Q2 2024 California Resources Corp Earnings Call Transcript
Key Points
- Successful merger with Aera, doubling daily production volumes and increasing average net revenue interest to 90%.
- Strong cash flow growth, with a mid-10s cash flow per share growth from 2021 to 2023 and a 25% increase in dividend per share.
- Significant cost savings and synergies from the merger, with $235 million in total synergies expected over the next 15 months.
- Expansion of carbon management business, with over 300 million tonnes of CO2 under permit review and new projects in the pipeline.
- Solid financial performance in Q2 2024, with $139 million in adjusted EBITDAX and $63 million in free cash flow, driven by consistent base production and higher-than-expected oil sales.
- Permitting headwinds in California, which could impact future growth and operational efficiency.
- Recent economic developments have created a riskier outlook for the domestic and global economy, emphasizing the need for sustainable earnings.
- Ongoing integration costs and merger-related expenses, which will continue to impact financials in the near term.
- Dependence on regulatory approvals for carbon management projects, which could delay execution and impact timelines.
- Potential challenges in maintaining production levels without incremental permits, relying heavily on workovers and sidetracks.
Good day and welcome to the California Resources Corporation Second Quarter 2024 conference call. (Operator Instructions) Please note that this event is being recorded.
At this time, I would now like to turn the conference over to Joanna Park, Vice President of Investor Relations and Treasurer. Please go ahead.
Good morning and welcome to California Resources Corporation's second quarter conference call. This is our first call following the closing of our air merger, and we are excited to share our progress. Prepared comments today will come from our CEO, Francisco Leon, and our CFO, Nelly Molina. Following their remarks, we will be available to take your questions with us on the call.
We also have other members of our senior leadership team. By now. I hope you have had a chance to review our earnings release and our supplemental slides. We have also provided information reconciling non-GAAP financial measures discussed to the most directly comparable
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