Saturn Oil & Gas (SOIL) Q4 2024 earnings summary

Executive summary

• Achieved significant progress in 2024 with two core-up acquisitions, including the major South Saskatchewan acquisition, enhancing asset quality and future development potential.

• Achieved record Q4 2024 production of 41,051 boe/d and year-end exit rate of 41,908 boe/d, surpassing guidance and analyst expectations.

• Record Q4 adjusted funds flow of CAD 124 million (CAD 0.64/share), beating consensus by 12%; full-year AFF of CAD 380 million (CAD 2.10/share), up 37% year-over-year.

• Returned approximately CAD 15 million to shareholders via buybacks, repurchasing 6.7 million shares (~3% of outstanding).

• Maintained strong liquidity with $48.4 million cash and undrawn $150 million credit facility at year-end.

Financial highlights

• 2024 petroleum and natural gas sales reached $908.3 million, up from $693.9 million in 2023.

• Adjusted EBITDA grew 33% year-over-year to $483.0 million; Q4 Adjusted EBITDA was $152.8 million.

• Net operating expense reduced to CAD 19/BOE for the year and just over CAD 18/BOE in Q4, below the CAD 20 target.

• Free funds flow in 2024 totaled CAD 134 million (CAD 0.74/share), with a 39% free funds flow yield.

• Net income for 2024 was $54.1 million ($0.30/share); Q4 saw a net loss of $26.3 million due to non-cash items.

Outlook and guidance

• Guidance maintained for 2025, with operating costs expected to remain below CAD 20/BOE.

• Majority of 2025 capital program (70%) to be deployed in H2, with production peaking in Q1 and Q4, and free cash flow cresting in Q2.

• Q1 2025 capital expenditures expected at $70–$75 million for drilling ~22 wells; Q1 2025 production expected to average 39,500–40,500 boe/d.

• Hedge targets to remain around 50–60% of next 12 months' production, providing flexibility for oil price movements.

• FX hedges lock in principal and interest on US debt through mid-2027, offsetting $20 million in net debt impact.