Vital Energy, Inc. (NYSE:VTLE) Q3 2023 Earnings Conference Call November 3, 2023 8:30 AM ET

Company Participants

Ron Hagood - Vice President, Investor Relations

Jason Pigott - President and Chief Executive Officer

Bryan Lemmerman - Senior Vice President and Chief Financial Officer

Katie Hill - Vice President, Operations

Kyle Coldiron - Vice President, Development & Production

Conference Call Participants

Derrick Whitfield - Stifel

Operator

Good day, ladies and gentlemen, and welcome to Vital Energy, Inc. Third Quarter 2023 Earnings Conference Call. My name is Desiree, and I will be your operator for today. [Operator Instructions] As a reminder, this conference is being recorded for replay purposes. It is now my pleasure to introduce Mr. Ron Hagood, Vice President, Investor Relations. You may proceed, sir.

Ron Hagood

Thank you, and good morning. Joining me today are Jason Pigott, President and Chief Executive Officer; Bryan Lemmerman, Senior Vice President and Chief Financial Officer; Katie Hill, Vice President, Operations as well as additional members of our management team.

During today’s call, we will be making forward-looking statements. These statements, including those describing our beliefs, goals, expectations, forecasts and assumptions are intended to be covered by the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Our actual results may differ from these forward-looking statements for a variety of reasons, many of which are beyond our control.

In addition, we will be making reference to non-GAAP financial measures. Reconciliations to GAAP financial measures are included in the press release and presentation we issued last night describing our financial and operating results. The press release and presentation can be accessed on our website at www.vitalenergy.com.

I’ll now turn the call over to Jason Pigott, President and Chief Executive Officer.

Jason Pigott

Thanks, Ron. Good morning, everyone, and thank you for joining us today. Our results in the third quarter were outstanding and were a continuation of our exceptional execution throughout the year. We are delivering on all aspects of our strategy. In the third quarter, we announced three acquisitions, making a total of five for the year. These acquisitions increase scale, are accretive to free cash flow and add high-value inventory. We generated $91 million of free cash flow and also achieved company record production levels. We continue to demonstrate capital efficiency improvements, coming in below guidance on capital investments and reducing our leverage ratio.

We have successfully integrated the Driftwood and Forge properties we acquired earlier this year and are completing wells on those properties that are outperforming what the previous operators achieved. Additionally, we are making progress upgrading operations to our standards and seeing opportunities for synergies, future cost reductions and base production enhancement. As we close out 2023, we have high confidence in our ability to execute on the plan for 2024 that we communicated in September. We have a proven track record of integrating and creating value through acquisitions by applying our operational expertise and proprietary technologies to enhance base production.