On February 19, 2025, Texas Pacific Land Corp (TPL, Financial) released its 8-K filing detailing its financial results for the fourth quarter and full year of 2024. As one of the largest landowners in Texas, TPL is primarily involved in land sales and leases, oil and gas royalties, and land management. The company operates through two segments: Land and Resource Management, and Water Services and Operations, with the majority of revenue generated from the former.
Texas Pacific Land Corp reported a consolidated net income of $118.4 million, or $5.14 per diluted share, for the fourth quarter of 2024. This represents an increase from the previous quarter's net income of $106.6 million. Total revenues for the quarter reached $185.8 million, slightly surpassing the analyst estimate of $185.00 million. The increase in revenue was primarily driven by a $7.5 million rise in easements and other surface-related income, alongside a $2.5 million increase in oil and gas royalty revenue.
Despite the positive revenue growth, TPL faces challenges due to fluctuating commodity prices and operational decisions by its customers, which directly impact its revenue streams. The average realized price per barrel of oil equivalent (Boe) decreased slightly to $37.93 in Q4 2024 from $38.04 in Q3 2024.
For the full year 2024, TPL achieved record oil and gas royalty production of 26.8 thousand Boe per day. The Water Services and Operations segment also reported record performance, with water sales revenue reaching $150.7 million and produced water royalties at $104.1 million. These achievements are crucial as they highlight TPL's ability to capitalize on its extensive land and resource management capabilities, particularly in the oil and gas industry.
Texas Pacific Land Corp's total revenues for the year ended December 31, 2024, were $705.8 million, exceeding the annual estimate of $705.00 million. This growth was largely attributed to a 31.0% increase in water sales volumes and a $24.6 million rise in oil and gas royalty revenue, excluding a prior year settlement impact.
Operating expenses for the year increased to $166.7 million from $145.5 million in 2023, driven by higher water service-related expenses and increased depreciation, depletion, and amortization costs. However, general and administrative expenses decreased by $12.0 million, reflecting improved operational efficiency.
| Metric | Q4 2024 | Q3 2024 | FY 2024 | FY 2023 |
|---|---|---|---|---|
| Total Revenues | $185.8 million | $173.6 million | $705.8 million | $631.6 million |
| Net Income | $118.4 million | $106.6 million | $454.0 million | $405.6 million |
| Adjusted EBITDA | $161.3 million | — | $610.7 million | — |
| Free Cash Flow | $123.7 million | — | $461.1 million | — |
Texas Pacific Land Corp's strategic acquisitions and record performance in its water segment underscore its robust operational capabilities and growth potential. The company's focus on expanding its royalty interests and surface assets positions it well for future growth, despite the inherent challenges of commodity price volatility. As TPL continues to explore next-generation growth prospects and enhance its water treatment technologies, it remains a compelling entity within the oil and gas sector.
“Fourth quarter 2024 represented a strong finish to a year full of milestones and accomplishments for TPL,” said Tyler Glover, Chief Executive Officer of the Company. “In the quarter, we delivered record oil and gas royalty production and produced water royalty volumes.”
Explore the complete 8-K earnings release (here) from Texas Pacific Land Corp for further details.
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