Q4 2024 APA Corp (US) Earnings Call Transcript
Key Points
- APA Corp (APA) achieved a BBB- rating from S&P, marking it as investment grade with all three rating agencies.
- The company reported $420 million of free cash flow in the fourth quarter, the highest of any quarter in 2024.
- APA Corp (APA) successfully integrated Callon, achieving meaningful synergies and reducing breakeven oil prices to $61 per barrel.
- The company returned 71% of free cash flow to shareholders in 2024 through dividends and share repurchases.
- APA Corp (APA) is targeting $350 million in annualized cost savings by year-end 2027, with $35 million already identified and captured.
- The company's share price has been underperforming relative to its peer group, indicating a potential crisis of confidence among investors.
- Fourth quarter DD&A expense was higher than guidance due to accelerated depreciation at Alpine High.
- Lease operating expense came in slightly higher than guidance, largely due to an extra North Sea cargo lifting.
- There is a contingent liability increase of $190 million related to the Fieldwood properties, reflecting high cash costs for asset management.
- The company faces challenges in balancing its capital return framework with the need to address its capital structure and debt levels.
Thank you for standing by. Welcome to the APA Corporation's fourth quarter 2024 financial and operational Results. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. (Operator Instructions)
As a reminder today's program is being recorded. And now I'd like to introduce your host for today's program, Ben Rodgers, Senior Vice President of Finance and Treasurer. Please go ahead, sir.
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Good morning, and thank you for joining us on APA Corporation's fourth quarter and year-end 2024 financial and operational results conference call. We will begin the call with an overview by CEO, John Christmann. Steve Riney, President and CFO, will then provide further color on our results and outlook.
Also on the call and available to answer questions are Tracy Henderson, Executive Vice President of Exploration; and Clay Bretches, Executive Vice President of Operations. Our
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