Vermilion Energy Inc. (NYSE:VET) Q3 2022 Earnings Conference Call November 10, 2022 11:00 AM ET
Company Participants
Dion Hatcher - President
Lars Glemser - Vice President & Chief Financial Officer
Darcy Kerwin - Vice President, International HSE
Bryce Kremnica - Vice President, North America
Conference Call Participants
Robert Mann - RBC Capital Markets
Menno Hulshof - TD Securities
Dennis Fong - CIBC World Markets
Travis Wood - National Bank Financial
Operator
Good morning, afternoon, evening. My name is Elaine, and I will be your operator today. At this time, I would like to welcome everyone to the Vermilion Energy Q3 Conference Call. As a reminder, today's conference is being recorded. All lines have been placed on mute to prevent any background noise. After the speaker’s remarks there will be a question-and-answer session. [Operator Instructions] Thank you.
Mr. Dion Hatcher, you may begin your conference.
Dion Hatcher
Well, thank you, Elaine. Well, good morning, ladies and gentlemen. Thank you for joining us. I'm Dion Hatcher, President of Vermilion Energy. With me today are Lars Glemser, Vice President and CFO; Darcy Kerwin, Vice President, International HSE; Bryce Kremnica, Vice President, North America; Jenson Tan, Vice President, Business Development; and Kyle Preston, Vice President of Investor Relations.
We will be referencing a PowerPoint presentation to discuss the Q3 2022 results. Presentation can be found on our website under Invest with Us and Events and Presentations. Please refer to our advisory and forward-looking statements at the end of the presentation, it describes the forward-looking information, non-GAAP measures and oil and gas terms used today and outline the risk factors and assumptions relevant to this discussion.
As shown on slide 2, we generated $508 million of fund flow in Q3, which is a 12% increase over the prior quarter and is another quarterly record for Vermilion. For perspective, this quarterly fund flow is more than we generated for the full year of 2020. Free cash flow of $324 million was down slightly from the previous quarter due to higher capital expenditures associated with our Australia drilling program, which we successfully completed during the quarter.
Majority of Q3 free cash flow was allocated to debt reduction. Our net debt decreased by 11% to $1.4 billion, representing a debt to trailing 12-month fund flow ratio of 0.8 times. As we outlined last quarter, with our formal return of capital framework is our intention to return more free cash flow to our shareholders as debt decreases.