- We hosted a fireside chat on November 29, 2022, with Kelly Loyd, President, Chief Executive Officer, and a Director of Evolution Petroleum. Our discussion concentrated on Evolution’s strategy of driving total shareholder returns.
- Evolution’s strategy includes growing the asset base through the acquisition of mature producing oil and gas assets that generate free cash flow.
- Management allocates free cash flow with a goal of maximizing risk-adjusted returns. Allocation options include debt reduction, dividends, share repurchases, and reinvesting in the asset base via incremental acquisitions and/or exploitation/development.
- The current quarterly dividend is $0.12/share, equating to a 7.4% yield. The dividend was increased 20% in September 2022 with the declaration for Evolution’s 1QFY23 payout. Also in September, the board authorized a $25-million share repurchase program through December 31, 2024.
- Evolution’s asset base was assembled through acquisitions to support management’s goal of providing a sustainable dividend to shareholders. The company’s shallow production decline, coupled with a conservative financial posture, provide the flexibility to invest opportunistically across the business cycle.
- Acquisitions closed during the first half of calendar 2022 further diversified the asset base. The added scale exposes the company to a wider variety of exploitation/development projects and diversified the commodity mix thereby insulating the company from severe basin dislocation.
- The EPM fireside chat from November 29, 2022, can be accessed on demand.
THE COMPANY
Evolution Petroleum Corporation is an independent energy company focused on maximizing total returns to shareholders through the ownership of and investment in onshore oil and natural gas properties in the US. The company owns a diverse portfolio of long-life producing gas assets built through acquisitions and through selective development opportunities, production enhancement, and other exploitation efforts. The current property portfolio includes non-operated interests in the Jonah Field in Wyoming, the Williston Basin in North Dakota, the Barnett Shale in North Texas, the Hamilton Dome Field in Wyoming, and the Delhi Holt-Bryant Unit in the Delhi Field in northeast Louisiana.
Jeff Robertson: I would like to thank everyone for joining us today. My name is Jeff Robertson. I am the Managing Director for Natural Resources at Water Tower Research. It is my pleasure today, to be joined by Kelly Loyd, Evolution Petroleum’s President and Chief Executive Office. Kelly has also served on Evolution’s board of directors since 2008.
Before we get started, I should mention that today’s discussion could include forward-looking statements. Participants can find Evolution’s disclosures regarding forward-looking statements in the company’s SEC filings and corporate presentation in the Investor Relations section of Evolution’s website.
Kelly, I would like to pick up where we left off from our last fireside chat at the end of July, when we spent a lot of time discussing Evolution’s total shareholder return philosophy. Since then, the company has reported fiscal year-end financial results and first-quarter fiscal 2023 results. Those result...
Kelly W. Loyd
Kelly Loyd is currently Evolution’s President and Chief Executive Officer and has served as a director of the company since 2008. He is currently Chairman of the Investment Committee. Mr. Loyd has more than 20 years of energy experience in both investment banking and on the buy-side.
Over his career, Mr. Loyd has focused on analysing and investing in public and private energy opportunities as well as corporate finance and mergers and acquisitions. Since 2004, He has been associated with Petralis Energy Partners, LLC and JVL Advisors, LLC, both being private energy investment vehicles. Mr. Loyd received a B.S. degree in Economics with Finance Applications from Southern Methodist University and earned an MBA from Rice University.
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