Viper Energy Partners LP (NASDAQ:VNOM) Q1 2022 Results Conference Call May 3, 2022 12:00 PM ET

Company Participants

Adam Lawlis - VP, IR

Travis Stice - CEO

Kaes Van’t Hof - President

Austen Gilfillian - IR

Conference Call Participants

Neal Dingmann - Truist Securities

Chris Baker - Credit Suisse

Derrick Whitfield - Stifel

Jeanine Wai - Barclays

Kyle May - Capital One Securities

Leo Mariani - KeyBanc

Operator

Good day. Thank you for standing by, and welcome to the Viper Energy Partners First Quarter 2022 Earnings Conference Call. [Operator Instructions] Please be advised that today’s conference call is being recorded. [Operator Instructions]

I would now like to hand the conference over to your speaker today, Adam Lawlis, Vice President of Investor Relations. Thank you. Please go ahead.

Adam Lawlis

Thank you, Cherry. Good morning, and welcome to Viper Energy Partners’ First Quarter ‘22 Conference Call. During our call today, we will reference an updated investor presentation, which can be found on Viper’s website. Representing Viper today are Travis Stice, CEO; and Kaes Van’t Hof, President.

During this conference call, the participants may make certain forward-looking statements relating to the company’s financial condition, results of operations, plans, objectives, future performance and businesses. We caution you that actual results could differ materially from those that are indicated in these forward-looking statements due to a variety of factors. Information concerning these factors can be found in the company’s filings with the SEC.

In addition, we will make reference to certain non-GAAP measures. The reconciliations with the appropriate GAAP measures can be found in our earnings release issued yesterday afternoon.

I’ll now turn the call over to Travis Stice.

Travis Stice

Thank you, Adam. Welcome, everyone, and thank you for listening to Viper Energy Partners’ First Quarter 2022 Conference Call. During the first quarter, Viper continued to build on its track record of delivering strong financial and operating results highlighted by the 43% quarter-over-quarter increase in our distribution to $0.67 per common unit. This distribution represents approximately 70% of the total cash available for distribution and implies a 9.5% annualized yield based on yesterday’s unit closing price. Additionally, we repurchased 1.6 million common units during the quarter at an average price of $24.84 per unit for a total cost of $39 million. Combined with the distribution, this represents a return of approximately 95% of free cash flow to our unitholders.

Looking ahead, we continue to focus on maximizing long-term returns to our unitholders and believe we are differentially positioned to do so with our best-in-class cost structure that enables investors to participate in the recent strength seen in commodity prices via the highest margins in the public oil and gas industry. Importantly, with 0 capital requirements and only limited operating costs, Viper will not face the inflationary cost pressures being seen across the industry and broader economy.