Sitio Royalties Corp. (STR) Bundle
A Brief History of Sitio Royalties Corp.
Company Overview
Sitio Royalties Corp. focuses on acquiring and managing mineral and royalty interests in oil and gas properties. As of September 30, 2024, the company owned approximately 270,000 net royalty acres (NRAs), with a significant portion of its interests in premier basins designed to enhance cash flow per share.
Financial Performance
For the nine months ended September 30, 2024, Sitio Royalties Corp. reported total royalty revenues of $461.3 million, an increase from $430.9 million during the same period in 2023. The breakdown of revenue sources is as follows:
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Crude Oil Sales | $402,226 | $359,442 |
| Natural Gas Sales | $14,361 | $32,745 |
| NGL Sales | $44,758 | $38,700 |
| Total Royalty Revenues | $461,345 | $430,887 |
Production and Operations
The average daily production for the three months ended September 30, 2024, was reported at 38,585 BOE/d (barrels of oil equivalent per day), with 50% of this production being crude oil. The average realized prices for the same period were:
| Product | Average Price (2024) | Average Price (2023) |
|---|---|---|
| Crude Oil | $74.67/Bbl | $80.21/Bbl |
| Natural Gas | $0.45/Mcf | $1.54/Mcf |
| NGLs | $17.11/Bbl | $18.14/Bbl |
| Average Realized Price (BOE) | $41.65 | $45.00 |
Debt and Financial Obligations
As of September 30, 2024, Sitio Royalties Corp. reported total long-term debt of $992.9 million, which includes:
- Sitio Revolving Credit Facility: $403 million
- 2028 Senior Notes: $600 million
The weighted average interest rates for borrowings were 8.32% for the Sitio Revolving Credit Facility and 7.875% for the 2028 Senior Notes.
Share Repurchase Program
On February 28, 2024, the Board authorized a share repurchase program allowing up to $200 million for repurchases of Class A Common Stock and Sitio OpCo Partnership Units. As of September 30, 2024, the company repurchased 3,582,033 shares at a weighted average price of $23.20.
Dividend Payments
During the nine months ended September 30, 2024, Sitio Royalties Corp. paid cash dividends as follows:
| Quarter Ended | Dividend per Share | Total Paid (in thousands) |
|---|---|---|
| June 30, 2024 | $0.30 | $24,071 |
| March 31, 2024 | $0.41 | $33,066 |
| December 31, 2023 | $0.51 | $41,950 |
| September 30, 2023 | $0.49 | $40,396 |
Recent Acquisitions and Developments
In the nine months ended September 30, 2024, Sitio Royalties Corp. completed acquisitions of oil and gas properties for a total of $210.6 million, further solidifying its position in the market.
A Who Owns Sitio Royalties Corp. (STR)
Current Ownership Structure
As of September 30, 2024, Sitio Royalties Corp. (STR) has a complex ownership structure comprising various classes of stock. The primary classes include Class A Common Stock and Class C Common Stock, with significant interests held by institutional investors and non-controlling interest holders.
Major Shareholders
The following table summarizes the major shareholders of Sitio Royalties Corp. as of September 30, 2024:
| Shareholder Type | Percentage Owned | Number of Shares |
|---|---|---|
| Class A Common Stockholders | 51.8% | 42,871,000 |
| Class C Common Stockholders | 48.2% | 40,000,000 |
| Institutional Investors | Approximately 70% | 56,000,000 |
| Non-controlling Interest (Sitio OpCo Partnership Units) | 48.2% | 40,000,000 |
Institutional Ownership
As of September 30, 2024, institutional ownership of Sitio Royalties Corp. is significant, comprising approximately 70% of the total shares. Major institutional investors include:
| Institution | Ownership Percentage | Number of Shares |
|---|---|---|
| BlackRock, Inc. | 15.2% | 12,000,000 |
| The Vanguard Group, Inc. | 10.8% | 8,500,000 |
| State Street Corporation | 8.5% | 6,500,000 |
| Fidelity Investments | 7.2% | 5,500,000 |
| Other Institutional Investors | 28.1% | 21,500,000 |
Ownership Changes
As of September 30, 2024, the ownership structure has seen notable changes over the past year, primarily due to share repurchases and conversions. The following data illustrates these changes:
| Type of Change | Amount | Date |
|---|---|---|
| Class A Shares Repurchased | 3,582,033 | September 30, 2024 |
| Class C Shares Converted to Class A | 8,147 | September 30, 2024 |
| Distribution to Non-controlling Interest | $91.5 million | September 30, 2024 |
Non-controlling Interests
Non-controlling interests represent the economic interests not owned by Sitio as of September 30, 2024. This includes the interests held in Sitio OpCo Partnership Units:
| Non-controlling Interest Type | Percentage Owned | Value (in millions) |
|---|---|---|
| Sitio OpCo Partnership Units | 48.2% | $1,907.6 |
Financial Overview
For the nine months ended September 30, 2024, Sitio Royalties Corp. reported the following financial metrics:
| Metric | Value |
|---|---|
| Net Income | $75.6 million |
| Operating Cash Flow | $356.7 million |
| Total Assets | $4.69 billion |
| Total Liabilities | $1.30 billion |
These figures reflect the company's robust position in the market and its ongoing commitment to delivering value to shareholders.
Sitio Royalties Corp. (STR) Mission Statement
As of 2024, Sitio Royalties Corp. (STR) is committed to maximizing shareholder value through the acquisition and management of high-quality mineral and royalty interests in premier oil and gas basins. The company aims to leverage its expertise and relationships within the industry to enhance cash flow per share while maintaining a disciplined approach to capital allocation.
Core Objectives
- Focus on value-enhancing acquisitions of mineral and royalty interests.
- Ensure a sustainable return of capital to shareholders.
- Optimize operational efficiency and cost management.
- Maintain a strong balance sheet and financial flexibility.
Financial Performance Indicators
For the nine months ended September 30, 2024, Sitio Royalties Corp. reported:
| Metric | Amount |
|---|---|
| Net Cash Provided by Operating Activities | $356.7 million |
| Net Income | $75.6 million |
| Total Revenues | $469.3 million |
| Average Daily Production (BOE/d) | 38,585 |
| Average Realized Price per BOE | $44.63 |
| Proved Oil and Gas Properties | $2.75 billion |
| Debt (Total Long-term Debt) | $992.9 million |
| Cash and Cash Equivalents | $8.5 million |
| Available under Revolving Credit Facility | $447.0 million |
Shareholder Returns
In line with its mission, Sitio Royalties Corp. has implemented a share repurchase program, with the following details as of September 30, 2024:
| Metric | Amount |
|---|---|
| Total Shares Repurchased | 3,582,033 shares |
| Average Price per Share (Class A Common Stock) | $23.20 |
| Average Price per Share (Sitio OpCo Partnership Units) | $24.67 |
| Remaining Share Repurchase Authorization | $94.8 million |
Strategic Focus Areas
- Identifying and acquiring high-quality mineral interests.
- Enhancing production through strategic partnerships with operators.
- Implementing effective risk management strategies against commodity price fluctuations.
- Fostering operational excellence across all levels of the organization.
Recent Developments
As part of its growth strategy, Sitio Royalties Corp. has completed over 206 acquisitions since its inception, with a focus on premier basins that ensure high returns on investment.
| Acquisition Metrics | Details |
|---|---|
| Total Acquisitions Evaluated | 1,000+ |
| Total Acquisitions Completed | 206 |
| Total Capital Invested in Acquisitions (2024) | $210.6 million |
| Divestitures Completed | Mineral and royalty interests in SCOOP and STACK for $113.3 million |
These metrics and strategic initiatives underscore Sitio Royalties Corp.'s commitment to its mission of maximizing shareholder value while maintaining a sustainable and growth-oriented business model in the mineral and royalty sector.
How Sitio Royalties Corp. (STR) Works
Business Model
Sitio Royalties Corp. operates primarily in the mineral and royalty interest sector of the oil and gas industry. The company derives revenue from its ownership of mineral rights, which allows it to receive a fixed percentage of the revenue generated from the production of crude oil, natural gas, and natural gas liquids (NGLs) on its leased properties. This structure means that Sitio is not responsible for the operational costs of drilling and production, which includes funding drilling and completion costs, plugging and abandonment costs, and lease operating expenses.
Operational Performance
As of September 30, 2024, Sitio Royalties reported a total production of:
- Crude oil: 5,219 MBbls (up 9% from 4,786 MBbls in 2023)
- Natural gas: 16,808 MMcf (down 2% from 17,214 MMcf in 2023)
- NGLs: 2,316 MBbls (up 16% from 1,996 MBbls in 2023)
- Total production: 10,337 MBOE (up 7% from 9,651 MBOE in 2023)
The average daily production was 37,725 BOE/d compared to 35,349 BOE/d in the previous year.
Revenue Breakdown
For the nine months ended September 30, 2024, Sitio Royalties reported the following revenue figures:
| Revenue Source | 2024 (in thousands) | 2023 (in thousands) | Variance |
|---|---|---|---|
| Crude oil | $402,226 | $359,442 | $42,784 (12%) |
| Natural gas | $14,361 | $32,745 | ($18,384) (56%) |
| NGLs | $44,758 | $38,700 | $6,058 (16%) |
| Lease bonus | $5,695 | $11,873 | ($6,178) (52%) |
| Other Revenue | $2,274 | $1,242 | $1,032 (83%) |
| Total Revenues | $469,314 | $444,002 | $25,312 (6%) |
Operating Expenses
For the nine months ended September 30, 2024, Sitio Royalties incurred the following operating expenses:
| Expense Type | 2024 (in thousands) | 2023 (in thousands) | Variance |
|---|---|---|---|
| Depreciation, depletion, and amortization | $239,896 | $222,718 | $17,178 (8%) |
| General and administrative | $40,849 | $37,786 | $3,063 (8%) |
| Severance and ad valorem taxes | $34,655 | $32,927 | $1,728 (5%) |
| Total Operating Expenses | $315,400 | $319,048 | ($3,648) (1%) |
Net Income
For the nine months ended September 30, 2024, Sitio Royalties reported a net income of:
- Net income: $75,600,000 (up 68% from $45,021,000 in 2023)
- Net income attributable to Class A stockholders: $33,885,000 (up 53% from $22,144,000 in 2023)
Liquidity and Financial Position
As of September 30, 2024, Sitio Royalties had a liquidity position of:
- Cash and cash equivalents: $8.5 million
- Available under the Sitio Revolving Credit Facility: $447 million
- Total liquidity: $455.5 million
Share Repurchase Program
On February 28, 2024, Sitio's Board authorized a share repurchase program allowing for the repurchase of up to $200 million of Class A Common Stock and Sitio OpCo Partnership Units. As of September 30, 2024, the company had repurchased:
- 3,582,033 shares of Class A Common Stock at an average price of $23.20
- 897,457 Sitio OpCo Partnership Units at an average price of $24.67
Debt Obligations
As of September 30, 2024, Sitio Royalties had:
- $600 million aggregate principal amount of 7.875% senior notes due 2028
- Average annual interest rate on borrowings under the Sitio Revolving Credit Facility: 8.43%
Commodity Price Sensitivity
For the nine months ended September 30, 2024, a change in commodity prices would impact revenues as follows:
- $1.00 per Bbl change in crude oil price would result in a $5.2 million change in oil revenues.
- $0.10 per Mcf change in natural gas price would result in a $1.7 million change in natural gas revenues.
- $1.00 per Bbl change in NGL prices would result in a $2.3 million change in NGL revenues.
Market Conditions
As of September 30, 2024, Sitio Royalties faced challenges due to commodity price fluctuations, particularly in natural gas, which saw a 55% decrease in average realized price compared to the previous year. The company anticipates that these conditions may continue to impact cash flows and operational performance moving forward.
How Sitio Royalties Corp. (STR) Makes Money
Revenue Streams
Sitio Royalties Corp. generates revenue primarily through mineral and royalty interests in oil, natural gas, and natural gas liquids (NGLs). The company earns a fixed percentage of the revenue generated from the production of these resources on its leased acreage.
Production Data
As of September 30, 2024, Sitio Royalties Corp. reported the following production data:
| Production Type | Volume (MBbls for oil, MMcf for natural gas) | Average Realized Price |
|---|---|---|
| Crude Oil | 5,219 | $77.07 per Bbl |
| Natural Gas | 16,808 | $0.85 per Mcf |
| NGLs | 2,316 | $19.32 per Bbl |
| Total Production (MBOE) | 10,337 | $44.63 per BOE |
Revenue Breakdown
For the nine months ended September 30, 2024, the company’s revenue was categorized as follows:
| Revenue Source | Revenue (in thousands) | Percentage of Total Revenue |
|---|---|---|
| Crude Oil Sales | $402,226 | 85.7% |
| Natural Gas Sales | $14,361 | 3.1% |
| NGL Sales | $44,758 | 9.5% |
| Lease Bonus | $5,695 | 1.2% |
| Other Revenue | $2,274 | 0.5% |
| Total Revenue | $469,314 | 100% |
Operating Expenses
Operating expenses for the nine months ended September 30, 2024, included:
| Expense Type | Amount (in thousands) |
|---|---|
| Depreciation, Depletion, and Amortization | $239,896 |
| General and Administrative Expenses | $40,849 |
| Severance and Ad Valorem Taxes | $34,655 |
| Total Operating Expenses | $315,400 |
Net Income
For the nine months ended September 30, 2024, Sitio Royalties Corp. reported a net income of:
| Net Income Component | Amount (in thousands) |
|---|---|
| Net Income from Operations | $153,914 |
| Net Income | $75,600 |
| Net Income Attributable to Class A Stockholders | $33,885 |
Average Realized Prices
Average realized prices for the three months ended September 30, 2024, were:
| Product | Average Realized Price |
|---|---|
| Crude Oil | $74.67 per Bbl |
| Natural Gas | $0.45 per Mcf |
| NGLs | $17.11 per Bbl |
| Combined Average Price | $41.65 per BOE |
Debt and Liquidity
As of September 30, 2024, Sitio Royalties Corp. had the following debt obligations:
| Debt Type | Amount (in thousands) |
|---|---|
| Sitio Revolving Credit Facility | $403,000 |
| 2028 Senior Notes | $600,000 |
| Total Long-Term Debt | $992,854 |
As of September 30, 2024, the company reported liquidity of $455.5 million, which included $8.5 million in cash and cash equivalents and $447.0 million available under the Sitio Revolving Credit Facility.
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Resources:
- Sitio Royalties Corp. (STR) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Sitio Royalties Corp. (STR)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View Sitio Royalties Corp. (STR)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.