Vitesse Energy Announces Full Year 2023 Results

Source: 2/26/2024, Location: North America

Vitesse Energy, Inc. (NYSE: VTS) (“we,” “our,” “Vitesse,” or “the Company”) announced the Company’s 2023 financial and operating results and declared a quarterly cash dividend.

- Declared a quarterly cash dividend of $0.50 per common share to be paid on March 29, 2024
- Net loss of $19.7 million and Adjusted Net Income(1) of $53.6 million
- Adjusted EBITDA(1) of $157.0 million
- Cash flow from operations of $141.9 million and Free Cash Flow(1) of $60.7 million
- Production of 11,889 barrels of oil equivalent (“Boe”) per day (68% oil), an increase of 15% from 2022, and fourth quarter 2023 production of 13,652 Boe per day (72% oil)
- Total cash development capital expenditures and acquisition costs of $120.5 million
- Total debt of $81.0 million and Net Debt to Adjusted EBITDA ratio(1) of 0.51

Bob Gerrity, Vitesse’s Chairman and Chief Executive Officer commented, “During our first year as a publicly traded company, we followed through on our strategy of returning capital to stockholders by paying a $2.00 per share fixed dividend. Our allocation of capital to the highest return opportunities also resulted in production growth during the year, while maintaining our conservative leverage profile. Going forward, we believe our significant inventory of organic development locations and access to attractive self-sourced deal flow position us to both continue the return of capital strategy and pursue accretive growth opportunities.”

Vitesse’s Board of Directors declared its first quarter 2024 cash dividend for Vitesse’s common stock of $0.50 per share for stockholders of record as of March 15, 2024, which will be paid on March 29, 2024.

On December 29, 2023, the Company paid its fourth quarter cash dividend of $0.50 per share to common stockholders of record as of December 15, 2023.

Net loss for 2023 was $19.7 million and Adjusted Net Income was $53.6 million. Adjusted EBITDA was $157.0 million. See “Non-GAAP Financial Measures”.

Oil and natural gas production during 2023 averaged 11,889 Boe per day. For the fourth quarter, oil and natural gas production averaged 13,652 Boe per day. Sequentially this represents 24% growth over third quarter 2023, reflecting the impact of the Company’s acquisition of additional oil and natural gas interests previously announced in October 2023. Oil represented 68% of production and 93% of total oil and natural gas revenue for the year. Total revenue, including the effects of realized hedges, for 2023 was $235.1 million.

Vitesse’s average realized oil and natural gas prices before hedging were $73.59 per Bbl and $1.88 per Mcf, respectively, during 2023. For the year, the Company had hedges covering 49% of oil production and its realized oil price with hedging was $73.99 per Bbl.

Lease operating expenses in 2023 were $39.5 million, or $9.11 per Boe. General and administrative (“G&A”) expenses for 2023 totaled $23.9 million, or $5.52 per Boe, which included $6.8 million of costs related to the spin-off from Jefferies Financial Group Inc. on January 13, 2023 (the “Spin-Off”). Excluding these costs, G&A would have been $3.94 per Boe.

Proved developed reserves at December 31, 2023 increased 5% from December 31, 2022 to 28.5 million Boe. Total proved reserves decreased 7% to 40.6 million Boe (70% proved developed). The decrease in proved reserves was attributable to the removal of undeveloped drilling locations related to the pace of development in North Dakota. To comply with SEC guidelines, proved undeveloped reserves are limited to those locations that are reasonably certain to be developed over the next five years. A portion of the increase in proved developed reserves was the result of Vitesse adding 1.5 million Boe of reserves that were not classified as proved undeveloped at December 31, 2022, but were part of its unproven inventory of drilling locations.

Total proved reserves at December 31, 2023 had an associated Standardized Measure of $575.7 million and PV-10 value of $682.1 million (79% proved developed). The decrease in Standardized Measure and PV-10 from 2022 is primarily related to the reduction in the benchmark oil and natural gas prices used in accordance with the SEC’s rules regarding reserve reporting from $94.14/Bbl to $78.21/Bbl for oil and $6.36/MMBtu to $2.64/MMBtu for natural gas, along with a decrease in NGL prices that contributed to the reduction in realized natural gas price from $7.98/Mcf in 2022 to $1.71/Mcf. These benchmark prices represent an average price equal to the 12-month unweighted arithmetic average of the first day of the month prices for each of the preceding 12 months and are adjusted for location and quality differentials, unless prices are defined by contractual arrangements, excluding escalations based on future conditions (“SEC Pricing”). Vitesse’s Standardized Measure, PV-10 and proved reserves at year-end 2022 did not include the reserves of Vitesse Oil, LLC (“Vitesse Oil”), which was acquired as part of the Spin-Off.

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