Texas Pacific Land Corporation Announces First Quarter Results
Earnings
First Quarter 2025 Highlights
- Oil and gas royalty production of 31.1 thousand barrels of oil equivalent (“Boe”) per day, a Company record
- As of March 31, 2025, TPL’s royalty acreage had an estimated 5.9 net well permits, 12.9 net drilled but uncompleted wells ("DUCs"), and 5.4 net completed but not producing wells ("CUPs"). Net well permits, DUCs, and CUPs total 24.3 net wells(1), which represents a Company record. TPL had 90.2 net producing wells, and net producing wells added during the quarter had an average lateral length of approximately 8,988 feet.
-
Water Services and Operations segment revenues of
$69.4 million -
Consolidated net income of
$120.7 million $5.24 -
Adjusted EBITDA(2) of
$169.4 million -
Free cash flow(2) of
$126.6 million -
Quarterly cash dividend of
$1.60
(1) |
Total may not foot due to rounding. |
(2) |
Reconciliations of non-GAAP performance measures are provided in the tables below. |
“Results for the first quarter of 2025 represented an excellent start to the year as the Company set quarterly records for oil and gas royalty production and Water Services and Operations segment revenue," said Tyler Glover, Chief Executive Officer of the Company. “TPL's resilient business model, high-margin cash flows, and fortress balance sheet enhances the Company's ability to weather a potential industry downcycle. Near-term activity levels remain strong around our footprint, but should economic volatility persist, our business retains numerous naturally embedded hedges to mitigate the potential direct impact of lower oil prices. In addition, TPL’s exceptional financial profile and strong liquidity with ample cash and no debt also allows us to be opportunistic during periods of uncertainty.”
Financial Results for the First Quarter of 2025 - Sequential
The Company reported net income of
Total revenues for the first quarter of 2025 were
Total operating expenses were
Financial Results for the First Quarter of 2025 - Year Over Year
Total revenues for the first quarter of 2025 were
Total operating expenses were
Quarterly Dividend Declared
On May 6, 2025, the Company’s Board of Directors declared a quarterly cash dividend of
Conference
The Company will hold a conference call on Thursday, May 8, 2025 at 9:30 a.m. Central Time to discuss first quarter results. A live webcast of the conference call will be available on the Investors section of the Company’s website at www.TexasPacific.com. To listen to the live broadcast, go to the site at least 15 minutes prior to the scheduled start time in order to register and install any necessary audio software.
The conference call can also be accessed by dialing 1-877-407-4018 or 1-201-689-8471. The telephone replay can be accessed by dialing 1-844-512-2921 or 1-412-317-6671 and providing the conference ID# 13753234. The telephone replay will be available starting shortly after the call through May 22, 2025.
About Texas Pacific Land Corporation
Texas Pacific Land Corporation is one of the largest landowners in the
Visit TPL at www.TexasPacific.com.
Cautionary Statement Regarding Forward-Looking Statements
Certain statements in this news release are, and certain statements made on the related conference call may be, forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on TPL’s beliefs, as well as assumptions made by, and information currently available to, TPL, and therefore involve risks and uncertainties that are difficult to predict. Generally, future or conditional verbs such as “will,” “would,” “should,” “could,” or “may” and the words “believe,” “anticipate,” “continue,” “intend,” “expect” and similar expressions or the negative of such terms identify forward-looking statements. Forward-looking statements include, but are not limited to, references to strategies, plans, objectives, expectations, intentions, assumptions, future operations and prospects; statements regarding the anticipated benefits of recent acquisitions; and other statements that are not historical facts. You should not place undue reliance on forward-looking statements. Although TPL believes that plans, intentions and expectations reflected in or suggested by any forward-looking statements made herein are reasonable, TPL may be unable to achieve such plans, intentions or expectations and actual results, and performance or achievements may differ materially from those set forth in the forward-looking statements due to a number of factors, including, but not limited to: the initiation or outcome of potential litigation; any changes in general economic and/or industry specific conditions; and the other risks discussed in TPL’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. You can access TPL’s filings with the Securities and Exchange Commission (“SEC”) through the SEC’s website at www.sec.gov and TPL strongly encourages you to do so. These forward-looking statements are based only on information available to TPL and speak only as of the date hereof. Except as required by applicable law, TPL undertakes no obligation to update any forward-looking statements or other statements herein for revisions or changes after this communication is made.
FINANCIAL AND OPERATIONAL RESULTS (unaudited) |
|||||||||
|
|
Three Months Ended |
|||||||
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|||
Company’s share of production volumes (1): |
|
|
|
|
|
|
|||
Oil (MBbls) |
|
|
1,123 |
|
|
1,115 |
|
|
990 |
Natural gas (MMcf) |
|
|
5,230 |
|
|
4,763 |
|
|
3,806 |
NGL (MBbls) |
|
|
807 |
|
|
768 |
|
|
633 |
Equivalents (MBoe) |
|
|
2,801 |
|
|
2,676 |
|
|
2,258 |
Equivalents per day (MBoe/d) |
|
|
31.1 |
|
|
29.1 |
|
|
24.8 |
|
|
|
|
|
|
|
|||
Oil and gas royalty revenue (in thousands): |
|
|
|
|
|
|
|||
Oil royalties |
|
$ |
76,179 |
|
$ |
75,286 |
|
$ |
72,614 |
Natural gas royalties |
|
|
17,561 |
|
|
4,882 |
|
|
7,062 |
NGL royalties |
|
|
17,505 |
|
|
16,786 |
|
|
12,444 |
Total oil and gas royalties |
|
$ |
111,245 |
|
$ |
96,954 |
|
$ |
92,120 |
|
|
|
|
|
|
|
|||
Realized prices (1): |
|
|
|
|
|
|
|||
Oil ($/Bbl) |
|
$ |
71.05 |
|
$ |
70.73 |
|
$ |
76.77 |
Natural gas ($/Mcf) |
|
$ |
3.63 |
|
$ |
1.11 |
|
$ |
2.01 |
NGL ($/Bbl) |
|
$ |
23.46 |
|
$ |
23.63 |
|
$ |
21.24 |
Equivalents ($/Boe) |
|
$ |
41.58 |
|
$ |
37.93 |
|
$ |
42.71 |
| _____________________________ | |||||
(1) |
Term |
|
Definition |
||
|
Bbl |
|
One stock tank barrel of 42 U.S. gallons liquid volume used herein in reference to crude oil, condensate or NGL. |
||
|
MBbls |
|
One thousand barrels of crude oil, condensate or NGL. |
||
|
MBoe |
|
One thousand Boe. |
||
|
MBoe/d |
|
One thousand Boe per day. |
||
|
Mcf |
|
One thousand cubic feet of natural gas. |
||
|
MMcf |
|
One million cubic feet of natural gas. |
||
|
NGL |
|
Natural gas liquids. Hydrocarbons found in natural gas that may be extracted as liquefied petroleum gas and natural gasoline. |
||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (in thousands, except share and per share amounts) (unaudited) |
|||||||||
|
|
Three Months Ended |
|||||||
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
|||
Revenues: |
|
|
|
|
|
|
|||
Oil and gas royalties |
|
$ |
111,245 |
|
$ |
96,954 |
|
$ |
92,120 |
Water sales |
|
|
38,813 |
|
|
36,737 |
|
|
37,126 |
Produced water royalties |
|
|
27,700 |
|
|
28,089 |
|
|
23,006 |
Easements and other surface-related income |
|
|
18,225 |
|
|
21,761 |
|
|
20,646 |
Land sales |
|
|
— |
|
|
2,243 |
|
|
1,244 |
Total revenues |
|
|
195,983 |
|
|
185,784 |
|
|
174,142 |
|
|
|
|
|
|
|
|||
Expenses: |
|
|
|
|
|
|
|||
Salaries and related employee expenses |
|
|
14,572 |
|
|
14,359 |
|
|
12,461 |
Water service-related expenses |
|
|
11,126 |
|
|
9,357 |
|
|
10,212 |
General and administrative expenses |
|
|
6,072 |
|
|
6,752 |
|
|
9,231 |
Depreciation, depletion and amortization |
|
|
11,941 |
|
|
11,467 |
|
|
3,840 |
Ad valorem and other taxes |
|
|
2,199 |
|
|
1,305 |
|
|
2,357 |
Total operating expenses |
|
|
45,910 |
|
|
43,240 |
|
|
38,101 |
|
|
|
|
|
|
|
|||
Operating income |
|
|
150,073 |
|
|
142,544 |
|
|
136,041 |
|
|
|
|
|
|
|
|||
Other income, net |
|
|
4,321 |
|
|
8,434 |
|
|
9,943 |
Income before income taxes |
|
|
154,394 |
|
|
150,978 |
|
|
145,984 |
Income tax expense |
|
|
33,742 |
|
|
32,618 |
|
|
31,567 |
Net income |
|
$ |
120,652 |
|
$ |
118,360 |
|
$ |
114,417 |
|
|
|
|
|
|
|
|||
Net income per share of common stock |
|
|
|
|
|
|
|||
Basic |
|
$ |
5.25 |
|
$ |
5.15 |
|
$ |
4.97 |
Diluted |
|
$ |
5.24 |
|
$ |
5.14 |
|
$ |
4.97 |
|
|
|
|
|
|
|
|||
Weighted average number of shares of common stock outstanding |
|
|
|
|
|
|
|||
Basic |
|
|
22,980,695 |
|
|
22,974,238 |
|
|
23,003,001 |
Diluted |
|
|
23,005,847 |
|
|
23,015,530 |
|
|
23,020,249 |
SEGMENT OPERATING RESULTS (dollars in thousands) (unaudited) |
||||||||||||||||||
|
|
Three Months Ended |
||||||||||||||||
|
|
March 31,
|
|
December 31,
|
||||||||||||||
|
|
Land and
|
|
Water
|
|
Consolidated |
|
Land and
|
|
Water
|
|
Consolidated |
||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Oil and gas royalties |
|
$ |
111,245 |
|
$ |
— |
|
$ |
111,245 |
|
$ |
96,954 |
|
$ |
— |
|
$ |
96,954 |
Water sales |
|
|
— |
|
|
38,813 |
|
|
38,813 |
|
|
— |
|
|
36,737 |
|
|
36,737 |
Produced water royalties |
|
|
— |
|
|
27,700 |
|
|
27,700 |
|
|
— |
|
|
28,089 |
|
|
28,089 |
Easements and other surface-related income |
|
|
15,336 |
|
|
2,889 |
|
|
18,225 |
|
|
19,431 |
|
|
2,330 |
|
|
21,761 |
Land sales |
|
|
— |
|
|
— |
|
|
— |
|
|
2,243 |
|
|
— |
|
|
2,243 |
Total revenues |
|
|
126,581 |
|
|
69,402 |
|
|
195,983 |
|
|
118,628 |
|
|
67,156 |
|
|
185,784 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries and related employee expenses |
|
|
7,404 |
|
|
7,168 |
|
|
14,572 |
|
|
7,366 |
|
|
6,993 |
|
|
14,359 |
Water service-related expenses |
|
|
— |
|
|
11,126 |
|
|
11,126 |
|
|
— |
|
|
9,357 |
|
|
9,357 |
General and administrative expenses |
|
|
3,313 |
|
|
2,759 |
|
|
6,072 |
|
|
4,509 |
|
|
2,243 |
|
|
6,752 |
Depreciation, depletion and amortization |
|
|
7,689 |
|
|
4,252 |
|
|
11,941 |
|
|
7,327 |
|
|
4,140 |
|
|
11,467 |
Ad valorem and other taxes |
|
|
2,189 |
|
|
10 |
|
|
2,199 |
|
|
1,269 |
|
|
36 |
|
|
1,305 |
Total operating expenses |
|
|
20,595 |
|
|
25,315 |
|
|
45,910 |
|
|
20,471 |
|
|
22,769 |
|
|
43,240 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating income |
|
|
105,986 |
|
|
44,087 |
|
|
150,073 |
|
|
98,157 |
|
|
44,387 |
|
|
142,544 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other income, net |
|
|
3,416 |
|
|
905 |
|
|
4,321 |
|
|
6,317 |
|
|
2,117 |
|
|
8,434 |
Income before income taxes |
|
|
109,402 |
|
|
44,992 |
|
|
154,394 |
|
|
104,474 |
|
|
46,504 |
|
|
150,978 |
Income tax expense |
|
|
23,858 |
|
|
9,884 |
|
|
33,742 |
|
|
22,543 |
|
|
10,075 |
|
|
32,618 |
Net income |
|
$ |
85,544 |
|
$ |
35,108 |
|
$ |
120,652 |
|
$ |
81,931 |
|
$ |
36,429 |
|
$ |
118,360 |
SEGMENT OPERATING RESULTS (Continued) (dollars in thousands) (unaudited) |
||||||||||||||||||
|
|
Three Months Ended |
||||||||||||||||
|
|
March 31,
|
|
March 31,
|
||||||||||||||
|
|
Land and
|
|
Water
|
|
Consolidated |
|
Land and
|
|
Water
|
|
Consolidated |
||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Oil and gas royalties |
|
$ |
111,245 |
|
$ |
— |
|
$ |
111,245 |
|
$ |
92,120 |
|
$ |
— |
|
$ |
92,120 |
Water sales |
|
|
— |
|
|
38,813 |
|
|
38,813 |
|
|
— |
|
|
37,126 |
|
|
37,126 |
Produced water royalties |
|
|
— |
|
|
27,700 |
|
|
27,700 |
|
|
— |
|
|
23,006 |
|
|
23,006 |
Easements and other surface-related income |
|
|
15,336 |
|
|
2,889 |
|
|
18,225 |
|
|
18,121 |
|
|
2,525 |
|
|
20,646 |
Land sales |
|
|
— |
|
|
— |
|
|
— |
|
|
1,244 |
|
|
— |
|
|
1,244 |
Total revenues |
|
|
126,581 |
|
|
69,402 |
|
|
195,983 |
|
|
111,485 |
|
|
62,657 |
|
|
174,142 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Salaries and related employee expenses |
|
|
7,404 |
|
|
7,168 |
|
|
14,572 |
|
|
6,465 |
|
|
5,996 |
|
|
12,461 |
Water service-related expenses |
|
|
— |
|
|
11,126 |
|
|
11,126 |
|
|
— |
|
|
10,212 |
|
|
10,212 |
General and administrative expenses |
|
|
3,313 |
|
|
2,759 |
|
|
6,072 |
|
|
6,674 |
|
|
2,557 |
|
|
9,231 |
Depreciation, depletion and amortization |
|
|
7,689 |
|
|
4,252 |
|
|
11,941 |
|
|
693 |
|
|
3,147 |
|
|
3,840 |
Ad valorem and other taxes |
|
|
2,189 |
|
|
10 |
|
|
2,199 |
|
|
2,356 |
|
|
1 |
|
|
2,357 |
Total operating expenses |
|
|
20,595 |
|
|
25,315 |
|
|
45,910 |
|
|
16,188 |
|
|
21,913 |
|
|
38,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating income |
|
|
105,986 |
|
|
44,087 |
|
|
150,073 |
|
|
95,297 |
|
|
40,744 |
|
|
136,041 |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other income, net |
|
|
3,416 |
|
|
905 |
|
|
4,321 |
|
|
7,930 |
|
|
2,013 |
|
|
9,943 |
Income before income taxes |
|
|
109,402 |
|
|
44,992 |
|
|
154,394 |
|
|
103,227 |
|
|
42,757 |
|
|
145,984 |
Income tax expense |
|
|
23,858 |
|
|
9,884 |
|
|
33,742 |
|
|
22,256 |
|
|
9,311 |
|
|
31,567 |
Net income |
|
$ |
85,544 |
|
$ |
35,108 |
|
$ |
120,652 |
|
$ |
80,971 |
|
$ |
33,446 |
|
$ |
114,417 |
NON-GAAP PERFORMANCE MEASURES AND DEFINITIONS
In addition to amounts presented in accordance with generally accepted accounting principles in
EBITDA, Adjusted EBITDA and Free Cash Flow
EBITDA is a non-GAAP financial measure of earnings before interest expense, taxes, depreciation, depletion and amortization. The purpose of presenting EBITDA is to highlight earnings without finance, taxes, and depreciation, depletion and amortization expense, and its use is limited to specialized analysis. We calculate Adjusted EBITDA as EBITDA plus employee share-based compensation and less pension curtailment and settlement gain. The pension curtailment and settlement gain is related to a buyout by a third party of defined benefit obligations under our pension plan and the subsequent freezing of our pension plan, both of which occurred in the fourth quarter of 2024. We have excluded the pension curtailment and settlement gain from the calculation of Adjusted EBITDA as such gain is a non-recurring item and is not related to our core business. The purpose of presenting Adjusted EBITDA is to highlight earnings without non-cash activity such as share-based compensation and other non-recurring or unusual items, if applicable. We calculate free cash flow as Adjusted EBITDA less current income tax expense and capital expenditures. The purpose of presenting free cash flow is to provide an additional measure of operating performance. We have presented EBITDA, Adjusted EBITDA and free cash flow because we believe that these metrics are useful supplements to net income in analyzing the Company’s operating performance. Our definitions of EBITDA, Adjusted EBITDA and free cash flow may differ from computations of similarly titled measures of other companies.
The following table presents a reconciliation of EBITDA, Adjusted EBITDA and free cash flow to net income for the three months ended March 31, 2025, December 31, 2024 and March 31, 2024 (in thousands):
|
|
Three Months Ended |
||||||||||
|
|
March 31,
|
|
December 31,
|
|
March 31,
|
||||||
Net income |
|
$ |
120,652 |
|
|
$ |
118,360 |
|
|
$ |
114,417 |
|
Add: |
|
|
|
|
|
|
||||||
Income tax expense |
|
|
33,742 |
|
|
|
32,618 |
|
|
|
31,567 |
|
Depreciation, depletion and amortization |
|
|
11,941 |
|
|
|
11,467 |
|
|
|
3,840 |
|
EBITDA |
|
|
166,335 |
|
|
|
162,445 |
|
|
|
149,824 |
|
Add (deduct): |
|
|
|
|
|
|
||||||
Employee share-based compensation |
|
|
3,083 |
|
|
|
3,509 |
|
|
|
2,220 |
|
Pension curtailment and settlement gain |
|
|
— |
|
|
|
(4,616 |
) |
|
|
— |
|
Adjusted EBITDA |
|
|
169,418 |
|
|
|
161,338 |
|
|
|
152,044 |
|
Deduct: |
|
|
|
|
|
|
||||||
Current income tax expense |
|
|
(32,954 |
) |
|
|
(30,177 |
) |
|
|
(31,898 |
) |
Capital expenditures |
|
|
(9,908 |
) |
|
|
(7,429 |
) |
|
|
(5,662 |
) |
Free cash flow |
|
$ |
126,556 |
|
|
$ |
123,732 |
|
|
$ |
114,484 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20250507740663/en/
Investor Relations
IR@TexasPacific.com
Source: Texas Pacific Land Corporation
