Bullboard - Stock Discussion Forum Whitecap Resources Inc T.WCP

Alternate Symbol(s): SPGYF

Energy Oil & Gas E&P

Whitecap Resources Inc. is an oil-weighted growth company. The Company is engaged in the business of acquiring, developing and holding interests in petroleum and natural gas properties and assets. Its core areas include the West Division and East Division. Its West Division is comprised of three regions: Smoky, Kaybob and Peace River Arch (PRA). The properties in its Smoky region include Kakwa... see more

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TSX:WCP - Post Discussion

Whitecap Resources Inc > RBC

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Post by retiredcf on Oct 23, 2024 9:06am

RBC

October 23, 2024

Whitecap Resources Inc.
Q3/24 Results - Slightly Ahead of Street

TSX: WCP | CAD 10.49 | Outperform | Price Target CAD 14.00

Sentiment: Neutral

Q3/24 results were slightly ahead of Street, leaving the company well positioned to meet/exceed FY24 guide and continue with meaningful return of capital. Management also unveiled its 2025 outlook, which was largely in line with prior street expectations. Reiterate Outperform.

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Key Points:

WCP reported Q3/24 production of 173,3052 boe/d (RBC: 170,110 boe/d; Street: 169,400 boe/d) driving AFFO (f.d.) of $0.68 (RBC/Street: $0.67/0.66).
Capital expenditures came below expectations at $273mm (RBC/Street: $300mm/$275mm); $136 million ($0.23/share) in FCF was generated in the quarter.
Whitecap exited Q3/24 with $1.4bn in net debt (RBC: $1.0bn) and pro-forma ~1.0bn debt while awaiting PGI final regulatory approval while in tandem returning 75% of FCF through a mix of its base dividend ($0.74/share) and NCIB utilization YTD. During the quarter, the company bought back 11.5mm shares for a total of $119mm.
The upper-end of WCP's 2024 production guidance increases slightly by 500 boe/d to 172,500 boe/d (from 172,000 boe/d); Capital spending of $0.9–1.1B was unchanged (RBC: $1.1bn, 170.7 mboe/d) and we expect a longer-term run-rate of $1.2–1.4bn.
Whitecap unveiled formal 2025 guidance, calling for production of 176-180 mboe/d (+5% y/y, prior RBCe: 179 kboe/d) and capital spend of $1.1-$1.2B (+15% y/y, prior RBCe: $1.2B). WCP plans to allocate 50% of its budget (550-600mm) to its Montney and Duvernay assets that includes drilling 30 (30 net) wells (67% Duvernay) and tieing in 34 (32.5 net) wells in 2025. The company plans to drill 190 (171.8 net) conventional wells in Alberta and Saskatchewan in 2025.
Operational highlights include; (1) WCP drilled its 11-14B pad (5 wells) and will be tied in by the end of February; (2) At Musreau, WCP completed drilling its last four well pad in 2024 with production expected prior to year end with one 4-well pad planned in H2/25; (3) In Kakwa, the company is drilling its first triple bench pad, testing each D2,D3 and Lower Montney. (4) WCP has one 4-well pad planned at southeast Kakwa including wider spacing in 2025; (5) At Lator, WCP is progressing with its technical analysis to coincide with its planned 04-13 battery in late 2026/27 with two wells coming onstream prior to year-end and two additional wells in 2025.