W&T Offshore Inc (WTI) 2024 Q3 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the W&T Offshore third quarter, 2024 conference call. (Operator Instructions)

女士們先生們，謝謝你們的支持。歡迎參加 W&T Offshore 2024 年第三季電話會議。（操作員說明）

This conference is being recorded and a replay will be made available on the company's website following the call. I would now like to turn the call over to Al Petrie, Investor Relations Coordinator.

本次會議正在錄製中，電話會議後將在公司網站上提供重播。我現在想將電話轉給投資人關係協調員 Al Petrie。

Thank you, Megan. And on behalf of the management team, I would like to welcome all of you to today's conference call to review W&T Offshores third quarter, 2024 financial and operational results. Before we begin, I would like to remind you that our comments may include forward-looking statements. It should be noted that a variety of factors could cause W&T's actual results to differ materially from the anticipated results or expectations expressed in these forward-looking statements.

謝謝你，梅根。我謹代表管理團隊歡迎大家參加今天的電話會議，回顧 W&T Offshores 2024 年第三季的財務和營運表現。在我們開始之前，我想提醒您，我們的評論可能包含前瞻性陳述。應指出的是，多種因素可能導致 W&T 的實際結果與這些前瞻性陳述中表達的預期結果或期望有重大差異。

Today's call may also contain certain non-GAAP financial measures please refer to the earnings release that we issued yesterday for disclosures on forward-looking statements and reconciliations of non-GAAP measures.

今天的電話會議也可能包含某些非公認會計原則財務指標，請參閱我們昨天發布的收益報告，以了解前瞻性陳述和非公認會計原則指標調節表的揭露。

With that, I would like to turn the call over to Tracy Krohn, our Chairman and CEO.

說到這裡，我想把電話轉給我們的董事長兼執行長特雷西·克羅恩(Tracy Krohn)。

Thanks Al. Good day to everyone and thank you for joining us on our conference call. So with me today are William Wilford, our Executive Vice President and Chief Operating Officer; Sameer Parasnis, our Executive Vice President and Chief Financial Officer; and Trey Hartman, our Vice President and Chief Accounting Officer. They're all available to answer questions later during the call.

謝謝艾爾。祝大家有美好的一天，感謝您參加我們的電話會議。今天和我在一起的還有我們的執行副總裁兼營運長 William Wilford； Sameer Parasan，我們的執行副總裁兼財務長；以及我們的副總裁兼首席會計官 Trey Hartman。他們稍後都可以在通話期間回答問題。

So we continue to report solid operational and financial results while continuing to execute our strategic vision. Our focus is always on generating free cash flow while maintaining and optimizing our assets including the assets that we acquired in the first quarter of this year.

因此，我們將繼續報告穩健的營運和財務業績，同時繼續執行我們的策略願景。我們的重點始終是產生自由現金流，同時維護和優化我們的資產，包括今年第一季收購的資產。

In September 30, 2024 we've generated free cash flow of $54.9 million on a year-to-date basis. For the past seven years, we've generated positive free cash flow and it's because we operate very efficiently and know that cash is paramount to our success. Our balance sheet continues to improve as we're delivering meaningful adjusted EBITDA which year-to-date totaled $122 million.

截至 2024 年 9 月 30 日，我們年初至今已產生 5,490 萬美元的自由現金流。在過去的七年裡，我們產生了正的自由現金流，這是因為我們營運非常高效，並且知道現金對我們的成功至關重要。我們的資產負債表持續改善，我們實現了有意義的調整後 EBITDA（今年迄今總計 1.22 億美元）。

So I'd like to begin our operational discussion by focusing on production. In the third quarter, production was 31,000 barrels of oil equivalent per day. Our production was impacted by an active hurricane season in the Gulf of Mexico seems that continues as we speak. Thus, we saw about 3,500 barrels of oil per day shut in associated with hurricanes and other downtime. Despite this, our production was within our guidance range and the majority of this production has been restored with our October production rate at around 34,000 barrels of oil equipment per day.

因此，我想從專注於生產開始我們的營運討論。第三季產量為每天 31,000 桶油當量。我們的生產受到墨西哥灣活躍颶風季節的影響，就在我們說話之際，颶風季節似乎仍在繼續。因此，我們每天看到大約 3,500 桶石油因颶風和其他停工而關閉。儘管如此，我們的產量仍在指導範圍內，大部分產量已恢復，10 月的石油設備產量約為每天 34,000 桶。

In addition, we continue to optimize production that we acquired in Q1 2024. However, only four of the six fields are currently online. We're working diligently to return the remaining two fields to production, which should provide a boost to production in 2025. With over 40 years of experience integrating acquisitions into our asset base, we've proven that the near term costs, are well worth it to realize the long term potential of the newly acquired assets, generating cash flow for us for many years to come.

此外，我們持續優化 2024 年第一季收購的生產。不過，目前這六個領域中只有四個線上。我們正在努力恢復剩餘兩個油田的生產，這應該會提振 2025 年的產量。憑藉 40 多年將收購整合到我們的資產基礎中的經驗，我們已經證明，為了實現新收購資產的長期潛力，短期成本是非常值得的，從而為我們在未來許多年產生現金流。

So turning to costs, our lease operating expenses for the third quarter, 2024 were $72.4 million which was below the bottom end of our guidance range by 6%. In fact, costs were down 2% compared to the second quarter of 2024. Our continued attention to controlling costs and capturing synergies from our acquisitions helps us to generate strong free cash flow, pay down debt and build our cash balance. At the end of the third quarter, our cash on hand rose to $126.5 million and we lowered our net debt to $266 million.

因此，就成本而言，我們 2024 年第三季的租賃營運費用為 7,240 萬美元，比我們指導範圍的下限低了 6%。事實上，與 2024 年第二季相比，成本下降了 2%。我們持續專注於控製成本並從收購中獲取協同效應，這有助於我們產生強勁的自由現金流、償還債務並建立現金餘額。第三季末，我們手頭現金增至 1.265 億美元，淨負債降至 2.66 億美元。

We also continued returning cash to our shareholders, paying our fourth consecutive quarterly dividend in August and we announced the fourth quarter, 2024 payment will occur later this month.

我們也繼續向股東返還現金，在 8 月連續第四次支付季度股息，並宣布將於本月稍後支付 2024 年第四季股息。

In our earnings release, we provided our fourth quarter guidance. We're projecting production to increase compared to the third quarter due to less hurricane and related downtime, fourth quarter, 2024 production guidance has a midpoint of 33,600 bales of oil equivalent per day again, we do have a storm out in the Gulf of Mexico kind of meandering around, we're not quite sure how that will affect us or even if it will affect us at this point in time.

在我們的收益發布中，我們提供了第四季度的指導。由於颶風和相關停機時間減少，我們預計產量將比第三季度有所增加，2024 年第四季度產量指導值的中點再次為每天 33,600 包石油當量，墨西哥灣確實遭遇了風暴有點徘徊，我們不太確定這將如何影響我們，或即使它現在會影響我們。

We plan to spend a little more on lease operating expenses in the fourth quarter as we undertake some of the projects we deferred earlier in the year and we continue to bring on the other two new fields back online to help increase operational and financial results.

我們計劃在第四季度增加一點租賃營運費用，因為我們開展了今年早些時候推遲的一些項目，並繼續讓其他兩個新油田重新上線，以幫助提高營運和財務業績。

For CapEx, excluding acquisitions, we invested about $9.5 million during the quarter and about $23.3 million in the first nine months of 2024. In addition, we invested $80.6 million in acquisitions year-to-date.

對於資本支出（不包括收購），我們在本季度投資了約 950 萬美元，在 2024 年前 9 個月投資了約 2,330 萬美元。此外，今年迄今我們還投資了 8,060 萬美元用於收購。

So now we plan to invest about $25 million to $35 million in full year, 2024 excluding acquisitions. This is down about $10 million at the midpoint from our prior 2024 estimate. These expenditures are directed primarily to facilities projects, our existing fields and the new fields acquired in late 2023 and early 2024 to maximize and optimize production.

因此，現在我們計劃在 2024 年全年投資約 2,500 萬至 3,500 萬美元（不包括收購）。這比我們之前對 2024 年的估計減少了約 1000 萬美元。這些支出主要用於設施項目、我們的現有油田以及 2023 年底和 2024 年初收購的新油田，以最大限度地提高和優化產量。

So as you can see our ability to execute operationally continues to help us build cash, reduce net debt and further strengthen the balance sheet. We're in a very good financial position was -- as we close out 2024 and we remain focused on operational execution to build on these solid results.

正如您所看到的，我們的營運執行能力繼續幫助我們累積現金、減少淨債務並進一步強化資產負債表。到 2024 年結束時，我們的財務狀況非常好，我們仍然專注於營運執行，以鞏固這些紮實的成果。

Regarding the Cox Offshore acquisition, we've had good execution to integrating these assets into W&T, we still have more work to do that should help to increase production from these new fields. We hired select Cox Offshore personnel while completing all regulatory transfers of operatorship, lease ownership and financial responsibility. Our team has worked really hard integrating, accounting, production reporting, cost tracking and other data into existing W&T systems.

關於 Cox Offshore 收購，我們將這些資產整合到 W&T 方面執行得很好，我們還有更多工作要做，這應該有助於增加這些新油田的產量。我們聘請了精選的考克斯離岸人員，同時完成了經營權、租賃所有權和財務責任的所有監管轉讓。我們的團隊非常努力地將會計、生產報告、成本追蹤和其他數據整合到現有的 W&T 系統中。

Those records weren't really in that good order in recognizing that these assets were bought out of bankruptcy and the company was indeed bankrupt. And getting some of this data has taken a little bit of time to assimilate and put in a proper order so that we can maintain it going forward.

這些記錄並沒有真正按照正確的順序承認這些資產是在破產時購買的，而且公司確實破產了。獲取其中一些數據需要一點時間來消化並按正確的順序排列，以便我們能夠繼續維護它。

In addition, we've worked to inspect all aspects of the fields to ensure W&T's health safety and environmental standards are implemented and we're negotiating midstream services at the newly acquired fields. Safety is a key component to our ongoing commitment to ESG and 2024 has been an outstanding safety year. Despite all the hurricanes and shut ins and restarting production in the third quarter, we had zero recordable safety incidents. In fact, we've not had an employee recordable incident in the entire year. And our overall TRIR rate for 2024 is 0.09, one of the latest -- one of the lowest in our long history.

此外，我們還努力檢查油田的各個方面，以確保 W&T 的健康安全和環境標準得到實施，並且我們正在就新收購油田的中游服務進行談判。安全是我們持續致力於 ESG 的關鍵組成部分，2024 年是出色的安全年。儘管第三季遭遇了颶風、停產和恢復生產，但我們的可記錄安全事故為零。事實上，我們全年沒有發生過可記錄的員工事件。我們 2024 年的整體 TRIR 率為 0.09，是最新的比率之一，也是我們長期歷史上最低的比率之一。

So W&T's culture of success and sustainability is built on environmental stewardship, sound corporate governance and contributing positively to our employees and the communities where we work and operate. We've made a concerted effort in addressing shareholder concerns and improving our ESG metrics. Our ongoing sustainability commitment and additional details regarding our recent accomplishments can be seen in our 2023 ESG report that we issued in the third quarter.

因此，W&T 的成功和永續發展文化建立在環境管理、健全的公司治理以及為我們的員工以及我們工作和經營的社區做出積極貢獻的基礎上。我們共同努力解決股東關心的問題並改善我們的 ESG 指標。我們持續的可持續發展承諾以及有關我們最近取得的成就的更多詳細資訊可以在我們第三季發布的 2023 年 ESG 報告中看到。

I'm also proud to announce that W&T was named as a finalist for the best proxy statement in the small mid category at the 18th Annual Corporate Governance Awards which recognize outstanding achievements of governance, risk and compliance. We're honored to receive this recognition which serves as a testament to our dedication to shareholders to deliver clear, comprehensive and accessible communications. We believe in open communication with our stakeholders and directly engage our largest shareholders to ensure alignment. And by the way, we didn't accomplish first place. We did get on the podium at P2.

我還很自豪地宣布，W&T 入圍第 18 屆年度公司治理獎中小型類別最佳委託書決賽，該獎項表彰了治理、風險和合規方面的傑出成就。我們很榮幸獲得這項認可，證明了我們致力於為股東提供清晰、全面且易於理解的溝通。我們相信與利害關係人進行開放式溝通，並直接與我們最大的股東接觸以確保一致。順便說一句，我們沒有獲得第一名。我們確實以 P2 的成績登上了頒獎台。

So in closing, I'd like to sincerely thank our team at W&T, as we're well positioned to add value in 2025 and beyond, we got cash on the balance sheet, strong balance sheet and robust cash position and enhances our optionality to potentially acquire more complementary Gulf of Mexico assets to enhance the scale of W&T. Acquisitions remain a key component of our success and it's our ability to integrate and enhance the assets that we acquire that has allowed us to grow reserves and production over the past 40 years.

因此，最後，我要真誠地感謝我們W&T 的團隊，因為我們已經做好了在2025 年及以後增加價值的準備，我們的資產負債表上有現金，資產負債表強勁，現金狀況強勁，並增強了我們的選擇權潛在收購更多墨西哥灣互補資產，以擴大 W&T 的規模。收購仍然是我們成功的關鍵組成部分，正是我們整合和增強所收購資產的能力使我們能夠在過去 40 年增加儲量和產量。

We also remain committed to increasing shareholder value and returning value to our shareholders through the quarterly dividend program that we initiated in November of last year.

我們也持續致力於透過去年 11 月啟動的季度股利計畫來增加股東價值並為股東回報價值。

We believe in our proven strategy and is the company's largest shareholder. I believe W&T is very well positioned to succeed going forward. Our entire management team's interests are highly aligned with those of our shareholders, given our 34% stake in W&T's equity, which is one of the highest of any public E&P company. We're focused on operational excellence and making and maximizing the cash flow potential of our asset base.

我們相信我們行之有效的策略，並且是公司的最大股東。我相信 W&T 處於非常有利的位置，能夠在未來取得成功。我們整個管理團隊的利益與股東的利益高度一致，因為我們持有 W&T 34% 的股權，這是所有上市勘探與生產公司中最高的股權之一。我們專注於卓越營運以及創造和最大化我們資產基礎的現金流潛力。

So with that operator, we can now open the lines for questions.

透過該操作員，我們現在可以打開提問線路。

(Operator Instructions)

（操作員說明）

John White, ROTH Capital.

約翰懷特，羅斯資本。

Good morning and congratulations on following your plan, your generating free cash flow, integrating your recent acquisitions and reducing debt. With not a lot of drilling activity going on, you want to offer some generalized comments on what you're seeing in the acquisition market.

早安，恭喜您遵循您的計劃、產生自由現金流、整合您最近的收購並減少債務。由於鑽井活動不多，您希望對您在收購市場中看到的情況提供一些概括性的評論。

Sure John and thanks and good morning to you too. Yeah. Things are in a bit of flux. I think people were standing down a little bit trying to figure out what was going on with the elections. And we think that's a positive for our industry.

當然，約翰，謝謝，也祝你早安。是的。事情有點不穩定。我認為人們有點停下來試圖弄清楚選舉發生了什麼事。我們認為這對我們的行業來說是積極的。

Drilling has been a challenge in the Gulf of Mexico primarily due to regulatory requirements. There's more than one lawsuit out there dealing with the regulations that seem to be a penalty to our industry. And so hopefully that'll get sorted out a bit more and make it easier to have a line of sight on additional drilling. And we certainly will take that into consideration. We're working on our budget as we speak. And we'll be able to address that in a more concise manner going forward. We do have wells that we want to get drilled and this will help us with trying to estimate economics going forward.

主要由於監管要求，鑽探在墨西哥灣一直是一個挑戰。有不止一起訴訟涉及似乎對我們行業的懲罰的法規。因此，希望這能得到更多的解決，並讓人們更容易看到額外的鑽探。我們當然會考慮到這一點。正如我們所說，我們正在製定預算。今後我們將能夠以更簡潔的方式解決這個問題。我們確實有想要鑽探的油井，這將有助於我們嘗試估計未來的經濟效益。

And you said, the acquisition market has been in flux waiting on the outcome of the election.

您也說過，收購市場一直在不斷變化，等待選舉結果。

You bet. People are trying to figure out what pricing is and what their properties are worth. We are faced with the same responsibility. So I think that you'll see an uptick in acquisitions certainly through the first and second quarters of next year. And we see some things that are attractive. We also see some drilling opportunities that are attractive and we'll be working on some other things as well.

你打賭。人們試圖弄清楚定價是什麼以及他們的房產值多少錢。我們面臨同樣的責任。因此，我認為明年第一季和第二季收購肯定會增加。我們看到了一些有吸引力的東西。我們也看到了一些有吸引力的鑽探機會，我們也將致力於其他一些事情。

Okay. Thanks for that and good luck on making some deals and getting your wells drilled. I'll turn the call back to the operator.

好的。謝謝你，祝你在達成一些交易和鑽井方面好運。我會將電話轉回給接線生。

Thanks, John.

謝謝，約翰。

(Operator Instructions)

（操作員說明）

Jeff Robertson, Water Tower Research.

傑夫·羅伯遜，水塔研究。

Thank you. Good morning. Tracy, the two fields that are still shut in from the Cox acquisition. What -- can you talk about the production mix and what kind of production contribution you would expect when those fields come back on.

謝謝。早安.特雷西（Tracy），這兩個油田仍因考克斯收購而被封鎖。您能談談生產組合以及當這些油田恢復生產時您期望的生產貢獻嗎？

Yeah, it'll be several 1,000 barrels a day. One of them is more technically oriented with the equipment at all. And the other one is more of a legal challenge. So -- and I'm not going to address the legal challenge part of it. The operational issues aren't -- too hard to overcome and I think we'll on -- one of them will be back online in the near future, but then probably within the next week or two.

是的，每天會有幾千桶。其中之一更注重設備的技術性。另一個更多的是法律挑戰。所以——我不會解決其中的法律挑戰部分。營運問題並不是——太難克服，我想我們會繼續——其中一個將在不久的將來重新上線，但可能會在接下來的一兩週內恢復上線。

In the mix between oil and gas.

在石油和天然氣的混合物中。

Yes, most of the oil.

是的，大部分都是油。

Okay. For, just to follow up, I guess John's question. Does the election resolve some issues that help further your -- the potential formation of a drilling partnership?

好的。因為，只是為了跟進，我猜約翰的問題。這次選舉是否解決了一些有助於進一步形成鑽探夥伴關係的問題？

Again we'll, hope so. Yeah, I think, we're getting a lot of resistance mainly because of -- I shouldn't say a lot. We're getting some concern with regard to regulatory issues. There's an issue out there with the rice's whale that cause the government to draw a large band between Florida and Texas through which we could -- we weren't allowed to run our boats at night and we weren't allowed to run them during the day, more than 6 miles per hour, it would have affected our production quite a bit. There's a challenge to that lawsuit, those orders are in abeyance at this point.

我們再次希望如此。是的，我認為，我們遇到了很多阻力，主要是因為——我不應該說太多。我們對監管問題感到一些擔憂。稻鯨存在一個問題，導致政府在佛羅裡達州和德克薩斯州之間畫了一條大帶，我們可以通過它——我們不被允許在晚上駕駛我們的船，我們也不被允許在白天駕駛它們。該訴訟受到質疑，這些命令目前已暫停。

But yeah, I mean, there was a big concern that this was going to affect our operations and incidentally it was only germane to oil and gas companies. So apparently cruise ships and commercial fishing vessels and recreational vessels don't hit whales. It's only oil and gas companies that hit whales. So we thought that was a little absurd and still do. So we're -- clearly this was an attempt to stymie production in the Gulf of Mexico as the previous administration, seemingly we would want to do why else would be restricted to just the oil and gas business.

但是，是的，我的意思是，人們非常擔心這會影響我們的運營，順便說一句，這僅與石油和天然氣公司密切相關。因此顯然遊輪、商業漁船和休閒船不會撞到鯨魚。只有石油和天然氣公司才會攻擊鯨魚。所以我們認為這有點荒謬，現在仍然如此。因此，我們顯然是上屆政府試圖阻礙墨西哥灣的生產，似乎我們想要知道為什麼其他的業務將僅限於石油和天然氣業務。

So hopefully that'll get straightened out in the courts and reasonably, you would think it would. As far as the other lawsuit with regard to financial assurance. The governments or the taxpayers never come out of pocket to abandon any field in the Gulf of Mexico. So the government has -- and I say the government, it's the regulatory arm that deals with the Gulf of Mexico and have required financial assurance in the Gulf of Mexico since really -- since the Obama administration. And it's created a problem in getting that capacity.

因此，希望這能在法庭上得到理順，並且合理地，你會認為會的。至於其他有關財務保證的訴訟。政府或納稅人永遠不會自掏腰包放棄墨西哥灣的任何油田。因此，自從歐巴馬政府以來，政府——我說的是政府，它是處理墨西哥灣事務的監管機構，並要求墨西哥灣提供財務保證。這給獲得這種能力帶來了問題。

There have been some bankruptcies in the Gulf of Mexico that have affected the surety market and surety markets are a little bit muddled right now as to what to do. So we are -- we by the way, have done over a $1 billion of abandonment in the Gulf of Mexico since inception. And we've never failed to meet all of our obligations. We feel like financial assurance in the Gulf of Mexico since we have -- as an industry we're joint and severally liable on all of these leases for the abandonment,

墨西哥灣發生了一些破產事件，影響了擔保市場，擔保市場現在有點混亂，不知道該怎麼辦。所以，順便說一句，自成立以來，我們已經在墨西哥灣進行了超過 10 億美元的廢棄處理。我們從未未能履行我們的所有義務。我們感覺墨西哥灣有財務保證，因為作為一個行業，我們對所有這些租賃的廢棄承擔連帶責任，

And that's part of the -- that's the biggest reason why there hadn't been an issue with regard to plugging and abandoning all of these wells. That's the point of the financial insurance, but since it never has happened, there's no reason to have this financial insurance, we think. We see this as punitive to the industry. We see it as a solution to a problem that doesn't exist.

這是堵塞和廢棄所有這些油井沒有出現問題的最大原因的一部分。這就是金融保險的意義所在，但我們認為，由於這種情況從未發生過，所以沒有理由擁有這種金融保險。我們認為這是對產業的懲罰。我們將其視為一個不存在問題的解決方案。

Thank you.

謝謝。

That kind of long winded explanation, but --

那種冗長的解釋，但是--

That's good though.

不過這樣也不錯。

This concludes our question and answer session. I would like to turn the conference back over to Tracy Krohn, Chairman and CEO for any closing remarks.

我們的問答環節到此結束。我想將會議轉交給董事長兼執行長 Tracy Krohn 發表閉幕詞。

Thank you, operator. Yeah, we'll be back with you in the not too distant future. We've got a lot of things going on and we are encouraged, production is down a bit, but some of that stuff we can't control.

謝謝你，接線生。是的，我們會在不久的將來和你一起回來。我們發生了很多事情，我們受到鼓舞，產量有所下降，但有些事情我們無法控制。

Hopefully this next little storm out in the Gulf of Mexico is going to fizzle out and although the weather reports have been going in different directions, so we want to make sure that we don't put our personnel in harm's way. But anyway, we'll be back with you shortly and thank you so much for your attention.

希望墨西哥灣的下一場小風暴能夠平息，儘管天氣預報的方向各不相同，但我們希望確保我們的人員不會受到傷害。但無論如何，我們很快就會與您聯繫，非常感謝您的關注。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連線。