Magnolia Oil & Gas Corporation MGY reported a fourth-quarter 2023 adjusted net income of 50 cents per share, which missed the Zacks Consensus Estimate of 54 cents. The bottom line also deteriorated from the year-ago quarter's level of 86 cents due to a decline in commodity prices.

Total revenues came in at $322.6 million, which missed the Zacks Consensus Estimate of $325 million. The top line also declined 4.9% from $349 million recorded in the year-ago period.

On Feb 5, 2024, South Texas-focused Magnolia declared a cash dividend of 11.5 cents per share of Class A common stock and a cash distribution of 13 cents per Class B unit, payable on May 1, 2024, to shareholders of record as of Feb 16, 2024. This represents a 13% hike to Magnolia's quarterly dividend rate. The company repurchased 2.5 million of its Class A common shares for $54.2 million in the reported quarter.

Magnolia Oil & Gas Corp Price, Consensus and EPS Surprise

Magnolia Oil & Gas Corp price-consensus-eps-surprise-chart | Magnolia Oil & Gas Corp Quote

Production & Prices

The average daily total output of 85,414 barrels of oil equivalent per day (boe/d) increased from the year-ago quarter's figure of 73,785 boe/d.The figure also beat our estimate of 85,000 boe/d.
Oil and gas production increased 15.8% year over year. Oil volumes totaled 35,466 barrels per day (bpd), up 9.8% from that reported in the fourth quarter of 2022. However, the figure missed our estimate of 36,500 bpd. 

The average realized crude oil price was $77.39 per barrel, indicating a 6.2% decline from the year-ago period's level of $82.53. The average realized natural gas liquids price was $19.69 per barrel, implying a 22.6% deterioration from the year-ago period's figure. Natural gas price decreased 61.2% year over year to $1.85 per thousand cubic feet. MGY recorded $41.06 per boe compared with $51.42 a year ago.

Balance Sheet & Capital Expenditure

As of Dec 31, Magnolia had cash and cash equivalents of $401.1 million and long-term debt of $392.8 million. The total debt-to-total capital was 17.3%.

The company spent $91.5 million on its capital program in the reported quarter. Operating expenses increased to $184.5 million from $151.1 million in the year-ago period.

Guidance

Magnolia expects to spend between $450 million and $480 million on D&C capital in 2024. The company anticipates first-quarter D&C capital expenditures to be around $130 million, which will be the highest quarterly rate of spending in 2024.

Total production for the first quarter is expected to be in the range of 84-85 Mboe/d, including several days of production and facility downtime caused by severe winter weather in mid-January.