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SANDRIDGE ENERGY INC (SD)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 delivered revenue of $42.6M (+41% y/y, +9% q/q) and net income of $13.0M ($0.35 diluted EPS); adjusted EBITDA was $25.5M and free cash flow $13.6M, supported by 17.9 MBoed production (+17% y/y) and stronger gas realizations .
  • Versus S&P Global consensus, SD modestly missed on Primary EPS (0.39 vs 0.43) and revenue ($42.6M vs $43.3M); S&P’s EBITDA “actual” was below its estimate (22.2M vs 26.1M), while company-reported adjusted EBITDA was 25.5M [Values retrieved from S&P Global]* .
  • Capital returns continued: $0.11/share dividend declared (payable 6/2/2025) and ~$5M in buybacks; cash ended at $101.1M, with no debt and ~30% of guided production hedged (40%+ gas, ~15% oil) .
  • Operationally, management is progressing an 8-well operated Cherokee program (6 completions in 2025) with $66–$85M 2025 capex plan; exit-rate targeting ~19 MBoed in H2, with flexibility to moderate if WTI pressure persists (breakevens ~$35 WTI) .

What Went Well and What Went Wrong

What Went Well

  • Production growth and pricing: 17.9 MBoed (+17% y/y) drove revenue up 41% y/y; gas realizations rose to $2.69/Mcf (from $1.25 y/y, $1.47 q/q); adjusted EBITDA increased to $25.5M .
  • Cost discipline: LOE/BOE improved to $6.79 (from $7.92 y/y); adjusted G&A was $2.9M ($1.83/BOE) .
  • Capital returns and balance sheet: $0.11 dividend declared; ~$5M buybacks; cash $101.1M with no debt; hedges covering ~30% of guided production to secure cash flows .
  • Quote: “Our operated Cherokee wells have robust returns at current commodity prices… breakevens for these new wells are down to $35 WTI” .

What Went Wrong

  • Estimates misses: S&P consensus Primary EPS (0.43) and revenue ($43.3M) were modestly above reported (0.39 and $42.6M); S&P EBITDA actual (22.2M) below estimate (26.1M) [Values retrieved from S&P Global]*.
  • Sequential mix shift and oil price headwinds: Oil’s revenue share fell to 44% (from 54% in Q4) and realized oil price fell to $69.88 (from $71.44 q/q) amid WTI pressure .
  • Hedging vs upside: Extensive gas collars/swaps secure cash flows but cap some upside; Q1 noted WTI in low-$60s/high-$50s testing and vigilance on commodity downside .

Financial Results

MetricQ3 2024Q4 2024Q1 2025
Revenues ($USD)$30.057M $38.973M $42.604M
Net Income ($USD)$25.484M $17.583M $13.049M
Diluted EPS ($USD)$0.69 $0.47 $0.35
EBITDA ($USD)$20.023M $21.590M $23.091M
Adjusted EBITDA ($USD)$17.742M $24.073M $25.491M
Adjusted Net Income ($USD)$7.057M $12.698M $14.534M
Production (MBoed)17.0 19.1 17.9
LOE per BOE ($)$5.82 $6.43 $6.79

Estimates vs Actuals (S&P Global):

MetricConsensusActualSurprise
Primary EPS ($)0.430.39-0.04 [Values retrieved from S&P Global]*
Revenue ($USD)$43.32M$42.60M-$0.72M (-1.7%) [Values retrieved from S&P Global]*
EBITDA ($USD)$26.10M$22.25M-$3.85M [Values retrieved from S&P Global]*

KPIs and Realizations:

KPIQ3 2024Q4 2024Q1 2025
Oil (% of production)15% 17% 17%
Gas (% of production)50% 52% 49%
NGL (% of production)35% 31% 34%
Realized Oil ($/bbl)$73.07 $71.44 $69.88
Realized Gas ($/Mcf)$0.92 $1.47 $2.69
Realized NGL ($/bbl)$16.25 $18.19 $20.07
Cash & Restricted Cash ($USD)$94.1M $99.5M $101.1M
Dividend declared$0.11 (Nov 2024) $0.11 (Mar 2025) $0.11 (Jun 2025)
Share repurchases——~$5.0M

Guidance Changes

MetricPeriodPrevious GuidanceCurrent (Q1 2025)Change
Total CapexFY 2025$66–$85M No update; program ongoing (Cherokee 8 wells, 6 completions) Maintained
D&C CapexFY 2025$47–$63M No update Maintained
Workovers/Optimization/LeaseholdFY 2025$19–$22M No update Maintained
LOEFY 2025$42–$50M No update provided Maintained
Adjusted G&AFY 2025$10–$12M No update provided Maintained
Production (MMBoe)FY 20255.9–7.1 No update; exit-rate ~19 MBoed targeted H2 Maintained (qualitative update)
DividendOngoingRegular $0.11/qtr $0.11 declared (payable 6/2/2025) Maintained

Earnings Call Themes & Trends

TopicQ3 2024 (Prior-2)Q4 2024 (Prior-1)Q1 2025 (Current)Trend
Commodity prices & hedgingEthane recovery and low HH prices weighed; basis widening; limited hedges Added gas/ethane hedges to secure cash flows ~30% of guided production hedged; 40%+ gas, ~15% oil Increasing hedge coverage
Cherokee developmentAcquisitions added DUCs; strong IP30s, breakeven ~$35 WTI Plan 8 drill / 6 completions in 2025; breakeven ~$35 First operated well drilled; pad drilling wells #2–3; H2-weighted volumes Executing plan
Cost discipline (LOE/G&A)LOE/BOE down; adjusted G&A $1.02/BOE Adjusted G&A $1.39/BOE; LOE $6.43/BOE Adjusted G&A $1.83/BOE; LOE $6.79/BOE Stable efficiency
M&A optionalityStrong net cash, optionality to grow Optionality and NOLs emphasized Potential to acquire producing properties if commodity downturn Opportunistic stance
Macro tariffs/inflationNoted cost inflation; watched Tariffs could influence costs Continued vigilance on tariffs/costs Ongoing risk management
ESG practicesNo routine flaring; water via pipeline ESG reaffirmed ESG reaffirmed Consistent

Management Commentary

  • “Current commodity prices our operated Cherokee wells have robust returns, and break-evens for these new wells are down to $35 WTI” .
  • “Our production remains meaningfully hedged… nearly 30% of guided production… over 40% of natural gas production and roughly 15% of oil” .
  • “Exit rates projected around 19 MBoe per day… most of the production from our development program will occur in the second half of this year” .
  • “Cash… just over $100 million… more than $2.75 per share… no term debt or revolving debt obligations” .
  • “LOE and expense workovers… approximately $10.9 million or $6.79 per BOE… compares favorably to $7.92 per BOE in the first quarter last year” .

Q&A Highlights

  • The Q1 2025 transcript concluded prepared remarks and opened the Q&A; no substantive Q&A content was included in the provided transcript materials .
  • Prior quarter color: discussion on hedge philosophy, production growth and upside conditions (from Q4) may inform expectations, but no new Q1 Q&A clarifications were captured in source documents .

Estimates Context

  • S&P Global consensus for Q1 2025: Primary EPS 0.43 vs actual 0.39 (miss), revenue $43.32M vs reported $42.60M (miss), EBITDA $26.10M vs S&P “actual” $22.25M (miss); note company-reported adjusted EBITDA of $25.49M is non-GAAP and reconciled [Values retrieved from S&P Global]* .
  • With stronger gas prices in Q1 and H2-weighted volume from Cherokee, models may need to raise gas realizations and H2 production, while trimming near-term oil price assumptions and incorporating hedge coverage (~30% of guided production) .

Key Takeaways for Investors

  • Near-term: Modest miss vs S&P on EPS/revenue; stock reaction will hinge on commodity trajectory (WTI softness vs gas strength) and visibility to operated Cherokee well results in Q2—watch for H2 volume inflection and mix shift [Values retrieved from S&P Global]* .
  • Balance sheet resiliency: $101.1M cash, no debt supports continued dividends/buybacks and optionality to add producing assets in weaker commodity tapes .
  • Hedge profile reduces downside risk in 2025 (notably gas), increasing confidence in capex-funded development while preserving return of capital .
  • Operational execution: Pad drilling underway (#2–3), 8-well plan with 6 completions in 2025; breakevens ~$35 WTI provide cushion if oil remains pressured .
  • Cost leadership persists: LOE/BOE and adjusted G&A remain competitive; scaling oilier Cherokee volumes should improve returns and cash conversion .
  • Estimate revisions: Expect buy-side to adjust models for H2 volume timing and higher gas realizations, with neutral-to-cautious near-term EPS given WTI headwinds and hedge effects .
  • Catalyst calendar: Q2 2025 operated well results, hedging updates, and any M&A disclosure could drive narrative and positioning.

Notes:

  • Asterisked values are from S&P Global; Values retrieved from S&P Global.