Evolution Petroleum Corporation, Inc.

Good morning and welcome to the Evolution Petroleum first quarter fiscal year 2024 earnings release conference call. All the participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then 2. Please note this event is being recorded. I would now like to turn the conference over to Brandi Hudson, Investor Relations Manager. Please go ahead.

Thank you, and welcome to Evolution Petroleum's Fiscal First Quarter 2024 Earnings Call. I'm joined by Kelly Lloyd, President and Chief Executive Officer, and Ryan Stash, Senior Vice President, Chief Financial Officer, and Treasurer. We released our Fiscal 2024 First Quarter financial results after the market closed yesterday. Please refer to our earnings press release for additional information concerning these results. You can access our earnings release in the Investors section of our website. Please note that any statements and information provided in today's call speak only as of today's date, November 8, 2023, and any time-sensitive information may not be accurate at a later date. Our discussion today will contain forward-looking statements of management's beliefs and assumptions based on currently available information. These forward-looking statements are subject to the risks, assumptions, and uncertainties as described in our SEC filings. Actual results may differ materially from those expected. We undertake no obligation to update any forward-looking statement. During today's call, we may discuss certain non-GAAP financial measures, including adjusted EBITDA and adjusted net income. Reconciliations of these measures to the closest comparable GAAP measures can be found in our earnings release. Brian will begin today's call with a brief review of our fiscal quarter highlights, and then we'll turn over the call to Kelly for an update on our properties and plans as they relate to our ongoing strategy of maximizing total shareholder returns. After our prepared remarks, the management team will be available to answer any questions. As a reminder, this conference call is being recorded. If you wish to listen to a webcast replay of today's call, it will be available on the Investors section of our website. With that, I will turn the call over to Ryan.

Thanks, Brandi. As Brandi just mentioned, we released our earnings yesterday, which contains more information on our results. My comments will focus mainly on the highlights of the current quarter. In September, we entered into a participation agreement to horizontally develop a portion of the Chavarru oil field in the Permian Basin in New Mexico. This is exciting to us for a number of reasons. It provides evolution with over 80 gross and 40 net locations to horizontally developed an enormous proven oil field with an estimated 700 million barrels of original oil in place, with only 5% having been recovered to date. Of all of our development opportunities, we expect the Shavaroo field to provide the most economic and largest upside opportunity. Additionally, the deal was structured in a way where Evolution only pays upfront acreage costs for locations to be drilled within the upcoming development block, and the majority of the money we spend on this project goes where it will benefit shareholders the most, into the ground and towards producing oil. This quarter, we had total revenues of $20.6 million, net income of $1.5 million, and adjusted EBITDA of $6.7 million, all significantly higher than last quarter, primarily as a result of improved commodity prices and also due to improved operations at most of our properties. Negatively impacting this quarter was $500,000 in adjustments related to ownership updates received from the operator of our Barnett properties. These adjustments covered a 22-month period beginning in September 2021. These adjustments affected the top line and therefore reduced revenue, net income before taxes, and adjusted EBITDA, each by $500,000. For production, we were able to achieve a net 0% decline in production from the previous quarter to this quarter. We saw operational improvements in our Williston and Delhi assets from last quarter, offsetting declines in the Barnett Shale properties due to some continued operational challenges there. On the development side, we brought on two new producing wells at Delhi at the end of the current quarter, and subsequent to quarter end, drilled, encased one well, and spud another at our Chavarri field in the Permian Basin. Our second fiscal quarter will benefit from a full quarter production from the two new wells at Delhi, while the Chavarri wells are expected to begin impacting financial results by the end of the third fiscal quarter and be more fully reflected in the fourth fiscal quarter. After fully funding our operations, field development expenditures, and paying our dividends, we ended the quarter with increased working capital and maintained liquidity of approximately $60 million between cash on hand and $50 million in borrowing capacity. On the shareholder return front, we paid $0.12 dividend in September and declared another $0.12 dividend to be paid in December, which will mark our 40th and 41st consecutive quarterly dividends and 5th and 6th consecutive dividends at the current level. I'll hand it over to Kelly now.