The following is a summary of the PHX Minerals Inc. (PHX) Q2 2024 Earnings Call Transcript:

Financial Performance:

• PHX Minerals reported a significant Q2 2024 performance with total corporate volumes reaching the highest since Q2 of 2018.

• Total corporate production increased by 40% from the previous quarter due to high-impact wells in Haynesville.

• They reduced debt from $32.75 million at the end of 2023 to $28.75 million, enhancing their balance sheet strength.

• Natural gas, oil, and NGL sales revenues increased by 39% to $9.8 million, primarily due to a significant increase in production volumes.

• Net income reported for the quarter was $1.3 million, or $0.04 per diluted share.

Business Progress:

• PHX Minerals has successfully shifted its business focus, increasing royalty volumes while reducing non-operated working interest, emphasizing a transition to a mineral-only focus.

• Achieved a 30% CAGR for royalty volumes over the past four years despite significant working interest divestiture.

• Divested non-op working interests and reinvested into minerals in core focus areas, notably in Haynesville and SCOOP regions.

• Closed on approximately $3.5 million of mineral acquisitions year-to-date in SCOOP and Haynesville.

• Increased the quarterly dividend by 33%, reflecting strong balance sheet and confidence in business strategy.

Opportunities:

• The anticipated demand increase for natural gas due to new LNG export facilities and AI-generated power demand provides potential revenue growth.

• Existing deep inventory of undeveloped locations actively being developed, contributing annually to volume growth.

Risks:

• The volatile macro environment with fluctuating natural gas prices, and challenges in natural gas basins could impact development activities and financial performance.

• Dependency on third-party operators for well development timing introduces variability in production volumes.

More details: PHX Minerals IR

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