Texas Pacific Land Corporation Announces Fourth Quarter and Full Year 2024 Results
– Achieved Record Annual Performance From Water Segment
– Earnings Call to be Held Thursday, February 20, 2025 at 7:30 am CT
Fourth Quarter 2024 Highlights
-
Acquired mineral interests across 7,490 net royalty acres located primarily in the Midland Basin for a purchase price of
$275.2 million - Royalty production of 29.1 thousand barrels of oil equivalent (“Boe”) per day, a company record
- As of December 31, 2024, TPL’s royalty acreage had an estimated 6.4 net well permits, 13.2 net drilled but uncompleted wells, 3.0 net completed wells, and 86.8 net producing wells; net producing wells added during the quarter had an average lateral length of approximately 10,100 ft.
-
Consolidated net income of
$118.4 million $5.14 -
Adjusted EBITDA(1) of
$161.3 million -
Free cash flow (1) of
$123.7 million -
Quarterly cash dividend of
$1.60
Full Year 2024 Highlights
- Record oil and gas royalty production of 26.8 thousand Boe per day
-
Water Service and Operations segment achieved record performance in 2024 for the following:
-
Water sales revenue of
$150.7 million -
Produced water royalties revenue of
$104.1 million -
Total segment revenues of
$265.0 million -
Total segment net income of
$139.1 million
-
Water sales revenue of
- Developed an energy-efficient method of produced water desalination and treatment; the Company successfully conducted a technology pilot and has begun construction of a sub-scale produced water test facility with an initial capacity of 10,000 barrels of produced water per day
- Three-for-one stock split effected March 26, 2024
-
Completed two acquisitions of mineral interests for a combined
$395.5 million -
Acquired 4,120 surface acres and other surface-related assets located in the core of the Midland Basin for a purchase price of
$45.0 million -
Consolidated net income of
$454.0 million $19.72 -
Adjusted EBITDA(1) of
$610.7 million -
Free cash flow (1) of
$461.1 million -
$347.3 million $10.00 $5.11 -
$29.2 million
(1) |
Reconciliations of non-GAAP performance measures are provided in the tables below. |
“Fourth quarter 2024 represented a strong finish to a year full of milestones and accomplishments for TPL,” said Tyler Glover, Chief Executive Officer of the Company. “In the quarter, we delivered record oil and gas royalty production and produced water royalty volumes. For the full year 2024, TPL set annual records across nearly every major performance metric, including oil and gas royalty production, water sales volumes and revenues, produced water royalty volumes and revenues, net income and free cash flow per share. Throughout 2024, we deployed over
“Beyond our legacy business, we are keenly pursuing various next-gen growth prospects and continue to advance commercial discussions across numerous opportunities. In addition, construction has begun on our sub-scale produced water desalination test facility, and we remain on-track for a mid-2025 completion. Furthermore, there remains a compelling opportunity to consolidate an enormous, yet fragmented market for oil and gas royalties, surface, and water assets. With our unmatched footprint overlapping premier hydrocarbon and non-hydrocarbon natural resources, TPL remains well-positioned to drive accretive growth.”
Financial Results for the Fourth Quarter of 2024 - Sequential
The Company reported net income of
Total revenues for the fourth quarter of 2024 were
Total operating expenses were
Financial Results for the Year Ended December 31, 2024
Total revenues for the year ended December 31, 2024 were
Total operating expenses were
Quarterly Dividend Declared
On February 18, 2025, the Company’s Board of Directors declared a quarterly cash dividend of
Conference Call and Webcast Information
The Company will hold a conference call on Thursday, February 20, 2025 at 7:30 a.m. Central Time to discuss fourth quarter and year end 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# 13745175. The telephone replay will be available starting shortly after the call through March 6, 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; and 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 |
|
Years Ended |
||||||||
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
||||
Company’s share of production volumes(1): |
|
|
|
|
|
|
|
|
||||
Oil (MBbls) |
|
|
1,115 |
|
|
1,046 |
|
|
4,118 |
|
|
3,701 |
Natural gas (MMcf) |
|
|
4,763 |
|
|
4,654 |
|
|
17,074 |
|
|
14,528 |
NGL (MBbls) |
|
|
768 |
|
|
779 |
|
|
2,841 |
|
|
2,453 |
Equivalents (MBoe) |
|
|
2,676 |
|
|
2,600 |
|
|
9,804 |
|
|
8,575 |
Equivalents per day (MBoe/d) |
|
|
29.1 |
|
|
28.3 |
|
|
26.8 |
|
|
23.5 |
|
|
|
|
|
|
|
|
|
||||
Oil and gas royalty revenue (in thousands): |
|
|
|
|
|
|
|
|
||||
Oil royalties |
|
$ |
75,286 |
|
$ |
75,427 |
|
$ |
298,074 |
|
$ |
273,304 |
Natural gas royalties |
|
|
4,882 |
|
|
4,201 |
|
|
18,512 |
|
|
29,915 |
NGL royalties |
|
|
16,786 |
|
|
14,816 |
|
|
56,745 |
|
|
45,510 |
Total oil and gas royalties |
|
$ |
96,954 |
|
$ |
94,444 |
|
$ |
373,331 |
|
$ |
348,729 |
|
|
|
|
|
|
|
|
|
||||
Realized prices (1): |
|
|
|
|
|
|
|
|
||||
Oil ($/Bbl) |
|
$ |
70.73 |
|
$ |
75.53 |
|
$ |
75.80 |
|
$ |
77.33 |
Natural gas ($/Mcf) |
|
$ |
1.11 |
|
$ |
0.98 |
|
$ |
1.17 |
|
$ |
2.23 |
NGL ($/Bbl) |
|
$ |
23.63 |
|
$ |
20.57 |
|
$ |
21.60 |
|
$ |
20.05 |
Equivalents ($/Boe) |
|
$ |
37.93 |
|
$ |
38.04 |
|
$ |
39.87 |
|
$ |
42.58 |
| ____________________________ | ||||
(1) |
Term |
|
Definition |
|
|
Bbl |
|
One stock tank barrel of 42 U.S. gallons liquid volume used herein in reference to crude oil, condensate or NGLs. |
|
|
MBbls |
|
One thousand barrels of crude oil, condensate or NGLs. |
|
|
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. |
|
|
|
|
|
|
(2) |
The metrics and dollars provided for the year ended December 31, 2023 exclude the impact of an |
|||
CONDENSED CONSOLIDATED STATEMENTS OF INCOME |
||||||||||||
(in thousands, except share and per share amounts) (unaudited) |
||||||||||||
|
|
Three Months Ended |
|
Years Ended |
||||||||
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
||||
Revenues: |
|
|
|
|
|
|
|
|
||||
Oil and gas royalties |
|
$ |
96,954 |
|
$ |
94,444 |
|
$ |
373,331 |
|
$ |
357,394 |
Water sales |
|
|
36,737 |
|
|
36,211 |
|
|
150,724 |
|
|
112,203 |
Produced water royalties |
|
|
28,089 |
|
|
27,727 |
|
|
104,123 |
|
|
84,260 |
Easements and other surface-related income |
|
|
21,761 |
|
|
14,280 |
|
|
73,257 |
|
|
70,932 |
Land sales |
|
|
2,243 |
|
|
901 |
|
|
4,388 |
|
|
6,806 |
Total revenues |
|
|
185,784 |
|
|
173,563 |
|
|
705,823 |
|
|
631,595 |
|
|
|
|
|
|
|
|
|
||||
Expenses: |
|
|
|
|
|
|
|
|
||||
Salaries and related employee expenses |
|
|
14,359 |
|
|
14,030 |
|
|
53,621 |
|
|
43,384 |
Water service-related expenses |
|
|
9,357 |
|
|
11,731 |
|
|
46,124 |
|
|
33,566 |
General and administrative expenses |
|
|
6,752 |
|
|
12,520 |
|
|
34,483 |
|
|
46,450 |
Depreciation, depletion and amortization |
|
|
11,467 |
|
|
5,762 |
|
|
25,162 |
|
|
14,757 |
Ad valorem and other taxes |
|
|
1,305 |
|
|
2,189 |
|
|
7,295 |
|
|
7,385 |
Total operating expenses |
|
|
43,240 |
|
|
46,232 |
|
|
166,685 |
|
|
145,542 |
|
|
|
|
|
|
|
|
|
||||
Operating income |
|
|
142,544 |
|
|
127,331 |
|
|
539,138 |
|
|
486,053 |
|
|
|
|
|
|
|
|
|
||||
Other income, net |
|
|
8,434 |
|
|
8,086 |
|
|
39,683 |
|
|
31,508 |
Income before income taxes |
|
|
150,978 |
|
|
135,417 |
|
|
578,821 |
|
|
517,561 |
Income tax expense |
|
|
32,618 |
|
|
28,823 |
|
|
124,861 |
|
|
111,916 |
Net income |
|
$ |
118,360 |
|
$ |
106,594 |
|
$ |
453,960 |
|
$ |
405,645 |
|
|
|
|
|
|
|
|
|
||||
Net income per share of common stock (1) |
|
|
|
|
|
|
|
|
||||
Basic |
|
$ |
5.15 |
|
$ |
4.64 |
|
$ |
19.75 |
|
$ |
17.60 |
Diluted |
|
$ |
5.14 |
|
$ |
4.63 |
|
$ |
19.72 |
|
$ |
17.59 |
|
|
|
|
|
|
|
|
|
||||
Weighted average number of shares of common stock outstanding (1) |
|
|
|
|
|
|
|
|
||||
Basic |
|
|
22,974,238 |
|
|
22,979,781 |
|
|
22,986,197 |
|
|
23,044,305 |
Diluted |
|
|
23,015,530 |
|
|
23,012,169 |
|
|
23,019,751 |
|
|
23,059,845 |
| ____________________________ | ||
(1) |
All share and share price amounts reflect the three-for-one stock split effected on March 26, 2024. |
|
SEGMENT OPERATING RESULTS |
||||||||||||||||||
(dollars in thousands) (unaudited) |
||||||||||||||||||
|
Three Months Ended |
|||||||||||||||||
|
December 31,
|
|
September 30,
|
|||||||||||||||
|
Land and
|
|
Water
Services and
|
|
Consolidated |
|
Land and
|
|
Water
|
|
Consolidated |
|||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Oil and gas royalties |
$ |
96,954 |
|
$ |
— |
|
$ |
96,954 |
|
$ |
94,444 |
|
$ |
— |
|
$ |
94,444 |
|
Water sales |
|
— |
|
|
36,737 |
|
|
36,737 |
|
|
— |
|
|
36,211 |
|
|
36,211 |
|
Produced water royalties |
|
— |
|
|
28,089 |
|
|
28,089 |
|
|
— |
|
|
27,727 |
|
|
27,727 |
|
Easements and other surface-related income |
|
19,431 |
|
|
2,330 |
|
|
21,761 |
|
|
11,303 |
|
|
2,977 |
|
|
14,280 |
|
Land sales |
|
2,243 |
|
|
— |
|
|
2,243 |
|
|
901 |
|
|
— |
|
|
901 |
|
Total revenues |
|
118,628 |
|
|
67,156 |
|
|
185,784 |
|
|
106,648 |
|
|
66,915 |
|
|
173,563 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Salaries and related employee expenses |
|
7,366 |
|
|
6,993 |
|
|
14,359 |
|
|
7,182 |
|
|
6,848 |
|
|
14,030 |
|
Water service-related expenses |
|
— |
|
|
9,357 |
|
|
9,357 |
|
|
— |
|
|
11,731 |
|
|
11,731 |
|
General and administrative expenses |
|
4,509 |
|
|
2,243 |
|
|
6,752 |
|
|
10,359 |
|
|
2,161 |
|
|
12,520 |
|
Depreciation, depletion and amortization |
|
7,327 |
|
|
4,140 |
|
|
11,467 |
|
|
2,135 |
|
|
3,627 |
|
|
5,762 |
|
Ad valorem and other taxes |
|
1,269 |
|
|
36 |
|
|
1,305 |
|
|
2,189 |
|
|
— |
|
|
2,189 |
|
Total operating expenses |
|
20,471 |
|
|
22,769 |
|
|
43,240 |
|
|
21,865 |
|
|
24,367 |
|
|
46,232 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating income |
|
98,157 |
|
|
44,387 |
|
|
142,544 |
|
|
84,783 |
|
|
42,548 |
|
|
127,331 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Other income, net |
|
6,317 |
|
|
2,117 |
|
|
8,434 |
|
|
6,446 |
|
|
1,640 |
|
|
8,086 |
|
Income before income taxes |
|
104,474 |
|
|
46,504 |
|
|
150,978 |
|
|
91,229 |
|
|
44,188 |
|
|
135,417 |
|
Income tax expense |
|
22,543 |
|
|
10,075 |
|
|
32,618 |
|
|
19,359 |
|
|
9,464 |
|
|
28,823 |
|
Net income |
$ |
81,931 |
|
$ |
36,429 |
|
$ |
118,360 |
|
$ |
71,870 |
|
$ |
34,724 |
|
$ |
106,594 |
|
SEGMENT OPERATING RESULTS (Continued) |
||||||||||||||||||
(dollars in thousands) (unaudited) |
||||||||||||||||||
|
Years Ended |
|||||||||||||||||
|
December 31,
|
|
December 31,
|
|||||||||||||||
|
Land and
|
|
Water
|
|
Consolidated |
|
Land and
|
|
Water
|
|
Consolidated |
|||||||
Revenues: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Oil and gas royalties |
$ |
373,331 |
|
$ |
— |
|
$ |
373,331 |
|
$ |
357,394 |
|
$ |
— |
|
$ |
357,394 |
|
Water sales |
|
— |
|
|
150,724 |
|
|
150,724 |
|
|
— |
|
|
112,203 |
|
|
112,203 |
|
Produced water royalties |
|
— |
|
|
104,123 |
|
|
104,123 |
|
|
— |
|
|
84,260 |
|
|
84,260 |
|
Easements and other surface-related income |
|
63,074 |
|
|
10,183 |
|
|
73,257 |
|
|
67,905 |
|
|
3,027 |
|
|
70,932 |
|
Land sales |
|
4,388 |
|
|
— |
|
|
4,388 |
|
|
6,806 |
|
|
— |
|
|
6,806 |
|
Total revenues |
|
440,793 |
|
|
265,030 |
|
|
705,823 |
|
|
432,105 |
|
|
199,490 |
|
|
631,595 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Expenses: |
|
|
|
|
|
|
|
|
|
|
|
|||||||
Salaries and related employee expenses |
|
27,493 |
|
|
26,128 |
|
|
53,621 |
|
|
21,945 |
|
|
21,439 |
|
|
43,384 |
|
Water service-related expenses |
|
— |
|
|
46,124 |
|
|
46,124 |
|
|
— |
|
|
33,566 |
|
|
33,566 |
|
General and administrative expenses |
|
25,531 |
|
|
8,952 |
|
|
34,483 |
|
|
39,078 |
|
|
7,372 |
|
|
46,450 |
|
Depreciation, depletion and amortization |
|
10,968 |
|
|
14,194 |
|
|
25,162 |
|
|
3,073 |
|
|
11,684 |
|
|
14,757 |
|
Ad valorem and other taxes |
|
7,257 |
|
|
38 |
|
|
7,295 |
|
|
7,382 |
|
|
3 |
|
|
7,385 |
|
Total operating expenses |
|
71,249 |
|
|
95,436 |
|
|
166,685 |
|
|
71,478 |
|
|
74,064 |
|
|
145,542 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Operating income |
|
369,544 |
|
|
169,594 |
|
|
539,138 |
|
|
360,627 |
|
|
125,426 |
|
|
486,053 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Other income, net |
|
31,707 |
|
|
7,976 |
|
|
39,683 |
|
|
30,384 |
|
|
1,124 |
|
|
31,508 |
|
Income before income taxes |
|
401,251 |
|
|
177,570 |
|
|
578,821 |
|
|
391,011 |
|
|
126,550 |
|
|
517,561 |
|
Income tax expense |
|
86,350 |
|
|
38,511 |
|
|
124,861 |
|
|
84,305 |
|
|
27,611 |
|
|
111,916 |
|
Net income |
$ |
314,901 |
|
$ |
139,059 |
|
$ |
453,960 |
|
$ |
306,706 |
|
$ |
98,939 |
|
$ |
405,645 |
|
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. Its purpose 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 December 31, 2024 and September 30, 2024 and for the years ended December 31, 2024 and 2023 (in thousands):
|
|
Three Months Ended |
|
Years Ended |
||||||||||||
|
|
December 31,
|
|
September 30,
|
|
December 31,
|
|
December 31,
|
||||||||
Net income |
|
$ |
118,360 |
|
|
$ |
106,594 |
|
|
$ |
453,960 |
|
|
$ |
405,645 |
|
Add: |
|
|
|
|
|
|
|
|
||||||||
Income tax expense |
|
|
32,618 |
|
|
|
28,823 |
|
|
|
124,861 |
|
|
|
111,916 |
|
Depreciation, depletion and amortization |
|
|
11,467 |
|
|
|
5,762 |
|
|
|
25,162 |
|
|
|
14,757 |
|
EBITDA |
|
|
162,445 |
|
|
|
141,179 |
|
|
|
603,983 |
|
|
|
532,318 |
|
Add (deduct): |
|
|
|
|
|
|
|
|
||||||||
Employee share-based compensation |
|
|
3,509 |
|
|
|
2,935 |
|
|
|
11,364 |
|
|
|
9,124 |
|
Pension curtailment and settlement gain |
|
|
(4,616 |
) |
|
|
— |
|
|
|
(4,616 |
) |
|
|
— |
|
Adjusted EBITDA |
|
|
161,338 |
|
|
|
144,114 |
|
|
|
610,731 |
|
|
|
541,442 |
|
Deduct: |
|
|
|
|
|
|
|
|
||||||||
Current income tax expense |
|
|
(30,177 |
) |
|
|
(27,416 |
) |
|
|
(120,257 |
) |
|
|
(110,517 |
) |
Capital expenditures |
|
|
(7,429 |
) |
|
|
(9,833 |
) |
|
|
(29,423 |
) |
|
|
(15,431 |
) |
Free Cash Flow |
|
$ |
123,732 |
|
|
$ |
106,865 |
|
|
$ |
461,051 |
|
|
$ |
415,494 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20250219899731/en/
Investor Relations
IR@TexasPacific.com
Source: Texas Pacific Land Corporation
