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January 2020 Investor Presentation – Laredo Petroleum Inc.

Laredo Petroleum Inc. · Jan 5, 2020 · 25 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. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 1
    L A R E D O P E T R O L E U M Corporate Presentation January 2020
  2. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 2
    Successful Implementation of Returns Strategy Delivered in 2019 GENERATED 38 MM OF FREE CASH FLOW1 from 1Q-19 - 3Q-19 OIL PRODUCTION ABOVE GUIDANCE for four consecutive quarters PROVED OIL RESERVES GROWTH of 27% YoY and total…
  3. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 3
    Laredo Petroleum: Delivering on Returns-Focused Strategy Market Cap1: 680 MM; Enterprise Value1: 1,815 MM Operations: Permian Basin (TX), Headquarters: Tulsa, OK 700 NAV/Inventory Focus Targeting Returns/Free Cash Flow 35…
  4. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 4
    Pivoted Strategy to Increase Stakeholder Value Target consistent Free Cash Flow1 generation and oil growth per net debt-adjusted share Continuous In Process Opportunistic Improve corporate Increase scale Optimize existing returns…
  5. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 5
    Laredos Recent Acquisitions at Discount to Precedent Trades Focused on employing a disciplined approach to acquisition economic evaluation 80,000 70,000 /Undeveloped Midland Basin Acre 60,000 50,000 40,000 Peer Avg.1…
  6. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 6
    Howard County Tier-One Acquisition Delivers Higher-Margin Production 130 MM acquisition price1, well below historic Howard County averages High-margin, tier-one acreage 7,360 net acres / 750 net royalty acres Expected first-year…
  7. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 7
    Bolt-On Glasscock County Acquisition Adds High-Return Inventory 65 MM purchase price 4,475 net acres 1,400 BOE/d (55% oil) current net production Bolsters higher-margin inventory LPI Leasehold 45 total gross expected locations…
  8. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 8
    Acquisitions Support Oil Growth & Free Cash Flow Generation 6 Cumulative Undiscounted 4 Cashflow ( MM) 2 0 -2 -4 -6 -8 -10 01 56 1011 16 15 2021 2526 3031 3536 41 40 46 45 51 50 56 55 60 Months LPI UWC/MWC Oil…
  9. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 9
    Disciplined Acquisition Strategy, Committed to a Strong Balance Sheet Target consistent Free Cash Flow1 generation and oil growth per net debt-adjusted share High-margin, higher-return (50+% oil) inventory Contiguous Midland Basin…
  10. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 10
    Surpassing Guidance on Production 2019 Oil Guidance vs Actual Production 32 Exceeding Oil Guidance Every Quarter in 2019 30.4 Oil Production 30 (MBO/d) 28.2 27.8 28 28.5 27.3 27.5 27.3 26 26.0 24 22 1Q-19 2Q-19…
  11. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 11
    Optimizing Costs on Existing Acreage Peer-Leading 3Q-19 Controllable Cash Costs 8.54 Cash G&A 7.83 7.50 7.50 7.48 Expense1 6.92 6.01 4.41 LOE1 Peer Peer Peer Peer Peer Peer Peer LPI Peer-Leading Midland Basin D&C Costs2…
  12. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 12
    Optimized Development & Cost Control Drive Free Cash Flow Peer2-Leading 1Q - 3Q-19A Free Cash Flow Generation 38 (63) (86) (219) (257) (296) (295) 1 Peer Peer Peer Peer Peer Peer LPI Recent acquisitions support…
  13. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 13
    Consistent Reserves Growth in Volatile Pricing Environment Total Proved Reserves 400 24% CAGR 2015 - 2019 70 Total Proved Reserves (MMBOE) 60 300 50 WTI Price1 (/BO) 50 21 40 200 25 30 26 244 20 25 217 100 191…
  14. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 14
    Acquisitions Add Oily, High-Margin Inventory Total Inventory (Acquired + Established) Inventory Inventory Years ROR (%) 655 - 825 12.5 30% - 65% Acquired Inventory Lower Spraberry/UWC/MWC Inventory Inventory Years ROR (%) 165…
  15. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 15
    Demonstrated Discipline Preserves Competitive Leverage Debt Maturity Summary 800 2.1x Debt ( MM) Net Debt to 375 600 Adj. EBITDA1 400 450 350 200 0 2020 2021 2022 2023 800 MM Senior unsecured notes 375 MM drawn (1.0 B…
  16. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 16
    Hedging Strategy Reduces Impact of Commodity Price Fluctuations 65 65 63.07 3.50 62.29 59.50 HH Price (/MMBtu) Brent Price (/Bbl) 60 58.16 60 WTI Price (/Bbl) 3.00 2.72 55 55 2.50 2.29 50 50 2.00 45 45 40 40 1.50…
  17. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 17
    Infrastructure Protects the Environment & Enhances Economics LPI In-Place Infrastructure 60 Miles 170 miles Natural gas gathering Crude oil gathering pipelines and distribution pipelines 110 Miles 54 MBWPD Water gathering &…
  18. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 18
    Positioned to Continue Delivering into 2020 and Beyond Successful implementation of returns strategy generated 38 MM of Free Cash Flow1 in 1Q-19 - 3Q-19 and increased FY-19 oil production and oil reserves Continued operational…
  19. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 19
    L A R E D O P E T R O L E U M APPENDIX
  20. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 20
    Oil Value Enhanced Via Gulf Coast Access Gross Physical Transportation Contracts: Medallion firm transportation secured for all crude oil produced within dedication area 10 MBOPD firm transportation on Bridgetex through 1Q-22, with…
  21. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 21
    Oil, Natural Gas & Natural Gas Liquids Hedges Hedge Product Summary FY-20 FY-21 Oil total volume (Bbl) 9,552,600 1,460,000 Oil wtd-avg price (/Bbl) - WTI 59.50 Oil wtd-avg price (/Bbl) - Brent 63.07 60.16 Nat gas total volume…
  22. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 22
    12-19-19 Strip Pricing as Utilized 12-19-19 Strip Pricing WTI (/BO) HH (/MMBtu) 4Q-19 53.75 2.35 FY-20 57.00 2.40 FY-21 53.50 2.45 FY-22+ 51.50 2.45 23
  23. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 23
    Supplemental Non-GAAP Financial Measure Adjusted EBITDA Adjusted EBITDA is a non-GAAP financial measure that we define as net income or loss plus adjustments for income taxes, depletion, depreciation and amortization, impairment expense,…
  24. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 24
    Supplemental Financial Calculations Net debt to Adjusted EBITDA 3Q-19 Net Debt to Adjusted EBITDA is calculated as net debt as of September 30, 2019 of 953 million divided by trailing twelve-month Adjusted EBITDA ending September 30,…
  25. January 2020 Investor Presentation – Laredo Petroleum Inc. – slide 25
    Free Cash Flow Free Cash Flow does not represent funds available for future discretionary use because those funds are required for future debt service, capital expenditures, working capital, income taxes, franchise taxes and other…

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