On February 25, 2025, Range Resources Corp (RRC, Financial) released its 8-K filing detailing its fourth quarter 2024 financial results and providing a three-year outlook. The Fort Worth-based company, focused on operations in the Marcellus Shale in Pennsylvania, reported a GAAP net income of $95 million, or $0.39 per diluted share, for the quarter. This performance was below the analyst estimate of $0.51 per share. The company also reported GAAP revenues of $626 million, slightly below the estimated $682.90 million.
Company Overview
Range Resources Corp (RRC, Financial) is an independent exploration and production company with a focus on the Marcellus Shale in Pennsylvania. As of year-end 2023, the company had proven reserves totaling 18.1 trillion cubic feet equivalent, with net production of 2.14 billion cubic feet equivalent per day. Natural gas accounted for 69% of its production.
Performance and Challenges
Despite facing low natural gas prices, Range Resources Corp (RRC, Financial) demonstrated resilience by generating free cash flow and returning capital to shareholders. The company reduced its net debt by $172 million and returned $77 million in dividends. However, the low natural gas prices posed a challenge, impacting revenue generation.
Financial Achievements
Range Resources Corp (RRC, Financial) achieved significant financial milestones, including cash flow from operating activities of $945 million and cash flow from operations, before working capital changes, of $1.1 billion. These achievements are crucial for the company as they provide the necessary capital for reinvestment and debt reduction, which are vital in the volatile oil and gas industry.
Key Financial Metrics
In the fourth quarter of 2024, Range Resources Corp (RRC, Financial) reported adjusted net income of $164 million, or $0.68 per diluted share, surpassing the analyst estimate of $0.51 per share. The company's debt to EBITDAX ratio stood at 1.2x, indicating a strong balance sheet position. The company also maintained its proven reserves at 18.1 Tcfe, with positive performance revisions for the 17th consecutive year.
Dennis Degner, the Company’s CEO, commented, “Last year demonstrated the resilience of Range’s business as we successfully generated free cash flow, returned capital to shareholders and met our long-term balance sheet target. We did this despite natural gas prices being at cycle lows and while strategically investing in the business.”
Income Statement and Cash Flow
Range Resources Corp (RRC, Financial) reported a GAAP net cash provided from operating activities of $218 million for the fourth quarter. The cash flow from operations before changes in working capital was $312 million. The company invested $124 million in drilling and completion expenditures during the quarter, with total capital expenditures for 2024 amounting to $654 million.
Production and Pricing
The company's production averaged 2.18 Bcfe per day in 2024, with natural gas accounting for approximately 68% of the production. The average realized prices after hedges for natural gas, NGLs, and oil were $2.90 per mcf, $26.47 per barrel, and $70.66 per barrel, respectively.
| Expenses | 4Q 2024 (per mcfe) | 4Q 2023 (per mcfe) | Increase (Decrease) |
|---|---|---|---|
| Direct operating | $0.12 | $0.11 | 9% |
| Transportation, gathering, processing and compression | $1.48 | $1.39 | 6% |
| Taxes other than income | $0.03 | $0.02 | 50% |
| General and administrative | $0.18 | $0.17 | 6% |
| Interest expense | $0.14 | $0.14 | 0% |
| Total cash unit costs | $1.94 | $1.83 | 6% |
| Depletion, depreciation and amortization (DD&A) | $0.46 | $0.45 | 2% |
| Total unit costs plus DD&A | $2.40 | $2.28 | 5% |
Analysis and Outlook
Range Resources Corp (RRC, Financial) has shown a strong performance in the fourth quarter of 2024, surpassing analyst estimates for earnings per share. The company's strategic investments and focus on maintaining a strong balance sheet have positioned it well for future growth. With a three-year outlook targeting a production level of 2.6 Bcfe per day by 2027, the company is poised to capitalize on the growing global demand for natural gas.
Explore the complete 8-K earnings release (here) from Range Resources Corp for further details.
