Gulfport Energy Corp (GPOR) Reports Solid 2023 Performance and Sets 2024 Guidance
Net Production: Achieved high end of updated guidance range with significant production levels.
Financial Discipline: Maintained initial capital budget range, generating substantial adjusted free cash flow.
Stock Repurchase: Allocated approximately 99% of adjusted free cash flow to repurchasing common stock in 2023.
Liquidity and Leverage: Maintained strong balance sheet with financial leverage below one times.
2024 Outlook: Plans to deliver similar production year over year with 10% less capital invested.
Proved Reserves: Reported year-end 2023 total proved reserves of 4.2 Tcfe, a 4% increase from 2022.
Gulfport Energy Corp (NYSE:GPOR) released its 8-K filing on February 27, 2024, detailing its financial and operating results for the fourth quarter and full year of 2023, and providing guidance for 2024. As an independent exploration and development company, Gulfport Energy operates primarily through its Utica Shale and Scoop properties, with a focus on natural gas, crude oil, and NGL production in the United States.
2023 Performance Highlights
Gulfport Energy's 2023 results showcased strong operational performance and financial discipline. The company delivered net production at the high end of the updated guidance range, surpassing initial expectations. This achievement was realized while adhering to the initial capital budget, even with increased activity in the fourth quarter of 2023. Strategic acquisitions of liquids-rich Utica acreage extended Gulfport's inventory base and provided additional value and development options.
Adjusted free cash flow generation was significant, and after accounting for discretionary acreage acquisitions, approximately 99% of this cash flow was directed towards repurchasing the company's common stock. Gulfport's CEO, John Reinhart, emphasized the importance of maintaining a strong balance sheet and financial leverage below one times, which the company successfully achieved throughout the year.
"Gulfports 2023 results delivered on all fronts, highlighted by our quality resource base and the continued improvement of development efficiencies throughout the year," commented John Reinhart, CEO of Gulfport.
Financial Achievements and 2024 Outlook
Despite a challenging natural gas pricing environment, Gulfport Energy is poised to continue its efficient and sustainable asset development into 2024. The company plans to optimize development programs and focus on liquids-rich development to improve margins and support robust adjusted free cash flow generation. Gulfport intends to allocate substantially all of its full-year 2024 adjusted free cash flow towards common stock repurchases, excluding acquisitions.
For the full year of 2023, Gulfport's net daily production averaged 1,054.3 MMcfe per day, with a production mix of approximately 91% natural gas, 7% NGL, and 2% oil and condensate. Capital investment for the year totaled $443.4 million, with D&C activity accounting for $388.6 million and maintenance leasehold and land investment comprising $54.8 million. Additionally, the company invested around $48.0 million in discretionary acreage acquisitions.
Gulfport's liquidity at the end of 2023 totaled approximately $720.1 million, including cash and available borrowing capacity under its revolving credit facility. The company also repurchased approximately 490 thousand shares of common stock during the fourth quarter for about $66.0 million, with $236.4 million of remaining capacity under the share repurchase program.
Looking ahead to 2024, Gulfport provided guidance with full-year expense estimates and projections for production and capital expenditures, based on commodity strip prices as of February 13, 2024. The company anticipates average daily gas equivalent production between 1,045 and 1,080 MMcfe/day, with approximately 92% gas composition.
Conclusion
Gulfport Energy's strategic approach to acquisitions, disciplined capital management, and efficient operations have positioned the company for continued success in 2024. With a strong financial position and a commitment to shareholder returns, Gulfport Energy remains focused on optimizing its asset portfolio and maintaining its competitive edge in the oil and gas industry.
For more detailed information, including financial statements and guidance documents, investors are encouraged to review the supplemental financial tables and non-GAAP disclosures available on Gulfport Energy's website at ir.gulfportenergy.com.
Explore the complete 8-K earnings release (here) from Gulfport Energy Corp for further details.
This article first appeared on GuruFocus.
