DALLAS, Dec. 07, 2021 (GLOBE NEWSWIRE) — Berry Corporation (bry) (NASDAQ: BRY) (“bry” or the “Company”) today announced the details of its new shareholder return model, which will go into effect January 1, 2022, and is expected to provide industry-leading returns.
This new model is designed to increase cash returns to our shareholders, further demonstrating bry’s commitment to be a leading returner of capital to its shareholders. The model is based on our discretionary free cash flow, which is defined as cash flow from operations less regular fixed dividends and the capital needed to hold production flat.
Under this new model, the company intends to allocate discretionary free cash flow on a quarterly basis as follows:
- 60% predominantly in the form of cash variable dividends to be paid quarterly, as well as opportunistic debt repurchases1
- 40% in the form of discretionary capital, to be used for organic growth, including from our extensive inventory of drilling opportunities, advancing our short- and long-term sustainability initiatives, share repurchases, and/or capital retention
“We have long been committed to returning a substantial amount of capital to stockholders, and today we are announcing the next step in that direction. Since going public in the summer of 2018, we have returned nearly $130 million to our shareholders through dividends and share repurchases. Today’s announcement reinforces that returning capital is a priority of the Company. This new return framework is designed to pay a sustainable fixed dividend, as we do now, while returning an additional, substantial portion of our discretionary free cash flow to investors each quarter. Like our business model, this new shareholder returns model is simple and strengthens our commitment to return capital to our shareholders,” stated Trem Smith, bry’s Chairman of the Board and CEO.
“Our cash flow potential is easier to measure than most of the industry. We have a predictable cost structure that we highlight every quarter in our investor presentation, which always includes the cost of keeping our production flat. This new return model continues to keep our focus on maintaining production while providing us the opportunity to use our abundant inventory to grow our production. Our focus remains creating the greatest value for our shareholders while providing affordable and equitable energy for all Californians,” added Smith.
The timing, volume and manner of debt and/or share repurchases under the Board’s authorization of this program will be determined by management at its discretion.
1 Subject to board approval and amounts of cash variable dividend will be announced with quarterly earnings release.
Bry is a publicly traded (NASDAQ: BRY) western United States independent upstream energy company with a focus on the conventional, long-lived oil reserves in the San Joaquin basin of California. More information can be found at the Company’s website at bry.com.
Forward Looking Statements
The information in this press release includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, included in this press release that address plans, activities, events, objectives, goals, strategies, or developments that the Company expects, believes or anticipates will or may occur in the future, such as those regarding its financial position; liquidity; cash flows; anticipated financial and operating results; capital program and development and production plans; operations and business strategy; potential acquisition opportunities; reserves; hedging activities; capital expenditures, shareholder returns or return of capital; payment, payment of or improvement of future dividends; future repurchases of stock or debt; capital investments, and guidance are forward-looking statements. The forward-looking statements in this press release are based upon various assumptions, many of which are based, in turn, upon further assumptions. Although we believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control. Therefore, such forward-looking statements involve significant risks and uncertainties that could materially affect our expected results of operations, liquidity, cash flows and business prospects.
Bry cautions you that these forward-looking statements are subject to all of the risks and uncertainties, incident to the exploration for and development, production, gathering and sale of natural gas, NGLs and oil most of which are difficult to predict and many of which are beyond bry’s control. These risks include, but are not limited to, commodity price volatility; legislative and regulatory processes and actions that may prevent, delay or otherwise restrict our ability to drill and develop our assets, including regulatory approval and permitting requirements; legislative and regulatory initiatives in California or our other areas of operation addressing climate change or other environmental concerns; drilling, production and other operating risks; investment in and development of competing or alternative energy sources; uncertainties inherent in estimating natural gas and oil reserves and in projecting future rates of production; cash flow and access to capital; the timing and funding of development expenditures; environmental, health and safety risks; effects of hedging arrangements; potential shut-ins of production due to lack of downstream demand or storage capacity; the impact and duration of the ongoing COVID-19 pandemic on demand and pricing levels; and the other risks described under the heading “Item 1A. Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 and subsequent filings with the SEC, including the Company’s Form 10-Q for the quarter ended September 30, 2021.
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Any forward-looking statement speaks only as of the date on which such statement is made, and we undertake no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise except as required by applicable law. Investors are urged to consider carefully the disclosure in our filings with the Securities and Exchange Commission, available from us at via our website or via the Investor Relations contact below, or from the SEC’s website at www.sec.gov.
Todd Crabtree – Manager, Investor Relations