Coterra Energy Inc. (CTRA) Q1 2022 Earnings Call Transcript

For the period ending March 31, 2022

May 3, 2022 10:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Thank you for standing by. My name is Cheryl, and I will be your conference operator today. At this time, I would like to welcome everyone to the Coterra Energy's First Quarter 2022 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. Thank you.

Caterina Papadimitropoulos, Investor Relations. You may begin your conference.

Caterina Papadimitropoulos - IR

Thank you, Cheryl. Good morning, everyone, and thank you for joining Coterra Energy's first quarter 2022 earnings conference call. During today's call, we may reference a updated investor presentation, which can be found on the company's website. Today's prepared remarks will include business overview from Tom Jorden, CEO and President; and Scott Schroeder, Executive Vice President and CFO. Also in the room, we have Steve Lindeman, Blake Sirgo, Todd Roemer and Daniel Guffey.

As a reminder, on today's call, we will make forward-looking statements based on our current expectations. Additionally, some of our comments will reference non-GAAP financial measures. Forward-looking statements and other disclaimers as well as reconcile to the most directly comparable GAAP financial measures were provided in yesterday afternoon's earnings release, which can be found on our website. Following our prepared remarks, we will take your questions. Please limit yourself to one question and one follow-up.

With that, I'll turn the call over to Tom.

Tom Jorden - CEO & President

Thank you, Caterina, and thank you to all for joining us this morning. By all measures, Coterra had an outstanding quarter. First quarter results were driven by a nice production beat and strong commodity prices. Our assets performed well as evidenced by our production coming at the high end of our guidance. We generated $961 million of free cash flow during the quarter and prosecuted our capital program with less than 30% of our cash flow from operations.

For the full year 2022, we currently project discretionary cash flow of $5.9 billion with our total 2022 capital program coming in at less than 30% of cash flow, leaving almost $4.5 billion in free cash flow. We were pleased to declare an ordinary dividend of $0.15 per share and a variable dividend of $0.45 per share for a total cash dividend of $0.60 per share.

Furthermore, we launched our share buyback program in the first quarter, buying in 7.6 million shares totaling $184. Taking together this resulted in a return of 69% of our free cash flow to our shareholders.