Kimbell Royalty Partners, LP Form 10-Q for the quarterly period ended March 31, 2025
Kimbell Royalty Partners, LP reported its quarterly financial results for the period ended March 31, 2025. The company’s consolidated balance sheet showed total assets of $1.43 billion, total liabilities of $1.14 billion, and total equity of $292 million. The company’s consolidated statements of operations reported net income of $23.1 million for the quarter, with revenue of $143.6 million and operating expenses of $120.5 million. The company’s cash flows from operations were $43.1 million, and its cash and cash equivalents stood at $143.6 million. The company’s management’s discussion and analysis highlighted the strong performance of its oil and gas operations, as well as the impact of commodity prices on its results. The company also provided an update on its capital expenditures and drilling plans for the remainder of the year.
Overview
Kimbell Royalty Partners, LP is a Delaware limited partnership that owns and acquires mineral and royalty interests in oil and natural gas properties throughout the United States. The company’s primary business objective is to provide increasing cash distributions to unitholders through acquisitions and organic growth.
Key Points:
Financial Performance:
- Revenue increased from $82.2 million in Q1 2024 to $84.2 million in Q1 2025, driven by higher natural gas and NGL prices.
- Net income increased from $9.3 million in Q1 2024 to $25.9 million in Q1 2025, due to lower impairment and depreciation/depletion expenses.
- Adjusted EBITDA increased from $57.9 million in Q1 2024 to $65.4 million in Q1 2025.
- Cash available for distribution on common units increased from $48.9 million in Q1 2024 to $57.2 million in Q1 2025.
Acquisitions and Growth:
- Completed the $230.4 million Boren Acquisition of mineral and royalty interests in the Midland Basin in January 2025.
- Funded the Boren Acquisition partially with proceeds from a $163.6 million equity offering in January 2025.
- Continued to pursue additional acquisitions of mineral and royalty interests to drive growth.
Operational Highlights:
- Owned mineral and royalty interests in approximately 12.3 million gross acres and overriding royalty interests in 4.7 million gross acres as of March 31, 2025.
- Produced 2,295,090 Boe (25,501 Boe/d) in Q1 2025, a decrease from 2,498,348 Boe (27,454 Boe/d) in Q1 2024 due to prior period production adjustments.
- Maintained a strong balance sheet with $550 million in available borrowing capacity under its secured revolving credit facility as of March 31, 2025.
Outlook and Risks:
- Continued volatility in oil and natural gas prices due to global conflicts and uncertainties.
- Potential impact from changes in regulations and tariffs on the oil and gas industry.
- Ongoing risk of impairment charges on oil and gas properties due to commodity price fluctuations.
- Ability to execute on acquisition strategy and integrate new assets.
Overall, Kimbell Royalty Partners delivered strong financial and operational results in Q1 2025, driven by its acquisition strategy and favorable commodity price environment. The company remains focused on growing its mineral and royalty interest portfolio to drive increased cash distributions to unitholders.
