Permian Resources Corporation ((PR)) has held its Q3 earnings call. Read on for the main highlights of the call.
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The recent earnings call for Permian Resources Corporation was marked by a generally positive sentiment, highlighting significant achievements in free cash flow, production outperformance, cost reductions, and successful acquisition strategies. However, some uncertainties lingered regarding future guidance and the potential impacts of lower commodity prices.
Record Free Cash Flow
Permian Resources Corporation reported its highest quarterly free cash flow per share since inception, despite a challenging commodity environment. The company achieved an adjusted operating cash flow of $949 million and a record adjusted free cash flow of $469 million, showcasing its robust financial performance.
Production Outperformance
The company exceeded expectations with its oil production, reaching 187,000 barrels per day, a 6% increase from the previous quarter. Total production was recorded at 410,000 barrels of oil equivalent per day, demonstrating strong operational capabilities.
Cost Reductions
Permian Resources successfully reduced controllable cash costs by 6% quarter-over-quarter. The company lowered its Lease Operating Expense (LOE) to $5.07 per Boe and Drilling & Completion (D&C) costs to an average of $7.25 per foot, reflecting its commitment to cost efficiency.
Debt Reduction and Credit Upgrade
The company made significant strides in reducing its outstanding debt by over $450 million. This financial prudence was rewarded with a positive credit outlook upgrade from Moody’s and an investment-grade credit rating from Fitch.
Successful Acquisition Strategy
Permian Resources closed 250 deals, primarily in New Mexico, adding 5,500 net leasehold acres and 2,400 net royalty acres for approximately $180 million. This strategic acquisition enhances the company’s asset portfolio and growth potential.
Gas Marketing Agreements
The company entered into agreements to sell approximately 330 million cubic feet per day out of the basin in 2026, increasing to 700 million cubic feet per day in 2028. These agreements are expected to realize $1 per Mcf higher pricing, improving future revenue streams.
Delayed 2026 Guidance
Permian Resources decided to delay its 2026 guidance until February, leaving investors uncertain about future production and capital expenditure plans. This decision introduces some uncertainty into the company’s long-term strategic outlook.
Potential for Lower Commodity Prices
The company acknowledged the potential for oil prices to fall to $40, which could impact dividend sustainability and capital allocation strategies. This acknowledgment reflects the company’s awareness of market volatility and its potential effects.
Forward-Looking Guidance
During the third-quarter 2025 earnings call, Permian Resources increased its full-year production guidance to 181,500 barrels of oil per day while maintaining its CapEx guidance. The company plans to leverage its technical expertise and cost structure to drive long-term value, with 2026 expected to be a capital-efficient year. Improved gas marketing agreements are anticipated to enhance netbacks, contributing to the company’s strategic flexibility in capital allocation.
In summary, Permian Resources Corporation’s earnings call was characterized by positive achievements in financial performance, production, and strategic acquisitions, despite some uncertainties regarding future guidance and commodity prices. The company’s focus on cost efficiency and strategic flexibility positions it well for future growth, although market volatility remains a concern.