Key Points
- Net income per share came in at $0.36, beating analyst estimates.
- Revenue of $66.6 million was up 29% year over year.
- The quarterly dividend increased by 5% to $0.525 per share.
Vitesse Energy (VTS -9.56%), an energy company focused on non-operated oil and natural gas properties, reported second-quarter financial results Monday that topped analyst consensus expectations. Overall, the company showed notable improvements and continued commitment to its growth and dividend strategy.
| Metric | Q2 2024 | Analyst Estimate | Q2 2023 | Change (YOY) |
|---|---|---|---|---|
| EPS | $0.36 | $0.34 | $0.29 | 24% |
| Total revenue | $66.6 million | $64.73 million | $51.6 million | 29% |
| Net Income | $10.9 million | N/A | $9.6 million | 13.3% |
| Lease operating expenses | $12.3 million | N/A | $9.3 million | 32.3% |
Source: Vitesse Energy. Note: Analyst estimates provided by FactSet. YOY = Year over year.
Overview of Vitesse Energy's Business
Vitesse Energy is an energy company focusing on non-operated oil and natural gas properties, primarily in the Williston Basin and Central Rockies. The company's recent focus has been on strategic acquisitions and maintaining financial discipline.
Notable Events During the Quarter
In the second quarter, Vitesse Energy closed development acquisitions in the Williston Basin, expecting over $40 million in development capital expenditures primarily during 2024. These acquisitions should enhance production and cash flow by Q4 2024 and into 2025.
The company generated $43.1 million in adjusted EBITDA, showcasing strong operational cash generation. Approximately 62% of its oil production is hedged, with realized oil prices at $73.42 per barrel. This includes hedges for the second half of 2024, and part of 2025, ensuring predictability and stability amidst oil price volatility.
The dividend increase by 5% to $0.525 per share indicates robust confidence in the company's cash flow generation and financial health. Vitesse invested $24.5 million toward development and $13.1 million toward acquisitions during the quarter, demonstrating its commitment to growth.
Operationally, Vitesse Energy reported using proprietary data platforms to monitor and optimize operations, ensuring high efficiency and agility in decision-making processes.
Revenue from oil hit $64.1 million, compared to $48.7 million in the previous year, while natural gas revenue declined to $2.5 million from $2.9 million. Production volumes also saw increases, with oil production at 859,000 barrels and natural gas production at 2,217 million cubic feet, marking 23% and 10% increases, respectively, from Q2 2023.
Challenges included lease operating expenses rising by 32.3% year over year to $12.3 million. Interest expenses also increased to $2.6 million from $1.1 million due to higher debt levels, highlighting the need for meticulous cost management.
Looking Ahead
Vitesse's forward guidance reiterates an annual production range of 13,000 to 14,000 barrels of oil equivalent per day for the rest of 2024. Capital expenditures are forecasted at $130 million to $150 million, reflecting increased spending on recent acquisitions and development projects.
Investors should watch Vitesse's ongoing acquisition strategy and how it manages rising operational costs amidst competitive market conditions. The company's commitment to dividend growth and strategic acquisitions remains a key focus.
