Source: Investing Published 10/24/2024, 01:14
Vitesse Energy Inc. (NYSE:VTS) announced Tuesday an amendment to its credit facility, providing it with financial flexibility for years to come. The Denver-based company, which operates in crude oil and natural gas under SIC code 1311, detailed the terms of the amended credit agreement in an 8-K filing with the Securities and Exchange Commission (SEC).
According to the filing, Vitesse Energy entered into an amendment to the credit agreement on October 22, 2024, with Wells Fargo Bank, N.A. as administrative agent, along with other lenders. The amendment is the result of a re-establishment of the company’s semi-annual borrowing base.
Key changes include extending the maturity date by four years from the effective date of the amendment, while maintaining the borrowing base at $245 million. However, the company elected to reduce the elective commitment amount from $245 million to $235 million. Additionally, the amendment provided a 0.25% reduction in the applicable margin rates for both SOFR and ABR loans, which could reduce the interest costs on the company’s debt.
The credit agreement amendment will be included as an addendum to Vitesse Energy’s upcoming quarterly report for the period ending September 30, 2024. This strategic financial move comes as Vitesse Energy continues to navigate the dynamic energy market.
In other recent news, Vitesse Energy reported increased production and dividends in its second-quarter 2024 earnings call. The company saw an 8% increase in production compared to the previous quarter, averaging 13,504 barrels of oil equivalent per day. Vitesse also paid a dividend of $0.525 per share in June and plans to pay a similar dividend in September. The company’s financial health was underscored by $43.1 million in adjusted EBITDA, $11.7 million in adjusted net income, and $0.39 in adjusted earnings per share.
Vitesse also closed development acquisitions in North Dakota, investing over $40 million. The company’s leverage ratio stood at 0.67x, with $111 million in debt. The company expects significant increases in production and cash flow in Q4 2024 and 2025, and confirmed its 2024 guidance for production and capital expenditures. All of these recent developments highlight Vitesse Energy’s strategic approach to growth and efficiency.
InvestingPro Insights
Vitesse Energy’s recent credit facility amendment is consistent with its strong financial position, as evidenced by InvestingPro data. The company has a market cap of $734.96 million, with a price-to-earnings ratio of 28.62, indicating investor confidence in its earnings potential. Notably, Vitesse Energy has a large dividend yield of 8.43%, making it an attractive option for income-focused investors.
InvestingPro’s advice highlights that Vitesse Energy “pays a large dividend to shareholders” and “operates with a moderate level of debt,” supporting the company’s decision to maintain a large borrowing base while slightly reducing the amount of elective commitment. The advice that “the stock generally trades with low price volatility” may provide reassurance to investors regarding the stability of their holdings.
For those interested in a deeper analysis, InvestingPro offers 5 additional tips that can provide further insight into Vitesse Energy’s financial health and market position.