Coterra Energy (CTRA) Q4 2024 earnings summary

Executive summary

• 2024 production and capital efficiency exceeded high-end guidance, with oil at 113 MBopd, gas at 2,800 MMcfpd, and capital expenditures at the low end of guidance at $1.76B.

• Successfully closed and integrated $3.2B Delaware Basin acquisitions (Franklin Mountain and Avant Permian) in January 2025, expanding focus in the Northern Delaware to 83,000 acres.

• Returned 89% of 2024 free cash flow to shareholders via dividends and buybacks, with a 5% dividend increase to $0.88/share annualized.

• 2025 guidance targets 9% BOE and 47% oil production growth at the midpoint, with a capital program of $2.1–$2.4B and a reinvestment rate below 50%.

• Balance sheet remains strong, with net debt to EBITDAX at 0.4x and plans to retire $1B in term loans in 2025.

Financial highlights

• Q4 2024 net income was $297M ($0.40/share); adjusted net income was $358M ($0.49/share).

• Full-year 2024 net income: $1,121M ($1.51/share); adjusted net income: $1,245M ($1.68/share).

• Q4 2024 free cash flow was $351M; full-year 2024 free cash flow was $1,214M.

• 2024 capital expenditures were $1.76B, a 16% decrease year-over-year.

• 2024 unit operating cost was $8.66/BOE; 2025 guidance is $7.90–$9.30/BOE.

Outlook and guidance

• 2025 production guidance: 710–770 MBoepd (oil: 152–168 MBopd, gas: 2,675–2,875 MMcfpd), with oil up 47% YoY at midpoint.

• 2025 capital expenditures expected at $2.1–$2.4B, up 28% YoY at midpoint, mainly due to Delaware Basin acquisitions.

• Three-year outlook (2025–2027): annual oil growth ≥5%, BOE growth 0–5%, average annual capital $2.1–$2.4B, reinvestment rate below 50%.

• 2025 free cash flow projected at ~$2.7B at recent strip prices.

• 2025 dividend increased 5% to $0.88/share annually; expects to return 50%+ of free cash flow to shareholders.