Q4 2025 Matador Resources Co Earnings Call

February 25, 2026

Speaker #1: At this time, all participants are on listen-only mode. We will facilitate a question-and-answer session at the end of the company's remark. As a reminder, this conference is being recorded for replay purposes.

Speaker #1: And the replay will be available on the company's website for one year as discussed in the company's earnings press release. Issued yesterday. I'll now turn the call over to Mr. Mac Schmitz, Senior Vice President, Investor Relations for Matador.

Speaker #1: Mr. Schmitz, you may begin.

Speaker #2: Thank you, Marvin. And good morning, everyone. And thank you for joining us for Matador's fourth quarter and full year 2025 earnings conference call. Some of the presenters this morning will reference certain non-GAAP financial measures usually regularly used by Matador Resources in measuring the company's financial performance.

Mac Smith: Thank you, Marvin, good morning, everyone, thank you for joining us for Matador's Q4 and full year 2025 Earnings Conference Call. Some of the presenters this morning will reference certain non-GAAP financial measures, usually regularly used by Matador Resources in measuring the company's financial performance. Reconciliations of such non-GAAP financial measures with the comparable financial measures calculated in accordance with GAAP are contained at the end of the company's earnings press release. As a reminder, certain statements included in this morning's presentation may be forward-looking and reflect the company's current expectations or forecasts of future events based on the information that is now available. Actual results and future events could differ materially from those anticipated in such statements.

Speaker #2: Reconciliations of such non-GAAP financial measures with the comparable financial measures calculated in accordance with GAAP are contained at the end of the company's earnings press release.

Speaker #2: As a reminder, certain statements included in this morning's presentation may be forward-looking and reflect the company's current expectations or forecasts of future events based on the information that is now available.

Speaker #2: Actual results and future events could differ materially from those anticipated in such statements. Additional information concerning factors that could cause actual results to differ materially is contained in the company's earnings release and its most recent annual report on Form 10-K, and any subsequent quarterly reports on Form 10-Q.

Mac Smith: Additional information concerning factors that could cause actual results to differ materially is contained in the company's earnings release and its most recent annual report on Form 10-K and any subsequent quarterly reports on Form 10-Q. In addition to our earnings press release yesterday, I would like to remind everyone that you can find a slide presentation in connection with our Q4 and full year 2025 earnings release under the Investor Relations tab on our corporate website. With that, I would now like to turn the call over to Mr. Joe Foran, our Founder, Chairman, and CEO. Joe?

Speaker #2: In addition to our earnings press release yesterday, I would like to remind everyone that you can find a slide presentation in connection with our fourth quarter and full year 2025 earnings release under the Investor Relations tab on our corporate website.

Speaker #2: And with that, I would now like to turn the call over to Mr. Joe Foran, our founder, chairman, and CEO. Joe?

Speaker #3: Thank you, Mac. And thanks to everybody who's listening in and taking the opportunity to participate in this conference call. The first thing I do is really encourage you to look over the slides, particularly if you don't have time to read the whole press release that we had.

Joseph Wm. Foran: Thank you, Mac, and thanks to everybody who's listening in, that's taking the opportunity to participate in this conference call. The first thing I do really encourage you to look over the slides, particularly if you don't have time to read the whole press release that we had. There's been a lot of thought put into those slides to try to make important points that I believe are essential to the Matador story. Second, if you also do not feel you've been given an adequate opportunity to ask questions, we want to invite each of you to come visit us at our offices, where we will make sure that you're given all the time that you want to ask your questions and get your answers.

Speaker #3: There has been a lot of thought put into those slides to try to make important points that I believe are essential to the Matador story.

Speaker #3: Second, if you also do not feel you've been given an adequate opportunity to ask questions, we want to invite each of you to come visit us at our offices where we will make sure that you're given all the time that you want to ask your questions and get your answers.

Speaker #3: And, in particular, we would invite—if you do come—we will make sure that you get to have lunch with the executive team, or most of the executive team that's in town. Or, if you'd rather, we will arrange for you to meet or have breakfast or lunch with a lot of our young leaders and get to know the people who are coming up and being pillars of support and activity and are just doing a wonderful job, a great job in directing our various activities.

Joseph Wm. Foran: In particular, we would invite, if you do come, we will make sure that you get to have lunch with the executive team or most of the executive team that's in town. If you'd rather, we will arrange for you to meet or have breakfast, or lunch with a lot of our young leaders, and get to know the people who are coming up and being pillars of support and activity, and are just doing a wonderful job, great job in directing our various activities.

Joseph Wm. Foran: Of course, they're relative, you know, have some years of experience, but they're the ones who are actually on the job, and the first level of supervision and executive action, which, you know, none of the seniors will be in there, but give you that opportunity to get some very frank responses. That invitation goes, and just work through Matt to set up such a meeting. What I wish to emphasize today in this conversation is the quality inventory that we've procured over time, particularly in the Delaware, where I started Matador over 40 years ago, 43, to be exact, and that's where we started out in the Delaware. We've got to reflect 40, over 40 years of experience, and still think it's the best rock in the country.

Speaker #3: And of course, their relative have some years of experience but they're the ones who are actually on the job and the first level of supervision and executive action, which none of the seniors will be in there, but give you that opportunity to get some very fine responses.

Speaker #3: And that invitation goes and just work through Mac to set up such a meeting. Then, what I wish to emphasize today in this conversation is the quality inventory that we've procured over time, particularly in the Delaware, where I've been. I started Matador over 40 years ago—43 to be exact—and that's where we started out, in the Delaware.

Speaker #3: So we've got Reflect over 40 years of experience and still think it's the best rock in the country. And we like the position that we built.

Joseph Wm. Foran: We like the position that we built. It's now over 200,000 acres. My experience, having started a company, is when you're in what you feel is the best rock, it's a lot easier to build than trying to go to some of these outlying areas. Feel free to ask whatever tough questions you want on the inventory. I think our position stands out against anybody, acre for acre. Second is, I hope you'll note the strong balance sheet that we have, and that this past quarter, we increased production. Most importantly, we increased reserves by 9%, as measured by Netherland and Sewell. We increased production and reduced debt, and we had strong cash flow throughout, even though prices went up and down throughout the last 90-day period.

Speaker #3: It's now over 200,000 acres. And if you're going to my experience, having started a company, is when you're in what you feel is the best rock, it's a lot easier to build than trying to go to some of these outlying areas.

Speaker #3: So feel free to ask whatever tough questions you want on the inventory. I think our position stands out against anybody acre for acre. Second is I hope you'll note the strong balance sheet that we have, and that this past quarter we increased production most importantly, we increased reserves by 9%.

Speaker #3: It was measured by the Netherlands and Sewell. So we have a we increased production and reduced debt. And we had strong cash flow throughout, even though prices went up and down throughout the last 90-day period.

Joseph Wm. Foran: We believe this inventory, balance sheet, the strong cash flow, all lead to growth, optionality, and with San Mateo, we are now have flow assurance outside the basin. Hugh Brinson has been a change maker for us, and we're excited to work with Energy Transfer on that opportunity. With that, we'll take the questions. Matt?

Speaker #3: We believe this inventory balance sheet, the strong cash flow all lead to growth, optionality, and with Sam Mateo, we are now have flow assurance outside the basin.

Speaker #3: The Hugh Brinson has been a change-maker for us, and we're excited to work with Energy Transfer on that opportunity. And with that, we'll take the questions, Mac.

Mac Smith: Sounds great. Thanks. Marvin, we're ready for Q now.

Speaker #2: Sounds great. Thanks. Marvin, we're ready for Q&A.

Speaker #4: Thank you. At this time, we'll conduct the question-and-answer session. As a reminder to ask the question, you'll need to press star 11 on your telephone and wait for your name to be announced.

Operator: Thank you. At this time, we'll conduct a question and answer session. As a reminder, to ask a question, you will need to press star one one on your telephone and wait for your name to be announced. To withdraw your question, please press star one one again. Ladies and gentlemen, due to time constraint, we ask that you please limit yourself to one question. Again, we ask that you please limit yourself to one question, until all have had a chance to ask a question, after which we would welcome additional follow questions from you. First question comes from the line of Noah Lee Rose of Bank of America. Your line is now open.

Speaker #4: To withdraw your question, please press star 11 again. Ladies and gentlemen, due to time constraints, we ask that you please limit yourself to one question.

Speaker #4: Again, we ask that you please limit yourself to one question. And to all who have had a chance to ask a question, after which we would welcome additional follow-up questions from you.

Speaker #4: First question comes from the line of Lauren Lee Rose of Bank of America. Your line is now open.

[Analyst] (BofA Securities): Hey, this is Noah here. You guys increased your net undrilled lateral footage by 2% this year. I guess, you know, was this delineation or a result of your brick by brick land strategy? Where were these location adds? You also had some pretty significant inventory adds in the Avalon, Third Bone Spring Carbonate, and Wolfcamp D. Are you seeing something that you like from those formations?

Noah Lee Rose: Hey, this is Noah here. You guys increased your net undrilled lateral footage by 2% this year. I guess, you know, was this delineation or a result of your brick by brick land strategy? Where were these location adds? You also had some pretty significant inventory adds in the Avalon, Third Bone Spring Carbonate, and Wolfcamp D. Are you seeing something that you like from those formations?

Speaker #2: Hey, this is Noah here. So, you guys increased your net un-drilled lateral footage by 2% this year. I guess, was this the delineation or a result of your brick-by-brick land strategy?

Speaker #2: And were these location where were these location ads? And you also had some pretty significant inventory ads in the Avalon, Third Bone, Spring Carbonate, and Wolf Camp D.

Speaker #2: Are you seeing something that you like from those formations?

Joseph Wm. Foran: Hey, first, I just say, it was a lot more than one question, wasn't it? Which, which one of those do you want Tom to answer?

Speaker #3: Hey, first, I just say it was a lot more than one question wasn't it? So which one of those do you want Tom to answer?

[Analyst] (BofA Securities): Really, just, if you could, on the, on the inventory adds, and if you're seeing anything you like on the Avalon, Third Bone Spring, or Wolfcamp D?

Speaker #4: Really, just if you could, on the inventory ads—and if you're seeing anything you like on the Avalon, Third Bone, Spring, or Wolfcamp D.

Noah Lee Rose: Really, just, if you could, on the, on the inventory adds, and if you're seeing anything you like on the Avalon, Third Bone Spring, or Wolfcamp D?

Speaker #2: Sure. No, this is Tom Elsinger, EVP for Resort Engineering. Definitely appreciate your question, and it's something we're very, very proud to answer. I would say the production out of the Avalon in particular has been very strong.

W. Thomas Elsener: Sure, Noah, this is Tom Elsner, EVP for Reservoir Engineering. I definitely appreciate your question, and it's something we're very, very proud to answer. I would say the production out of the Avalon in particular, has been very strong. I think we highlighted a particular well in our kind of southern ranger asset area called the Gavilan, a very strong upper Avalon well that has, you know, been a very, very high performer. I think it's getting close to have made over 400,000 BOE, very high oil cuts. It's something that we have a lot of running room in that part of the basin floor. It's something that we've expanded our inventory in, you know, over the years.

Speaker #2: I think we highlighted a particular well in our kind of Southern Ranger/Acid area called the Gabalon—a very strong Upper Avalon well that has been a very, very high performer.

Speaker #2: I think it's getting close to having made over 400,000 BOE. Very high oil cuts. It's something that we have a lot of running room for in that part of the basin.

Speaker #2: It's something that we've expanded our inventory in over the years, so it's something we see as being a big part of the Basin. The other zones—various ads kind of all throughout the position—is what I would say.

W. Thomas Elsener: It's something we see as, you know, a big part of our, of our campaign out in the Delaware Basin. The other zones, you have various, you know, various adds and all throughout the position, is what I would say. I'm proud that you noted the increase in footage. Our teams have been very busy doing trades, extending laterals, and we're very proud to see the 6% increase in our average lateral length in our inventory from 2024 to 2025. We've noted that we've been drawing some 3.4 mile long laterals, particularly on our Ameredev acreage, that have helped us to dramatically increase our average lateral length.

Speaker #2: I'm proud that you noted the increase in footage. Our teams have been very busy doing trades, extending laterals, and we're very proud to see the 6% increase in our average lateral length in our inventory from 2024 to 2025.

Speaker #2: We've noted that we've been drawing some 3.4-mile-long laterals particularly on our Amerida acreage that have helped us to dramatically increase our average lateral length.

Speaker #2: And I think that that's something that I would tip my hat to Chris Calvert and all the operations teams for—pushing our lateral lengths out to these types of distances and doing it very, very well.

W. Thomas Elsener: I think that that's something that I would tip my hat to Chris Calvert and all the operations teams for, you know, pushing our lateral lengths out to these types of distances and, doing it, you know, very, very well. I think our teams have been able to improve the quality of our inventory, you know, through good geoscience support, you know, from Andrew Parker. You mentioned the Third Bone Spring carbonate was a zone that we had not originally included in our inventory, several years ago, and it's one that we've drilled very successfully, kind of, all throughout our Delaware Basin position.

Speaker #2: I think our teams have been able to improve the quality of our inventory through good geoscience support from Andrew Parker, identifying—you mentioned the Third Bone Spring Carbonate was a zone that we had not originally included in our inventory several years ago.

Speaker #2: And it's one that we've drilled very successfully kind of all throughout our Delaware basin position. Our teams had started with that target down in our Wolf area.

W. Thomas Elsener: Our teams had started with that target down in our Wolf area many years ago, then moved it further north into some of our top properties over in Ranger, then over across into Rustler Breaks. It's been one that has been a great add to our position.

Speaker #2: Many years ago, and then moved it further north into some of our properties over in Ranger, and then over across into Russell Brakes. And it's been one that has been a great add to our position.

Speaker #4: Thank you. One moment for our next question. Our next question comes from a line of Neil Dingman of William Blair. Your line is now open.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Neal Dingman of William Blair. Your line is now open.

Neal Dingmann: Morning, guys and Joe. I'll make sure to keep it to one question. I don't want to get in trouble.

Speaker #2: Morning, guys. Joel, make sure to keep to one question. I don't want to get in trouble.

Neal Dingmann: Morning, guys and Joe. I'll make sure to keep it to one question. I don't want to get in trouble.

Joseph Wm. Foran: Now, Neal?

Speaker #5: Neil, the other thing is what maybe some of the others on the deal, you know the way to our office. And you've been here a number of times, asking these questions, and we've always appreciated it.

Neal Dingmann: Yep.

Joseph Wm. Foran: The other thing is, maybe some of the others on the deal, you know the way to our office. You've been here a number of times, asking these questions, and we've always appreciated it. It's been a very useful dialogue, and the guys like having you come and ask you various questions. They're hoping you'll come back.

Speaker #5: It's been a very useful dialogue. And the guys like Kevin, you come and ask your various questions. And so they're hoping you'll come back.

Neal Dingmann: I appreciate that. You all have been very generous with the time, Joe. Joe, my question for you or Brian is really just on the 2026 plan. It seems, you know, you continue now to target free cash flow over production growth. You looked this year, great plan out there for 3% oil growth with 11% reduced capital spend. You know, I compare this to prior years, where maybe you were targeting higher production growth. My question is: I know you talked about value creation being sort of the key driver out there. Do you believe that the key to the value creation is just this capital and operational efficiency?

Speaker #2: I appreciate that. You all have been very generous with the time Jonah. It definitely look forward to getting back there soon. Joe, my question for you or Brian is really just on the 26 plan.

Speaker #2: It seems you continue now to target free cash flow over production growth. You looked this year, great plan out there for 3% oil growth with 11% reduced capital spend.

Speaker #2: If I compare this to prior years, where maybe you were targeting higher production growth, my question is: do you all now believe— I know you talked about value creation being sort of the key driver out there.

Speaker #2: Do you believe that the key to the value creation is just this capital and operational efficiency? Or what do you all look at as the key for this value creation?

Neal Dingmann: What, you know, what do you all look at as the key for this value creation?

Speaker #3: Well, it's a good question and it's a fair question. The way we do things is you know we like to collaborate with each other.

Joseph Wm. Foran: Well, it's a good question, and it's a fair question. The way we do things, as you know, we like to collaborate with each other, and several of us kind of lean one way, and others lean another way on what's important. When we roll that all together, it comes out that I think it depends on the time, you know, and what the nation's economy is doing and political situation, is which one you lean perhaps more on, what interest rates are. There's a lot of factors that go into it, as you would guess, just like what sector of the economy would you invest in? It varies from year to year and time to time.

Speaker #3: And several of us kind of lean one way and others lean another way on what's important. And then when we roll that all together, it comes out that I think it depends on the time and what the nation's economy is doing and political situation.

Speaker #3: Is which one you lean perhaps more on? What interest rates are? And so there's a lot of factors that go into it, as you would guess, just like what sector of the economy would you invest in?

Speaker #3: It varies from year to year and time to time. But our first we begin with first thing is look for the good acreage because if you have the good acreage, things generally have a good outcome.

Joseph Wm. Foran: We begin with first saying is, look for the good acreage, because if you have the good acreage, things generally have a good outcome. It's hard to turn bad acreage into profitable or highly profitable wells. Beginning with, is this a well that's in the right areas and the zone that's been properly tested, or is this a exploration, in effect, well? The other thing is, I lean more towards the long-term reserve growth, because when you've proved up the reserves, then it becomes optional when you want to complete wells in those zones and bring them and bring them to market. The...

Speaker #3: And it's hard to turn bad acreage into profitable or highly profitable wells. So, beginning with: is this a well that's in the right areas?

Speaker #3: And the zone that's been properly tested, or is this an exploration in effect well? The other thing is I lean more towards the long-term reserve growth because when you've proved up the reserves, then it becomes optional.

Speaker #3: When you want to complete wells in those zones and bring them to market, and you want to do it in a deliberate style, because as you drill these wells, the more you drill them, the better your pro-lateral foot or footage rate is, because you just are drilling them faster.

Joseph Wm. Foran: You want to do it in a deliberate style, because as you drill these wells, the more you drill them, the better your per lateral foot or footage rate is, because you just are drilling them faster. You've learned to adapt some ways of increasing your footage and reducing your costs. Last call we had, we were beaten up, because we had grown our production, but we had also grown our CapEx. That CapEx was, you know, we took criticism for that. This quarter, we showed what we could do, the capital efficiencies, that reduced CapEx spending by 11%, and we were able to recover essentially the same amount of production. To us, most important, because of the fluctuation in prices, we increased our overall reserves by 9%.

Speaker #3: You've learned to adapt some ways of increasing your footage and reducing your cost. So last call we had, we were beating up because we had grown our production but we had also grown our capex.

Speaker #3: And that capex was we took criticism for that. This quarter, we showed what we could do the capital efficiencies that reduced capex spending by 11%.

Speaker #3: And we were able to recover essentially the same amount of production but to us, most important because of the fluctuation in prices, we increased our overall reserves by 9%.

Speaker #3: That's not our numbers. But that's Netherlands and Sewell's numbers. And so we thought that was a good outcome in total for the 90-day period, that we increased production a little bit, 1%.

Joseph Wm. Foran: That's not our numbers, but that's Netherland and Sewell's numbers. We thought that was a good outcome in total for the 90-day period, that we increased production a little bit, 1%, but we reduced cost, CapEx by 11% for the same amount, roughly the same amount of lateral footage, and our overall reserves went up by 9%. We thought that's good, but y'all be the judge of it, and the market will be the judge of that. We're pretty excited that we have those numbers headed in that way. Production's up, costs are down, and that we've proved up some new zones, and that we're very excited about. With fewer rigs, and I'll let Chris take over from here.

Speaker #3: But we reduced cost, capex, by 11% for the same amount, roughly the same amount of lateral footage and our overall reserves went up by 9%.

Speaker #3: So we thought that's good. But y'all be the judge of it and the market will be the judge of that. But we're pretty excited that we have those numbers headed in that way.

Speaker #3: Production's up, costs are down, and we've proved up some new zones that we're very excited about. And so, with fewer rigs—and I'll let Chris take over from here—he can share what he feels were the most important accomplishments for the quarter.

Joseph Wm. Foran: He tells what was most important accomplishments for the quarter.

Speaker #2: Yeah. Hi, Neil. Chris Calvert, EVP. Chief Operating Officer. Great question. When we look at value creation specifically long-term value creation, I think the fundamentals of your question really do kind of build the foundation of what we think that value creation is.

Christopher P. Calvert: Yeah. Hi, Neal. Chris Calvert, EVP, Chief Operating Officer. Great question. You know, when we look at value creation, specifically long-term value creation, I think the fundamentals of your question really do kind of build the foundation of what we think that value creation is. You know, it's profitability focused, not necessarily production focused. When we look at that, then we try to figure out the ways to optimize the levers that build that strategy. On the revenue side, you look at the value of Hugh Brinson as that comes online towards the back end of this year to help improve gas realizations that we spoke to, the production impacts of that in the Q1. You look at the CapEx spend, you know, the 11% reduction, $130 million in CapEx savings forecasted for 2026.

Speaker #2: It's profitability. Profitability-focused, not necessarily production-focused. When we look at that, then we try to figure out the ways to optimize the levers that build that strategy.

Speaker #2: And so, on the revenue side, you look at the value of Hugh Brinson as that comes online towards the back end of this year to help improve gas realizations that we spoke to.

Speaker #2: The production impacts of that in the first quarter. You look at the capex spend, the 11% reduction, the 130 million dollars in capex savings forecasted for 2026.

Christopher P. Calvert: You know, I'd refer you to slide 6 to look at our year-over-year improvements in well costs. Really, even more specifically, I would focus you to slide 19, which I think tells a better story, that shows that we're able to achieve these well cost reductions while delivering stronger well results. When we can go out and deliver 10% improvements from an EUR perspective and do it at a lower investment cost, I think being able to optimize those levers just continue to improve the fundamentals of that long-term value creation. I think it's a great question, something we are hyper-focused on. The CapEx component of our 2026 plan is something that we are extremely thoughtful to, that is going to be underpinned by efficiencies, vendor relationships in these volatile times, and we'll look forward to deliver that plan.

Speaker #2: I'd refer you to slide 6 to look at our year-over-year improvements. More specifically, I would focus you to slide 19, which I think tells a better story that shows that we're able to achieve these well cost reductions while delivering stronger well results.

Speaker #2: And so when we can go out and deliver 10% improvements from an EUR perspective and do it at a lower investment cost, I think being able to optimize those levers just continue to improve the fundamentals of that long-term value creation.

Speaker #2: And so I think it's a great question, something we're hyper-focused on. The capex component of our 2026 plan is something that we are extremely thoughtful about, and that is going to be underpinned by efficiencies, vendor relationships, and these volatile times.

Speaker #2: And we'll look forward to deliver that plan.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Tim Rezvan of KeyBanc Capital Markets. Your line is now open.

Speaker #1: Thank you. One moment for our next question. Our next question comes on the line of Tim Rizvon of Quebec Capital Markets. Your line is now open.

Speaker #4: Hey, good morning, folks. Thank you for taking my one question. Joe and Brian, we couldn't help but notice the second priority for 2026 and your earnings release was midstream value realization.

Tim Rezvan: Hey, good morning, folks. Thank you for taking my one question. Joe and Brian, we couldn't help but notice, the second priority for 2026 in your earnings release was midstream value realization. We also saw your report, aggregate San Mateo and Matador Midstream, EBITDA guidance, you know, for the year. As we think about the timeline, knowing this is a high priority, it seems like a drop of Matador assets into San Mateo seems to be a precursor to anything. Is that something you could do now? Do you need to let the dust settle, on the FivePoint continuation vehicle first? Can you just kind of walk through the theoretical steps we could be looking at this year? Thank you.

Speaker #4: We also saw your report aggregate San Mateo and Matador midstream EBITDA guidance for the year. So as we think about the timeline, knowing this is a high priority, it seems like a drop of Matador assets into San Mateo seems to be a precursor to anything so is that something you could do now?

Speaker #4: Do you need to let the dust settle on the five-point continuation vehicle first? Can you just kind of walk through the theoretical steps we could be looking at this year?

Speaker #4: Thank you.

Joseph Wm. Foran: That's a good one question. Let me try to answer. I was trying to make notes as you were asking that. No, the limitation of the one question is we're not limiting our time with y'all. After these one questions you've gone through, if you've still got them, stay on the line. We'll stay here as long as you want to ask them. We invite you to come see us. Now, in answer to your question that you're talking about, is that we approach this on a very holistic approach. It's not me sitting in a room and telling everybody else what to do. We gather in here, in this room, same room that we're talking to you. We thrash it out.

Speaker #3: And that's a good one, question. Let me try to answer it. I'll try to make notes as you were asking that. But no, the limitation of the one question is we're not limiting our time with y'all.

Speaker #3: After these one-questions are gone through, if you've still got them, stay on the line. We'll stay here as long as you want to ask them.

Speaker #3: And we invite you to come see us. Now, in answer to your question, what you're talking about is that we approached this from a very holistic approach.

Speaker #3: And it's not me sitting in a room and telling everybody else what to do. We gather in here, in this room—the same room that we're talking to—and we thrash it out.

Joseph Wm. Foran: Different people have different views, but when we get through, we all feel like we've hashed out a good plan. You know, we try to be nimble enough that as the economic climate changes, we'll change with it. It's been that kind of 90-day period in the past where you had to move cautiously, or I felt my 40 years experience out here is be cautious. Cautiously, you have a president saying he wants $50 oil. That isn't gonna work long term for the industry, needs to go more higher. You've got a world situation where you got the prospect of war in Iran, you've got Europe that we're having difficulties on both sides.

Speaker #3: Different people have different views. But when we get through, we all feel like we've hashed out a good plan. And we try to be nimble enough that as the economic climate changes, we'll change with it.

Speaker #3: And so it's been that kind of 90-day period in the past where you had to move cautiously. Or I felt. My 40 years experience out here, it's be cautious.

Speaker #3: Because cautiously, you have a president saying he wants $50 oil. That isn't going to work long-term for the industry. Needs to go more higher.

Speaker #3: You've got a world situation where you got the prospect of war in Iran. You've got Europe that we're having difficulties on both sides. They don't like some of the things we're doing.

Joseph Wm. Foran: They don't like some of the things we're doing, I don't know who's right or wrong, but I hope they get resolved. Europe has been a good ally for us. You know, in our own country, you have this relations with Mexico, Venezuela, you know, all those different countries. The world view you got to take into account. The hedge, we hedged our bet. We're 50% hedged on oil to protect the balance sheet, no matter which direction we ultimately head. We've taken those precautions. We have, we've got great vendors. Patterson is always helpful to us on timing of rigs and quality of rigs.

Speaker #3: And I don't know who's right or wrong. But I hope they get resolved. Europe has been a good ally for us. And then in our own country, you have this relations with Mexico, Venezuela, all those different countries.

Speaker #3: That so you have the worldview. You got to take into account and so do we hedge our bet with 50% hedged on oil. To protect the balance sheet, no matter which way we which direction we ultimately head, but we've taken those precautions.

Speaker #3: We have we've got great vendors, Patterson is always helpful to us. I'll timing of rigs and quality of rigs. So it's a complex multifaceted and we get the various department heads in here.

Joseph Wm. Foran: It's a complex, multifaceted, and we get the various department heads in here, and we hash it out, making sure we're taking all this into account. FivePoint has been very good to work with, and that simply is a situation that they have an exit period in their fund, and they've got a continuation fund working so that they can work out long term. That's making steady progress, and we expect it to be resolved in the near term. We don't have control over that, but FivePoint's been a good partner, and they've done what they've said they would do. We're watching that.

Speaker #3: And we hash it out, making sure we're taking all this into account. Five Point has been very good to work with. And that simply is a situation that they have an exit period in their fund.

Speaker #3: And they've got to continue fund working so that they can work out long-term. And that's headed that's making steady progress. And we expect it to be resolved in the near term.

Speaker #3: We don't have control over that. But five-point's been a good partner. And they've done what they've said they would do. And so we're watching that.

Joseph Wm. Foran: You got activities, oil is important to the state of New Mexico, so you're going to deal with government agencies, like the Bureau of Land Management, and like the State Land Office on these matters, and what are their plans? Incorporating that in, you know, we really like our bank group. They've been very supportive, and we have an RBL that, of course, has increased over time as we've proved up more reserves, which is something we take into account. All night in the most recent redetermination by our bank group was that they came back and increased our borrowing base, and all 19 were unanimous in their support and even raised the amount that they had been offering on the, you know, on the midstream system.

Speaker #3: You’ve got activities—oil is important to the state of New Mexico. So you're going to deal with government agencies, like the Bureau of Land Management.

Speaker #3: And, like, the State Land Office on these matters—and what are their plans? So, incorporating that in. And then we really like our bank group.

Speaker #3: And they've been very supportive. And we have a an RBL that, of course, is increased over time as we've proved up more reserves, which is something we take in into account.

Speaker #3: And all night in the most recent redetermination by our bank group was that they came back and increased our borrowing base. And all 19 were unanimous in their support.

Speaker #3: And they even raised the amount that they had been offering on the midstream system. So we thought that was a win the whole way through.

Joseph Wm. Foran: We thought that was a win the whole way through. Other suppliers, B&L Pipeco Services, has been very supportive through time. We'd like to confirm what direction pipe prices are, because when you're drilling these longer laterals, you want to be sure you have the best quality pipe at the best prices. Give credit to all of them and Halliburton on our frac designs and execution. I would say, you know, you're not going to make a decision in an afternoon, but you're going to gather together, get everybody's proposals in there, massage them together, and go from there. It's something that these long relationships that we have with these vendors really pays off because you just make that time together in planning this that much more efficient.

Speaker #3: Other suppliers, B&L, PIPECO, has been very supportive through time. And we'd like to confirm what direction PIPE prices are. Because when you're drilling these longer laterals, you want to be sure you have the best quality PIPE at the best prices.

Speaker #3: So give credit to all of them and Halliburton on our frac designs. And execution. So I would say you're not going to make a decision in an afternoon.

Speaker #3: But you're going to gather together get everybody's proposals in there. Massage them together. And something that these long relationships that we have with these vendors really pays off.

Speaker #3: Because you just you really make that time together in planning this. That much more efficient. And we think that planning has played a big role in the reduction in our CapEx.

Joseph Wm. Foran: We think that planning has played a big role in the reduction in our CapEx, as well as the efficiency gains and, like the timing, you know, and the timing that we have in drilling these wells, we're just drilling them faster than we have in the past because everybody knows what they're supposed to do, and people come up with ways to expedite the operation and the drilling plans. Chris, did I leave something out there?

Speaker #3: As well as the efficiency gains in, like, the timing—the timing that we have in drilling these wells. We're just drilling them faster than we have in the past.

Speaker #3: Because everybody knows what they're supposed to do. And they people come up with ways to expedite the operation. And the drilling plans. Chris, did I leave something out there?

Christopher P. Calvert: No, I think Joe hit on a lot, and I think to the question, Tim, you know, the relationships we have on the E&P upstream side that Joe has mentioned have been long-standing and part of the success story of the operational excellence of Matador. I think to the story with FivePoint and the continuation vehicle, I think what we're excited about is they're structuring a deal that allows them to be part of the future growth of the entity. Now, as the drop-down conversation moves forward, I think that's something that from the E&P side, we have referenced these 3.4 mile laterals. We've referenced the productivity of the Ameredev acreage that is now in our asset base.

Speaker #2: No, I think Joe hit on a lot. And I think, to the question, Tim, the relationships we have on the AMP upstream side that Joe has mentioned have been long-standing—a part of the success story of the operational excellence of Matador.

Speaker #2: And I think to the story with Five-point and the continuation vehicle, I think what we're excited about is they're structuring a deal that allows them to be part of the future growth of the entity now as the drop-down conversation moves forward.

Speaker #2: I think that's something that from the AMP side, we have referenced these 3.4-mile laterals. We've referenced the productivity of the Ameridev acreage that is now in our asset base.

Speaker #2: And so I think that is an exciting story, from both the AMP side and the wholly owned Matador—excuse me, Matador Midstream side—the gathering side.

Christopher P. Calvert: I think that is an exciting story from both the E&P side and the wholly owned Matador Midstream side, the gathering side. I think that the cadence of any sort of drop-down, I think that's something that we will continue to work on. We're excited about the continuation vehicle simply because it's another sign of support from FivePoint, and they've been supportive of everything, you know, from plant expansions to interconnects between Marlin and Black River. This is just another sign that they want to be a part of the growth story that is San Mateo.

Speaker #2: And so I think that the cadence of any sort of drop-down, I think that's something that we will continue to work on. But we're excited about the continuation vehicle simply because it's another sign of support from Five-point.

Speaker #2: And they've been supportive of everything, from plant expansions to interconnects between Marlin and Black River. This is just another sign that they want to be a part of the growth story that is San Mateo.

Joseph Wm. Foran: Chris, I think that's excellent. I just want to add on to that we've gotten a number of questions recently about our artificial intelligence participation. What we found most effective is to work together with our vendors, where we can use artificial intelligence between us. Most often, they have the program, they're ahead of us, maybe more often. Work together, it's a win-win situation. We're taking, maybe it's baby steps, but we are taking it in a deliberate fashion with our partners, some of whom have more experience in this area, and we feel like, you know, it's another win-win, where we all are gaining from the collaboration.

Speaker #3: Chris, thanks. That's excellent. But I just want to add on to that. That we've gotten a number of questions recently about our artificial intelligence participation.

Speaker #3: And what we found most effective is to work together with our vendors, and where we can use artificial intelligence between us. Most often, they have the program.

Speaker #3: They're ahead of us maybe more often, but we work together so it's a win-win situation. And so we're taking—maybe it's baby steps—but we are taking it in a deliberate fashion with our partners.

Speaker #3: Some of whom have more experience in this area. And we feel like it's another win-win, where we all are gaining from the collaboration.

Speaker #4: Thank you. One moment for our next question. Our next question comes from the line of Zach Perham of JPMorgan. Your line is not open.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Zachary Parham of JPMorgan. Your line is now open.

Zachary Parham: Hey, thanks for taking my questions. Can you talk about how you're thinking about using the buyback going forward? It was relatively limited over the last couple of quarters. I know you didn't plan to be formulaic with the buyback. Just any thoughts on how you plan to allocate free cash flow to buybacks in the future? Thanks.

Speaker #5: Hey, thanks for taking my questions. Can you talk about how you're thinking about using the buyback going forward? It was relatively limited over the last couple of quarters.

Speaker #5: I know you didn't plan to be formulaic with the buyback, but just any thoughts on how you plan to allocate free cash flow to buybacks in the future?

Speaker #5: Thanks.

Speaker #2: Yeah. Hey, Zach. This is Rob Macalik. CFO definitely on the shareholder return we're proud of the cash we've returned. In the form of both the dividend and the share buyback.

Robert T. Macalik: Yeah. Hey, Zach, this is Rob Macalik, CFO. You know, definitely on the shareholder return, we're proud of the cash we've returned, you know, in the form of both the dividend and the share buyback. You know, we've raised the dividend, you know, 6 times in the last 4 years and are really proud of the 3% yield that we have on that dividend today. We just instituted the share buyback in 2025, and we think it's a really nice extra tool that we have at our discretion. As you can see through the management and employee share purchases, including the guys in the field, you know, we, as a management team, feel like the stock is undervalued. We've been trying to be prudent with our capital.

Speaker #2: We've raised the dividend six times in the last four years, and are really proud of the 3% yield that we have on that dividend today.

Speaker #2: We just instituted the share buyback in 2025. And we think it's a really nice extra tool that we have at our discretion. As you can see through the management and employee share purchases, including the guys in the field, we as a management team feel like the stock is undervalued.

Speaker #2: And so we've been trying to be prudent with our capital. But we do think that the share buyback is a nice tool that we have that we can continue to use opportunistically and feel like between the dividend and the share buyback, are really good shareholder return tools to use.

Robert T. Macalik: We do think that the share buyback is a nice tool that we have that we can continue to use opportunistically. Feel like between the dividend and the share buyback, you know, are really good shareholder return tools to use. I think you'll continue to see us use that in a very conservative way, but use it when there's a dislocation between our stock price and what the rest of the market is doing.

Speaker #2: And so I think you'll continue to see us use that in a very conservative way. But use it when there's a dislocation between our stock price and what the rest of the market is doing.

Speaker #4: Thank you. One moment for our next question. Our next question comes from the line of Derek Whitfield of Texas Capital. Your line is not open.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Derrick Whitfield of Texas Capital. Your line is now open.

Derrick Whitfield: Good morning, all, and thanks for your time.

Speaker #6: Good morning all. And thanks for your time.

Speaker #2: Morning.

Robert T. Macalik: Morning.

Speaker #6: Thanks. Thanks for your time too. Wanted to focus on surfactants with my question. Could you perhaps elaborate on the enhanced performance you're seeing in your well results?

Joseph Wm. Foran: Thanks. Thanks for your time, too.

Derrick Whitfield: I wanted to focus on surfactants with my question. Could you perhaps elaborate on the enhanced performance you're seeing in your well results, the degree at which you could expand the program in 2026, and how much of this is baked into your guidance?

Speaker #6: The degree at which you could expand the program in 2026. And how much of this is baked into your guidance?

Speaker #2: Great. Great question. This is Chris Calvert again. So I'll start with the back part. We have not baked any sort of uplift into our 2026 production guidance plan.

Christopher P. Calvert: Great, great question. This is Chris Calvert again. I'll start with the back part. We have not baked any sort of uplift into our 2026 production guidance plan, I'll put that out right now. As far as quantifying the successful results, we're excited about the pilot test we did in 2025. You know, we have long used surfactants throughout completions. You know, this is something that as the technology advances, as we continue to delineate from a subsurface perspective in the parts of the basin that we feel could be more benefited from advanced surfactants, that was kind of the basis of our pilot test in 2025. We're excited about the early results. As we look into 2026, once again, that, no sort of uplift is baked into the production.

Speaker #2: So I'll put that out right now. As far as quantifying the successful results, we're excited about the pilot test we did in 2025. We have long used surfactants throughout completions.

Speaker #2: This is something that as the technology advances, as we continue to delineate from a subsurface perspective, in the parts of the basin that we feel could be more benefited from advanced surfactants, that was kind of the basis of our pilot test in 2025.

Speaker #2: So we're excited about the early results. As we look into 2026, once again, that no sort of uplift is baked into the production. However, I think it's a little early to speak to the enhancements or uplift other than the fact that we have noticed that it is formation specific.

Christopher P. Calvert: However, I think it's a little early to speak to the enhancements or uplift other than the fact that we have noticed that is, it is formation specific. Certain formations respond a little better, but I think that could delineate and differentiate as we move into 2026, as we test in different parts of the basin. Stay tuned. We're excited about the 2026 plan. Once again, the capital is projected into the budget, but not production.

Speaker #2: Certain formations respond a little better. But I think that could delineate and differentiate as we move into 2026 as we test in different parts of the basin.

Speaker #2: So stay tuned. We're excited about the '26 plan. And once again, budget, but not production.

Speaker #4: Thank you. One moment for our next question. Our next question comes from the line of John Abbott of Wolf Research. Your line is not open.

Operator: Thank you. One moment for our next question. Our next question comes from the line of John Abbott of Wolfe Research. Your line is now open.

John Abbott: Hey, good morning, and thank you for taking our question. My question is really on the Woodford. What is the strategy there? Is your position primarily held by production? You're drilling your first well in the first half of this year. You have additional pipeline capacity next by the end of this year. Is there further de-risking in 2027? How are you thinking about that play?

Speaker #2: Hey. Good morning. And thank you for taking our question. My question is really on the Woodford. What is the strategy there? Is your position primarily held by production?

Speaker #2: You're drilling your first well in the first half of this year. You have additional pipeline capacity by the end of this year. Is there further de-risking in 2027?

Speaker #2: How are you thinking about that play?

Speaker #6: Yeah. John, this is Chris. I can take it again and probably pass it to Tom. We're excited about the Woodford. Obviously, our geoscience team has long looked at deeper parts of the basin.

Christopher P. Calvert: Yeah, John, this is Chris. I can take it again and probably pass it to Tom. You know, we're excited about the Woodford. Obviously, our geoscience team has long looked at deeper parts of the basin. You know, we're excited we've delineated and have producing wells out of 23 discrete horizons in the basin. The Woodford would be additive to that. We have a geoscience team who's long looked at deeper parts of the basin, and I think if you've looked at public data, about some of these well results in and around the zip codes in which they're being reported, you'll see that there is a nice overlap to what we think is the fairway of this basin, that is existing to current Matador acreage on the map.

Speaker #6: We're excited about we've delineated and have producing wells out of 23 discrete horizons in the basin. The Woodford would be additive to that. And so we have a geoscience team who's long looked at deeper parts of the basin.

Speaker #6: And I think if you've looked at public data about some of these well results in and around the zip codes in which they're being reported, you'll see that there is a nice overlap to what we think is the fair way of this basin that is existing to current Matador acreage on the map.

Speaker #6: And so we look at this as additive. And I can kick it to Tom.

Christopher P. Calvert: We look at this as additive, and I can kick it to Tom.

Speaker #3: Hey, John. Appreciate your question on the first well in the Woodford. And so I would say our primary objective is to learn as much as we can about the Woodford and all the other zones immediately adjacent to it.

Robert T. Macalik: Hey, John, appreciate your question on the Woodford. You know, this is our, this will be our first well in the Woodford. I would say our primary objective is to learn as much as we can about the Woodford and all the other zones, you know, immediately adjacent to it. We'll be drilling a pilot hole and running logs, and I know Andrew Parker can speak more to, you know, some of those things. We do have a nice position over there, you know, on the eastern side of the basin, where, you know, others have had some success, further over into Texas, in the Woodford.

Speaker #3: We'll be doing a pilot hole and running logs. And I know Andrew Parker can speak more to some of those things. But we do have a nice position over there on the eastern side of the basin where others have had some success further over into Texas.

Speaker #3: And the Woodford. Clearly, we're very excited about it. And so it's something that would be purely incremental to our current inventory. We have not yet awarded any inventory whatsoever to the Woodford.

Joseph Wm. Foran: Clearly, we're very excited about it. It's something that is, would be purely incremental to our current inventory. We have not yet awarded any inventory whatsoever to the Woodford. So it'd be a great win for Matador. I'll pass it over to Andrew Parker to speak more.

Speaker #3: So it would be a great win for Matador. But I'll pass it over to Andrew Parker to speak more.

Speaker #2: Yeah, thanks, John. Just to add on to Chris and Tom here, we've had our eye on this. We're real excited about the results in Texas.

Andrew Parker: Yeah, thanks, John. You know, to add on to Chris and Tom here, is, you know, we've had our eye on this. We're real excited about the results in Texas, and, you know, we really like our rock in New Mexico, and we think we have a lot of running room here. You know, again, it's very early, but we're excited to share more about this test later in the year. You know, the Woodford, you know, it's an important part of the petroleum system in the Delaware Basin, which, you know, this just adds to our confidence of being in the best basin here and, you know, our confidence in our inventory across the basin as well. We're real excited about it.

Speaker #2: And we really like our Rock in New Mexico. And we think we have a lot of running room here. Again, it's very early, but we're excited to share more about this test later in the year.

Speaker #2: But the Woodford, it's an important part of the petroleum system in the Delaware basin. Which this just adds to our confidence of being in the best basin here.

Speaker #2: And our confidence in our inventory across the basin as well. So we're real excited about it.

Speaker #4: Thank you. One moment for our next question. Our next question comes from the line of Scott Handel of RBC Capital Markets. Your line is not open.

Operator: Thank you. We're moving for our next question. Our next question comes from the line of Scott Hanold of RBC Capital Markets. Your line is now open.

Speaker #5: Yeah. Thanks for taking my question. Can you Matador basically built itself on the brick-by-brick M&A as well as organic growth? And moving forward, it looks like I think for the industry, the growth rate is obviously coming down.

Scott Hanold: Yeah, thanks for taking my question. you know, like, Matador basically, you know, built itself on, you know, the brick by brick M&A, as well as organic growth. you know, and moving forward, it looks like, you know, I think for the industry, the growth rate is obviously, you know, coming down, you know, as well as Matador. What do you see in terms of the ways to add values for Matador going forward? Do you see a lot of M&A opportunities left to continue to consolidate?

Speaker #5: As well as Matador. But what do you see in terms of the ways to add values for Matador going forward? And do you see a lot of M&A opportunities left to continue to consolidate?

Speaker #2: Hey, Scott. This is Van Singleton, co-president. Thanks for your question. I think you can see from last year that our brick-by-brick approach was effective.

Andrew Parker: Hey, Scott, this is Van Singleton, Co-President. Thanks for your question. I think you can see from last year that our brick-by-brick approach was effective, as it has been for some time. 17,500 acres without doing a major transaction, that was 690 or so individual transactions. I think you can count to see us be vigilant to, you know, protect the balance sheet, but always look for good opportunities in the future. We try to keep a pipeline of deals coming in, but they need to be the right deals in the right neighborhoods.

Speaker #2: As it has been for some time. And 17,500 acres without doing a major transaction. That was 690 or so individual transactions. I think you can count to see us be vigilant to protect the balance sheet, but always look for good opportunities in the future.

Speaker #2: We try to keep a pipeline of deals coming in, but they need to be the right deals in the right neighborhoods. So many of these are in units we have or adjacent to units that we have, to form these longer laterals.

Andrew Parker: Many of these are in units we have, or adjacent to units that we have to form these longer laterals, and we're excited to see there's still opportunities out there, and we'll continue to make trades that are good for both sides. You know, again, just like doing the deals with EnCap, you know, they've been good partners to work with, and we look forward to other deals like that coming up. If some bigger deals do come up, we'll give them full evaluation and due consideration. We need to stick to our strategy of protecting the balance sheet and putting ourselves in a position for, you know, future growth. Brian, do you want to add to that?

Speaker #2: And we're excited to see there's still opportunities out there. And we'll continue to make trades that are good for both sides. Again, just like doing the deals with Incap, they've been good partners to work with.

Speaker #2: And we look forward to other deals like that coming up. And if some bigger deals do come up, we'll give them full evaluation and due consideration.

Speaker #2: But we need to stick to our strategy of protecting the balance sheet and putting ourselves in a position for future growth. Brian, do you want to add to that?

Speaker #6: Yeah. Hey, Scott. This is Brian Ehrman, co-president, chief legal officer, and head of M&A. Just to pile on to what Van said, I think we have shown that we can grow in different ways.

Bryan A. Erman: Yeah. Hey, Scott Hanold, this is Bryan A. Erman, Co-President, Chief Legal Officer, and Head of M&A. Just to pile on to what Van H. Singleton II said, I, you know, I think we have shown that we can grow in different ways. We did the Ameredev and Advance deals in previous years, and then as Van H. Singleton II said, we did 17,500 net acres and essentially replaced our inventory that we drilled last year through smaller deals. I think that's a differentiator for us, that we can grow through the bigger deals, and we do think there will be some out there in the future that to look at.

Speaker #6: We did the Ameredev and Advance deals. In previous years, and then as Van said, we did 17,500 net acres, and essentially replaced our inventory that we drilled last year through smaller deals.

Speaker #6: And so I think that's a differentiator for us—that we can grow through the bigger deals. And we do think there will be some out there in the future.

Speaker #6: To look at. But in the years that those aren't there, we can grow through the brick-by-brick approach. And we really do feel like that's a differentiator for Matador.

Bryan A. Erman: In the years that those aren't there, we can grow through the brick by brick approach, and we really do feel like that's a differentiator for Matador.

Joseph Wm. Foran: Scott, this is Joe, and let's put a little bit of this in perspective. You know, I started, as I, as you know, with $270,000 in 1983, and today, we've got over $10 billion in assets. Throughout that 40-year period, this same question's been asked and asked again: Do you think you can grow anymore? You know, has there been so much consolidation that there are not opportunities out there? We've always been able to find opportunities, and I don't really see it much different, and that we think it's we aim for being better, not just bigger. In a lot of these situations, by going after these areas like Woodford and they fit us very well. I'm not sure it fits a major.

Speaker #3: Scott, this is Joe. And let's put a little bit of this in perspective. I started, as you know, with $270,000 in 1983. And today, we've got over $10 billion in assets.

Speaker #3: So, throughout that 40-year period, this same question's been asked and asked again: Do you think you can grow any more? Has there been so much consolidation that there aren't opportunities out there?

Speaker #3: We've always been able to find opportunities. And I don't really see it much different. And that we think it's we aim for being better not just bigger.

Speaker #3: And in a lot of these situations, by going after these areas like the Woodford and that, they fit us very well. I'm not sure it's major they need to be down there where they've got hundreds of thousands of acres.

Joseph Wm. Foran: They need to be down there where they've got hundreds of thousands of acres, and these are small, smaller, but they still fit us, and we consolidate that way. Van and others have an active trading circle where we give up here in their area, and they give back. Those arrangements are working. As far as the profitability goes, I think we've proven over 40 years that we've managed our money well to reinvest in the right areas. Even at old Matador, you know, we were investing in the right areas there in developing trades. We've been active in each of these extensions, and we've had merger opportunities, many merger opportunities, but so far, we found that it's worked best to be as we are.

Speaker #3: And these are smaller, but they still fit us. And we consolidate that way. And Van, and others have an active trading circle where we give up here in their area, and they give back.

Speaker #3: So those arrangements are working. And as far as the profitability goes, I think we've proven over 40 years that we've managed our money well to reinvest in the right areas.

Speaker #3: And even at Old Matador, we were investing in the right areas there and developing trades. So we've been active in each of these extensions.

Speaker #3: And we've had merger opportunities. Many merger opportunities. But so far, we've found this worked best to be as we are where a little unique in a lot of areas.

Joseph Wm. Foran: We're a little unique in a lot of areas, and one thing is the collaboration with each other in the company, as well as with our outside relationships. A good example of this is working with Plains, as we have, and we've done. They made us aware of some very good ways to add to production and make sure we're in the right areas and right equipment, what's on pipe and what's still on trucking. Is another example is that. Rather than fret about who's the next merger or anything, we try to work on the efficiencies.

Speaker #3: And one thing is the collaboration with each other in the company as well as with our outside relationships. And a good example of this is working with Plains as we have.

Speaker #3: And we've done some they made us wear some very good ways to add to production and make sure we're in the right areas. And right equipment, what's on pipe, and what's still on trucking.

Speaker #3: And is another example is that so rather than Fred about who's the next merger or anything, we try to work on the efficiencies and think it worked out pretty well that in 43 years, we've moved from one rig and part of the time and having 300,000 in assets which at the time I thought was a lot of money.

Joseph Wm. Foran: Things have worked out pretty well, that in 43 years, we've moved from one rig and part of the time, and having $300,000 in assets, which at the time I thought was a lot of money, but not so much today, when we're drilling 3,000 feet or more, and gaining efficiencies there. The business has changed, but the basics about building relationship, being in the absolute best area you can afford, and working trades to consolidate things, and looking for the new technology, all that, you know, that's same, the same thing in sports, is that, you know, it's not how big your school is, but it's often about how good your people are.

Speaker #3: But not so much today when we're drilling 3,000 feet or more. And gain the efficiencies there. So the business has changed. But the basics about building relationship, being in the absolute best area you can afford, and working trades to consolidate things, and looking for the new technology, all that, that's the same thing in sports.

Speaker #3: Is that it's not how big your school is, but it's often about how good your people are. I mean, you look at University of Indiana hadn't had a winning season or championship since 1800s.

Joseph Wm. Foran: I mean, you look at Indiana University, hadn't had a winning season or championship since the 1800s, the late 1800s, but then they win the national championship because they got better people. It's not that we can bribe people into coming, but we do have a dedicated group of professionals who try to get better every day. You've been to our offices often, and Scott, wouldn't you agree that it's a very motivated group here that works well together and has kind of a unique culture to it? I ask that question of you, if you'd respond.

Speaker #3: The late 1800s. But then they win the national championship because they got better people. And it's not that we can bribe people into coming.

Speaker #3: But we do have a dedicated group of professionals who try to get better every day. And you've been to our offices often. And Scott, wouldn't you agree that it's a very motivated group here that works well together and has kind of a unique culture to it?

Speaker #3: But I ask that question of you. If you respond.

Speaker #1: Thank you. One moment for our next question. And our next question concerns the line of Paul Diamond of Citi. Your line is now open.

Operator: Thank you. One moment for our next question. Our next question comes from the line of Paul Diamond of Citi. Your line is now open.

Paul Diamond: Thank you. Good morning, all. Thanks for taking the call. Just wanted to touch on DNC in 26 for a moment. You guys guided towards a midpoint of $795. Talked a bit about cycle times, lateral lengths, batch development. Just wanted to get an idea if you could parse that a little bit on how those improvements are kind of broken out amongst those groups or any other levers.

Speaker #2: I thank you. Good morning, y'all. Thanks for taking the call. Just wanted to touch on DNC in 2006 for a moment. You guys guided towards a midpoint of 795.

Speaker #2: We talked a bit about cycle times, lateral length, and batch development. I just wanted to get an idea if you could parse that a little bit—how those improvements are kind of broken out amongst those groups, or any other levers.

Christopher P. Calvert: Yeah, this is Chris Calvert. You kind of tailed off on the back end of the question, but I'll repeat it a little bit and then whatever I missed. You said a little bit more commentary surrounding increased lateral lengths, reduced cycle times that led to the reduction in our DNC cost per foot to $795. I think, Paul, you know, the first thing I would point to is when we look at this improvement in DNC cost per foot, it is largely efficiency driven. You know, as we look to we've talked a lot about these, this well batch, that it sits on our Ameredev acres. It's 3.4 mile laterals we expect to turn in line the first part of this year. That is contributory to the 10% increase in lateral lengths.

Speaker #4: Yeah, this is Chris Calvert. You kind of tailed off on the back end of the question, but I'll repeat it a little bit and then whatever I missed.

Speaker #4: So you said a little bit more commentary surrounding increased lateral lengths, reduced cycle times, that led to the reduction in our DNC cost per foot to 795.

Speaker #4: And so I think, Paul, the first thing I would point to is when we look at this improvement in DNC cost per foot, it is largely efficiency-driven.

Speaker #4: As we look to we've talked a lot about these well-batched that it sits on our Amerodrive acres. It's 3.4-mile laterals. We expect to turn in line the first part of this year.

Speaker #4: That has contributory to the 10% increase in lateral lengths. And so I think when we speak to the ability to do more with less, and I think that is a standard story that is somewhat spread across the industry, being able to drill the same lateral footage or accomplish the same with fewer rig counts stories like increased lateral length help contribute to that.

Christopher P. Calvert: I think when we speak to the ability to do more with less, and I think that is a standard story that is somewhat spread across the industry, of being able to drill the same lateral footage or accomplish the same with fewer rig counts, stories like increased lateral length help contribute to that. When we look at improvements in completion efficiencies, you know, we were kind of the one of the first to do simul-fracs and Trimul-Fracs in the Delaware Basin. It has stayed a large part of our completion story. We've seen completion efficiency improvements of 20% year-over-year, as far as completed lateral footage per day, all of which contributes to lowering your DNC cost per foot.

Speaker #4: And so when we look at improvements in completion efficiencies, we were kind of one of the first to do simul and trimorfract on the in the Delaware Basin.

Speaker #4: It has stayed a large part of our completion story. We've seen completion efficiency improvements of 20% year over year, as far as completed lateral footage per day.

Speaker #4: All of which contributes to lowering your D&C cost per foot. And so, when we think about cycle time improvements, that really underpins the ability to turn in line the same net lateral footage in 2026 versus 2025.

Christopher P. Calvert: When we think about cycle time improvements, that it really underpins the ability to turn in line the same net lateral footage in 2026 versus 2025, do it with a $130 million DNC capital savings year-over-year, also still be able to deliver moderate production growth in the form of 2% or 3% oil, organic oil volumes. I think, you know, the underpinning story to the 795 number is largely efficiency driven, focused on, like I said, longer laterals and reduced cycle times.

Speaker #4: Do it with $130 million in D&C capital savings year over year, and then also still be able to deliver moderate production growth in the form of two or three percent organic oil volumes.

Speaker #4: And so, I think the underpinning story to the 795 number is largely efficiency-driven, focused on, like I said, longer laterals and reduced cycle times.

Speaker #1: Thank you. One moment for our next question. And our last question concerns the line of Philip Johnworth of BMO. Your line is now open.

Operator: Thank you. One moment for our next question. Our last question comes from the line of Phillip Jungwirth of BMO. Your line is now open.

Joseph Wm. Foran: Yeah, thanks. Was hoping you could talk about the better wells for less money slide. Just what I was really interested in is first the forecasting of EURs and the bottom-up build here, and then second the footnote around excluding wells drilled by Ameredev or Advance, and whether this has been a drag on historical EURs, and if Matador-designed wells are demonstrating improvement across this acreage.

Speaker #5: Yeah, thanks. I was hoping you could talk about the 'Better Wells for Less Money' slide, and just what I was really interested in is, first, the forecasting of EURs and the bottom-up build here; and then, just second, the footnote around excluding wells drilled by Amerodrive or Advance, and whether this has been a drag on historical EURs—and if Matador-designed wells are demonstrating improvement across this acreage.

W. Thomas Elsener: Hey, Phillip, it's Tom Elsner, EVP for Reservoir Engineering. I'll take the, I'll take the first part of that one. What we're really proud of is the continued improvement in our well productivity over these years, and really highlighted by our own operations. Showing that how we've been able to improve our BO per foot of lateral year-over-year is something we're really proud of. It's not something that just very easily. It comes from a combination of improved targeting, improved spacing, and improved completions. You know, many of the different operational improvements that Chris has been winding out, but also from our geoscience teams, finding better places to buy acreage, better places to land the wells.

Speaker #4: Hey, so if it's Tom Elson, our EVP for Wells Farmer Engineering, I'll take the first part of that one. We're really proud of is the continued improvement in our well productivity over these years.

Speaker #4: And really highlighted by our own operations. And showing that how we've been able to improve our BO per foot of lateral year over year is something we're really proud of.

Speaker #4: It's not something that just comes very easily. It comes from a combination of improved targeting, improved spacing, improved completions, many of the different operational improvements that Chris has been lining out.

Speaker #4: But also from our geoscience teams finding better places to buy acreage, better places to land the wells. Combined with the approximately 25% improvement in cost per foot over these years, those are some very big improvements to the rate to returns to the quality of the inventory.

W. Thomas Elsener: You know, combined with the, you know, approximately 25% improvement in cost per foot over these years, those are some very big improvements to the rates of returns, to the quality of the inventory. We're certainly very proud of the Ameredev acreage and the Advance acreage. Those have been great acquisitions for us. You know, as has been mentioned on the deal front, we've been very successful with, you know, big deals and the smaller brick-by-brick transactions. Matador has improved its portfolio over the years through a wide range of different techniques.

Speaker #4: And we're certainly very proud of the Amerodrive acreage and the Advance acreage and those have been great acquisitions for us. As has been mentioned on the deal front, we've been very successful with big deals and the smaller brick-by-brick transactions.

Speaker #4: So Matador has improved its portfolio over the years through their wide range of different techniques.

Joseph Wm. Foran: You know, if I tag onto your note, Tom, it's just that, as an example of this, of these efficiencies, it isn't just it makes the well better, but it has generated additional cash flow that we've been able to pay down our debt some. Last year, for example, we paid it down by $200 million, so we were getting our leverage ratio down there to about 1, which gives you more options, having that kind of balance sheet strength. We tie those together in our discussions that I mentioned when we collaborate. What does this mean?

Speaker #3: If I can tag on to your note, Tom, is just that as an example of this, of these efficiencies, it isn't just it makes the well better.

Speaker #3: Whether it's generated additional cash flow that we've been able to use to pay down our debt some. And last year, for example, we paid it down by $200 million.

Speaker #3: So we were getting our leverage ratio down there to about 1, which gives you more options, having that kind of balance sheet strength. And so we tie those together in our discussions that I mentioned, when we elaborate.

Speaker #3: What does this mean?

Speaker #1: Thank you, ladies and gentlemen. This ends the Q&A portion of this morning's conference call. I'd like to turn the call over to management for any closing remarks.

Operator: Thank you. Ladies and gentlemen, this ends the Q&A portion of this morning's conference call. I'd like to turn the call over to management for any closing remarks.

Speaker #4: Well, I'd just like to say if anybody else on the call doesn't feel that they got your questions answered, please give a call in to Mac and we'll arrange a separate conference call.

Joseph Wm. Foran: Well, I'd just like to say, if anybody else on the call doesn't feel that they got their questions answered, please give a call in to Mac, and we'll arrange a separate conference call. We want to make ourselves available to you because we think there's a lot of good progress is being made, and we're very excited about some of these new areas that we're developing. It's just hard to always fit it in a 90-day period. As this year goes along, I think you're going to see why we're as optimistic about the year as we have been, and hope that oil prices will stabilize, and that some of the disruptions will be settled over time, and that the economy will remain strong.

Speaker #4: But we want to make ourselves available to you because we think there's a lot of good progress being made and we're very excited about some of these new areas that we're developing.

Speaker #4: It's just hard to always fit it in a 90-day period, but as this year goes along, I think you're going to see why we were as optimistic about the year as we have been.

Speaker #4: And hope that oil prices will stabilize, and that some of the disruptions will be settled over time. And then the economy will remain strong.

Speaker #4: But I give much credit to this team as continuing to grow and to work that much better together. And reiterate our invitation to come see it and meet the people in person that have a direct effect on the value of the company.

Joseph Wm. Foran: I give much credit to this team as continued to grow and to work that much better together, and reiterate our invitation to come see it and meet the people in person that have a direct effect on the value of the company. Then meet some of the younger people, because I think they've done a very impressive job. You know, with that, I want to be sure and give a shout-out to Glenn Stetson. Glenn hasn't been called on to say much, but he's watched over both the production and the midstream and kept both of them running, even in bad weather and other times. Glenn, if you want to say anything, please do so now.

Speaker #4: And then meet some of the younger people, because I think they've done a very impressive job with that. I want to be sure to give a shout-out to Lynn Stetson.

Speaker #4: Lynn hadn't been called on to say much, but he's watched over both the production and the midstream and kept both of them running even in bad weather and at other times.

Speaker #4: And so, Glen, if you want to say anything, please do so now. And if you want me to ask you a question first to give you a structure to do that.

Joseph Wm. Foran: If you want me to ask you a question first, to give you a structure to do that. You watching over those two very important areas that gotta work together, the production and the midstream.

Speaker #4: But you watching over those two very important areas that got worked together, the production and the midstream. Yeah. Thank you, Joe. Yeah. This is Glen Stetson, EVP of production.

W. Thomas Elsener: That's right. Thank you, Joe. This is Glenn Stetson, EVP of Production. I think, you know, Tom and Chris both gave examples of, you know, things that we're doing on the efficiency side. I would like to provide an example of where, you know, both Matador, San Mateo, and, you know, on the completion side, the production side, and the midstream, you know, companies that work together to achieve some of those efficiencies, and one of them is on the produced water side, using produced water for hydraulic fracturing operations. In 2025, 72% of the water that we used was produced water, and that has the benefit of both reducing our CapEx per foot, but also reducing our lease operating expenses.

Glenn Stetson: That's right. Thank you, Joe. This is Glenn Stetson, EVP of Production. I think, you know, Tom and Chris both gave examples of, you know, things that we're doing on the efficiency side. I would like to provide an example of where, you know, both Matador, San Mateo, and, you know, on the completion side, the production side, and the midstream, you know, companies that work together to achieve some of those efficiencies, and one of them is on the produced water side, using produced water for hydraulic fracturing operations. In 2025, 72% of the water that we used was produced water, and that has the benefit of both reducing our CapEx per foot, but also reducing our lease operating expenses.

Speaker #4: I think Tom and Chris have both gave examples of things that we're doing on the efficiency side. I would like to provide an example of where both Matador, San Mateo, and on the completion side, the production side, and the midstream companies to work together to achieve some of those efficiencies.

Speaker #4: And one of them is on the produced water side, using hydraulic using produced water for hydraulic fracturing operations. In 2025, 72% of the water that we used was produced water.

Speaker #4: And that has the benefit of both reducing our CapEx x per foot but also reducing our lease operating expenses and we couldn't do we couldn't achieve those results without the help of San Mateo, and Matador's midstream wholly owned midstreamed properties or assets.

W. Thomas Elsener: We couldn't achieve those results without the help of San Mateo and Matador's midstream, wholly owned midstream properties or assets. I just wanted, you know, that's just another area of where we are working together to help, you know, on all fronts.

Speaker #4: And so I just wanted that just another area of where we are working together, to help on all fronts.

Joseph Wm. Foran: Trying to help put the flow assurance, the importance of flow assurance into perspective is, if you're gonna, as I've often heard, some of you have heard me say, if you're gonna be a cotton farmer in Dawson County, Texas, you better own, also try to own part of a cotton gin, because you got to gin your cotton before it gets to market, and it's the same thing. After we produce the gas, it's got to be collected by a midstream entity and then taken to market. We started in on that view when we went public, when First Matador went public back in 2012, that it was important over the long run to have an interest in the midstream to be sure you had flow assurance. That's delivered a lot of benefit to us through time.

Speaker #3: And try to help put the flow assurance the importance of flow assurance into perspective is if you're going to as I often heard some of you've heard me say it, if you're going to be a cotton farmer in Dawson County, Texas, you better own also try to own part of the cotton gin.

Speaker #3: Because you got a gin in your cotton before it gets to market. And it's the same thing. After we produce the gas, it's got to be collected by a midstream entity and then taken to market.

Speaker #3: So we started in on that view when we went public when first Matador went public back in 2012 that it was important over the long run to have an interest in a midstream to be sure you had flow assurance.

Speaker #3: And that's delivered a lot of benefit to us through time. Now, we're not cotton farmers, but I believe it's an apt analogy.

Joseph Wm. Foran: Now, we're not cotton farmers, but, I believe it's an apt analogy.

Mac Smith: Marvin, with that concludes our closing remarks. Thank you.

Speaker #4: Marvin, with that, that concludes our closing remarks. Thank you.

Operator: Ladies and gentlemen, thank you for participating today. This concludes today's program.

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