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Dec 31, 2023
Sitio Royalties Q4 2022 Earnings Report
Sitio Royalties reported its fourth quarter and full year 2022 operational and financial results, recent developments, and provided full year 2023 guidance.
Key Takeaways
Sitio Royalties reported a record high average quarterly production volume of 18,925 Boe/d, with a pro forma average quarterly production volume of 34,424 Boe/d including Brigham Minerals volumes. The company declared a $0.60 dividend per share for Q4 2022 and closed its all-stock merger with Brigham Minerals in December 2022, significantly increasing its net royalty acres.
Record high average quarterly production volume of 18,925 Boe/d, up 5% sequentially.
Pro forma average daily production volume of 34,424 Boe/d, including Brigham Minerals volumes for the entire quarter.
Declared a $0.60 dividend per share of Class A Common Stock for Q4 2022, representing a 9.9% annualized yield.
Closed all-stock merger with Brigham Minerals in December 2022, increasing net royalty acres by 147% relative to year-end 2021.
Revenue by Geographic Location
Forward Guidance
Sitio Royalties issued full year 2023 financial and operational guidance, increasing the midpoint of production guidance by approximately 6% to 35,500 Boe/d.
Positive Outlook
- Increased midpoint of production guidance by approximately 6% to 35,500 Boe/d.
- Full year 2023 average daily production guidance range of 34,000 - 37,000 Boe/d.
- Anticipated average daily production (% oil) between 49% and 51%.
- Projected gathering and transportation costs between $1.25 and $1.75 per Boe.
- Expected production taxes (% of royalty revenue) between 6% and 8%.
Challenges Ahead
- Cash G&A expected to be between $25.0 million and $27.0 million (annual).
- Cash tax rate projected between 11% and 13% of pre-tax income.
- Continued capital discipline by public E&P operators may act as a headwind.
- Focus on lowering G&A expenses and reducing reliance on third-party vendors suggests areas for improvement.
Historical Earnings Impact
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Avg. Return Before/After Earnings
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