Expand Energy Corporation · NASDAQ:EXE
Expand Energy — Q4 2024 Earnings Presentation
46 slides from Expand Energy's earnings presentation, Feb 27, 2025
Slide 1: 4Q & FY 2024 Earnings
4Q & FY 2024 Earnings FEBRUARY 26, 2025
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include certain projec
Slide 3: Expanding Returns, Expanding Opportunities
Expanding Returns, Expanding Opportunities Attractive, Peer-leading Resilient Responsible Connected Returns Financial Stewardship Portfolio Foundation Premium rock, returns, Most efficient operator Investment grade Connecting affordable, runway with access to with proven track record balance sheet p
Slide 4: Highlights
Highlights Largest Domestic Accelerating 2025 Synergy Investment Grade Natural Gas Producer Capture to ~$400mm Credit Rating 4Q24 beat with net production of ~6.41 Bcfe/d, ~$500mm of total synergies expected annually Debut $750mm IG issuance during 4Q24, ~$1bn of Adj. EBITDAX(1) and ~$600mm of Capex
Slide 5: 2025 Outlook
2025 Outlook 4Q & FY 2024 EARNINGS
Slide 6: Production Outlook
Production Outlook Growing Annual Production from 2025 Production Plan: 2024 Productive Capacity Activation (MMcfe/d) ~7.1 Bcfe/d Actual Estimates ▪ Generating attractive FCF from 2024 productive ~7,500 capacity ~300 ▪ Expecting to exit 2025 at ~7.2 Bcfe/d, turning in line substantially all producti
Slide 7: Historical and Future Expected Rig and Production Activity
Historical and Future Expected Rig and Production Activity Average Rig Count(1) Historical and Future Estimated Production(1) ~15 rigs Running up to 15 rigs ~300 MMcfe/d of as of in 2H25 creates productive capacity merger productive capacity by 2026 if market close for 2026 fundamentals warrant ~7,5
Slide 8: Capital Outlook
Capital Outlook 2025 Capital Expenditures Demonstrate Significant ▪ ~$3.0bn of total capital Efficiency Relative to Standalone 2024 Programs (Implied Midpoints of 2025 Guidance, $mm) spend for 2025 ~$3.0bn ▪ ~$2.7bn capital delivers Productive capacity build ~7.1 Bcfe/d in 2025 ~$300 (+300 MMcfe/d ~
Slide 9: Optimizing Maintenance Production to Maximize Free Cash Flow
Optimizing Maintenance Production to Maximize Free Cash Flow (1) Centering activity to deliver ~7.5 Bcfe/d through-cycle maximizes FCF at mid-cycle prices between $3.50 to $4.00 Illustrative Annual FCF(2) at Various Mid-cycle Prices, Maintenance Production and Capital Mid-cycle Price, $/Mcf $2.50 $2
Slide 10: Long-term Production Strategy Focused on Remaining Flexible
Long-term Production Strategy Focused on Remaining Flexible Illustrative Productive Capacity Strategy ▪ Once at run-rate, production flexes above and below midpoint based on temporary market dislocations ▪ Capital activity is expected to be more constant OVERPRODUCING through-cycle, building and dra
Slide 11: Attractive, Connected Portfolio
Attractive, Connected Portfolio 4Q & FY 2024 EARNINGS
Slide 12: Attractive, Connected Portfolio
Attractive, Connected Portfolio Superior Portfolio Characteristics Northeast Appalachia ~700,000 net acres >1,500 gross locations Scale: Largest natural gas producer in FY25E Prod: ~2,600 MMcfe/d North America with ~1.9mm net acres, ~7.1 Bcfe/d in 2025 Southwest Appalachia ~566,000 net acres Flexibi
Slide 13: Consistently Outperforming Peers
Consistently Outperforming Peers Capital Efficiency Leader Across the Premier Gas Basins ($/12-month Mcfe) (1) Haynesville Northeast App Southwest App(2) $3.33 $3.35 $2.10 $2.15 $4.80 $3.01 $1.84 $2.67 $1.72 $3.72 $2.16 $1.41 $2.00 $2.60 $2.12 $1.84 EXE Peer 1 Peer 2 Peer 3 Peer 4 Peer 5 EXE Peer 1
Slide 14: Accelerating 2025 Synergy Capture to ~$400mm
Accelerating 2025 Synergy Capture to ~$400mm Annual Synergy Outlook ($mm) 2025 Synergy $100 ~$500/yr expected by YE26 2026+ Synergy $70 $40 $130 $50 ~$400/yr ~$400 expected in 2025 $100 $200 $110 $200 Corporate & D&C Other Operating Initial Synergy Additional Identified Updated Regional Costs Cost S
Slide 15: +20% Improvement of Haynesville Drilling Performance
+20% Improvement of Haynesville Drilling Performance ▪ Initial synergies highly Post-Close Performance Improvements on Legacy SWN Acreage leveraged to Haynesville Mobilization 2.8 days 8.8 days / ▪ Standardizing how we Surface Section 0.7 days $1.4mm drill across the rig fleet Intermediate Section 2
Slide 16: Material Progress with Completions Synergies in 2025
Material Progress with Completions Synergies in 2025 ▪ EXE-owned Louisiana sand mine • Began providing sand to operations on 2/1/2025 • Reduced cost per ton that scales as utilization increases ▪ Completions design standardization in NE Appalachia and Haynesville • Multi-disciplinary teams optimizin
Slide 17: Haynesville: Premium Markets with Scalable Growth
Haynesville: Premium Markets with Scalable Growth Haynesville Production (MMcfe/d) Actuals Guidance TEXAS ~ 2,900 ~ 2,600 2,338 LOUISIANA 4Q24 1Q25 FY25 Rig Count 8 7 7–9 EXE Acreage Crew Count 3 3 3 Net Acreage ~664,000 ▪ 2025 volume growth via productive capacity, development plan Avg. WI / NRI ~9
Slide 18: Northeast Appalachia: Low Breakeven, Cash Flow Machine
Northeast Appalachia: Low Breakeven, Cash Flow Machine Northeast Appalachia Production (MMcfe/d) NEW YORK Actuals Guidance ~ 2,675 ~ 2,600 2,425 4Q24 1Q25 FY25 PENNSYLVANIA Rig Count 2 2 2–3 EXE Acreage Crew Count 2 2 2 Net Acreage ~700,000 ▪ DTIL activation, operational efficiencies and enhanced co
Slide 19: Southwest Appalachia: Liquids Exposure and Upside Potential
Southwest Appalachia: Liquids Exposure and Upside Potential Southwest Appalachia Production (MMcfe/d) OHIO Actuals Guidance PENNSYLVANIA ~65% Gas 1,649 ~ 1,600 ~30% NGLs ~ 1,475 ~5% Oil 4Q24 1Q25 FY25 WEST VIRGINIA Rig Count 2 2 2–3 EXE Acreage Crew Count 1 2 1–2 Net Acreage ~566,000 ▪ Capital progr
Slide 20: Marketing & Commercial: Answering the Call for Growing Demand
Marketing & Commercial: Answering the Call for Growing Demand 4Q & FY 2024 EARNINGS
Slide 21: Ready to Answer the Call for Growing Demand
Ready to Answer the Call for Growing Demand APP: Greater Appalachia ~33% ▪ Advantaged transportation portfolio provides: APP: Canada ~1% • Deliverability • Diversification APP: Northeast/ • Flexibility Citygate ~11% ▪ Established supplier of choice to global LNG APP: Midwest ~1% exporters and domest
Slide 22: Ready to Answer the Call for Growing Demand
Ready to Answer the Call for Growing Demand Advantaged transportation portfolio expected to provide deliverability, diversification and flexibility ▪ Haynesville ▪ NE Appalachia • Haynesville portfolio balanced between growing LNG demand • ~1 Bcf/d flows east to premium priced Northeast points and S
Slide 23: Being LNG Ready Will Create Meaningful Value and Enhance Returns
Being LNG Ready Will Create Meaningful Value and Enhance Returns Growing Exports Expected to be Significant to U.S. Gas Demand (U.S. LNG Capacity, Bcf/d)(1) ▪ Fully financed, under construction LNG projects Plaquemines increase U.S. capacity >40% >11 Bcf/d Lake Charles Magnolia Sempra – Cameron of i
Slide 24: Peer-Leading Returns
Peer-Leading Returns 4Q & FY 2024 EARNINGS
Slide 25: Enhanced Capital Returns Framework
Enhanced Capital Returns Framework Program designed to return cash to shareholders and reduce net debt $2.30/ Annual Base Dividend share ▪ Tranche 1 – Annual Base Dividend EXCESS FCF • $2.30/share • Remains priority and is paid through-cycle • 4Q24 DPS of $0.575/sh to be paid in March $116mm Net Deb
Slide 26: Resilient Financial Foundation
Resilient Financial Foundation 4Q & FY 2024 EARNINGS
Slide 27: Investment Grade Rating Demonstrates Resilient Financial Foundation
Investment Grade Rating Demonstrates Resilient Financial Foundation ▪ Investment Grade Ratings Expand Energy Debt Maturity Profile ($mm)(2) • BBB- from S&P ~6.00% • BBB- from Fitch EXE ~6.10% • Ba1 from Moody’s RBL Capacity (positive outlook) $700 5.375% ▪ Financial Policy Targets 5.375% $2,500 $500
Slide 28: EXE's Recurring Hedge Strategy Preserves Upside and Minimizes Downside
EXE’s Recurring Hedge Strategy Preserves Upside and Minimizes Downside Through-Cycle Illustrative Hedge-the-Wedge Approach (% Volume Hedged) 50% – 60% of Production Hedged 20% – 45% of Production Hedged 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 5th Quarter 6th Quarter 7th Quarter 8th Quarter H
Slide 29: Current Hedge Position Preserves Upside as Prices Strengthen
Current Hedge Position Preserves Upside as Prices Strengthen Hedged Natural Gas Volumes Added since 3Q Earnings (Bcf) Last Public Disclosure (Bcf) 75 95 80 75 167 251 246 258 232 169 126 104 98 21 32 14 1Q25 2Q25 3Q25 4Q25 1Q26 2Q26 3Q26 4Q26 Current Hedge Book Supports Near-Term Realizations and Pr
Slide 30: Responsible Stewardship
Responsible Stewardship 4Q & FY 2024 EARNINGS
Slide 31: Connecting Affordable, Reliable and Lower Carbon Energy to Markets in Need
Connecting Affordable, Reliable and Lower Carbon Energy to Markets in Need Five fundamentals that drive our decision-making and increase our ability to deliver for our stakeholders: 1 Ensure a safe and inclusive workplace, promoting collaboration and innovation Our Commitments: 2 Take meaningful act
Slide 32: Appendix
Appendix 4Q & FY 2024 EARNINGS
Slide 33: Management's Guidance as of February 26, 2025
Management’s Guidance as of February 26, 2025 Production (MMcfe/d) 4Q24A 1Q25E 2025E Operating Costs (per Mcfe of Projected Production) 4Q24A 2025E Total Production 6,412 6,700 – 6,800 7,000 – 7,200 Production Expense $0.27 $0.25 – $0.30 Haynesville 2,338 ~2,600 ~2,900 Gathering, Processing and Tran
Slide 34: 4Q24 EXE Business Unit Results
4Q24 EXE Business Unit Results Haynesville NE Appalachia SW Appalachia Production (MMcfe/d) 2,338 2,425 1,649 Production Expense ($/Mcfe) $0.33 $0.18 $0.32 Differential to NYMEX ($/Mcfe) $(0.22) $(0.45) $(0.36) GP&T ($/Mcfe) $0.74 $0.87 $1.33 Rigs 8 2 2 Spuds (by zone) Haynesville 13 Bossier 8 Lower
Slide 35: 2025 Modeling Assumptions
2025 Modeling Assumptions Haynesville NE Appalachia SW Appalachia Haynesville Bossier Lower Marcellus Upper Marcellus Marcellus Utica 2025 PDP Decline (12-month decline) ~45% ~30% ~25% Differential(1) to NYMEX ($/Mcf) ($0.20) – ($0.30) ($0.45) – ($0.55) ($0.25) – ($0.35) Production Expense ($/Mcfe)
Slide 36: Illustrative Sensitivities
Illustrative Sensitivities Adj. EBITDAX(1,3,4) Cash Flow from Operations(2,3,4) ($bn) ($bn) ~$7.6 ~$6.5 ~$6.4 ~$6.5 ~$5.6 ~$5.6 ~$5.7 ~$5.0 ~$5.2 ~$4.6 ~$4.8 ~$4.3 ~$4.2 ~$3.7 ~$3.8 ~$4.1 $3.00 $3.50 $4.00 $4.50 $3.00 $3.50 $4.00 $4.50 2025 2025 (~7.1 Bcfe/d) 2026 2026 (~7.5 Bcfe/d) 2025 (~7.1 Bcfe/
Slide 37: Haynesville, Northeast and Southwest Appalachia Sales Points
Haynesville, Northeast and Southwest Appalachia Sales Points Haynesville Sales Points Northeast Appalachia Sales Points Southwest Appalachia Sales Points DEDUCT FROM NYMEX ($)(1) DEDUCT FROM NYMEX ($)(1) DEDUCT FROM NYMEX ($)(1) Historical Avg Current Historical Avg Current Historical Avg Current CG
Slide 38: Return Framework Mechanics
Return Framework Mechanics ▪ New return framework effective on 1/1/2025 ▪ Tranche 2 and Tranche 3 are filled based on how much FCF is generated above the base dividend within a six-month evaluation period ▪ 2025 Tranche 2 target is set at $500mm ($250mm per evaluation period) ▪ 75% of Tranche 3 FCF
Slide 39: Fully Diluted Share Count Breakdown
Fully Diluted Share Count Breakdown As of 2/19/2025 8.0 232.7 232.7 240.7 - Shares Warrants Fully Diluted Shares Outstanding 39 4Q & FY 2024 Earnings
Slide 40: Reducing Risk, Protecting Returns Through Hedge Program
Reducing Risk, Protecting Returns Through Hedge Program NATURAL GAS ESTIMATED NYMEX GAS SETTLEMENT ($mm) SWAPS COSTLESS COLLARS THREE-WAY COLLARS $2.00 $3.00 $4.00 $5.00 Date Bought Bought Date Volume Price Volume Sold Call Volume Sold Call Sold Put NYMEX NYMEX NYMEX NYMEX Put Put Bcf $/Mcf Bcf $/Mc
Slide 41: Reducing Risk, Protecting Returns Through Hedge Program
Reducing Risk, Protecting Returns Through Hedge Program NATURAL GAS LIQUIDS ESTIMATED NGL SETTLEMENT ($mm) C2 SWAPS C3 SWAPS C4 SWAPS C5 SWAPS Date Date $0.25 $0.50 $1.00 $1.50 Volume Price Volume Price Volume Price Volume Price MBbl $/gal MBbl $/gal MBbl $/gal MBbl $/gal 1Q 2025 900 0.25 603 0.73 1
Slide 42: Reducing Risk, Protecting Returns Through Hedge Program
Reducing Risk, Protecting Returns Through Hedge Program CRUDE OIL ESTIMATED NYMEX WTI SETTLEMENT ($mm) SWAPS COSTLESS COLLARS THREE-WAY COLLARS $60.00 $70.00 $80.00 $90.00 Date Bought Bought Date Volume Price Volume Sold Call Volume Sold Call Sold Put WTI WTI WTI WTI Put Put MBbl $/Bbl MBbl $/Bbl MB
Slide 43: Hedged Financial Basis
Hedged Financial Basis HAYNESVILLE NORTHEAST APPALACHIA CGT MAINLINE TETCO WLA TGT Z1 TETCO M3 TGP Z4 300L LEIDY EASTERN GAS Date Volume Avg. Price Volume Avg. Price Volume Avg. Price Volume Avg. Price Volume Avg. Price Volume Avg. Price Volume Avg. Price Bcf $/Mcf Bcf $/Mcf Bcf $/Mcf Bcf $/Mcf Bcf
Slide 44: Non-GAAP Financial Measures
Non-GAAP Financial Measures As a supplement to the financial results prepared in accordance with U.S. GAAP, Expand Energy’s quarterly earnings presentations contain certain financial measures that are not prepared or presented in accordance with U.S. GAAP. These non-GAAP financial measures include A
Slide 45: Reconciliation of Net Cash Provided by Operating Activities to Adjusted Free Cash Flow
Reconciliation of Net Income (Loss) to Adjusted Reconciliation of Net Cash Provided by Operating EBITDAX (Unaudited) Activities to Adjusted Free Cash Flow (Unaudited) Three Months Three Months Three Months Three Months Ended Ended Year Ended Year Ended Ended Ended Year Ended Year Ended December 31,
Slide 46: Reconciliation of Total Debt to Total Capitalization
Reconciliation of Net Cash Provided by Operating Reconciliation of Total Debt to Total Capitalization Activities to Adjusted EBITDAX (Unaudited) (Unaudited) Three Months Three Months Ended Ended Year Ended Year Ended December 31, December 31, December 31, December 31, December 31, 2024 2023 2024 202