Ovintiv Inc. (de) · NYSE:OVV
Ovintiv Inc. (de) — Q3 2024 Earnings Presentation
21 slides from Ovintiv Inc. (de)'s earnings presentation, Oct 8, 2024
Slide 1: 3Q24 Results Conference Call
3Q24 Results Conference Call 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exc
Slide 3: Cautionary Statements
Cautionary Statements For convenience, references in this presentation to “Ovintiv”, “OVV”, the “Company”, “we”, “us” and “our” may, where applicable, refer only to or include any relevant direct and indirect subsidiary entities and partnerships (“Subsidiaries”) of Ovintiv Inc., and the assets, acti
Slide 4: Execution Driving Durable Returns
Execution Driving Durable Returns Financial Outperformance More production, lower capital & relentless focus on profitability $1.92 3Q24 Earnings per Share $3.70 3Q24 Cash Flow per ShareŦ Diluted Diluted Resilient Free Cash FlowŦ More Free Cash FlowŦ than 2Q24 despite lower oil prices $440 3Q24 Free
Slide 5: Operational Excellence in 3Q24
Operational Excellence in 3Q24 3Q24 Operational Performance Guidance Actuals Production above guidance Oil & Condensate • Driven by Permian & Montney (Mbbls/d) 204 - 208 212 Capital below guidance midpoint Other NGLs (C2-C4) 88 - 92 93 (Mbbls/d) Met or beat all other guidance items Natural Gas 1
Slide 6: Track Record of Shareholder Returns
Track Record of Shareholder Returns 17% Consistent & Transparent Framework • In action for ~3 years • ~$2.7 B returned (~$850 MM base dividends & ~$1,850 MM in buybacks) 3Q24 Free Cash Flow YieldŦ • >40 MM shares repurchased through 3Q24 • $181 MM in buybacks expected in 4Q24 $B 3 Shareholder Return
Slide 7: Committed to Debt Reduction
Committed to Debt Reduction September 30, 2024 $5,877 MM Debt Debt / Leverage TargetŦ $4,000 MM Debt target reaffirmed 1.2x Debt to Adjusted EBITDAŦ Asset Settlement ($150 MM) to be received in 4Q24 & applied to debt Adjusted EBITDAŦ is ~$4B at mid-cycle1 $210 MM Debt Reduction in 3Q24 Debt Maturity
Slide 8: Leading Permian Operations
Leading Permian Operations Well Performance in-line with 2024 Type Curve Permian Well Performance • Wells completed across acreage position 18 2024 OVV Type Curve 16 4Q23 through 3Q24 (154 wells) Continuing to push the D&C envelope in 3Q24 • Fastest quarter ever for drilling speed (~2,170 ft/day) 14
Slide 9: Speed Driving Montney Efficiencies
Speed Driving Montney Efficiencies Drilled Ft/Day 3Q24 Drilling ~1,820 ~1,800 6% faster drilling in 3Q24 vs. FY23 ~1,700 ~1,725 ~1,700 6% Faster Longest industry lateral in Montney history at 18,110 ft 1 3Q24 vs. FY23 Ovintiv has drilled 14 of the 20 longest Montney laterals 1 2022 2023 1Q24 2Q24
Slide 10: Free Cash Flow Engine in the Anadarko
Free Cash FlowŦ Engine in the Anadarko First Year Production & Revenue Substantial Free Cash FlowŦ Generation Year 1 Well Production Year 1 Well Revenue • ~85% of first-year revenue from oil & condensate • <20% base decline rate Oil Oil • Life-of-well production is ~1/3 oil & condensate, 1/3 natural
Slide 11: Resumed Uinta Drilling Program
Resumed Uinta Drilling Program Competitive margin similar to the Permian Core Uinta Position • Lower royalty rate and higher oil cut Duchesne Uintah 29 Mbbls/d oil & condensate production in 3Q24 • >50% increase from 3Q23 High-quality oil resource & well results • Multiple benches & ~1k ft of pay, ~
Slide 12: Updated Guidance
Updated Guidance More FY24E production for the same capital 2024 Production and Capital Guidance Third production guide increase this year 4Q24 FY24 Production guidance increase driven by 3Q24 results Total Production 575 – 595 583 – 587 Additional & asset-level guidance unchanged (MBOE/d) Oil & Con
Slide 13: OVV's Keys to Success
OVV’s Keys to Success High-Quality Portfolio • Four top-tier assets with substantial operating scale • Innovations distributed across the portfolio to drive results Montney High-return oil & deep multi- Operational Excellence Drives Efficiencies • Proven operational flexibility and margin enhanc
Slide 14: _ Ovintiv’
_ 636 Ovintiv’ “
Slide 15: Appendix
Trl Appendix
Slide 16: Additional 2024 Guidance & Sensitivities
Additional 2024 Guidance & Sensitivities Operating Expenses Upstream T&P2 Sensitivities 3Q24A 4Q24 FY24 Sensitivity Upstream T&P2 PMOT F/X Rate 4.9% 4-5% (CAD/USD) ~0.75 +/- 0.01 CAD/USD $0.10/BOE (% of Upstream Revenue1) Upstream T&P2 WTI $7.31 $7.50-$8.00 ($/bbl) ~$75 +/- $10/bbl $0.10/BOE ($/BOE)
Slide 17: Hedge Positions as of September 30, 2024
Hedge Positions as of September 30, 2024 Oil and Condensate Hedge Positions1 Oil and Condensate 4Q24 1Q25 2Q25 3Q25 4Q25 WTI & NYMEX Realized Gain / Volume Mbbls/d 50 50 50 50 0 WTI 3-Way Call Strike $/bbl $84.35 $84.85 $86.48 $80.59 - (Loss) Sensitivities ($ MM)2 Options Put Strike $/bbl $65.00 $65
Slide 18: Durable Cash Return Framework
Durable Cash Return Framework Committed to Our Proven Framework 4Q24 Cash Returns ($ MM) 3Q24 Results Post Base Dividend $978 Non-GAAP Cash FlowŦ Free Cash FlowŦ ($538) Capex $440 Non-GAAP Free Cash FlowŦ ($78) 3Q24 Base Dividend Shareholder Returns $362 Available Capital Allocation Framework $181 5
Slide 19: Proactive AECO & Waha Risk Management
Proactive AECO & Waha Risk Management Successfully Managing ~100% transport to market secured Gas Flow & Price Risk Minimal exposure to local market prices 4Q24 – 4Q25 Montney Price Exposures1 4Q24 Permian Price Exposures1 ~60% ~45% Physical Transport Outside AECO Physical Transport Outside Waha C
Slide 20: Canadian Royalty Sensitivity
Canadian Royalty Sensitivity Royalty Sensitivity1 Royalty Rates Vary Based on Commodity Prices 24 – 26% US Basin Average (20 – 25%) • OVV Reports “NRI” volumes after royalties across its US and Canadian assets • Changes in royalty rates seen in changes to reported net production Observed Montney Rat
Slide 21: Track Record of Responsible Operations
Track Record of Responsible Operations 50% Scope 1&2 Achieved 41% Reduction Through YE23 GHG Intensity Reduction Target Intensity Reduction1 (from ‘19 – ‘30) Tied to Compensation For All Employees >65% Methane Intensity Reduction2 Dedicated to Social Engagement Achieved 33% Reduction from ’19 T