Q2 2024 Highpeak Energy Inc Earnings Call Transcript
Key Points
- HighPeak Energy Inc (HPK) reported positive free cash flow for the fourth consecutive quarter, even with high capital expenditures.
- The company achieved a significant reduction in lease operating expenses, maintaining a sub-seven dollars per BOE cost level.
- Production volumes exceeded expectations, with an average of over 52,000 barrels a day in the third quarter.
- HighPeak Energy Inc (HPK) raised its production guidance for 2024, reflecting confidence in continued strong performance.
- The company successfully reduced long-term debt by $30 million and continued its share buyback program, acquiring over 413,000 shares.
- A delay in bringing a key pad online reduced expected second quarter production volumes.
- Higher workover expenses were incurred in the second quarter, impacting lease operating expenses.
- The company faces high interest payments on debt, which is 20% of EBITDA, affecting cash flow.
- There are Make-Whole provisions on debt that limit flexibility in refinancing until March.
- The capital budget was slightly increased due to additional infrastructure projects, impacting financial planning.
Good day and thank you for standing by. Welcome to the HighPeak Energy 2024 Second Quarter Earnings Conference Call [Operator Instructions] Please be advised that todayâs conference is being recorded.
I would now like to hand the conference over to your first speaker today, Steven Tholen, CFO. Please go ahead.
Good morning, everyone and welcome to HighPeak Energyâs second quarter 2024 earnings call. Representing HighPeak today are Chairman and CEO, Jack Hightower; President, Michael Hollis; and Iâm Steven Tholen, the Chief Financial Officer.
During todayâs call, we will make reference to our August Investor Presentation and our second quarter earnings release, which can be found on HighPeakâs website. Todayâs call participants may make certain forward-looking statements relating to the Companyâs financial condition, results of operations, expectations, plans, goals, assumptions, and future performance.
So please refer to the cautionary information regarding
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