Diamondback Energy, Inc. Announces Fourth Quarter and Full Year 2024 Financial and Operating Results; Increases Base Dividend

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MIDLAND, Texas, Feb. 24, 2025 (GLOBE NEWSWIRE) -- Diamondback Energy, Inc. (NASDAQ: FANG) ("Diamondback” or the "Company”) today announced financial and operating results for the fourth quarter and full year ended December 31, 2024.

FOURTH QUARTER 2024 HIGHLIGHTS

• Average production of 475.9 MBO/d (883.4 MBOE/d)
• Net cash provided by operating activities of $2.3 billion; Operating Cash Flow Before Working Capital Changes (as defined and reconciled below) of $2.3 billion
• Cash capital expenditures of $933 million
• Free Cash Flow (as defined and reconciled below) of $1.3 billion; Adjusted Free Cash Flow (as defined and reconciled below) of $1.4 billion
• Increased annual base dividend by 11% to $4.00 per share; declared Q4 2024 base cash dividend of $1.00 per share payable on March 13, 2025; implies a 2.6% annualized yield based on February 21, 2025 closing share price of $156.12
• Repurchased 2,326,247 shares of common stock in Q4 2024 for $402 million, excluding excise tax (at a weighted average price of $172.91 per share); repurchased 1,254,600 shares of common stock to date in Q1 2025 for $210 million, excluding excise tax (at a weighted average price of $167.42 per share)
• Total Q4 2024 return of capital of $694 million; represents ~51% of Adjusted Free Cash Flow (as defined and reconciled below) from stock repurchases and the declared Q4 2024 base dividend
• Closed previously announced TRP Energy ("TRP") transaction in December 2024

FULL YEAR 2024 HIGHLIGHTS

• Average production of 337.0 MBO/d (598.3 MBOE/d)
• Net cash provided by operating activities of $6.4 billion; Operating Cash Flow Before Working Capital Changes (as defined and reconciled below) of $6.5 billion
• Cash capital expenditures of $2.9 billion
• Free Cash Flow (as defined and reconciled below) of $3.6 billion; Adjusted Free Cash Flow (as defined and reconciled below) of $4.0 billion
• Declared total base-plus-variable dividends of $6.21 per share for the full year 2024
• Repurchased 5,525,276 shares of common stock in 2024 for $959 million, excluding excise tax (at a weighted average price of $173.57 per share)
• Total full year 2024 return of capital of $2.3 billion; represents ~57% of FY 2024 Adjusted Free Cash Flow (as defined and reconciled below)
• As previously announced, closed merger with Endeavor Energy Resources, L.P. ("Endeavor") on September 10, 2024
• Proved reserves as of December 31, 2024 of 3,557 MMBOE (1,761 MMBO, 50% oil), up 63% year over year; proved developed producing ("PDP") reserves of 2,385 MMBOE (1,121 MMBO, 47% oil, 67% of proved reserves), up 59% year over year

2025 GUIDANCE HIGHLIGHTS

Please note the guidance below gives effect to the pending acquisition of Double Eagle IV Midco, LLC ("Double Eagle”) from April 1, 2025 onward.

• Full year 2025 oil production guidance of 485 - 498 MBO/d (883 - 909 MBOE/d)
• Full year 2025 cash capital expenditures guidance of $3.8 - $4.2 billion
• The Company expects to drill between 446 - 471 gross (406 - 428 net) wells and complete between 557 - 592 gross (526 - 560 net) wells with an average lateral length of approximately 11,500 feet in 2025
• Q1 2025 oil production guidance of 470 - 475 MBO/d (860 - 875 MBOE/d)
• Q1 2025 cash capital expenditures guidance of $900 million - $1.0 billion
• Implies Q2 2025 - Q4 2025 run-rate oil production of 490 - 505 MBO/d (891 - 920 MBOE/d)
• Full year 2025 Midland Basin well costs per lateral foot guidance of $555 - $605
• Implies full year 2025 oil production per million dollars of cash capital expenditures ("MBO per $MM of CAPEX”) of 44.8, 10% better than the Company's original pro forma 2025 outlook provided in February 2024

OPERATIONS UPDATE

The tables below provide a summary of operating activity for the fourth quarter of 2024.

During the fourth quarter of 2024, Diamondback drilled 131 gross wells in the Midland Basin and six gross wells in the Delaware Basin. The Company turned 124 operated wells to production in the Midland Basin and four gross wells in the Delaware Basin, with an average lateral length of 11,810 feet. Operated completions during the fourth quarter consisted of 26 Wolfcamp A wells, 26 Lower Spraberry wells, 24 Wolfcamp B wells, 19 Jo Mill wells, 15 Middle Spraberry wells, four Wolfcamp D wells, four Dean wells, three Upper Spraberry wells, three Barnett wells, two Second Bone Spring wells and two Third Bone Spring wells.

For the year ended December 31, 2024, Diamondback drilled 342 gross wells in the Midland Basin and 30 gross wells in the Delaware Basin. The Company turned 391 operated wells to production in the Midland Basin and 19 operated wells to production in the Delaware Basin. The average lateral length for wells completed during the year ended December 31, 2024 was 11,719 feet, and consisted of 98 Lower Spraberry wells, 87 Wolfcamp A wells, 69 Wolfcamp B wells, 59 Jo Mill wells, 49 Middle Spraberry wells, 13 Wolfcamp D wells, 13 Dean wells, nine Upper Spraberry wells, six Third Bone Spring wells, four Barnett wells and three Second Bone Spring wells.

FINANCIAL UPDATE

Diamondback's fourth quarter 2024 net income was $1.1 billion, or $3.67 per diluted share. Adjusted net income (as defined and reconciled below) for the fourth quarter was $1.1 billion, or $3.64 per diluted share. For the full year ended December 31, 2024, Diamondback's net income was $3.3 billion, or $15.53 per diluted share. Adjusted net income for the full year was $3.6 billion, or $16.57 per diluted share.

Fourth quarter 2024 net cash provided by operating activities was $2.3 billion. For the full year ended December 31, 2024, Diamondback's net cash provided by operating activities was $6.4 billion.

During the fourth quarter of 2024, Diamondback spent $834 million on operated and non-operated drilling and completions, $93 million on infrastructure and environmental and $6 million on midstream, for total cash capital expenditures of $933 million. For the full year ended 2024, Diamondback spent $2.6 billion on operated and non-operated drilling and completions, $221 million on infrastructure and environmental and $14 million on midstream, for total cash capital expenditures of $2.9 billion.

Fourth quarter 2024 Consolidated Adjusted EBITDA (as defined and reconciled below) was $2.6 billion. Adjusted EBITDA net of non-controlling interest (as defined and reconciled below) for the fourth quarter was $2.5 billion. For the full year ended December 31, 2024, Consolidated Adjusted EBITDA was $7.7 billion. Adjusted EBITDA net of non-controlling interest for the full year was $7.3 billion.

Diamondback's fourth quarter 2024 Free Cash Flow (as defined and reconciled below) was $1.3 billion. Adjusted Free Cash Flow (as reconciled and defined below) for the fourth quarter was $1.4 billion. For the full year ended December 31, 2024, Diamondback's Free Cash Flow was $3.6 billion, with $4.0 billion of Adjusted Free Cash Flow over the same period.

Fourth quarter 2024 average unhedged realized prices were $69.48 per barrel of oil, $0.48 per Mcf of natural gas and $19.27 per barrel of natural gas liquids ("NGLs"), resulting in a total equivalent unhedged realized price of $42.71 per BOE.

Diamondback's cash operating costs for the fourth quarter of 2024 were $10.30 per BOE, including lease operating expenses ("LOE") of $5.67 per BOE, cash general and administrative ("G&A") expenses of $0.69 per BOE, production and ad valorem taxes of $2.77 per BOE and gathering, processing and transportation expenses of $1.17 per BOE.

As of December 31, 2024, Diamondback had $134 million in standalone cash and no borrowings outstanding under its revolving credit facility, with approximately $2.5 billion available for future borrowings under the facility and approximately $2.6 billion of total liquidity. As of December 31, 2024, the Company had consolidated total debt of $13.2 billion and consolidated net debt (as defined and reconciled below) of $13.0 billion, up from consolidated total debt of $13.1 billion and consolidated net debt of $12.7 billion as of September 30, 2024.

DIVIDEND DECLARATIONS

Diamondback announced today that the Company's Board of Directors declared a base cash dividend of $1.00 per common share for the fourth quarter of 2024 payable on March 13, 2025 to stockholders of record at the close of business on March 6, 2025.

Future base and variable dividends remain subject to review and approval at the discretion of the Company's Board of Directors.

COMMON STOCK REPURCHASE PROGRAM

During the fourth quarter of 2024, Diamondback repurchased ~2.3 million shares of common stock at an average share price of $172.91 for a total cost of approximately $402 million, excluding excise tax. To date, Diamondback has repurchased ~25.8 million shares of common stock at an average share price of $136.82 for a total cost of approximately $3.5 billion and has approximately $2.5 billion remaining on its current share buyback authorization. Subject to factors discussed below, Diamondback intends to continue to purchase common stock under the common stock repurchase program opportunistically with cash on hand, free cash flow from operations and proceeds from potential liquidity events such as the sale of assets. This repurchase program has no time limit and may be suspended from time to time, modified, extended or discontinued by the Board at any time. Purchases under the repurchase program may be made from time to time in privately negotiated transactions, or in open market transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, and will be subject to market conditions, applicable regulatory and legal requirements and other factors. Any common stock purchased as part of this program will be retired.

RESERVES

Estimates of Diamondback's proved reserves as of December 31, 2024 were prepared by Diamondback's internal reservoir engineers and audited by Ryder Scott Company, L.P., an independent petroleum engineering firm. Reference prices of $75.48 per barrel of oil and $2.13 per Mmbtu of natural gas were used in accordance with applicable rules of the Securities and Exchange Commission. Realized prices with applicable differentials were $76.15 per barrel of oil, $0.54 per Mcf of natural gas and $22.02 per barrel of natural gas liquids.

Proved reserves at year-end 2024 of 3,557 MMBOE represent a 63% increase over year-end 2023 reserves. Proved developed reserves increased by 59% to 2,385 MMBOE (67% of total proved reserves) as of December 31, 2024, reflecting the continued development of the Company's horizontal well inventory. Proved undeveloped reserves ("PUD" or "PUDs") increased to 1,173 MMBOE, a 72% increase over year-end 2023, and are comprised of 1,381 horizontal locations in which we have a working interest, of which 1,310 are in the Midland Basin. Crude oil represents 50% of Diamondback's total proved reserves.

Net proved reserve additions of 1,599 MMBOE resulted in a reserve replacement ratio of 730% (defined as the sum of extensions and discoveries, revisions, purchases and divestitures, divided by annual production). The organic reserve replacement ratio was 68% (defined as the sum of extensions and discoveries and revisions, divided by annual production).

Net purchases of reserves were the primary contributor to the increase in reserves totaling 1,449 MMBOE followed by Extensions and discoveries of reserves totaling 279 MMBOE, with downward revisions of 129 MMBOE. PDP extensions were the result of 1,172 new wells in which the Company has an interest, and PUD extensions were the result of 445 new locations in which the Company has a working interest. Net purchases of reserves of 1,449 MMBOE were the net result of acquisitions of 1,569 MMBOE and divestitures of 121 MMBOE. Downward revisions of 129 MMBOE were primarily the result of negative revisions of 89 MMBOE associated with lower commodity prices, 49 MMBOE due to PUD downgrades related to changes in the corporate development plan and 17 MMBOE due to a decline in well performance. These were partially offset by positive performance revisions of 26 MMBOE related to ownership and acquisition variance revisions.

The SEC PUD guidelines allow a company to book PUD reserves associated with projects that are to occur within the next five years. With its current development plan, the Company expects to continue its strong PUD conversion ratio in 2025 by converting an estimated 33% of its PUDs to a Proved Developed category, and develop approximately 78% of the consolidated 2024 year-end PUD reserves by the end of 2027.

Diamondback's exploration and development costs in 2024 were $3.2 billion. PD F&D costs were $10.51/BOE. PD F&D costs are defined as exploration and development costs, excluding midstream, divided by the sum of reserves associated with transfers from proved undeveloped reserves at year-end 2023 including any associated revisions in 2024 and extensions and discoveries placed on production during 2024. Drill bit F&D costs were $19.12/BOE including the effects of all revisions including pricing revisions. Drill bit F&D costs are defined as the exploration and development costs, excluding midstream, divided by the sum of extensions, discoveries and revisions.

FULL YEAR 2025 GUIDANCE

Below is Diamondback's guidance for the full year 2025, which includes first quarter production, cash tax and capital guidance. This guidance gives effect to the estimated contribution related to the pending Double Eagle acquisition, which is expected to close on April 1, 2025, subject to the satisfaction of customary closing conditions and regulatory approval.

_{⁽¹⁾ Includes approximately $60 million in estimated midstream capital expenditures for the full year 2025.}

CONFERENCE CALL

Diamondback will host a conference call and webcast for investors and analysts to discuss its results for the fourth quarter of 2024 on Tuesday, February 25, 2025 at 8:00 a.m. CT. Access to the webcast, and replay which will be available following the call, may be found here. The live webcast of the earnings conference call will also be available via Diamondback's website at www.diamondbackenergy.com under the "Investor Relations” section of the site.

About Diamondback Energy, Inc.

Diamondback is an independent oil and natural gas company headquartered in Midland, Texas focused on the acquisition, development, exploration and exploitation of unconventional, onshore oil and natural gas reserves primarily in the Permian Basin in West Texas. For more information, please visit www.diamondbackenergy.com.

Forward-Looking Statements

This news release contains "forward-looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act, which involve risks, uncertainties, and assumptions. All statements, other than statements of historical fact, including statements regarding Diamondback's: future performance; business strategy; future operations (including drilling plans and capital plans); estimates and projections of revenues, losses, costs, expenses, returns, cash flow, and financial position; reserve estimates and its ability to replace or increase reserves; anticipated benefits or other effects of strategic transactions (including the recently completed Endeavor merger, the pending Double Eagle acquisition and other acquisitions or divestitures); and plans and objectives of management (including plans for future cash flow from operations and for executing environmental strategies) are forward-looking statements. When used in this news release, the words "aim,” "anticipate,” "believe,” "continue,” "could,” "estimate,” "expect,” "forecast,” "future,” "guidance,” "intend,” "may,” "model,” "outlook,” "plan,” "positioned,” "potential,” "predict,” "project,” "seek,” "should,” "target,” "will,” "would,” and similar expressions (including the negative of such terms) as they relate to Diamondback are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. Although Diamondback believes that the expectations and assumptions reflected in its forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond Diamondback's control. Accordingly, forward-looking statements are not guarantees of future performance and Diamondback's actual outcomes could differ materially from what Diamondback has expressed in its forward-looking statements.

Factors that could cause the outcomes to differ materially include (but are not limited to) the following: changes in supply and demand levels for oil, natural gas, and natural gas liquids, and the resulting impact on the price for those commodities; the impact of public health crises, including epidemic or pandemic diseases and any related company or government policies or actions; actions taken by the members of OPEC and Russia affecting the production and pricing of oil, as well as other domestic and global political, economic, or diplomatic developments, including any impact of the ongoing war in Ukraine and the Israel-Hamas war on the global energy markets and geopolitical stability; instability in the financial markets; inflationary pressures; higher interest rates and their impact on the cost of capital; regional supply and demand factors, including delays, curtailment delays or interruptions of production, or governmental orders, rules or regulations that impose production limits; federal and state legislative and regulatory initiatives relating to hydraulic fracturing, including the effect of existing and future laws and governmental regulations; physical and transition risks relating to climate change; those risks described in Item 1A of Diamondback's Annual Report on Form 10-K, filed with the SEC on February 22, 2024, and those risks disclosed in its subsequent filings on Forms 10-K, 10-Q and 8-K, which can be obtained free of charge on the SEC's website at http://www.sec.gov and Diamondback's website at www.diamondbackenergy.com/investors.

In light of these factors, the events anticipated by Diamondback's forward-looking statements may not occur at the time anticipated or at all. Moreover, Diamondback operates in a very competitive and rapidly changing environment and new risks emerge from time to time. Diamondback cannot predict all risks, nor can it assess the impact of all factors on its business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those anticipated by any forward-looking statements it may make. Accordingly, you should not place undue reliance on any forward-looking statements. All forward-looking statements speak only as of the date of this letter or, if earlier, as of the date they were made. Diamondback does not intend to, and disclaims any obligation to, update or revise any forward-looking statements unless required by applicable law.