Brian M. Corales
Magnolia Oil & GasAbout Brian M. Corales
Brian M. Corales, age 46, is Senior Vice President and Chief Financial Officer of Magnolia Oil & Gas (MGY). He became CFO on November 3, 2022 after serving as Vice President, Investor Relations since November 2018; he is a Certified Public Accountant with a bachelor’s in economics and accounting from the College of the Holy Cross . During his CFO tenure, Magnolia delivered operating margins of 45% (2023) and 39% (2024), cumulative TSR of $176.99 and $198.59 respectively on a $100 base since 2019, and net income of $442.6 million (2023) and $397.3 million (2024) . In 2024, Magnolia generated $430 million of free cash flow, returned ~88% of it to shareholders, and achieved 9% total production growth with 11% oil growth .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Magnolia Oil & Gas | VP, Investor Relations | Nov 2018–Nov 2022 | Built IR function post-Business Combination; investor communications across a growing E&P platform |
| Scotia Howard Weil (now part of Scotiabank) | Director (Equity Research) | Oct 2009–Feb 2018 | Covered U.S. E&P companies; informed capital markets and strategy perspectives |
| Johnson Rice & Co. | Senior Analyst | Pre-2009 (dates not specified) | Sell-side coverage of E&P; deep basin and operator knowledge |
| Ernst & Young | Assurance (Energy) | Began 2001 | Audited energy companies; foundation in accounting controls and reporting |
External Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| None disclosed | — | — | No current outside public company directorships or committee roles disclosed for Corales |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $367,500 | $382,200 | $525,000 (effective Mar 3, 2024) |
| Maximum Bonus Goal (% of Salary) | 110% | 110% (unchanged; total opportunity $420,420) | 135% (total opportunity $708,750) |
| Actual Non-Equity Bonus Paid ($) | $404,300 | $391,100 | $637,900 (90% of opportunity) |
Notes:
- 2024 bonus funding was 90% based on 65% quantitative and 25% qualitative results .
Performance Compensation
Annual Bonus Design and Outcomes (2024)
| Metric | Weighting | Target Framework | Actual 2024 Result | Component Payout | Weighted Score |
|---|---|---|---|---|---|
| Operating Margin | 25% | Min 30% / Max 50% | 39% | 61% | 15% |
| Free Cash Flow % | 25% | Non-linear brackets to 50% max | 50% | 100% | 25% |
| Net Debt to EBITDAX | 25% | Lower is better; averaged | 0.1x | 100% | 25% |
| Qualitative Goals | 25% | Committee assessment | Significant success (acquisitions, LOE -10%, buybacks, dividend +15%) | 100% | 25% |
| Total | 100% | — | — | — | 90% |
Long-Term Incentives (Grants made Feb 13, 2024)
| Award Type | Target Shares | Grant Date Fair Value/Share | Vesting | Performance Metric |
|---|---|---|---|---|
| RSUs | 61,606 | $20.34 | Ratable over 3 years; vests ~Mar 1, 2025/2026/2027 | Service-based |
| PSUs | 61,606 (target) | $21.12 | Settles after 3-year period ending Dec 31, 2026 | Relative TSR vs peer group; 0–150% payout; capped at target if absolute TSR negative |
2023 awards outstanding at 12/31/24: 15,050 RSUs and 22,574 target PSUs (reported at 33,861 at 150% max for SEC table presentation) .
PSU Relative TSR Schedule and Peer Group (2024 grant)
| Performance vs Peers (Percentile) | Earned PSUs (% of Target) |
|---|---|
| <30th | 0% |
| 30th | 50% |
| 50th | 100% |
| ≥80th | 150% (capped at 100% if absolute TSR is negative) |
TSR Peer Group includes APA, EOG, Chord, Civitas, CNX, Coterra, Devon, Kosmos, Marathon (removed post-acquisition), Matador, Murphy, Range, SM Energy, Talos, Vital Energy .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (as of Mar 10, 2025) | 98,321 Class A shares; <1% of voting power |
| Unvested RSUs (12/31/24) | 61,606 (2024 grant) + 15,050 (2023 grant) + 600 (2022 RSUs) |
| Unvested PRSUs (12/31/24) | 1,690 (ratable 2022 PRSUs) + 6,268 (cliff 2022 PRSUs; vest Mar 1, 2025) |
| Unvested PSUs (12/31/24, SEC reporting at max) | 92,409 (2024 PSUs at 150%) and 33,861 (2023 PSUs at 150%); target levels 61,606 and 22,574 |
| Options | None; Magnolia has not granted options |
| Hedging/Pledging | Prohibited; pledging only with prior consent |
| Ownership Guidelines | Senior Vice Presidents: 2× base salary; all NEOs in compliance |
Employment Terms
| Provision | Key Terms |
|---|---|
| Employment Agreement | None; Magnolia does not use executive employment agreements |
| Severance (non-CIC) | Lump sum = 1.5× (base + total bonus opportunity); pro-rata current-year bonus; prior-year bonus at discretion; health (18 months) and outplacement (up to 18 months) |
| Change-in-Control (double-trigger) | Lump sum = 2.5× (base + total bonus opportunity); pro-rata bonus; extended health (30 months); accelerated vesting: RSUs/PRSUs full; PSUs “Frozen” at greater of target or performance-to-date; vest acceleration upon qualifying termination |
| Restrictive Covenants | 12-month non-compete and non-solicit; confidentiality 5 years (trade secrets in perpetuity) |
| Excise Tax | No tax gross-ups; 280G “best-net” cut or pay-in-full chosen for best after-tax outcome |
| Clawback | Dodd-Frank compliant policy adopted Oct 30, 2023; recoup incentive comp for certain restatements (lookback 3 years) |
| Perquisites | Minimal; under $10,000 per officer; standard 401(k) contributions ($27,600 reported in 2024) |
| Deferred Comp | No nonqualified deferred compensation plan for NEOs (director plan exists) |
Performance & Track Record
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Operating Margin | 63% | 45% | 39% |
| Company TSR (Value of $100 since 2019) | $190.88 | $176.99 | $198.59 |
| Peer Group TSR (Value of $100 since 2019) | $154.15 | $159.64 | $158.04 |
| Net Income ($000) | $1,050,249 | $442,604 | $397,330 |
| Free Cash Flow ($mm) | — | — | $430.2 |
| Capital Returns | — | — | ~88% of FCF returned; ~$378mm total (buybacks + dividends) |
Highlights and execution signals:
- 2024 achievements underpin qualitative bonus: $165mm bolt-on acquisitions, LOE -10%, ~11mm shares repurchased (5% reduction), dividend increased 15% .
- Strong pay-versus-performance alignment: annual bonus tied 75% to Operating Margin, FCF%, Net Debt/EBITDAX; LTI 50% PSUs on relative TSR .
Compensation Peer Group & Say-on-Pay
- Compensation peer group includes Callon (acquired by APA), Civitas, CNX, Comstock, Chord, Kosmos, Matador, Murphy, Permian Resources, Range, SM Energy, Talos, Vital; Magnolia positioned slightly above median market cap of the 2024 peer set .
- Say-on-pay approved by >98% of votes in 2024, indicating strong shareholder support for pay design .
Investment Implications
- Pay-for-performance alignment: Bonus metrics emphasize margin quality, FCF conversion, and leverage discipline; PSUs on relative TSR cap payouts if absolute TSR is negative—reduces windfall risk and aligns downside with shareholders .
- Retention risk moderate: No employment contracts, but robust severance/change-in-control plan (1.5× non-CIC; 2.5× CIC) and multi-year RSU/PRSU vesting support retention; stock ownership guidelines and anti-hedging/pledging strengthen alignment .
- Insider selling pressure: Company policy restricts hedging/pledging; Corales’ beneficial ownership is modest (<1%), with substantial unvested equity—vesting cadence could lead to periodic tax-related sales but structural pressure appears limited absent Form 4 activity .
- Governance quality: Strong shareholder support (>98% say-on-pay), independent compensation consultant (FW Cook), clawback, and no tax gross-ups; signals disciplined compensation oversight .
Overall, Corales’ incentives tie closely to value-creation levers MGY can control (margin, FCF, leverage) and market-relative TSR, with retention supported by double-trigger CIC protection and significant unvested equity. This design suggests aligned decision-making on capital allocation, balance sheet prudence, and return of capital, reducing agency risk while maintaining performance accountability .