SM Energy Company

Greetings and welcome to the SM Energy's second quarter 2026 earnings call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note that this conference is being recorded. I would now like to turn the conference over to Megan Hayes, SM Energy's Vice President, Investor Relations. Thank you, Megan. You may begin.

Yes, thank you. Good morning and welcome to SM Energy's second quarter 2026 earnings call. I'm Megan Hayes, Vice President of Investor Relations. It's a busy morning for everyone, so we'll jump right in. Joining me are Beth McDonald, our President and CEO, Wade Pursell, our Executive Vice President and CFO, and Blake McKenna, our Executive Vice President and COO. Today's discussion will reference forward-looking statements. Please see slide two of our earnings presentation as well as the risk factors section of our most recent Form 10-K for risks and uncertainties that could cause actual results to deter materially. We will also reference non-GAAP financial metrics throughout the call. You can find definitions and reconciliations to the closest comparable GAAP metrics in yesterday's earnings release, Form 10-Q, and in the slide deck available on our website. When we get to Q&A, please limit your inquiries to one question and one follow-up, as this simply allows us to get more of your questions in today. With that, I'll turn it over to Beth.

Thanks, Megan. Good morning, everyone. The second quarter was our first full quarter operating as a combined asset. We generated $467 million of adjusted free cash flow, returned $137 million to stockholders, and have now actioned approximately 95% of our merger synergy target. Together, those results demonstrate that SM is already stronger, more cash generative and more valuable than either legacy business on its own. And they underscore why this platform is materially undervalued today. Integrate, execute, bolster. The framework for 2026 hasn't changed. And this quarter is proof that it's working. I'll take each in turn. On Integrate, we have now actioned approximately $355 million of our $375 million run rate synergy target, which we raised last quarter to nearly double the original. The organizational capability we brought to this merger is real, and it's now showing up directly in our cost structure, including a lower G&A outlook that Wade will cover. Overall, we are ahead of the pace that we laid out when we announced the merger. On Execute, Production averaged approximately 440,000 barrels of oil equivalent per day within our guidance range and building into the second half of 2026 pro forma for the divestiture of our Galvan assets in South Texas. On the strength of that trajectory, we are increasing our second half production outlook and reaffirming our full year capital plan. Wade will take you through that detail, but the takeaway is clear. We are executing within a disciplined capital framework and turning the combined platform into a higher free cash flow, higher return business for our stockholders. On bolster, we closed the Galvan divestiture, substantially achieving our billion dollar divestiture target within a year of the merger, and directed the proceeds to debt reduction, putting us on a visible path to low one times leverage. Alongside that, we also repurchased $84 million of shares this quarter under our capital return framework. In addition, with the cash on hand at quarter end, we provide a notice to redeem the remaining 2027 senior notes, underscoring the rapid progress we've made in strengthening the balance sheet. That combination, a stronger balance sheet and rising free cash flow with buybacks already underway, is a key part of why we believe SM's equity is so attractive today. In short, this quarter shows we are doing what we said we would do, integrating at pace, executing the plan, strengthening the balance sheet, and demonstrating the free cash flow and returns power of SM. I'll now turn the call over to Wade, who will cover the second quarter results and our guidance updates.