On August 6, 2024, W&T Offshore Inc (WTI, Financial) released its 8-K filing detailing its financial and operational results for the second quarter of 2024. W&T Offshore Inc is an oil and gas exploration and production company focused on the Gulf of Mexico, engaging in both deepwater and shallow-water shelf drilling. The company primarily extracts crude oil, natural gas, and natural gas liquids, with crude oil accounting for the majority of its revenue.
Performance Overview
W&T Offshore Inc reported a net loss of $15.4 million for Q2 2024, translating to a loss of $0.10 per share. This result missed the analyst estimate of a $0.02 loss per share. The company generated revenues of $142.8 million, falling short of the estimated $163.12 million. Despite these misses, the company declared a third-quarter dividend of $0.01 per share.
Production and Revenue
Production for Q2 2024 was 34.9 MBoe/d, which was at the midpoint of the company's guidance range but slightly lower than the 35.1 MBoe/d in Q1 2024 and 37.0 MBoe/d in Q2 2023. The production mix included 15.2 MBbl/d of oil, 3.7 MBbl/d of natural gas liquids, and 96.4 MMcf/d of natural gas. The average realized price per Boe was $44.40, up from $42.55 in Q1 2024 and $36.76 in Q2 2023.
Financial Achievements
W&T Offshore Inc achieved an Adjusted EBITDA of $45.9 million and generated $18.7 million in Free Cash Flow, marking the 26th consecutive quarter of positive Free Cash Flow. The company increased its cash on hand by 30% and decreased net debt by 9% compared to March 31, 2024.
Income Statement Highlights
| Metric | Q2 2024 | Q1 2024 | Q2 2023 |
|---|---|---|---|
| Total Revenues | $142.8 million | $140.8 million | $126.2 million |
| Lease Operating Expenses | $74.0 million | $70.8 million | $66.0 million |
| Net (Loss) Income | $(15.4) million | $(11.5) million | $(12.1) million |
Balance Sheet and Liquidity
As of June 30, 2024, W&T Offshore Inc had available liquidity of $173.4 million, including $123.4 million in unrestricted cash and $50.0 million of borrowing availability. The company had total debt of $391.9 million, with net debt standing at $268.5 million. The net debt to TTM Adjusted EBITDA ratio was 1.4x.
Operational Challenges
Production was negatively impacted by the shutdown of the primary Mobile Bay processing plant by a third-party operator, forcing W&T to reroute volumes to a separate plant with lower capacity. This led to curtailed production and sales, although the primary plant resumed operations in June 2024.
Commentary
"We remain committed to executing our strategic vision focused on free cash flow generation, maintaining solid production and maximizing margins while increasing proved reserves and PV-10," said Tracy W. Krohn, W&T’s Board Chair and Chief Executive Officer.
Future Outlook
W&T Offshore Inc plans to continue integrating its 2024 acquired assets and expects to increase production from these new fields. The company is also focused on maintaining its quarterly dividend program and leveraging its scale and expertise in the Gulf of Mexico for future growth.
For more detailed financial data and analysis, visit the full 8-K filing.
Explore the complete 8-K earnings release (here) from W&T Offshore Inc for further details.
