Diversified Energy Company · NYSE:DEC
Diversified Energy — H1 2023 Earnings Presentation
14 slides from Diversified Energy's earnings presentation, September 2023
Slide 1: Earnings Presentation: Six Months Ended 30 June 2023
September 2023 Earnings Presentation Six Months Ended 30 June 2023
Slide 2: Disclaimer and Forward-Looking Statements
DISCLAIMER AND FORWARD-LOOKING STATEMENTS The information contained in this document (the "Presentation") has been prepared by Diversified Energy In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with Company PLC (“Diversified” or the
Slide 3: Relentless Focus on Increasing Value
RELENTLESS FOCUS ON INCREASING VALUE 863 Acquire. Target low-decline, producing assets that complement our returns-focused strategy 144 Mboepd MMcfepd 10 % Production Declines June 2023 Production Industry-leading Produce. Deploy Smarter Asset Management to 50 80 enhance economics and reduce emissio
Slide 4: Outstanding Execution in Dynamic Environment
OUTSTANDING EXECUTION IN DYNAMIC ENVIRONMENT Achieving Delivering Prioritizing Record Production Reliable Results Sustainability Goals 852MMcfepd $3.56per Mcfe 87 | 174 142 Mboepd $21.27 per Boe 1H23 Average Production Average Realised Price(a) DEC / Total Wells Retired 863MMcfepd $1.66 per Mcfe 97%
Slide 5: Value Proposition: De-Risked Investment
VALUE PROPOSITION: DE-RISKED INVESTMENT Commodity Price Risk Diversified’s business model reduces Dynamic hedging sustains realized pricing and delivers exposure to typical industry risk factors consistent cash margins Oil & Gas Development Risk Spectrum High Risk Low Risk Development/Operational
Slide 6: Track Record of Delivering on Strategic Objectives
TRACK RECORD OF DELIVERING ON STRATEGIC OBJECTIVES 2017 1H23 History Since IPO 863 Enhance Scale 62 863 with Acquisitions Daily Production 62 (MMcfe) Sustain Low 10.0% Corporate Declines 4% 10% 4% Corporate Decline Rate 2.4x 2.1x Maintain a Strong Balance Sheet 2.1x 2.4x Net Debt / Adj. EBITDA(a) 17
Slide 7: Maintaining Consistent Leverage Throughout Commodity Price Cycle
MAINTAINING CONSISTENT LEVERAGE THROUGHOUT COMMODITY PRICE CYCLE Diversified’s differentiated, durable leverage profile averages 25% lower than peers on full-cycle economics Henry Hub Price (Avg) Durable cash margins drive Industry-leading average Disciplined hedging strategy consistent leverage pro
Slide 8: Disciplined Hedging Strategy Mitigates Risks, Enhances Returns
DISCIPLINED HEDGING STRATEGY MITIGATES RISKS, ENHANCES RETURNS % of Production Hedged Average Floor Price NYMEX Strip $3.53 $3.50 $3.49 $3.43 $3.08 $3.05 $3.00 2H23 Average Hedged Floor ($/MMBtu)) $2.72 Percent of 2H23 Production Hedged 85% $2.82 (strip pricing) $2.41 87% 67% 59% 58% 50% 52% 17% 6%
Slide 9: Unlocking Upside Value on Non-Core Asset Portfolio
UNLOCKING UPSIDE VALUE ON NON-CORE ASSET PORTFOLIO Undeveloped Acreage Sales History of Realising “Free” Upside As an operator of producing assets, sale of associated Allocation of value only to producing assets undeveloped acreage provides upside to valuations creates natural runway for value accre
Slide 10: Smarter Asset Management in Action
SMARTER ASSET MANAGEMENT IN ACTION Achieving Scale in Contract Management Strategic Production Curtailment in Central Region $3.5 million net uplift from proactive $2 million net uplift from temporary contract management and renegotiation shut-in of select wells in low-price environment enhances con
Slide 11: Continued Commitment to Strong Sustainability Practices
CONTINUED COMMITMENT TO STRONG SUSTAINABILITY PRACTICES GOLD GOLD Disclosed State-by-State Enhanced Biodiversity & Published 2023 ESG Received Gold Rating Achieved ‘AA’ Rating Awarded OGMP 2.0 Economic Analysis Climate Risk Disclosures Performance Objectives from Project Canary from MSCI Analytics G
Slide 12: Delivering Consistent Cash Generation on Durable Margins
DELIVERING CONSISTENT CASH GENERATION ON DURABLE MARGINS Revenue per Unit a ~25% Premium to NYMEX(a) $542 million Total Revenue, Inclusive of Hedges $/Mcfe $3.48 ($/Boe) Realized price 25% higher than average Henry Hub of $2.78/MMBtu $3.31 ($20.89) ($19.87) $2.96 $1.66/Mcfe Total Cash Costs per Unit
Slide 13: Right Company, Right Time
RIGHT COMPANY, RIGHT TIME Seasoned management team with proven record of identifying, optimizing and delivering returns from existing producing assets Consolidator of choice for Own the value chain through US natural gas producing vertical integration from assets production through retirement Maximi
Slide 14: Diversified Brokers
DIVERSIFIED BROKERS Corporate Tennyson Stifel Peel Hunt PO Box 381087 Tennyson Securities Stifel Nicolaus Europe Ltd Peel Hunt LLP Birmingham, Alabama 65 Petty France 150 Cheapside 100 Liverpool Street 35238-1087 (USA) London SW1H 9EU London EC2V 6ET London EC2M 2AT div.energy chton@peelhunt.com Dou
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