As a result of operational outperformance from the most recent drilling campaign, and while supported by a now higher oil price strip, Highwood is in a position to increase its 2024 capital plan to $60–65 million (from $40–45 million) resulting in upwardly revised forecasted 2024 average & exit production guidance of 5,500–5,700 boe/d (+8% increase at midpoint) and 6,400–6,500 boe/d (+19% increase at midpoint), respectively, while continuing to maintain the same target 2024 net debt / 2024 exit EBITDA ratio of approximately 0.8x. Over the 12 month period ended December 2024, Highwood expects to grow production per share by over +50% (from prior forecasted +25%), while still reducing debt by approximately 25%.
Highwood is pleased to announce the following updates to its 2024 guidance:
|
Operating and Financial Metrics |
Forecast Guidance |
|
|
2024 Updated Guidance |
2024 Initial Guidance |
|
|
Production |
5.5–5.7 Mboe/d |
5.2 Mboe/d |
|
     Liquids |
75–78% |
~78% |
|
Adjusted EBITDA(1)(2) |
$82–87 million |
$72 million |
|
Capital Expenditures(1) |
$60–65 million |
$40–45 million |
|
Operating Netback (per boe)(3) |
$40.00–42.00 |
$39.00–41.00 |
|
Net Debt / 2024 Exit EBIDTA(2) |
~0.8x |
~0.8x |
|
2024 Exit Production |
6.4–6.5 Mboe/d |
5.2–5.4 Mboe/d |
|
(1) Based on Management’s projections (not Independent Qualified Reserves Evaluators’ forecasts) and applying the pricing ‎assumptions noted below. Management ‎projections are used in place of Independent Qualified Reserves Evaluators’ ‎‎‎forecasts as Management believes it provides investors with valuable ‎‎information concerning the liquidity of the Company.‎ |
|
|
(2) See “Non-GAAP and other Specified Financial Measures” and “Cautionary Note Regarding Forward-Looking Information”. |
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(3) See “Caution Respecting Reserves Information” and “Cautionary Note Regarding Forward-Looking Information”. |
Highwood is encouraged by the current market conditions and recent successful fourth quarter 2023 and first quarter 2024 capital programs. The Company is pleased to announce that it will be expanding its capital expenditure program from $40–45 million to $60–65 million, with the majority of the increased capital being deployed in the fourth quarter of 2024, and with the full benefits not being realized until early 2025. The majority of the capital expenditures are expected to be directed towards drilling, completion, equipping and tie-in activities. In the first quarter of 2024 the Company drilled 5.0 wells (5.0 net) with production from these wells exceeding internal projections. Highwood is currently planning to drill 6.0 wells (5.95 net) in the second half of 2024.
Highwood remains dedicated to growing its Free Cash Flow profile, on a per share basis, while using prudent leverage to provide it maximum flexibility for organic growth and / or other strategic M&A opportunities, with a longer-term goal to provide shareholders with a significant return of capital.
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