The following is a summary of the PHX Minerals Inc. (PHX) Q3 2024 Earnings Call Transcript:

Financial Performance:

• Reported Q3 2024 natural gas, oil, and NGL sales revenues of $7.9 million, down 20% sequentially.

• Total royalty volumes for the quarter were the second highest in PHX history, despite a 20% drop in production from Q2 2024.

• Net income for the quarter was $1.1 million, or $0.03 per share, compared to $1.3 million, or $0.04 per share in the previous quarter.

• Reduced total debt by $5 million, reaching $27,750, reflecting a lower debt burden and strong financial management.

• Reaffirmed the borrowing base under the bank credit facility at $50 million.

Business Progress:

• Notable increase in drilling activity in the SpringBoard III area, with approximately 40 gross wells currently in some stage of progress.

• Continued development on both legacy and newly acquired mineral assets, expected to lead to annually increasing royalty volumes.

• Invested $3 million in accretive mineral acquisitions during Q3 2024, showing disciplined and strategic capital deployment.

Opportunities:

• Bullish outlook for natural gas prices supported by new LNG export facilities and increased power demand driven by AI and data centers projections.

• Incremental increase of about 13 Bcf a day from current levels in U.S. LNG export volumes foreseen by 2028.

• Ongoing strategic acquisitions focused on high-quality drilling locations, aiming for a seven-year inventory sustaining operation without the need for aggressive acquisitions.

Risks:

• Delayed development decisions influenced by fluctuating natural gas prices and challenging macro environment.

• Volatility in realized commodity prices with natural gas prices averaging $2 per Mcf and oil prices at $74.83 which is a 3% decline from Q2 2024.

More details: PHX Minerals IR

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