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Expand Energy Corporation Stock Price: Quote, Forecast, Splits & News (EXE)

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Company Profile

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Expand Energy Corporation Price & Performance (EXE)

Stock Performance

Updated Mar 24, 8:00 PM UTC

EXE:NASDAQ

$109.10USD

1.63% · $1.75

After Hours

-2.37% · $2.59

Open

$108.03

High

$109.39

Low

$107.36

Market Cap

$25.39B

P/E Ratio

-24.0

Volume

5.41M

Year High

$109.63

Year Low

$69.12

Dividend Yield

2.24%

News & Market Insights

BMO Capital Boosts Expand Energy Price Target Amid Positive Outlook
today
BMO Capital has raised its price target for Expand Energy from $115 to $119 while maintaining an "Outperform" rating. This adjustment reflects confidence in the company's operational strategy and market positioning, particularly in natural gas production across key U.S. basins. Analysts highlight the proximity of its assets to LNG export infrastructure as a strategic advantage.12
Centuri Secures $490M in Contracts to Expand U.S. Presence
today
Centuri Holdings has announced nearly half a billion dollars in new and renewed contracts, enhancing its utility infrastructure services. The agreements include two renewals in the Northeast and Midwest and two new contracts in the Pacific Northwest. This expansion aligns with Centuri's strategy to diversify geographically and strengthen client relationships.34
Icon Energy Adds Eco-Friendly Vessel to Fleet Expansion Plan
today
Icon Energy has entered into an agreement to charter and potentially purchase a 2020-built, eco-friendly dry bulk carrier. The vessel, named Charlie, will be operational under a time charter-out contract for 9 to 12 months. Icon's strategy includes financing this acquisition through multiple funding sources, emphasizing sustainable growth.5

What's Happening

Earnings

Report Date

—

Rev Estimate

—

Avg 1d Change

2.01%

Report Period

Q4 2024

EPS Estimate

—

Implied Move 1d

—

Transcript

12m 31s

During this morning's call, we will be making forward looking statements which consist of statements that cannot be confirmed by reference to existing information, including statements regarding our beliefs, goals, expectations, forecasts, projections and future performance and the assumptions underlying such statements. Please also note there are a number of factors that cause actual results to materially differ from forward looking statements, including factors identified and discussed in our press release yesterday and other SEC filings. Please also recognize that as except required by law, we undertake no duty to update any forward looking statements Expand you should not place undue reliance on such statements. We may also refer to some non GAAP measures, which will help facilitate comparisons across periods and with peers. For any non GAAP measure, there's a reconciliation on our website. With me on the call today are Nick Delaso, Josh Vitz and Dan Turko, our new EVP of Marketing and Commercial. Nick will give a brief overview of our results and then we will open up the teleconference to Q and A. So with that, thank you again, and I will now turn teleconference over to Nick.

13m 41s

Good morning, and thank you for joining our call today. [indiscernible] world's need for energy continues to grow. With our attractive market connected portfolio, resilient financial foundation and peer leading returns Expand Energy was created specifically to better respond to this growing demand and yield stronger returns for shareholders in times of volatility. Our productive capacity strategy uniquely positions us to not [indiscernible] but to capitalize on the dynamic market we see today. As our 2025 capital and operating plan demonstrates, this is exactly what we are doing. Benefiting from a powerful combination of premium rock, returns and runway across our portfolio, access to advantaged markets and some of the most capital efficient operations in the industry we've enhanced our outlook for 2025. We continue to benefit from the tailwind of our 2024 productive capacity strategy and now expect to produce approximately 7.1 Bcf per day for a capital investment of approximately $2,700,000,000 As market fundamentals continue to improve the outlook for natural gas, we are electing to invest in incremental $300,000,000 to build approximately 300,000,000 cubic feet per day of additional productive capacity. This will allow us to efficiently deliver 7.5 Bcf per day in 2026 should market conditions warrant.

15m 5s

We believe this level of production optimizes free cash flow at mid cycle prices. Since we won't pull the trigger on this incremental capacity until mid year, we have time to watch the market and we'll have the flexibility to adjust as necessary. Continue to capture significant capital and operating efficiencies rapidly accelerating the achievement of our annual synergies. We now expect to achieve approximately $400,000,000 of our annual synergy target in 2025 and to capture the entire $500,000,000 target by year end 2026. I am especially encouraged to see the 20% improvement we are delivering in our Haynesville drilling for In the fourth quarter alone, we cut nearly nine days and $1,500,000 in in cost per well from Southwestern's legacy drilling The definition of synergy success is clear. Achieving capital and operating efficiencies that result in spending less, while producing more. Which is exactly what we're doing. Our resilient financial foundation and peer leading returns program are two areas which also further differentiate our company. At today's prices, we expect to end 2025 with less than $4,500,000,000 in net debt. Our debut $750,000,000 investment grade issuance set a record spread for an energy rising star 132 basis points over ten year treasuries.

16m 29s

And cleared all near term maturities through 2029. Our enhanced capital return framework is designed to efficiently return cash to shareholders and reduce net debt. After paying our $2.3 per share dividend, we expect to allocate $500,000,000 to debt reduction in 2025.

16m 49s

In our strong free cash flow outlook, we expect to have additional cash available to allocate to a combination of variable dividends, share repurchases and the balance sheet. Turning to our marketing program, we see great opportunity to capitalize on our position as the nation's largest natural gas producer. There is greater than 11 Bcf per day of LNG capacity under construction. And the domestic power market continues to grow in support of data centers and rising consumer demand. [indiscernible] balance sheet and capital efficient operations to help meet this new demand. I'm pleased to welcome Dan Turco to our team to lead this effort. Dan has extensive experience creating value for marketing and trading programs and will help us realize the benefit of our advantage position.

17m 33s

The marketing program has already seen the value of our combined portfolio. Our team worked extremely hard from the date of close to fully integrate our marketing and transportation portfolio by January one of this here. Allowing us to optimize the flow of volumes across pipes increasing value for our gas, and reducing costs.

17m 52s

Looking forward to 2026, once the NG3 pipe is online, approximately 75% of our marketed volumes are expected to reach strategic markets. Including 2.5 Bcf per day directly to the growing LNG corridor.

18m 7s

Expand combination of an attractive connected portfolio, a peer leading returns program and resilient financial foundation is distinct among natural gas producers. Today's market provides a unique opportunity for our company. And we look forward to expanding opportunity for our shareholders in the year Operator, we'll now take questions.

18m 27s

Thank you. Our first question will come from the line of Matt Portio of TPH. Your line is open.

18m 55s

Good morning, Nick and team.

18m 57s

Hey, Matt. Just a quick question pricing Just curious maybe if you could speak to that slide and specifically if we're in kind of a $3.5 to $4 world, should we be thinking about kind of your productive capacity once you get to the 7.5 Bcf a day in 2026 to hold around 7.5 Bs or do you think you could continue to see growth from that point forward?

19m 26s

Yes. I'm really glad you asked about this slide to start off with, Matt. This is an important way for us to communicate how we think about our capital allocation for this year and over time. We all talk a lot about the right way to set up our business and we thought this slide did a good job of laying out our thought process. We believe that it starts with a view of the macro. And so we'll continue to have a view of the fundamentals and let that underpin how we think about allocating our capital. That means that we're going to always have a rolling forward two to three year assessment of where the market is and what that means for mid cycle prices. And you're right to point out that right now, We're pegging that at $3.5 to $4 per Mcf. Henry Hub And so the table below simply lays out a look at the heat map is designed around cash flow generation, free cash flow, Looking at at various levels of production relative to various levels of price where is your business optimized?

20m 37s

Stronger market growing volumes. That always feels good.

20m 41s

But there's certainly an optimal level of production for a business given the underlying macro. And I think this helps to highlight how we view that, that there can be levels of production that are too high for a given price Expand there can be levels of production that are too low. And so at three fifty to four you can see that we sit in a pretty good place at 7.5 Bcf a day. What we also like about this slide that we're giving you some parameters around which we would have to underwrite a longer term view of the macro in order to raise that level of targeted production. And I say targeted and we say mid cycle and all of those things because there's plenty of volatility that could show up in the short term. That would continue to cause us to do things like we did in 2024, curtail volumes, curtail capacity that's otherwise on the sideline given a short term event. But when we think about mid cycle activity, we think about this level of production relative to this price that we're underwriting. So right now, dollars 3.5 to $4.075 Bcf a day of production.

21m 51s

I think it's pretty interesting to note that From an overall market standpoint, we are underwriting a level of price that is below where the twenty five and twenty six strip is today. We do that with the recognition that one, we don't mind being a bit on the conservative side in underwriting price. Two, we do think a lot about how this will evolve over time. And we know that when prices as they are today are above the marginal breakevens of the industry supply will ultimately show up and compete. And that competing supply as we go out into 'twenty seven, 'twenty eight, 'twenty nine is increasingly going to be not just domestic supply, but international supply. We've talked for a while about how in the second half of this decade, will be more LNG capacity that comes online around the world that will compete directly with U. S. Gulf Coast capacity. And so we think it's appropriate to take this multiyear view of the market [indiscernible] again, we see $3.5 to $4 is a pretty reasonable price to underwrite. [indiscernible] all of that informs how we think about our business today. It thinks about what helps us to think about what the optimal level of production and CapEx is that then drives the optimal level of cash flow.

23m 8s

I would also just point out that we're giving you a lot of information on this slide, including the right hand column of the matrix, which tells you the amount of maintenance capital that would be required for each of these levels of production. Obviously, there's a lot of assumptions embedded into a chart like this. Those assumptions would have to be revisited over time. We're using our current assumptions of well cost, we're using our current assumptions of of well productivity. Our team is pretty focused on improving capital efficiency around both halves of that equation every day. And so we'll continue to refresh our thoughts around this. But we think this is a pretty good framework. Perfect.

23m 51s

And then maybe just a follow-up. You mentioned LNG. I was just curious if you can maybe touch on your updated thoughts on the marketing strategy. I know it's a diversification for you all. And there's obviously some puts and takes and views on global incremental supply versus demand over the next few years. So just curious how you guys are thinking about the LNG market and your strategy moving forward?

24m 13s

Got it. Another great question. So So again, we're excited about what's happening with the incremental LNG export capacity on the Gulf Coast and how we're positioned relative to that We think we are uniquely positioned to that. One, just given the scale of production that we have approximate to those assets in the Haynesville, but then also we have a really nice transportation portfolio that allows us to move point five Bcf a day by the end of this year to Gilles, move another two Bcf a day over towards Perryville, which then can flow south towards the Eastern facilities like Plaquemines. And we have a lot of connectivity to these projects. We have a great relationship with a lot of the liquefiers themselves as well as the off takers and we have regular communication with all of them about what their needs are and how we should think about being prepared to supply gas So we really like our position. As you know, we have announced one supply agreement going through the Dolphin facility And we think there's more that we can do around LNG in the future, but I would say we're really focused on ensuring that as we take on any incremental LNG projects, we're thinking hard about how we can do a couple of things.

25m 35s

One, ensure that it provides a diversified revenue source for us connecting us to markets that we wouldn't otherwise be connected to that have diverse and different characteristics than Henry Hub. We think that's important. And then exposing us to revenue opportunities that [indiscernible] to generate higher levels of cash flow through cycles for our business. I think as we think about our our business today, we are in the Haynesville, which is a really important geographic diversity for us being approximate to markets and being able to grow. And we need to show higher revenue prove out the value of that geographic diversification.

26m 27s

Thank you.

26m 30s

Thank you. One moment for the next question. And our next question will be coming from the line of Doug Leggate of Wolfe Research. Your line is open.

26m 43s

Hi, good morning, everyone. Thanks Thanks for taking my questions. Nick, I've got two if I may.

26m 50s

I guess the synergy number, we're all kind of watching that.

26m 53s

Evolve a little quicker than you'd originally planned. But if I go back to when you announced the deal back in January of last year, You'd put a kind of a two year timeline on building a marketing business and you obviously made a very high profile hire here recently. I just wonder if you could give us a quick refresh on what you think the timing looks like now to achieve what you think is possible and maybe quantify what that number looks like? Again, 2.5 TCF a year more or less. What's the is that $0.1 number? Is that $0.2 number? What's the ambition obviously, I don't think that's been a lot of people's numbers at this point. That's my first one. I've got a quick follow-up, please.

27m 34s

Yes. Thanks, Doug. We're really excited about what in front of us from a marketing perspective. And you're right, we have made a really important hire for our team And we're looking forward to building out our business in a way that takes better advantage of the scale of production that we have as well as the transportation portfolio we have today. Traditionally, both Chesapeake and Southwestern marketed gas in a relatively close to wellhead fashion. We do have a lot of transportation. But we are for the most part, selling gas to the nearest purchaser at the terminus of that transportation, whether that's off the gathering system or if it's further downstream. And we haven't engaged in a lot of optimization, which generally larger companies do. Think there's quite a bit of value in the domestic optimization of how we sell our gas. And we're looking forward to building out the processes and the the capabilities to do that.

28m 34s

We know how to do it. We have the talent to do it. We need to build systems processes and certainly need to build a risk framework to ensure that we do it properly But in doing that, we think we can add pretty meaningful value to our business and increase our netbacks to our equity production certainly by a few pennies on that domestic optimization alone. And then the longer term, value opportunity is, of course, around new commercial relationships that could be more interesting. And those could be in the form of power deals, industrial deals, LNG deals, long term buyers of gas. [indiscernible] seek certainty of supply. And potentially seek some certainty of cost. And we think there's quite a bit of opportunity in a market that looks like it will increasingly have challenges of getting the right amount of gas to the right markets at the right time. And we think we're well positioned to help solve those challenges. So, Nick, just to be clear, is that $400,000,000 annual business or is that stretching [indiscernible] Yes.

29m 47s

Look, I'm thinking $0.15 Yes. I think we're going to hold off on giving you an exact number. Today, Doug. We're going to continue to build this business plan. We're going to hold off on giving you exact number today, but we think it's certainly meaningful. And we're pretty excited about what's in front of us. Okay.

30m 5s

Got it.

30m 6s

So my follow-up is you've kind of subtly slipped into the presentation twenty years plus of inventory. And I think you used to have the Southwestern and the Chesapeake standalone saying we've got a fifteen year backlog. I think when you think about We're telling you, you can hold this at dollars 3,000,000,000 of capital, dollars 7.5 Bcf a day. Seems you're making life pretty simple for everybody. It's going to lay out what the value proposition is. My question is, [indiscernible] What's extending the inventory? What is the relative economics look like of the portfolio today versus what you were saying before? And because I was always the impression that Bossier and Hensel had very different returns, but now they're both part of the story. So if you could help us understand that a little bit, if that twenty years is out apples for apples comparison, that'd be great.

31m 2s

Yes. Look, it's essentially productive life of around the assets that we generate today. So yes, Bossier is in there, Upper Marcellus is in there. And we continue to derisk all aspects of those plays that have less producing wells than maybe the traditional Haynesville zone or the Lower Marcellus zone. Our team has done some really, really good work over the last couple of years to add value to all of those locations. And every time we add value to those locations, more of those locations can turn green, so to speak, in our inventory count. And in our skyline charts. One of the things that's happening here though is that as we brought these two companies together, we think that we are ultimately going to be most efficient and most effective [indiscernible] leaning on the capital efficiency of our business. We'll run less rigs than each company was running on a standalone basis. And so the Expand extends the number of years of development extends partially just because of that. But we're definitely very focused continuing to turn more and more sticks within our acreage green, which allows us to add more adjacent acreage around our plays.

32m 17s

Thanks a lot for the answers.

32m 25s

And our next question will be coming from the line of Scott Hanold of RBC. Your line is open.

32m 32s

Yes. Hey, thanks. Good morning. Let's Stick on that same topic if we could and specifically with the Upper Marcellus and Bossier, can you talk about how what percentage of that is in the activity over the next couple of years? And just give us a sense of the relative economics of those zones comparatively? And are you seeing the ability to kind of what things are you seeing that can maybe improve those economics and you get closer to sort of the Haynesville slash Lower Marcellus Yes.

33m 7s

Hey, good morning, Scott.

33m 8s

This is This is Josh. First on the split, we do provide a slide in the deck on Slide 35 that provides the breakdown for the number of TILs. But you'll notice in the Haynesville, we are going to be slightly heavier weighted towards the Haynesville wells.

33m 25s

So it's probably closer to 60% to 65%. And then the in the Northeast with the upper and lower, it's probably closer to maybe 45% lower and the rest will be upper. And so on the comparative economics, one of the things I would just say, and I'll maybe start with the Haynesville specifically, Both reservoirs offer tremendous potential from a returns standpoint. And we like the productivity that we see in each The Bossier tends to be just a little bit more expensive on the completion side. Also recognize it's shallower. So drilling costs are a little bit less. We find productivity to be fantastic across both, I would say somewhat equitable. The upper and the lower, we've talked about for some time the fact that we do see lower productivity on a per foot basis in the upper But the ways we find to enhance the economics of that, which is really the ultimate goal is by Expand lateral lengths. And because it's less developed, we have opportunities to drill longer laterals, which we've been doing year over year. We've also really been investing in analytics and looking opportunities to enhance the way at which we complete these wells.

34m 41s

And so the combination, the longer laterals, the enhanced completion designs, we've talked about hybrid wells in the past as another mechanism at which we could really boost up the profitability of the upper wells where we combine let's say, a 10,000 foot section of upper with 5,000 feet of lower reservoir That all helps to normalize our returns across across the Marcellus play.

35m 7s

Appreciate the context Thanks. And as my follow-up, just talking about productive capacity increase that you have planned into 2026 Expand to me, it was interesting on I guess you're calling a production that does correct if I'm wrong, tell indicate to us that there's some optionality if the market is not there, but Can you Can you give us some sense of as you get into the back half of 'twenty five, Obviously, it's a very sensitive time coming into the winter every year with the gas market. If you start building this productive capacity and in these wells to bring on, and let's say the winter doesn't pan out, what happens in 2026 now that you've already spent those $300,000,000 of extra capital, what do you do Sorry, my mute didn't come off. I'm going to start over Yes, we're really pleased with the flexibility we exhibited in our business in 2024. And we think it would set up really similarly. So we're going to build this productive [indiscernible] coming into the end of this year, it will be ready to be turned in line in 2026. And if the market is not there, [indiscernible] it would we would likely have a response to that that would be some combination of either holding back the turn in lines or curtailing volumes to to alleviate pressure on the market.

36m 42s

I would back up even further than that and let's say that we see that as we come through this year, macro conditions change in some unforeseen way and the market doesn't look as strong in 2026 or 2027. Then we'll change our capital allocation as well. We've proven I think several times over. Flexibility we have there and the willingness to try and be responsive and in front of market conditions to be efficient with our capital relative to where we are in the cycle. So we maintain a ton of flexibility in our business. And this is what we think is the right planning step for today. And we're very prepared for both increasing capital or decreasing capital as conditions warrant.

37m 31s

Thank you for that.

37m 35s

Thank you. One moment for the next question. And our next question will be coming from the line of Kevin MacDermot of Morgan Stanley. Your line is open.

37m 48s

Hey, good morning. Thanks for taking my questions.

37m 52s

So wanted to dive in first on the 2025 activity in a little bit more detail. Definitely agree with the constructive outlook for gas prices this year. Looking back about a month ago, we were slurring with $2 on Henry Hub. So I was wondering if you could talk a bit more about the decision process to pull forward the deferred tails and then also give a little bit more color on the cadence of that productive capacity throughout this year? I know you have the 1Q guide and the full year number, but how are you thinking about the volume trajectory as we move through 2025 for the business?

38m 24s

Yes, good question, Devin. So we're again, I want to go back to talking about how we think about the macro and thinking about two to three year look of underwriting a a price range here and we've landed at $350,000,000 to $400,000,000 There's a lot that goes into that. And ultimately, you're thinking about the trajectory of supply and demand and all the features of the market that will impact supply and demand over the next couple of years. And so on the supply side, you're certainly thinking about many rigs are running, how many wells are being completed, the productivity of those wells, how many pipes are coming online, including from associated gas areas like the Permian and building out a pretty good view of what the supply to the market looks like on the demand side going to pay a lot of attention to the trends of power generation and what fuels power generation growth is relying on trends of industrial demand and then certainly what we see now as the big driver is the increase in LNG export capacity. Which requires a view not just of what that of the aggregate capacity but also a view of the of the likely utilization of that capacity.

39m 37s

Which again we've talked about initially we think is going to be very, very high and then over the next few years would would potentially begin to run at less than 100% capacity as more and more comes online. So all of that informs this longer term view. One of the things that you do pay attention to as a part of all of this analysis is where storage we've had this constructive view on the longer term. And then as we got through this winter, you see that it's been very cold, of course. And storage has drawn down a good bit, which just accelerates the timing at which the market is seeking incremental supply so that storage doesn't run too low. So I think the multiyear look hasn't really changed much for Expand all the changed is that the starting point at which the market is looking for more supply has come to us a little bit sooner as a result of there being a cold winter We think it's really important to maintain this view that is multiyear, multi season so that we don't end up chasing a near term event of price in the market. And then again to make sure we have the flexibility in our business to continue to review those assumptions over time.

40m 50s

I'll ask Josh to comment just on the trajectory of production this year and going into next because we gave a lot of thought about that. As we have the flexibility with our deferred till strategy.

41m 2s

Yes. Hey, Devin. We absolutely start seeing some strengthening fundamentals as we were exiting the year. And so we did start to bring online some of the deferred hills at the December. In fact, across the fourth quarter, we brought on about 40 wells and roughly 25 of those were technically deferred tills. And what you have to just remember in the is what we've been able to accomplish with just, let's just say those 25 wells, wells could have come online in a $2 gas price environment.

41m 32s

But instead we were able to bring them on into a very strong environment with roughly $4 gas We feel really good about that decision.

41m 40s

Then as we come into the first quarter and again fundamentals remain strong, We talked about weather. We've seen relatively strong LNG feed gas pools as well, which again we think is helping to tighten storage. And so across the first quarter, we're anticipating bringing on roughly 90 wells into the markets. And just to give you a little bit perspective on what that means from a trajectory standpoint, course, we've guided to a six seventy five number for Q1. But we expect to grow from the December where our production was just over 6.4 Bcf a day We expect to exit March around seven Bcf a day.

42m 22s

And so when you talk about kind of short cycle market response to production, that's really what we've created here. And so with the deployment of our deferred hills, which we expect to be extinguished effectively by the first half of this year. We expect to be kind of up on plane between say seven and seven point one Bcf a day. Heading into the second quarter. And we'd expect to maintain that type of production as we exit the year, which then of course positions us to be able to benefit from the productive capacity that will now build on this up cycle as we look to ex five.

43m 6s

Got it. Thanks. That's really helpful. And my follow-up is on that productive capacity. Slide eight has the building blocks of capital and also some breakdown of where that incremental $300,000,000 of spending would go. And I think it's notable that it's actually split across Appalachia and the Haynesville. You have some going to each of your core assets. So I was wondering if you could just talk a bit more about how you think about allocating growth capital across the different assets in your portfolio? Maybe as part of that, if you could just address the takeaway situation in Northeast Pennsylvania and how much room there actually is to boost volumes there? Yes. So we think about allocating capital across these assets, just as you alluded to in your question. Our ability to grow is primarily in the Haynesville. In Appalachia, The capital that's coming in there is really in recognition of what the existing capacity is bringing production up to those capacity levels. We know where we've been able to produce successfully in the past and we're not going to attempt to go beyond that. So the growth capital that you really see more about the Haynesville. I just want to remind everybody that we do sit right adjacent to the LNG growth corridor and have 2.5 Bcf a day by the end of this year of capacity to deliver to Gilles.

44m 36s

So as you think about where that LNG gas is going to come from, it's going to primarily be sourced from Gilles We have the LEAP pipeline and the NG3 pipeline and in aggregate that's 2.5 Bcf a day. That gets delivered right to the source of growing demand. And so the incremental volumes that we really think about here as we increase our volume profile into 2026, are focused on meeting that growing demand. This is not delivering volumes into a static environment. [indiscernible] And our next question will be coming from the line of Neil Mehta of G. S. Your line is open.

45m 25s

Hi, it's Neil Mady here. Can you guys hear me okay?

45m 30s

Yes, sir.

45m 31s

All right, Nick. So I just wanted to spend some time just talking about return of capital and capital allocation and those three tranches.

45m 40s

That you outlined in the deck and your objectives here in 2025 as you transition from delevering to focusing potentially on shrinking your share count too?

45m 52s

Sure. Pretty happy with the cash flow profile that's in front of us for the next couple of years. One, we've prioritized debt pay down and you can see that really clearly in that waterfall We've put in place a $500,000,000 debt pay down goal for the year. That's on top of the fact that we retired the outstanding revolving credit facility that was Southwestern's at the close.

46m 15s

We paid down $389,000,000 of bonds that maturing in January. And then we've done another refinancing of course with our first investment grade issuance.

46m 29s

That allowed us to push out some maturities. So we have a really good runway in front of us to retire debt and a lot of cash flow to do it.

46m 37s

So that $500,000,000 out of our free cash flow will flow towards debt pay down as well as we have a little bit of incremental proceeds from the Eagle Ford sales that will come to Expand deferred proceeds in 2025 that will go towards debt pay down as well.

46m 53s

So we're taking a pretty good swipe at the balance sheet and we're going to end the year with less than $4,500,000,000 of net debt based on recent strip. So feel pretty good about that. That will obviously be well under one times. EBITDA with prices around where they are. I would also remind you that that $500,000,000 is a target that we'll set each year. So next year, we will have another bet debt pay down target. And what we've attempted to do with this framework is allow for good balance of ensuring our balance sheet stays very, very strong. It's, as you know, with the history of our company, and the way we've been able to bring assets into the portfolio that have been very accretive to our overall returns profile We We believe you need to have a very strong balance sheet to do that. So we're going to continue have a really strong balance sheet You need a strong balance sheet to allocate your capital efficiency and maintain the flexibility to allow production to decrease and increase as we've done over the last year. And that balance sheet strength is such an important part of how we think about our competitive position in the market that it will stay front of mind for us and be protected.

48m 9s

And then beyond that though, we're going to generate a lot of excess free cash flow. And we think that that needs to be returned to shareholders in a pretty significant proportion. So that remaining tranche then have the flexibility to return to shareholders, 75% of it either in the form of buybacks or variable dividends, We will use that flexibility to be thoughtful about the most efficient way to do that for shareholders. Over the last couple of years, you've seen us use both And I wouldn't be surprised if we continue to use both. [indiscernible] Thanks, Nick. And that kind of brings us to the follow-up, which is you guys have done a great job of hedging the wedge or taking advantage The constructive Forward gas curve. Can you just talk about how you're thinking about the hedging strategy on a go forward, does hedge to wedge still make sense? Have you gotten to an optimal level? At this point? And just how you're thinking about that part of Yes. Our hedging strategy, we feel like has worked really well for us. We had a really nice offset to the low prices last year that supported our our cash flow.

49m 25s

Despite the fact that gas averaged for the year about $2.26 We ended the year with a nearly neutral free cash flow position that's really largely supported by our hedges In 2025, as prices have run quite a bit, [indiscernible] hedge losses are a fraction of what that gain was last year and that's a function of the fact that we've hedged, we think, on a rolling basis that has really made sense so that we have exposure to the right prices in the market that we're setting the appropriate floors. And we've been able to use a fair amount of collars as we approached the start of twenty twenty five. We like the approach. We like having roughly 50% to 60% of the first year hedge and then less in the second year and continuing to lag into those hedges over time. We also would acknowledge that in recent weeks, as prices have been a lot stronger we're not afraid to shift for near term prices more towards swaps. You're elevating the floor of your locked in price and you're also willing to move to the to the higher end of your ranges of targeted levels of hedges. We see prices in 2025 that I noted a few minutes ago are well above the marginal breakevens in the industry.

50m 47s

And when you see that, and you want to go ahead and lock in those prices. So that's what we'll continue to do. Thanks, Nick.

51m 8s

And our next question will be coming from the line of John Freeman of Raymond James. Your line is open. Good morning. Thanks.

51m 17s

The first question I had just hi, just following up on an earlier question pull forward on the deferred TILs. Just to sort of level set kind of the model since I know that the plan is that you said, all the TILs basically get exhausted first half of the year, And then I believe the plan assumes about 85% of the DUCs get bought online this year as well. Where did the TILs and deferred TILs Expand the DUCs stand at year end?

51m 53s

Yes. So because we started bringing on wells in the back end of the quarter, which was about 25 of those deferred deals that left us with about 55 to 60 deferred tilts at year end. And between fifty and sixty DUCs at year end. And just one comment I would make on the DUCs is that we have a a somewhat ratable activation of the DUCs across the year. And of course, there's a capital amount that comes along with that One of the things we really like about the plan is just the retained flex flexibility that we have. And we have this option to actually accelerate [indiscernible] completion of the DUCs that creates more flexibility in the year from a production standpoint while holding capital flat. And so so, though we'll have activated all of our deferred hills, we still feel like we've retained flexibility with the DUCs throughout the calendar year.

53m

That's great. And my follow-up, when looking at that Slide nine, It would appear that going from kind of 7.5 bs a day to call it eight plus bs a day It looks like just trying to back into what you all have got for the CapEx. That it doesn't look like there is like a material increase that's needed on infrastructure Expand, it looks like you all can handle that without any big step change on that front. Is that the right read on that?

53m 32s

Yes, that is the right read. You need to remember is just where both companies were operating prior to deal announcement at the end of twenty twenty three. And so so we have adequate offtake the infrastructure, both in the field and with the transport is capable. And so effectively, with what we're doing right now, we're restoring volumes. And then the productive capacity that we'll build will essentially continue down a path to get us to a spot where we're just more fully utilizing the infrastructure that we have access to.

54m 7s

Got it. Thank you all.

54m 11s

Thank you. One moment for the next question.

54m 15s

And our next question will be coming from the line of Paul Diamond of Citi. Your line is open. Paul, your line is open. Apologies, the line cut there for a second.

54m 38s

I just wanted to talk about Slide 15, you guys talked about having made some good progress on the good progress on the drilling activity. Expand just wanted to inquire if there was any remaining opportunity there or the timing of such? Like I guess how much meat is left in the bone there?

54m 56s

Yes. We still feel like there's plenty of room to drive improvements. And this is this slide on Slide 15, of course, focused on the Haynesville. And I'd just I'd say that we've been incredibly pleased with the progress that the team has made Through our diligence process with the transaction, we had pretty clear understanding of what the gap was in terms of days And we utilized the time of our integration planning really to break that down into well segments. And we've used that time obviously effective to allow us to realize more than a 20% improvement in our footage per day, and 20% improvement in cost just in the first quarter. And so to your question, we're going to continue to improve in this. And talking to the teams, we know there's additional opportunities I'm seeing that even just flowing into the first quarter. So we feel really good about the trajectory that we're on. And then the thing that I would also just mention, again, we focused this in on the Haynesville for this discussion. But we just drilled a a 5.5 mile lateral up in West Virginia and we did so with a single bit run-in just over five days.

56m 8s

And that type of progress that we see in an asset that clearly has an opportunity to kind of lend it itself into the other areas that ultimately translates into incremental synergies. So we definitely think there's meat on the bone and really, really excited about what we have in front of us.

56m 29s

Understood. Appreciate it. And just one quick follow-up. Thinking about the Thinking about the rig adds in second half, should we think about the timing and cadence? Or is that purely reactive Or is there a plan for July 1 and then October 1? How to think about the timing there.

56m 48s

Yes, Paul. I'll lay that out for you. The re adds are premised across the second half of the year. What we're looking at right now is that we'd add a couple of rigs in the third quarter. Those would be desk for the Haynesville and Northeast App. And then in the fourth quarter, we would expect to add a rig in Southwest App and then the ninth rig in the Haynesville.

57m 15s

Understood.

57m 16s

Appreciate the clarity. I'll leave it there.

57m 20s

Thank you. One moment for the next question. And the next question will be coming from the line of Charles Meade of Johnson Rice. Your line is open.

57m 32s

Good morning, Nick, to you and Josh and the rest of the Xperon team there.

57m 37s

Hey Charles. Nick, I wanted to ask a question about about Page 10. Really this graph on the the left side of the page. My first reaction I see there reminds me of my son's high school trigonometry homework.

57m 52s

It makes me think maybe whoever came up with this slide is looking at something similar recently, but But I think what this is, is this is the this is trying to describe the dynamics around the baseline kind of scenario that you're outlined on Page nine. And if that's right in interpretation, I look at this and I think the message that you're trying to send is that is that you will be increasing CapEx When [indiscernible] prices are low and that you'll be kind of max prices are higher, but I wonder if you could guide our interpretation of that of that this dynamic that you've laid out here.

58m 40s

Yes. You're talking about our attempt to be countercyclical And generally, I would agree with you. I would say that it's not going to be quite as simple as you just but generally, this is a a look at how we would attempt to be responsive to market conditions in a way that is faster than the cycles of capital capital typically allow you to be in this industry.

59m 4s

We go put capital to work in this industry today, it takes us a couple of years to bring production online and then earn a return on that production. From the point of which you make the decision, until the time at which you have return of capital in the bank from that decision. It's a couple of years. So what you really want is a business that's much more flexible in a market that has conditions that change much faster than that cycle of capital. And this is really meant to describe how we would achieve that. We are very willing to allow production to fall in the near term. Then as you bring production back to move above a targeted mid midpoint when prices are there to support that. And so what you should think about is, you accelerate and decelerate capital if you want to move that middle dash line.

59m 53s

But you move above and below that dash line based on the nearer term conditions in the market.

1h 3s

That is helpful, Nick.

1h 5s

I That adds to my understanding. And then one other thing, Nick, as a follow-up, twice now I think you've mentioned marginal breakeven for the industry. Can you you share what you think that is and where Expand sits vis a vis the industry on that marginal breakeven? Sure. I mean, I think we can all calculate like a specific number in a supply model on what marginal breakeven Of course, everybody is going to look at it a little bit differently. So we think that number is I'm going to just call it loosely in the mid-3s so we think we sit probably on the lower end of that as a business because we have a huge amount of inventory at very, very low cost in the Marcellus Expand then we have a lower cost inventory in the Haynesville than some of our peers. Lower cost because we still have a lot of development in the core of the Haynesville, And also because we have the best capital efficiency in the Haynesville Expand we have a slide in the deck that details that. So we think we sit in a really attractive position relative to the industry's marginal breakeven.

1h 1m 20s

And that's super important because if you're going to be a company that responds to supply and demand signals, you really need to know where you sit. Marginal breakeven, you shouldn't be the first company to respond. We don't think that's where we are. We are most proximate to the growing demand [indiscernible] in that area of proximity. We have the most capital efficient assets. And so we really like our competitive position. Thanks, Nick.

1h 1m 50s

Thanks, Charles. Thank you. One moment for the next question, please. And our next question will be coming from the line of Zach Parram of JPMorgan.

1h 2m 2s

Your line is open.

1h 2m 5s

Thanks for taking my questions. First, Josh, you mentioned some meat on the bone left on driving D and C costs lower Have you built any of those incremental D and C declines into the CapEx budget I mean, you all been consistently coming in at the low end or below on CapEx. Over the last several quarters. So just trying to get a sense on if that trend could could be set to continue Yes. So what I would say is that for the $400,000,000 of synergy that does account for additional improvements. But I do believe and I have an expectation that we continue to find opportunities to enhance efficiencies through the year. And if realized, we'll create upside to the capital needed to Hey, Zach, one thing I would add to that is just as we think about our synergies over time, And this goes back to a little bit of a question that Doug was asking at the beginning of the call We've identified $500,000,000 in synergies that we think are very clearly tied to this merger.

1h 3m 21s

Now ongoing, one of the reasons you put together businesses like this and the reasons you're excited about it are that there's increasing opportunities each and every day to improve upon your business. So where we see the line between synergies that are directly tied to the to the merging of the two entities versus ongoing [indiscernible] post close.

1h 3m 47s

So we're going to be really accountable for this first $500,000,000 and then we're just going to continue to improve our business every day.

1h 3m 56s

Thanks. That's helpful color.

1h 3m 58s

And then just wanted to follow-up on a couple of the earlier questions.

1h 4m 2s

So you've currently talked about anchoring to that 7.5 Bcf a day level in 2026, which in the slide in the deck, that's based on a mid cycle price of $3.50 The strip is above that level over the next couple of years. Do you see any scenarios where you would move production higher from that 7.5 Bcf a day level in 2026? Just trying to get a sense it's of how flexible you could be there both going higher and lower You certainly could go higher, Zach. Think it would take underwriting a price above $4 If you look at that heatmap chart, you can see that for us to be comfortable targeting a price above or targeting a level of production above 7.5 Bcf a day, you probably want to be underwriting a price, meaning you have confidence in a forward look for two to three years that's $4 or higher not quite where we are today.

1h 4m 58s

The dynamics for the gas market are super constructive. And we feel really good about the near term here.

1h 5m 5s

But we also know that like I mentioned earlier, These prices will elicit a supply response. And so we want to make sure we're not getting in front of that and we're thinking through that and prepared for how that dynamic will will evolve over time. Our market never responds perfectly and is always overreacting to one side or the other. But given the lack of rig count increase that we've seen as we've gone through this winter, we do think that the supply response should be a bit more muted this time. Than what we've seen in some past cycles. And we think that's a really encouraging sign for the health the market longer term. If any of those dynamics change and you see that the lookout into 'twenty six, 'twenty seven, 'twenty eight, maintains a more constructive dynamic of supply and Expand, then yes, we could underwrite a higher price I think the most likely thing that would drive that would be if we felt that the utilization of LNG on the Gulf Coast would remain at or near 100 LNG LNG around the globe maintained a strong pull on U. S. Supply through that entire period. We need to see that evolve.

1h 6m 24s

We're not quite there today. [indiscernible] [indiscernible] growth demand story in The U. S. Is another angle could surprise to the upside. You'd have to see a real acceleration. In how those plants are built, where they're built, and our ability to supply gas to them. Now we really like our position for the power demand growth story in The U. S. Because we are regionally diversified because we have access to infrastructure that can allow us to grow. So there's a good news story around all of those things. We want to see that play out before we would underwrite a higher price. And I'm using the word underwrite very intentionally. Right? We think about making a multiyear investment decision and we think about it as an underwriting decision, that should have an appropriate level of conservatism to it and be prepared to capture upside when it's available to us.

1h 7m 17s

Thanks, Nick. That makes a lot of sense.

1h 7m 21s

Thank you. And our last question will be coming from the line of [indiscernible] Of Truist, your line It's open.

1h 7m 33s

Hey, good morning guys. Thanks for getting me on the potential data center agreements. Maybe what are your thoughts on how involved you need to be in the project? I guess, where on the spectrum do you fall if maybe all the way on one side is you need to be a part of the upfront spend or maybe all the way on the other side where you just provide the gas and get a a fixed price or a premium? And do you think there's room for a consortium of names to provide the gas supply? Or should it be more siloed with each producer having kind of their own individual agreement?

1h 8m 6s

Those are good questions, Bert. And I don't think they're completely known yet. Open to all commercial structures associated with the creation and support of long term demand for our industry. What we like about those projects is they do represent long term structural Expand.

1h 8m 22s

Really sticky not weather driven short term [indiscernible] So we're open to supporting that in a number of different ways, but we are also very cognizant of our cost of capital what would be efficient for our shareholders for us to invest. So, I don't know that we need to invest capital in the infrastructure, but under the right economic scenarios, would we? We do definitely focus on what it means from a bottom line standpoint for the gas that we sell and the opportunity that we have to create a total return on our activity. As to whether or not we can do supply agreements like that on our own or you need a consortium, Given our scale of supply, investment grade balance sheet, our ability to deliver gas to a number of different places, We're we're perfectly capable of doing things like that on our own. Maybe even uniquely so. And At the same time, if if there's a series of plants or a series of customers that want to have gas from multiple locations or want some diversity of supply, we can work with others on that as well. But we do think we're well situated to be a sole supplier for certain projects.

1h 9m 42s

Got you. Very clear. And then just shifting gears a little bit, you outlined most of the potential growth in the productive capacity scenario would come from the Haynesville, but I I assume maybe some growth happens in Appalachia at higher prices.

1h 9m 54s

And a few of your peers outlined growth plans in Appalachia that I think assume in basin demand is going to materialize. But could you maybe talk about if you're seeing availability of transportation pickups? I mean, are there roll offs of other operators that aren't growing?

1h 10m 11s

Just maybe how you think about it, there is Appalachian growth, where do those incremental volumes head? Thanks Another good question, Bernard. I think there's a little bit of all of that not maybe in huge size. So there's always a little bit of roll off from others as the basins mature. When that happens, we're really well positioned should we want it to take advantage There's definitely some in basin demand growth And like I said, we're in the middle of a lot of those conversations to try to help encourage that. Is discussion of new infrastructure and you've seen some of that in the press lately and we're going to pay really close attention to that And if those projects make sense, we'll be a part of that as well.

1h 10m 49s

The assets that we have in Appalachia, particularly our Northeast Pennsylvania position, the most economic gas The United States. Durable demand you should expect we will [indiscernible] and achieve. So those things are hard to make happen or they would have happened several times over. But there's probably a better opportunity to see those things happen today than there has been in quite a long time.

1h 11m 25s

And that does conclude today's Q and A session. I would like to turn the call over to Nick for closing remarks. Please go ahead.

1h 11m 33s

Thanks everybody for joining the call today. We're really and 2026 has in store for us. The market's been volatile. And we are better prepared for that [indiscernible] We look forward to using that preparation and flexibility in our business to create incremental and attractive return for shareholders We'll all be on the road quite a bit over the next few weeks Expand so probably see several of you out on the conference circuit and look forward to engaging with everybody.

1h 12m 5s

This does conclude today's teleconference. Thank you so much for joining. You may all disconnect. [indiscernible]

Key Insights

EXE has enhanced its 2025 outlook, expecting to produce approximately 7.1 Bcf per day with a capital investment of $2.7 billion, and plans to invest an additional $300 million to build 300 MMcf per day of productive capacity for potential 2026 production of 7.5 Bcf per day, contingent on market conditions.
The company anticipates achieving $400 million in annual synergies by 2025 and the full $500 million target by year-end 2026, driven by operational efficiencies, including a 20% improvement in Haynesville drilling costs and time.
EXE expects to end 2025 with less than $4.5 billion in net debt, supported by a $500 million debt reduction target and a strong free cash flow outlook, with additional cash allocated to variable dividends, share repurchases, and balance sheet improvements.
The company is strategically positioned to capitalize on growing LNG demand, with 2.5 Bcf per day of capacity to deliver gas to the Gulf Coast LNG corridor by the end of 2026, and is exploring diversified revenue opportunities through LNG and other long-term supply agreements.
EXE maintains flexibility in its capital allocation strategy, with plans to adjust production levels based on market conditions, targeting a mid-cycle price range of $3.50 to $4 per Mcf, while continuing to optimize operational efficiencies and infrastructure utilization.

Recent Transcripts

Extendicare delivered strong Q4 and FY 2024 results with significant NOI and margin growth.

Enhanced 2025 outlook highlights natural gas production growth and financial resilience.

Income Statement

Revenue

	2020	2021	2022	2023	2024
Revenue	$5.2B	$7.3B	$11B	$7.8B	$4.2B
Cost of Revenue	$4.6B	$4.9B	$3.3B	$2.9B	$3.2B
Gross Profit	$620M	$2.4B	$8.2B	$4.9B	$1B
Gross Profit %	12%	33%	71%	63%	25%
R&D Expenses	$0	$0	$0	$0	$0

2020

2021

2022

2023

2024

Revenue

$5.2B

$7.3B

$11B

$7.8B

$4.2B

Cost of Revenue

$4.6B

$4.9B

$3.3B

$2.9B

$3.2B

Gross Profit

$620M

$2.4B

$8.2B

$4.9B

$1B

Gross Profit %

12%

33%

71%

63%

25%

R&D Expenses

Cash Flow

Net Income

	2020	2021	2022	2023	2024
Net Income	-$9.8B	$6.3B	$4.9B	$2.4B	-$714M
Dep. & Amort.	$1.5B	$995M	$1.8B	$0	$0
Def. Tax	-$10M	-$106M	-$1.3B	$428M	-$123M
Stock Comp.	$21M	$0	$22M	$33M	$38M
Chg. in WC	$915M	$814M	-$123M	$275M	-$315M

2020

2021

2022

2023

2024

Net Income

-$9.8B

$6.3B

$4.9B

$2.4B

-$714M

Dep. & Amort.

$1.5B

$995M

$1.8B

Def. Tax

-$10M

-$106M

-$1.3B

$428M

-$123M

Stock Comp.

$21M

$22M

$33M

$38M

Chg. in WC

$915M

$814M

-$123M

$275M

-$315M

Balance Sheet

Cash

	2020	2021	2022	2023	2024
Cash	$279M	$905M	$130M	$1.1B	$317M
ST Investments	$19M	$5M	$34M	$637M	$0
Cash & ST Inv.	$279M	$905M	$130M	$1.8B	$317M
Receivables	$746M	$1.1B	$1.4B	$593M	$1.2B
Inventory	$0	$0	$0	$0	$0

2020

2021

2022

2023

2024

Cash

$279M

$905M

$130M

$1.1B

$317M

ST Investments

$19M

$5M

$34M

$637M

Cash & ST Inv.

$279M

$905M

$130M

$1.8B

$317M

Receivables

$746M

$1.1B

$1.4B

$593M

$1.2B

Inventory

Go Deeper

Financial information provided by Financial Modeling Prep. Options data provided by Unusual Whales. Live transcripts provided by Quartr. All data is provided for informational purposes only, and is not intended for trading purposes or financial, investment, tax, legal, accounting or other advice. · See all tickers.

OverviewOverview
News & Market InsightsNews & Market Insights
PeersPeers
Recent TranscriptsRecent Transcripts
RelatedRelated
EarningsEarnings
Income StatementIncome Statement
Cash FlowCash Flow
Balance SheetBalance Sheet

Earnings

Report Date

—

Rev Estimate

—

Avg 1d Change

2.01%

Report Period

Q4 2024

EPS Estimate

—

Implied Move 1d

—

Transcript

12m 31s

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18m 27s

Thank you. Our first question will come from the line of Matt Portio of TPH. Your line is open.

18m 55s

Good morning, Nick and team.

18m 57s

19m 26s

20m 37s

Stronger market growing volumes. That always feels good.

20m 41s

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25m 35s

26m 27s

Thank you.

26m 30s

Thank you. One moment for the next question. And our next question will be coming from the line of Doug Leggate of Wolfe Research. Your line is open.

26m 43s

Hi, good morning, everyone. Thanks Thanks for taking my questions. Nick, I've got two if I may.

26m 50s

I guess the synergy number, we're all kind of watching that.

26m 53s

27m 34s

28m 34s

29m 47s

30m 5s

Got it.

30m 6s

31m 2s

32m 17s

Thanks a lot for the answers.

32m 25s

And our next question will be coming from the line of Scott Hanold of RBC. Your line is open.

32m 32s

33m 7s

Hey, good morning, Scott.

33m 8s

33m 25s

34m 41s

35m 7s

36m 42s

37m 31s

Thank you for that.

37m 35s

Thank you. One moment for the next question. And our next question will be coming from the line of Kevin MacDermot of Morgan Stanley. Your line is open.

37m 48s

Hey, good morning. Thanks for taking my questions.

37m 52s

38m 24s

39m 37s

40m 50s

I'll ask Josh to comment just on the trajectory of production this year and going into next because we gave a lot of thought about that. As we have the flexibility with our deferred till strategy.

41m 2s

41m 32s

But instead we were able to bring them on into a very strong environment with roughly $4 gas We feel really good about that decision.

41m 40s

42m 22s

43m 6s

44m 36s

45m 25s

Hi, it's Neil Mady here. Can you guys hear me okay?

45m 30s

Yes, sir.

45m 31s

All right, Nick. So I just wanted to spend some time just talking about return of capital and capital allocation and those three tranches.

45m 40s

That you outlined in the deck and your objectives here in 2025 as you transition from delevering to focusing potentially on shrinking your share count too?

45m 52s

46m 15s

We paid down $389,000,000 of bonds that maturing in January. And then we've done another refinancing of course with our first investment grade issuance.

46m 29s

That allowed us to push out some maturities. So we have a really good runway in front of us to retire debt and a lot of cash flow to do it.

46m 37s

46m 53s

48m 9s

49m 25s

50m 47s

And when you see that, and you want to go ahead and lock in those prices. So that's what we'll continue to do. Thanks, Nick.

51m 8s

And our next question will be coming from the line of John Freeman of Raymond James. Your line is open. Good morning. Thanks.

51m 17s

51m 53s

53m

53m 32s

54m 7s

Got it. Thank you all.

54m 11s

Thank you. One moment for the next question.

54m 15s

And our next question will be coming from the line of Paul Diamond of Citi. Your line is open. Paul, your line is open. Apologies, the line cut there for a second.

54m 38s

54m 56s

56m 8s

56m 29s

56m 48s

57m 15s

Understood.

57m 16s

Appreciate the clarity. I'll leave it there.

57m 20s

Thank you. One moment for the next question. And the next question will be coming from the line of Charles Meade of Johnson Rice. Your line is open.

57m 32s

Good morning, Nick, to you and Josh and the rest of the Xperon team there.

57m 37s

57m 52s

58m 40s

59m 4s

59m 53s

But you move above and below that dash line based on the nearer term conditions in the market.

1h 3s

That is helpful, Nick.

1h 5s

1h 1m 20s

1h 1m 50s

Thanks, Charles. Thank you. One moment for the next question, please. And our next question will be coming from the line of Zach Parram of JPMorgan.

1h 2m 2s

Your line is open.

1h 2m 5s

1h 3m 21s

1h 3m 47s

So we're going to be really accountable for this first $500,000,000 and then we're just going to continue to improve our business every day.

1h 3m 56s

Thanks. That's helpful color.

1h 3m 58s

And then just wanted to follow-up on a couple of the earlier questions.

1h 4m 2s

1h 4m 58s

The dynamics for the gas market are super constructive. And we feel really good about the near term here.

1h 5m 5s

1h 6m 24s

1h 7m 17s

Thanks, Nick. That makes a lot of sense.

1h 7m 21s

Thank you. And our last question will be coming from the line of [indiscernible] Of Truist, your line It's open.

1h 7m 33s

1h 8m 6s

1h 8m 22s

1h 9m 42s

1h 9m 54s

1h 10m 11s

1h 10m 49s

1h 11m 25s

And that does conclude today's Q and A session. I would like to turn the call over to Nick for closing remarks. Please go ahead.

1h 11m 33s

1h 12m 5s

This does conclude today's teleconference. Thank you so much for joining. You may all disconnect. [indiscernible]

Key Insights

EXE has enhanced its 2025 outlook, expecting to produce approximately 7.1 Bcf per day with a capital investment of $2.7 billion, and plans to invest an additional $300 million to build 300 MMcf per day of productive capacity for potential 2026 production of 7.5 Bcf per day, contingent on market conditions.
The company anticipates achieving $400 million in annual synergies by 2025 and the full $500 million target by year-end 2026, driven by operational efficiencies, including a 20% improvement in Haynesville drilling costs and time.
EXE expects to end 2025 with less than $4.5 billion in net debt, supported by a $500 million debt reduction target and a strong free cash flow outlook, with additional cash allocated to variable dividends, share repurchases, and balance sheet improvements.
The company is strategically positioned to capitalize on growing LNG demand, with 2.5 Bcf per day of capacity to deliver gas to the Gulf Coast LNG corridor by the end of 2026, and is exploring diversified revenue opportunities through LNG and other long-term supply agreements.
EXE maintains flexibility in its capital allocation strategy, with plans to adjust production levels based on market conditions, targeting a mid-cycle price range of $3.50 to $4 per Mcf, while continuing to optimize operational efficiencies and infrastructure utilization.

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