Q3 2024 Kimbell Royalty Partners LP Earnings Call Transcript
Key Points
- Kimbell Royalty Partners LP (KRP) declared a third quarter cash distribution of $0.41 per common unit, highlighting their commitment to returning value to unitholders.
- The company reported strong drilling activity with 90 rigs actively drilling on their acreage, representing a 16% market share of all land rigs in the Lower 48.
- KRP achieved a record number of lease bonuses during the third quarter, indicating increased operator interest in their acreage.
- The number of net DUCs increased by 34% quarter-over-quarter to 5.1 net DUCs, the second highest level in the company's history, driven by activity in the Permian Basin.
- KRP maintained a conservative balance sheet with a net debt to trailing 12-month consolidated adjusted EBITDA of approximately 0.8 times, ensuring financial flexibility.
- The decision to delay the partial redemption of Apollo preferred stock to May 2025, although cost-efficient, may raise concerns about the timing and financial strategy.
- Net permits decreased by about 1.4, which could indicate a potential slowdown in future drilling activity if not addressed.
- The company faces competition in smaller acquisitions, which could limit their ability to consolidate smaller interests efficiently.
- There is uncertainty regarding the continuation of increased lease bonuses, as it may depend on operators running through their Tier 1 acreage.
- KRP's exposure to the Appalachian Basin is limited, which could be a missed opportunity given the potential for increased infrastructure and LNG exports in the region.
Greetings, and welcome to Kimbell Royalty Partners third quarter earnings conference call.
(Operator Instructions) As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Rick Black, Investor Relations. Thank you, Mr. Black, you may begin.
Thank you, operator, and good morning, everyone. Welcome to the Kimbell Royalty Partners conference call to review financial and operational results for the third quarter of 2024, which ended September 30, 2024. This call is also being webcast and can be accessed through the audio link on the Events & Presentations page of IR section of the kimbellrp.com.
Information recorded on this call speaks only as of today, which is November 07, 2024, so please be advised that any time-sensitive information may no longer be accurate as of the date of any replay listening or transcript reading.
I would also like to remind you that the statements made in today's discussion that are not historical facts,
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