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California Resources Reports Fourth Quarter and Full-Year 2023 Financial and Operating Results

LONG BEACH, Calif. , February 27 /Businesswire/ - California Resources Corporation (NYSE: CRC) today reported financial and operating results for the fourth quarter and full-year 2023. The Company plans to host a conference call and webcast on Wednesday, February 28th at 1:00 p.m. Eastern Time (10:00 a.m. Pacific Time). Participation details can be found within this release. In addition, supplemental slides are posted to CRC’s website at www.crc.com.

2023 Highlights:

  • Generated $653 million of net cash from operating activities and $468 million of free cash flow1
  • Demonstrated strong capital efficiency with lower-than-expected total capital of $185 million delivering 6% entry to exit gross production decline
  • Reported net income of $564 million, or $7.78 per diluted share. When adjusted for items analysts typically exclude from estimates (including gains on asset divestitures, business transformation costs and mark-to-market adjustments on commodity derivative contracts) adjusted net income1 was $372 million, or $5.13 per share
  • Average annual net production of 86 thousand barrels of oil equivalent per day (MBoe/d). Oil production averaged 52 thousand barrels of oil per day (MBo/d)
  • Returned $280 million to stakeholders, more than half of 2023 free cash flow1, through share repurchases, debt repurchases and dividends
  • Exited 2023 with a leverage ratio1 of 0.1 times, down from 0.3 times at year-end 2022
  • Through the business transformation initiative, strengthened future outlook by achieving $65 million in annual, sustainable cost savings
  • Announced receipt of California’s first U.S. Environmental Protection Agency (EPA) draft Class VI well permits for underground carbon dioxide (CO2) injection and storage at Elk Hills. See Carbon TerraVault's 2023 Update for additional information

"Our 2023 results were exceptional, and our teams executed on our plan to build a stronger CRC while creating long-term value for all stakeholders," said Francisco Leon, CRC’s President and Chief Executive Officer. “We profitably grew our business and generated significant free cash flow that maintained our premier balance sheet and allowed us to prioritize cash returns to our shareholders. Our focus now is on securing the requisite approvals to close the recently announced merger with Aera Energy, while preparing for integration of their experienced team members and high value assets into CRC after closing. The Aera merger will provide CRC greater operating scale for the entire business, thereby improving our operating cash flows and liquidity profile. The Aera assets will also enhance CRC’s carbon management business from which CRC will accelerate the decarbonization of California.”

Fourth Quarter 2023 Financial and Operating Summary

The Company reported fourth quarter net cash from operating activities of $131 million and free cash flow1 of $65 million. Net income for the period was $188 million, or $2.60 per diluted share of common stock, and adjusted net income1 was $67 million, or $0.93 per diluted share. Adjusted EBITDAX1 was $179 million.

CRC’s daily gross production in the fourth quarter averaged 98 MBoe/d. Net production averaged 83 MBoe/d, including 50 MBo/d. Average realized oil prices during the period were 99% of Brent.

Operating costs in the fourth quarter of 2023 averaged $24.49 per Boe, compared to $24.96 per Boe in the third quarter of 2023 and reflect a positive impact of recent organizational changes. In August 2023, CRC took actions to better align its resources to strategic priorities and improve operational efficiency. The Company realized approximately $15 million of savings in the fourth quarter and expects these actions to result in approximately $65 million of savings in operating costs and general and administrative expenses on an annualized basis.

Capital investments in the fourth quarter were in line with expectations and totaled $66 million. Capital allocation during the period was focused on a one-rig program in the Los Angeles basin.

Fourth Quarter and Full Year Financial Results

Selected Production, Price Information and Results of Operations

4th Quarter

 

 

3rd Quarter

 

 

Total Year

 

 

Total year

($ in millions)

2023

 

 

2023

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

Average net oil production per day (MBbl/d)

 

50

 

 

 

51

 

 

 

 

52

 

 

 

 

55

 

Realized oil price with derivative settlements ($ per Bbl)

$

71.34

 

 

$

66.12

 

 

 

$

65.97

 

 

 

$

61.8

 

Average net NGL production per day (MBbl/d)

 

11

 

 

 

11

 

 

 

 

11

 

 

 

 

11

 

Realized NGL price ($ per Bbl)

$

49.08

 

 

$

44.95

 

 

 

$

48.94

 

 

 

$

64.33

 

Average net natural gas production per day (Mmcf/d)

 

130

 

 

 

138

 

 

 

 

135

 

 

 

 

147

 

Realized natural gas price with derivative settlements ($ per Mcf)

$

4.66

 

 

$

4.83

 

 

 

$

8.59

 

 

 

$

7.54

 

Average net total production per day (MBoe/d)

 

83

 

 

 

85

 

 

 

 

86

 

 

 

 

91

 

 

 

 

 

 

 

 

 

 

 

 

Margin from marketing purchased natural gas ($ millions)

$

28

 

 

$

47

 

 

 

$

180

 

 

 

$

41

 

Margin from electricity sales ($ millions)

$

24

 

 

$

44

 

 

 

$

108

 

 

 

$

94

 

Net gain (loss) from commodity derivatives ($ millions)

$

119

 

 

$

(204

)

 

 

$

(12

)

 

 

$

(551

)

Selected Financial Statement Data and non-GAAP measures:

4th Quarter

 

 

3rd Quarter

 

 

Total Year

 

 

Total year

($ and shares in millions, except per share amounts)

2023

 

 

2023

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

Statements of Operations:

 

 

 

 

 

 

 

 

 

 

Revenues

 

 

 

 

 

 

 

 

 

 

Total operating revenues

$

726

 

 

 

$

460

 

 

 

$

2,801

 

 

 

$

2,707

 

 

 

 

 

 

 

 

 

 

 

 

Selected Expenses

 

 

 

 

 

 

 

 

 

 

Operating costs

$

186

 

 

 

$

196

 

 

 

$

822

 

 

 

$

785

 

General and administrative expenses

$

66

 

 

 

$

65

 

 

 

$

267

 

 

 

$

222

 

Adjusted general and administrative expenses1

$

55

 

 

 

$

51

 

 

 

$

218

 

 

 

$

201

 

Taxes other than on income

$

33

 

 

 

$

48

 

 

 

$

165

 

 

 

$

162

 

Transportation costs

$

18

 

 

 

$

16

 

 

 

$

67

 

 

 

$

50

 

Exploration expense

$

1

 

 

 

$

 

 

 

$

3

 

 

 

$

4

 

Operating Income (loss)

$

283

 

 

 

$

(15

)

 

 

$

808

 

 

 

$

812

 

Interest and debt expense

$

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