50
Slide 41: ESG Stewardship
ESG Stewardship July 23, 2024
Slide 42: Committed to Environmental, Social and Governance (ESG) Stewardship
Committed to Environmental, Social and Governance (ESG) Stewardship Matador is committed to increasing the long-term value of its shares in a responsible manner. Matador’s aim has always been to reliably and profitably provide the energy that society needs in a manner that is safe, protects the envi
Slide 43: Committed to ESG Stewardship – Environmental and Social Metrics
Committed to Environmental, Social and Governance (ESG)(1) Stewardship ENVIRONMENTAL Increased transportation on pipeline Continued reduction of Meaningful use of non-fresh water, Operated Produced Water on Pipe per-barrel emissions(2) including recycled water 400 Barrels Transported via Pipline Pip
Slide 44: Appendix
ay, ¢ Matador =a RESOURCES COMPANY ti Appendix MIDR July 23, 2024
Slide 45: Steady Growth, Measured Pace (Pro Forma Matador + Ameredev)
Steady Growth, Measured Pace (Pro Forma Matador + Ameredev) 602.1 MMBOE 4.82 BOE/Share Matador Total Proved Reserves Growth & BOE Per Share 5.00 600 Total Proved Reserves, MMBOE 4.00 500 BOE Per Share 400 28% CAGR 3.00 300 2.00 200 1.00 100 0 0.00 IPO 2013 2014 2015 2016 2017 2018 2019 2020 2021 202
Slide 46: San Mateo Third-Party Volumes and Revenues Continue to Grow
San Mateo Third-Party Volumes and Revenues Continue to Grow San Mateo Midstream Services Revenues (Non-Matador) 26% Year-Over-Year ($ 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 Q2 20
Slide 47: Matador Resources and San Mateo Credit Facilities
Matador Resources and San Mateo Credit Facilities +$1 Billion in Commitments in Conjunction with Ameredev Acq. Matador Credit Agreement Summary Bank group led by PNC Bank Last Elected Borrowings Letters of Credit Financial Covenant: Facility Maturity Borrowing Financial Covenant: Reserves Borrowing
Slide 48: Simple Balance Sheet – No Near-Term Debt Maturities
Simple Balance Sheet – No Near-Term Debt Maturities Debt Maturities ($ in millions) As of July 23, 2024 $2,500 $2.5 billion = $1.5 billion elected commitment Senior Notes + $750 million elected commitment increase $2,250 + $250 million Term Loan A Revolver Borrowings Outstanding $2,000 Letters of Cr
Slide 49: Q2 2024 Selected Operating and Financial Results
Q2 2024 Selected Operating and Financial Results Three Months Ended June 30, 2024 March 31, 2024 June 30, 2023 Net Production Volumes:(1) Oil (MBbl) 8,689 7,715 6,947 Natural gas (Bcf) 35.4 35.5 29.7 Total oil equivalent (MBOE) 14,588 13,628 11,892 Average Daily Production Volumes:(1) Oil (Bbl/d) 95
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) 2Q 2023 3Q 202
Slide 52: 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 operating activities, respectively, for San Mateo Midstream, LLC. (In thou
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) Jun
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,
Slide 56: 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 income. PV-10 is not an estimate of the fair market value of the Company’
Matador Resources Company — Q2 2024 Earnings Presentation on 6ix