SM Energy Company (NYSE:SM) SM Energy's Q2 2022 Financial and Operating Results Q&A August 4, 2022 10:00 AM ET

Company Participants

Jennifer Samuels - VP, IR

Herb Vogel - President and CEO

Wade Pursell - CFO

Conference Call Participants

Zach Parham - JPMorgan

Gabe Daoud - Cowen

Michael Scialla - Stifel

Operator

Thank you for standing by. My name is Angela, and I will be your conference operator today. At this time, I would like to welcome everyone to the SM Energy Second Quarter 2022 Financial and Operating Results Q&A Call.

I would now like to introduce Jennifer Samuels, VP of Investor Relations. You may now begin your conference.

Jennifer Samuels

Thank you, Angela. Good morning, and thank you all for joining us for our second quarter 2022 Q&A call. To answer your questions today, we have our President and CEO, Herb Vogel; and CFO, Wade Pursell.

Before we get started, our discussion today may include forward-looking statements and discussion of non-GAAP measures. I direct you to Slide 2 of the accompanying slide deck, Page 6 of the accompanying earnings release and the Risk Factors section of our most recently filed 10-K and 10-Q, which describe risks associated with forward-looking statements that could cause actual results to differ.

We may also refer to non-GAAP measures. Please see the slide deck appendix and earnings release for definitions and reconciliations of non-GAAP measures to the most directly comparable GAAP measures and discussion of forward-looking non-GAAP measures. Also, look for our second quarter 10-Q, which was filed this morning.

With that, I will turn it back to Angela to open it up for questions. Angela?

Question-and-Answer Session

Operator

[Operator Instructions] We will now take our first question from Zach Parham with JPMorgan. Please go ahead.

Zach Parham

Yes, thanks for taking my question. I guess first, just on the CapEx raise. Could you give us a little more detail on the decision to add a bit of activity to the 2022 program? And maybe just also detail how much of the increase in the budget is from that incremental activity versus the increased inflation expectations?

Herb Vogel

Good morning, Zach, thanks for calling in. So on the -- how much is from continuing operations. The basic background is we've got some great crews that are out there working for us. And even when we look within those operators, those service providers, we have some of their best crews when they benchmark them against all the crews they have running. So we had about four months of activity that was open in the back part of the year, and we said let's close that down, and that was on the frac spread side.