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Annual Meeting of Shareholders – Matador Resources Company

Matador Resources Company · Jun 9, 2016 · 48 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Annual Meeting of Shareholders – Matador Resources Company – slide 1
    Annual Meeting of Shareholders June 9, 2016 NYSE: MTDR
  2. Annual Meeting of Shareholders – Matador Resources Company – slide 2
    Board of Directors Expertise and Stewardship Board Members Professional Experience Business Expertise David M. Laney - Past Chairman, Amtrak Board of Directors Law and Investments Lead Director - Former Partner, Jackson Walker LLP…
  3. Annual Meeting of Shareholders – Matador Resources Company – slide 3
    Special Board Advisors Expertise and Stewardship Special Board Advisors Professional Experience Business Expertise - Retired President North America, Archer Ronney F. Coleman Oilfield Services - Former Vice President North America…
  4. Annual Meeting of Shareholders – Matador Resources Company – slide 4
    Shareholder Advisory Committee for Board Nominations Committee Member Professional Experience - Vice President / Engineering and Co-founder, North Plains Energy, LLC Reynald A. Baribault - President and CEO, IPR Energy Partners, LLC…
  5. Annual Meeting of Shareholders – Matador Resources Company – slide 5
    Proven Management Team Experienced Leadership Industry Matador Management Team Background and Prior Affiliations Experience Experience Joseph Wm. Foran - Matador Petroleum Corporation, Foran Oil Company, 35 years Since Inception…
  6. Annual Meeting of Shareholders – Matador Resources Company – slide 6
    Annual Meeting of Shareholders June 9, 2016 NYSE: MTDR
  7. Annual Meeting of Shareholders – Matador Resources Company – slide 7
    Summary of Proposals Proposal 1 Election of Directors Proposal 2 Approval of Amended and Restated Annual Incentive Plan Proposal 3 Advisory Vote on Named Executive Officer Compensation Proposal 4 Ratification of the Appointment…
  8. Annual Meeting of Shareholders – Matador Resources Company – slide 8
    Proposal 1 Election of Directors Director Nominees Class II Directors Craig T. Burkert Gregory E. Mitchell Dr. Steven W. Ohnimus Directors Continuing in Office Class III Directors (Terms Expiring at 2017 Annual Meeting of…
  9. Annual Meeting of Shareholders – Matador Resources Company – slide 9
    Proposal 2 Approval of Amended and Restated Annual Incentive Plan The Company previously maintained the Matador Resources Company Annual Incentive Plan for Management and Key Employees, effective January 1, 2012. On February 19,…
  10. Annual Meeting of Shareholders – Matador Resources Company – slide 10
    Proposal 3 Advisory Vote on Named Executive Officer Compensation The Company seeks a non-binding advisory vote from its shareholders regarding the compensation of its Named Executive Officers as described in the Proxy Statement…
  11. Annual Meeting of Shareholders – Matador Resources Company – slide 11
    Proposal 4 Ratification of the Appointment of KPMG LLP KPMG LLP (KPMG) served as the Companys independent registered public accounting firm for the fiscal year ended December 31, 2015 The Audit Committee has appointed KPMG as the…
  12. Annual Meeting of Shareholders – Matador Resources Company – slide 12
    Proposal 5 Advisory Vote on Shareholder Proposal to Adopt a Majority Voting Standard for the Election of Directors The voting procedures set forth in the Companys Amended and Restated Bylaws, as amended, establish a plurality voting…
  13. Annual Meeting of Shareholders – Matador Resources Company – slide 13
    Summary of Proposals Proposal 1 Election of Directors Proposal 2 Approval of Amended and Restated Annual Incentive Plan Proposal 3 Advisory Vote on Named Executive Officer Compensation Proposal 4 Ratification of the Appointment…
  14. Annual Meeting of Shareholders – Matador Resources Company – slide 14
    Annual Meeting of Shareholders June 9, 2016 NYSE: MTDR
  15. Annual Meeting of Shareholders – Matador Resources Company – slide 15
    Chairmans Remarks Joseph Wm. Foran, Chairman and CEO June 9, 2016 NYSE: MTDR
  16. Annual Meeting of Shareholders – Matador Resources Company – slide 16
    Matadors Execution History Doing What We Say Matador continues to execute on its core strategy of acquiring great assets, developing a highly professional, committed workforce, maintaining a strong balance sheet and generating…
  17. Annual Meeting of Shareholders – Matador Resources Company – slide 17
    Matador Has Made Tremendous Progress Since its IPO At IPO(1): Today(2) Difference February 7, 2012 414 Bbl/d 13,700 Bbl/d Oil Production (6% oil) (50% oil)(3) +33-fold 27 MMBOE 90 MMBOE Proved Reserves (4% oil) (56% oil)…
  18. Annual Meeting of Shareholders – Matador Resources Company – slide 18
    Operations Update Matthew V. Hairford, President June 9, 2016 NYSE: MTDR
  19. Annual Meeting of Shareholders – Matador Resources Company – slide 19
    Company Overview Exchange: Ticker NYSE: MTDR Shares Outstanding(1) 93.3 million common shares Share Price(1) 24.22/share Market Capitalization(1) 2.3 billion Actual Actual % YoY 2014 Results 2015 Results 2016 Guidance…
  20. Annual Meeting of Shareholders – Matador Resources Company – slide 20
    Matador Resources Company Operations Overview Market Capitalization(1) 2.3 billion Avg. Daily Production Q1 2016(2) 23,846 BOE/d 33% of total production Almost no oil Oil (% total) 11,473 Bbl/d (48%) 63% of total natural gas…
  21. Annual Meeting of Shareholders – Matador Resources Company – slide 21
    Delaware Basin Brushy Cyn. Understanding the Opportunities U. Avalon L. Avalon Most current unconventional plays target one or two zones across a trend area. 1st Bone Spring The Delaware Basin has over a dozen unique targets 2nd…
  22. Annual Meeting of Shareholders – Matador Resources Company – slide 22
    Matadors 2016 Delaware Basin Operated Drilling Plan: 3-Rig Case(1) TWIN LAKES 42,700 gross / 30,300 net Wolf/Loving Area acres 20 gross (16.8 net) wells planned for 2016 ARROWHEAD 18 gross (15.8 net) wells on production,…
  23. Annual Meeting of Shareholders – Matador Resources Company – slide 23
    Improving Wolfcamp Drilling Times Significantly in 2015 and 2016 50 2014 Average 45 43 2015 Planned 40 2015 Best Well 35 35 32 2016 Record Well Drilling Days 30 26 25 20 18 17.3 15 13.8 15 10 5 0 Loving County…
  24. Annual Meeting of Shareholders – Matador Resources Company – slide 24
    2016 Anticipated Wolf Area Total Drilling and Completion Cost Improvements 12.0 Efficiencies 12.0 100,000 Cost Reduction ROR Increase 2% 44% 10.0 Drilling and Completion Costs, millions Service Costs 8.0 56% 6.0…
  25. Annual Meeting of Shareholders – Matador Resources Company – slide 25
    Evolution of Delaware Basin Frac Design Reservoir Specific Bone Spring 350 ft. Gen 1 Gen 2 Testing 50 ft. 2,000 lbs/ft 1,333 lbs/ft 2,100 lbs/ft Coupled 500 Mlbs 40 Bbl/ft 20 Bbl/ft 40 Bbl/ft 50 cluster 75 cluster 50…
  26. Annual Meeting of Shareholders – Matador Resources Company – slide 26
    Single Wolfcamp B Well at Rustler Breaks Holds Up To 15 Potential Locations One producing Wolfcamp B well holds 320 surface acres and up to 15 additional potential locations for future development 320 - Acre Development Spacing…
  27. Annual Meeting of Shareholders – Matador Resources Company – slide 27
    Rustler Breaks 5 Wells Producing From 3 Zones on Multi-Well Pad West (Section 14) East (Section 13) INTER-Formational Stacked Pay Gamma Ray Resistivity 3 producing wells Multi-Well Pad 2 producing wells Bone Spring Lime Upper…
  28. Annual Meeting of Shareholders – Matador Resources Company – slide 28
    Wolf Area Wolfcamp A-XY Wells Continue Strong Performance Across Acreage 10,000 Dorothy White 1H has produced 515 MBOE (68% oil) in 28 months Norton Schaub 84TTTB33 WF 201H has produced 425 MBOE (67% oil) in 21 months Billy Burt…
  29. Annual Meeting of Shareholders – Matador Resources Company – slide 29
    Delaware Basin Midstream Update Gas Gathering and Processing Water Gathering Salt Water Disposal Oil Gathering Note: All acreage at May 3, 2016. 30
  30. Annual Meeting of Shareholders – Matador Resources Company – slide 30
    Company Overview Exchange: Ticker NYSE: MTDR Shares Outstanding(1) 93.3 million common shares Share Price(1) 24.22/share Market Capitalization(1) 2.3 billion Actual Actual % YoY 2014 Results 2015 Results 2016 Guidance…
  31. Annual Meeting of Shareholders – Matador Resources Company – slide 31
    Financial Highlights David E. Lancaster, Executive Vice President and CFO June 9, 2016 NYSE: MTDR
  32. Annual Meeting of Shareholders – Matador Resources Company – slide 32
    Matadors Financial Position is Strong Strong balance sheet with cash on hand of 118 million, 400 million in bonds and no borrowings under revolving credit facility at March 31, 2016 Low debt levels and strong debt metrics relative to…
  33. Annual Meeting of Shareholders – Matador Resources Company – slide 33
    Commodity Prices Volatile, but Have Rallied from Q1 2016 Lows 160 8 Oil Price Oil/Gas Price Ratio 140 Gas Price 7 Prices begin declining in July 2014 120 6 Oil Price /Bbl, Oil/Gas Price Ratio _ 100 5 Gas Price,…
  34. Annual Meeting of Shareholders – Matador Resources Company – slide 34
    Committed to Maintaining Strong Balance Sheet Preserved and enhanced liquidity through April 2015 equity and Senior Notes offerings, sale of certain Loving County midstream assets for 143 million(1) in October 2015 and March 2016…
  35. Annual Meeting of Shareholders – Matador Resources Company – slide 35
    Strong Balance Sheet Metrics Relative to Peers(1) 1Q16 Net Debt / FY15 Proved Reserves ( / BOE) 1Q16 Net Debt / LTM Adjusted EBITDA (2) 6.6x 15.79 10.53 10.70 4.0x 3.9x 8.64 Average 6.54 7.74 Average 2.7x…
  36. Annual Meeting of Shareholders – Matador Resources Company – slide 36
    2016 Capital Investment Plan Summary 2016E CapEx 2016E CapEx of 325 million (3 rigs in the Delaware Basin throughout 2016) Decrease of 33% from 2015 capital expenditures of 325 million 482 million(1) Includes estimated efficiency…
  37. Annual Meeting of Shareholders – Matador Resources Company – slide 37
    2016 Oil and Natural Gas Production and Adjusted EBITDA Estimates Oil and Natural Gas Production 2016E Oil Production 2016E CapEx: D&C / Facilities: 260 MM Estimated oil production of 4.9 to 5.1 million barrels Midstream / Land: 65…
  38. Annual Meeting of Shareholders – Matador Resources Company – slide 38
    Hedging Profile Remainder of 2016 Hedges(1) Oil: 1.8 million barrels of oil hedged for remainder of 2016 at weighted average floor and ceiling prices of 42/Bbl and 61/Bbl, respectively Over 50% of oil hedged for remainder of 2016…
  39. Annual Meeting of Shareholders – Matador Resources Company – slide 39
    Credit Agreement Status Strong, supportive bank group led by Royal Bank of Canada (group includes eight banks) Borrowing base set at 300 million on May 3, 2016 based on December 31, 2015 reserves and using commodity price estimates…
  40. Annual Meeting of Shareholders – Matador Resources Company – slide 40
    Matador Bonds Have Traded Well Bonds have rallied sharply from January 2016 levels due to equity deal, recent improvement in commodity prices and operating results Bonds have rallied back above par and are currently trading at…
  41. Annual Meeting of Shareholders – Matador Resources Company – slide 41
    Matador Bonds Relative Performance vs. Peers 120.000 100.000 80.000 60.000 40.000 20.000 0.000 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 Apr-16 Jun-16 Peer A Peer E Peer D Peer B Peer C Peer F Peer J Peer I…
  42. Annual Meeting of Shareholders – Matador Resources Company – slide 42
    Matadors Financial Position is Strong Strong balance sheet with cash on hand of 118 million, 400 million in bonds and no borrowings under revolving credit facility at March 31, 2016 Low debt levels and strong debt metrics relative to…
  43. Annual Meeting of Shareholders – Matador Resources Company – slide 43
    E&P Perspective Marlan W. Downey, Special Board Advisor June 9, 2016 NYSE: MTDR
  44. Annual Meeting of Shareholders – Matador Resources Company – slide 44
    Closing Remarks Joseph Wm. Foran, Chairman and CEO June 9, 2016 NYSE: MTDR
  45. Annual Meeting of Shareholders – Matador Resources Company – slide 45
    Delaware Basin Inventory Continues to Increase Matador has identified up to 3,543 gross (1,417 net) potential locations(1) for future drilling on its Delaware Basin acreage Only 118 gross (71.1 net) locations are PUD locations at…
  46. Annual Meeting of Shareholders – Matador Resources Company – slide 46
    Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…
  47. Annual Meeting of Shareholders – Matador Resources Company – slide 47
    Adjusted EBITDA Reconciliation The following table presents our calculation of Adjusted EBITDA and reconciliation of Adjusted EBITDA to the GAAP financial measures of net income (loss) and net cash provided by operating activities,…
  48. Annual Meeting of Shareholders – Matador Resources Company – slide 48
    PV-10 Reconciliation PV-10 is a non-GAAP financial measure and generally differs from Standardized Measure, the most directly comparable GAAP financial measure, because it does not include the effects of income taxes on future net…

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