Expand Energy Corporation

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the Expand Energy Corporation fourth quarter 2025 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question, press star 1-1 on your telephone keypad. If your question has been answered or you wish to remove yourself from your queue, simply press star 1-1 again. As a reminder, this conference call is being recorded. At this time, I would like to turn the conference over to Mr. Colby Arnold. Sir, please begin.

Thank you, Howard. Good morning, everyone, and thank you for joining our call today to discuss Expand Energy's 2025 fourth quarter and full year financial and operating results. Hopefully, you've had a chance to review our press release and the updated investor presentation that we posted to our website yesterday. During this morning's call, we will be making forward-looking statements, which consist of statements that cannot be confirmed by reference to existing information COB, Chris Hagelin, Including statements regarding our beliefs goals expectations forecast projections and future performance and the assumptions underlying such statements. COB, Chris Hagelin, Please note that there are a number of factors that will cause actual results to differ materially from our forward looking statements. COB, Chris Hagelin, Including the factors identified and discussed in our press release yesterday and in other SEC filings. Please recognize that, except as required by applicable law, we undertake no duty to update any forward-looking statements, and you should not place undue reliance on such statements. We may also refer to some non-GAAP financial measures, which help facilitate comparisons across periods and with peers. For any non-GAAP measure, we use a reconciliation to the nearest corresponding GAAP measure and can be found on our website. With me on the call today are Mike Wistrich, Josh Feets, Dan Turco, and Brittany Rayford. Mike will give a brief overview of our results, and then we will open up the teleconference to Q&A. So with that, thank you again, and I will now turn the teleconference over to Mike.

Thanks, Kobe. Good morning. I'd like to start out by talking about 2025. I think we had a really phenomenal execution year. I mean, we have 15% reduction in our break-evens in the Hainesville. That is very difficult to do. The team should be sort of congratulated on that. It's sort of phenomenal. It doesn't just help our reinvestment rate. It also helps our inventory. You'll notice in the deck we've moved locations over to the left, getting closer to lower break-evens. I think that is a real attribute to the team. When we did the Southwestern merger, we focused on reducing debt. We're fulfilling that promise this year. We've reduced debt, but we also returned a lot of money to our shareholders, and we continue to think that's a good way for the company to continue. Volatility. Look, we're seeing volatility gas prices today. You've seen it all quarter. We believe in hedging and our hedging program has been effective. We have $200 million in gains this year, but I mean, just look at today's prices and we're glad we have them. You'll see we're very active this quarter. What I like about the 15% break evens and the Hainesville is, you know, they're real and they know they're real because when we talk about 26, we've reduced our maintenance capital. That absolutely is a proof positive that the team is working and it's working well. 26, we'll continue to do our buy down of debt. We'll also consider shareholder returns as we always have. Big news, of course, is the change that we made last week. That is really a reflection of the changing natural gas business. We believe the world has fundamentally changed in natural gas. We're seeing a tremendous growth in demand. We're seeing 35 to 40% in the next five years. This move is absolutely trying to address that reality. Today, our marketing business, while we think about it, is in sort of three buckets. The first bucket that we consider is how do we get our gas to premium markets? This has been a goal for the company from the very beginning last year. When we started in Chesapeake in 2021, we had our goal of removing these numbers. It was at the time we're almost all in basin sales. Today we're close to 50%. We feel good progress has been made. The second leg of marketing is we need to take care of volatility. We live in a very volatile gas market. We know that. And so by hedging, by doing storage transactions, this helps us in the low price environments. which we always are concerned about. It's about discipline. Hedging is about that. Our third, which we have not made as much progress and we're disappointed in, and we expect to do better is we need to capture and facilitate new demand. We need to get our fair share of this market. Our team has done some good stuff. We saw the LCM deal this year, but we have not done enough and we're sort of taking that challenge. And that is really some of the fundamental reasons why we're moving to Houston. In order to participate in that market, you can see you have to sort of compete on our trading side of our business or our marketing side. We're not the only ones who are saying this. I mean, you see wellhead to water. You see wellhead to watts. We have to think beyond the wellbore. We have to say it's not good enough anymore to just drill great wells. We have to compete on the marketing side of our business. What is the size of the prize? Been asked many times about that. I think the size of the prize we're chasing is 20 cents. We're looking for improved realizations across our business. We think that will make us competitive and a better energy company. These changes, as all changes, you have some things that are unfortunate. Obviously, our senior leadership has changed. That does not change our mission. That does not change our strategy. But what you're seeing is a change in tactics. and focus that we have a new business we have to spend time on that business what's not changing our operations have been great look at the results we're not changing our leadership we're not changing our location we plan to stay in oklahoma city with our ops team uh we josh is still leading that group and we don't expect to have changes there because frankly it works and so we don't do things that that don't work so when you think about us our sort of our sort of mantra is Our foundation is in place. Our strategy is clear. Opportunity set is huge. It is time for us to act. And so we're talking about urgency. We're talking about competitiveness. And so all we need to do to be successful is execute. So with that, we'd like to turn it over to questions.