On February 24, 2025, Coterra Energy Inc (CTRA, Financial) released its 8-K filing, reporting impressive fourth-quarter and full-year 2024 results. The independent oil and gas company, which operates primarily in the Permian Basin, Marcellus Shale, and Anadarko Basin, exceeded expectations in several key areas, showcasing its operational efficiency and strategic growth initiatives.
For the fourth quarter of 2024, Coterra Energy Inc (CTRA, Financial) reported total barrels of oil equivalent (BOE), oil production, and natural gas production that surpassed the high-end of guidance by over 3%. Capital expenditures were near the low-end of guidance, demonstrating effective cost management. The company achieved a net income of $297 million, or $0.40 per share, while adjusted net income was $358 million, or $0.49 per share, surpassing the analyst estimate of $0.44 per share.
Despite these achievements, Coterra faces challenges such as fluctuating commodity prices and the need to integrate recent acquisitions effectively. These factors could impact future profitability and operational efficiency.
Coterra's financial achievements are significant for the oil and gas industry, highlighting the company's ability to generate substantial free cash flow and return value to shareholders. In 2024, dividends and share repurchases totaled $1,086 million, representing 89% of the full-year free cash flow. The company also announced a 5% dividend increase to $0.22 per share for the fourth quarter of 2024, reflecting its commitment to shareholder returns.
Key metrics from the income statement include a cash flow from operating activities of $626 million and discretionary cash flow of $776 million. Capital expenditures for drilling and completion totaled $417 million, aligning with guidance. The company's unit operating cost was $8.89 per BOE, within the annual guidance range.
On the balance sheet, Coterra ended the year with a cash balance of $2.0 billion and no debt under its $2.0 billion revolving credit facility, resulting in total liquidity of approximately $5.0 billion. The net debt to trailing twelve-month EBITDAX ratio was 0.4x, indicating a strong financial position.
| Production Volume | Q4 2024 | Q4 2023 |
|---|---|---|
| Natural Gas (MMcf/day) | 2,778.9 | 2,970.0 |
| Oil (MBbl/day) | 113.0 | 104.7 |
| NGL (MBbl/day) | 105.4 | 97.8 |
Realized average prices for Q4 2024 were $68.57 per barrel for oil, $2.02 per Mcf for natural gas, and $20.94 per BOE for NGLs, excluding the effect of commodity derivatives.
Looking ahead, Coterra expects 2025 capital expenditures to range between $2.1 and $2.4 billion, with a reinvestment rate slightly below 50%. The company anticipates a 9% year-over-year increase in total BOE production, with oil volumes up approximately 47%. The recent acquisitions in the Delaware Basin are expected to enhance production capabilities and drive future growth.
Tom Jorden, Chairman, CEO, and President of Coterra, stated, "I am proud to report that Coterra continued its trend of excellent operational execution throughout 2024. We remain committed to value creation through operational excellence, disciplined capital allocation driven by full-cycle returns, and returning value to shareholders."
Overall, Coterra Energy Inc (CTRA, Financial) has demonstrated strong operational performance and strategic foresight, positioning itself well for continued success in the competitive oil and gas industry. For more detailed insights and analysis, visit GuruFocus.com.
Explore the complete 8-K earnings release (here) from Coterra Energy Inc for further details.
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