On August 8, 2024, Granite Ridge Resources Inc (GRNT, Financial) released its 8-K filing reporting financial and operating results for the second quarter of 2024. Granite Ridge Resources Inc is a scaled, non-operated oil and gas exploration and production company, investing in a diversified portfolio of production and top-tier acreage across the Permian and other prolific U.S. basins in partnership with operators. The company generates maximum revenue from oil.
Performance Overview
Granite Ridge Resources Inc (GRNT, Financial) reported a net income of $5.1 million, or $0.04 per diluted share, for Q2 2024, falling short of the analyst estimate of $0.19 per share. Adjusted net income (non-GAAP) was $17.2 million, or $0.13 per diluted share. The company generated $68.3 million of Adjusted EBITDAX (non-GAAP) and placed 62 gross (9.10 net) wells online during the quarter.
Key Financial Achievements
Despite the earnings miss, Granite Ridge Resources Inc (GRNT, Financial) achieved several financial milestones:
- Increased production by 7% to 23,106 barrels of oil equivalent (Boe) per day from Q2 2023.
- Reported oil production volumes of 10,940 barrels per day, a 5% increase from Q2 2023.
- Natural gas production totaled 72,997 thousand cubic feet per day, a 9% increase from Q2 2023.
- Paid a dividend of $0.11 per share of common stock during the second quarter.
- Ended the quarter with liquidity of $148.2 million.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $90.7 million | $87.6 million |
| Net Income | $5.1 million | $8.7 million |
| Adjusted EBITDAX | $68.3 million | $69.7 million |
Balance Sheet and Cash Flow
Granite Ridge Resources Inc (GRNT, Financial) reported total assets of $990.5 million as of June 30, 2024, compared to $927.1 million at the end of 2023. The company’s long-term debt increased to $165 million from $110 million. Cash flow from operating activities was $64.2 million, including $0.6 million in working capital changes.
Operational Update
During Q2 2024, Granite Ridge Resources Inc (GRNT, Financial) closed multiple transactions, adding 16.4 net future drilling locations for a total acquisition cost of $22.4 million. Subsequent to the quarter end, the company acquired an additional 8.7 net future drilling locations for $25 million.
Management Commentary
"The second quarter 2024 was workmanlike from a results standpoint, but the deal side was anything but," commented Granite Ridge President and Chief Executive Officer Luke Brandenberg. "While our Traditional Non-Op business continued to generate high quality locations with near-term development at an attractive cost basis, it is our Controlled Capital strategy that stood out. By nearly doubling our operated location inventory and adding a Midland Basin-focused Strategic Partner, we continue to increase our capital allocation to Controlled Capital projects. Based on the success of our business model and our compelling fixed dividend that is underpinned by hedged cash flow and conservative leverage, we believe Granite Ridge is positioned to drive long-term value for shareholders."
Analysis
Granite Ridge Resources Inc (GRNT, Financial) faced challenges in meeting analyst expectations for Q2 2024, primarily due to lower-than-expected earnings per share. However, the company demonstrated resilience through increased production and strategic acquisitions. The focus on Controlled Capital projects and maintaining a strong liquidity position are positive indicators for long-term growth. The declared dividend and robust operational activities further underscore the company's commitment to delivering shareholder value.
For more detailed insights and to access the full earnings report, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Granite Ridge Resources Inc for further details.
