Viper Energy reports Q2 EPS 42c, consensus 32c

As of June 30, the Company had a cash balance of $13.1M “Viper’s announcement today to increase its annual base distribution is a natural progression of our enhanced return of capital program that was implemented with second quarter earnings last year. Over the past year we have further improved our balance sheet, grown oil production by 7%, and reduced our unit count by roughly five million units. With the increased base distribution currently representing over a 4% annualized yield, Viper has the balance sheet strength and durable cash flow profile to support this level of committed return of capital through the cycle. Additionally, while we still plan to opportunistically repurchase units, this increase to our base distribution highlights our commitment to a sustainable and growing return of capital through cash distributions over the long-term,” stated Travis Stice, Chief Executive Officer of Viper’s General Partner. Stice continued, “The results from the second quarter demonstrate the high-quality nature of Viper’s royalty assets as well as the advantaged relationship we have with Diamondback as oil production increased 5% quarter over quarter and set a fifth consecutive Company record. Looking ahead, we expect Diamondback to continue to focus their large-scale development on Viper’s high concentration royalty acreage. As a result, we have initiated production guidance for the third quarter that implies roughly 4% oil growth relative to the second quarter. Importantly, as assumed in our updated guidance, it is expected that Viper’s Diamondback-operated net oil volumes will increase over 15% for the full year 2023 with a further increase of roughly 10% expected for the full year 2024. With Diamondback doing almost exclusively large-scale development, and with Viper owning varying interests across the different developments, this growth will not always be ratable from quarter to quarter, but we expect the trend of meaningful growth on an annual basis to continue.”