Permian Resources Corporation Class A

Good morning and welcome to Permian Resources' conference call to discuss its second quarter 2026 earnings. Today's call is being recorded. A replay of the call will be available by visiting the company's website at www.permianres.com. At this time, I will now turn the call over to Hays Mabry, Permian Resources' Vice President of Investor Relations, for some opening remarks. Please go ahead.

Thanks, Eldie, and thank you all for joining us. On the call today are Will Hickey and James Walter, our Chief Executive Officers, and Guy Oliphint, our Chief Financial Officer. Many of the comments during this call are forward-looking statements that involve risk and uncertainties that could affect our actual results and are discussed in more detail in our filings with the SEC. We may also refer to non-GAAP financial measures. For any non-GAAP measure we use, a reconciliation to the nearest corresponding GAAP measure can be found in our earnings release or presentation. With that, I will turn the call over to Will Hickey, Co-CEO. Thanks, Hays.

Q2 is a standout quarter for Permian Resources. We delivered record free cash flow of $751 million, an increase of almost 50% quarter over quarter, and record free cash flow per share of $0.88. These results reflect our team's ability to respond quickly and decisively to a volatile commodity environment. Our activities this quarter are a reminder of the uniqueness of PR's business model. We can respond quickly to market conditions, we have a differentiated approach to sourcing and executing acquisitions, and we are relentlessly improving the capital efficiency of our business on a go-forward basis. All of these characteristics support the goal we are all aligned on, increasing free cash flow per share over the long term to create shareholder value. Turning to the quarter, oil production came in at approximately 198,000 barrels per day, up 3% quarter over quarter. Slide 4 shows the key drivers that drove that oil production growth. When oil prices moved higher, our team in the field responded immediately. We increased the number of work over rigs by 50%, which improved run times and quickly accelerated incremental barrels. At the same time, our successful ground game drove working interest in completed wells to approximately 82% for the quarter, up materially from our original expectations of 75%. Combined with strong well performance, these actions generated 6,000 barrels per day of oil growth quarter over quarter for cash capital expenditures of $521 million. One thing I'd highlight is our continued success increasing working interest ahead of development. This has always been part of the PR playbook, but our BD and land team have executed at an exceptionally high level this year. We view these acquisitions as some of the highest rate of return deals that we do, given that their near-term impact as evidence from our higher working interest not only in Q2, but also for the remainder of the year. Incremental workovers and ground game transactions are exactly the types of investments we want to make in a volatile market. Both generate incremental oil production and cash flow almost immediately, allowing us to recycle capital quickly and de-risk returns through shorter payback periods. Turning to natural gas, our team demonstrated their relentless focus on maximizing free cash flow as they navigated a severely depressed Waha market during the quarter. As many of you are aware, Waha natural gas prices averaged negative $3.14 per MCF during Q2 and traded as low as negative $9.52 per MCF. So, rather than selling natural gas at negative prices, we proactively curtailed production on high GOR wells with Waha exposure. reducing natural gas production by approximately 20% quarter over quarter. The curtailments combined with our firm transportation and hedging allowed us to realize a natural gas price of 38 cents per MCF for the quarter and an uplift of over 75 million of revenue on our natural gas sales. When Waha pricing improved in late June, we returned all previously curtailed wells to production without any operational issues. I want to give a big shout out to the field team for putting in the hard work to make this possible during the quarter. On the DNC side, we offset inflationary pressures from rising diesel prices with continued operational efficiency gains through longer laterals, increased water recycling, deployment of water-based mud, and new wellboard designs. We've also begun surfactant trials on completion and production operations. We're still early in evaluating surfactants, but we're encouraged by the initial results. between continued operational efficiency gains and the potential to improve recoveries, there are a lot of ways for us to continue our path of increasing capital efficiency. As you can see from today's results, the quality of our assets combined with our base and leading cost structure has driven a step change improvement to our business over the last several years. As a result, we achieved record free cash flow in Q2 of 751 million. This is more than we generated in all of 2023 and we expect full year 26 free cash flow to be nearly double what we generated in 2024. And with that, I'll turn it over to James.