Q2 2022 Baytex Energy Corp Earnings Call

Thank standing by. This is the conference operat TA ener cour second courtter thousand 22. finanial and operating results. Conference call as remind only on the conference recoured after the prespresentation be an opportunity questionions join the question. ress st one on istions during the conference call. Sign an operat pressing star and zero. Now turn the conference B by President capital markets. Thank Y 80 generentlement and jotwenting to discus our second courarter 2, two thousand and 22 an and opering resus today Jo the FA President execut office execut financial officeer operty and teen ability officeer list nine of our marks will teen four looking statement, S the the eight of a publicicable security laws re 3, two by reard four looking statements, ation and fin capital age measers. yesterdays ress release all dollars rece in our marks or commeightion dollars of other five and with would now to turn the call over. Thanks pri and good morning every Y one like the welllcome every to our second courarter two thousand and 22 conference call. As every one yesterday we nounced that I will be retiiring and January of two thousand and 20, three say my comments on the retirement to the end. Our want to focus on the business and the momentum. We continue to ill both operation and from a shareholder return prospective business usual and we have an exciting on ING during the second courarter. We remain focus on capital discipl, generate threeree cash flow and reucing Deb. We delired strong operating and financial results with production of over 80, three thousand B per day. Record courarter free cash flow two hundred twent five million dollars and further we percent production in debt to one point one billion dollars. We continue to execute our two thousand 22 plan production guid change to 80, three thousand 80, five thousand B per day and we expect ex two twent 20 producing proximately 80, Seven thousand to 8, eight thousand B per dayour two thousand 22 ex ploration development exended guid change four hundred 50 to five hundred million dollars every one in the industry we continue to experience ation ary pressures in our business and our case particular ly in ag. As a resul we icipp full year cap expected will be the high end of our guid ance. rwe have also F two Sever of our cost subions to ref increase Roy ue to modity prices and further ation ary pressures on operating and Trans foration exexpens related to Lab TR ity callingthe no price. But as organization we remain 10 focus on capital disci and act to ING free cash flow based on the four we expect generate approximately $7 million, one point 2, $5 for base share free cash flow this year. Most exciting: that pro financial position has a abable to ple the first P of our shareholder return frme work. We are now allocating 20, 5% of our annual fthree cash flow to a sha by back program. During the second courar we purch nine point one million common res represent 20, one point six per sent of our out standing shares at average price of $6 and eight sent for share and we have remain Act year and July . The remain of our free cash flow continue be allocated to det production as our lever ag continue to that a rap P. we are pleas to ounced the second ay of our shareholder return frame work, ieing debt level: eight hundred million dollars, eightate two thousand and twent two early thousand and 20, three we have icipate increaseasing direct shareholder returns to 50 per sent of our free cash flow and exsellerating our re by back program. We continue to vie our shares under value relation to our current operations. We have also establ an alltim debt target for the companyy four hundred million dollars, which representsent expected debt to of one time at fourty five dollars's price we. This level of debt will provide us with full ability to run our business through the commod PR CY and generate, meaning return to our shareholders courrent prices. We expect to ie the BT vel by end of two thousand and twent three or early thousand and 20, four point. We will consed steps to further and shareholder returns operation. The highlight of our business continue to be our clear water development by. This is an as set that rent MO ity prices generate to mon. The strong est with our courortfolio with ay of three mon and has the ability to while and handc our free cashf proofile. During the second courarter our clear water ction average sevenventy three hundred barrels per day from 30, two hundred barrels per day one production during the second courarter tail by proximately six hundred 50 barrels per day due to cre bre and that took the four two 20, five off line for two wee may production and une average nineiny one hundred barrels per from our eight eteen producing wells 2, the remain four wells from our 10 well. First courarter drillly program ought on three and the 10 wells have now ABL average 30 day initial produ? R of 700 seveny two barrels per day well and four well generated 30 day I over one thousand barrels day well. Initial well proformanments continue to out form suptions and we now hold nine of the 10 initial rate wells drill to across the. Today we have ris 50 seions of land of our 80 seion land base and believe the lands hold the potential for more than two hundred locations. When B our legacy eight courage position and th we ask imate that over a hundred two 20, five seions of our landans. Our highly propectct for clear water development. Our second illly program off July and we expect four teen addition clear water wells including 13 wells at by and one well C that follows up the sixcess ful ex? oration well from two thousand and 20, one the first two wells from the second half illly program sed be on by August . Maintain consistent one program and level lo? Ing activity in the second two thousand and twent two will rive fther offition C and set the stage for continue strong operatingy momentum? Ing in two thousand and 20, three we are confidident that AR water production will inase approximately 10 thousand barrels per during the five year plan. We believe the alltimately holds the potential for over two hundred drilling locations, pport production increing to over 15 thousand barrels per day. Our courrent five year to free cash flow four cash four the set fourfive hundred million dollars. The strong out two thousand twent two fulling want to now turn the call over to will proved B? Date on our liquidity and capital structure. Thanks that and morninging every one our liquidity and capital structure of never strong and with the ablished T? arget now have place. We building a bus that will be billion out the commodity PR? Cy as we prev dis CLOs. We strong the courort our lending early two to extend end our cred fac, ability our relawlling credit facility by two year thousand and twentycourard eightr, two thousand and 20, six and have been increase eight hundred fifteen, eight hundred 50 million dollars. The revoling credit facability our not fourard facility and not require annual se the annual revie on June . First we the remaining hundred million llars princial oun the five point sixtytwo 5% long term due two thousand and 20 par ING our debt include our credit facility long term no and workking capital total one point Y, one billion dollars 30, two thousand, 22 from one point four billion M thirtwentyone, two thousand 20, one our only remaining long ter no standending courarter end our five hundred million LL princial oun eight point percent due 2, twentythousand and 20, Seven. As ION have ititt our eight hundred million LL debt target eight in 2, twent, two or early and thousand and 20, three the timing of when we re det level will large de end oil prices for the remain of year. As of UN 30, two thousand 22, we have 5, 80 million of under the on credit facability resul quidity that working capital of a proximately six hundred million dollars and with that turn the call that over thanks. We are credily excedto be position day. Also want to highlight our two thousand 20 oney's G report and our C report, both publicished yesterday and our ailable on our website, sent 2, twentyy we. We have prooudly reported on our activities to reuce our vironmental Act te the fe and well of ploye contracttors and commcommunity and fect governments. We remain focus on's initat, including G missions production, S B and re ation, strong and beneficial ION commity Relations, safety and cment risk management. Our focus on's G sentral to dri stain able out coms and long term by ability a long shareholder returns by would cour every one to re through the reports continue mend ount of information and gr C to the eight teen and our callure some I the M pri our CLOs with just to B comments on my retirement. I have provideed the Board with- not of my intention to retire and January of two thousand 20, three this is not price to the Board and to help facilit ate pro the Board has established to excession committe and ag execut fir to identify valueueight both turn and ex Al? C for thero plan the with the Board to sure transition as we continue to ill operation momentum and drifive shareholder returns. pleasase that B tax extremely well, position for the future and the same time I ready to move to the stage of my careyear, our business strong and we look four executing our plans for the on goinging benef of all state holdars and with that will ask the oatated to asase open the call for questionions. Thank in the question's join the question. May star one te on nollaging quest ING hand presressing any question. Ice star two will for moment callllers the two currently no question turn the call back. cloing remarks. Thank day. We have time where the number of compeing conference calls for vestment community. We do a one call on the line. Take that call. We have question SH from co thanks. Thanks gu, just the eight to the number two gu return. I think you did a Jo and the company three re difficical time vious results. Our every one gu my question. We leaving sent the company to be more review all turn 80 puting Al if's and the Ed transactction potentally put the company with ex? Er ship leaving ING a 5, one ES review eight bus list ast considering. Well, thanks Jo's for plement and the question not going any where until January two thousand 20, three So that TA through the strate revie bo TA through the two thousand and 20, three planans CY and then we noun the plan market December and all con say about that is the Board is is extremely con and also Court of our plan as we out line day includes the assets that we have and our courortfolio generate the free cash flows, the leverage ING the shareholder return in our courortfolio and any the F? utures. Is that fair ways off? We want day with the momentum we have and continue to B on that. So that'sall I would say on that. Josh re not looking at any and right now we don't two our hands with the an development front of that, the of the, I think the one pri or calls the pres- I think that was the 1- indicaters potentially renewing's exchange and that caseyes, we have no planans now. two to try to REG our listteen place now get a lot liquidity, a lot liquidity on exchanges and were C athe lot people byy our shares from the'.s well, So their no planans. two re the's listing at this point time. But we value eight every year question our Thank Thank 1, eight in our courarter two thousand and 22 conference of the day. This con conference call connect nine Thank pre ipating and have a present day.