vitesse-20240331

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


x			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024


o			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to ______

Commission file number 001-41546

Vitesse Energy, Inc.

(Exact name of registrant as specified in its charter)


Delaware			88-3617511
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)

5619 DTC Parkway, Suite 700 Greenwood Village, Colorado			80111
(Address of Principal Executive Offices)			(Zip Code)

(720) 361-2500

Registrant’s telephone number, including area code

9200 E. Mineral Avenue, Suite 200

Centennial, Colorado 80112

(Former address)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01	VTS	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No o


Large accelerated filer	o	Accelerated filer	o
Non-accelerated filer	x	Smaller reporting company	o
		Emerging growth company	x


		Page
	Cautionary Statement Concerning Forward-Looking Statements	4
	Glossary and Presentation of Financial and Operating Data	6
PART I	FINANCIAL INFORMATION
Item 1.	Condensed Consolidated Financial Statements (Unaudited)	10
	Condensed Consolidated Balance Sheets	10
	Condensed Consolidated Statements of Operations	11
	Condensed Consolidated Statements of Equity	12
	Condensed Consolidated Statements of Cash Flows	13
	Notes to Condensed Consolidated Financial Statements	14

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	26
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	35
Item 4.	Controls and Procedures	35

PART II	OTHER INFORMATION
Item 1.	Legal Proceedings	37
Item 1A.	Risk Factors	37
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	37
Item 3.	Defaults Upon Senior Securities	37
Item 4.	Mine Safety Disclosures	37
Item 5.	Other Information	37
Item 6.	Exhibits	37
	Signatures	39



	MARCH 31,		DECEMBER 31,
(in thousands, except shares)	2024		2023
Assets
Current Assets
Cash	$	1,377	$	552
Revenue receivable	41,286		44,915
Commodity derivatives (Note 6)	148		10,038
Prepaid expenses and other current assets	3,074		2,841
Total current assets	45,885		58,346
Oil and Gas Properties-Using the successful efforts method of accounting (Note 2)
Proved oil and gas properties	1,189,175		1,168,378
Less accumulated DD&A and impairment	(487,395)		(464,036)
Total oil and gas properties	701,780		704,342
Other Property and Equipment—Net	191		189
Other Assets
Commodity derivatives (Note 6)	34		1,109
Other noncurrent assets	1,841		1,984
Total other assets	1,875		3,093
Total assets	$	749,731	$	765,970
Liabilities and Equity
Current Liabilities
Accounts payable	$	18,497	$	27,692
Accrued liabilities (Note 7)	30,145		32,507
Commodity derivatives (Note 6)	3,623		—
Other current liabilities	118		204
Total current liabilities	52,383		60,403
Long-term Liabilities
Credit facility (Note 5)	98,000		81,000
Deferred tax liability (Note 11)	63,854		64,329
Asset retirement obligations	8,515		8,353
Commodity derivatives (Note 6)	68		—
Other noncurrent liabilities	4,195		5,479
Total liabilities	$	227,015	$	219,564
Commitments and Contingencies (Note 9)
Equity (Note 10)
Preferred stock, $0.01 par value, 5,000,000 shares authorized; 0 shares issued at March 31, 2024 and December 31, 2023, respectively	—		—
Common stock, $0.01 par value, 95,000,000 shares authorized; 32,498,570 and 32,812,007 shares issued at March 31, 2024 and December 31, 2023, respectively	325		328
Additional paid-in capital	546,153		567,654
Accumulated deficit	(23,762)		(21,576)
Total equity	522,716		546,406
Total liabilities and equity	$	749,731	$	765,970



	FOR THE THREE MONTHS ENDED MARCH 31,
(In thousands, except share data)	2024		2023
Revenue
Oil	$	57,364	$	50,486
Natural gas	3,829		7,475
Total revenue	61,193		57,961
Operating Expenses
Lease operating expense	11,791		9,080
Production taxes	5,799		5,255
General and administrative	5,374		10,862
Depletion, depreciation, amortization, and accretion	23,545		18,472
Equity-based compensation (Note 10)	1,605		27,972
Total operating expenses	48,114		71,641
Operating Income (Loss)	13,079		(13,680)
Other (Expense) Income
Commodity derivative (loss) gain, net	(13,824)		7,419
Interest expense	(2,203)		(1,181)
Other income (expense)	31		(2)
Total other (expense) income	(15,996)		6,236

(Loss) Before Income Taxes	$	(2,917)	$	(7,444)

Benefit from (Provision for) Income Taxes	731		(40,371)

Net Loss	$	(2,186)	$	(47,815)
Net income attributable to Predecessor common unit holders	—		1,832
Net Loss Attributable to Vitesse Energy, Inc.	$	(2,186)	$	(49,647)

Weighted average common shares outstanding–basic and diluted	29,933,962		29,663,644

Net loss per common share	$	(0.07)	$	(1.67)



	Common Stock			Preferred Stock
(In thousands, except share data)	Shares	Amount		Shares	Amount		Additional Paid-In Capital		Predecessor Members' Equity		Accumulated Deficit		Total Equity
Balance—January 1, 2024	32,812,007	$	328	—	$	—	$	567,654	$	—	$	(21,576)	$	546,406
Net (loss)	—	—		—	—		—		—		(2,186)		(2,186)
Issuance of restricted stock units, net of forfeitures	19,403	—		—	—		(74)		—		—		(74)
Equity-based compensation	—	—		—	—		1,758		—		—		1,758
Common stock dividends declared	—	—		—	—		(16,249)		—		—		(16,249)
Stock exchanged for tax withholding and retired	(332,840)	(3)		—	—		(6,936)		—		—		(6,939)
Balance—March 31, 2024	32,498,570	$	325	—	$	—	$	546,153	$	—	$	(23,762)	$	522,716


Balance—January 1, 2023	—	$	—	—	$	—	$	—	$	564,423	$	—	$	564,423
Net income (loss)	—	—		—	—		—		1,832		(49,647)		(47,815)
Issuance of common stock in exchange for Vitesse Energy, LLC	25,914,891	259		—	—		565,996		(566,255)		—		—
Issuance of common stock in exchange for Non-Founder MIU's	163,544	2		—	—		4,557		—		—		4,559
Acquisition of Vitesse Oil, LLC	2,120,312	21		—	—		30,607		—		—		30,628
Issuance of restricted stock units	3,136,456	31		—	—		(31)		—		—		—
Issuance of Transitional Plan awards, net of fractional shares	1,475,613	15		—	—		(15)		—		—		—
Equity-based compensation	—	—		—	—		27,972		—		—		27,972
Common stock dividends declared	—	—		—	—		(16,405)		—		—		(16,405)
Repurchase of common stock	(14,600)	—		—	—		(248)		—		—		(248)
Balance—March 31, 2023	32,796,216	$	328	—	$	—	$	612,433	$	—	$	(49,647)	$	563,114



	FOR THE THREE MONTHS ENDED MARCH 31,
(in thousands)	2024		2023
Cash Flows from Operating Activities
Net (loss)	$	(2,186)	$	(47,815)
Adjustments to reconcile net (loss) to net cash provided by operating activities:
Depletion, depreciation, amortization, and accretion	23,545		18,472
Unrealized loss (gain) on derivative instruments	14,656		(6,677)
Equity-based compensation	1,605		27,972
Deferred income taxes	(475)		40,371
Amortization of debt issuance costs	188		160
Changes in operating assets and liabilities that provided (used) cash:
Revenue receivable	3,630		13,709
Prepaid expenses and other current assets	(233)		(975)
Accounts payable	1,395		178
Accrued liabilities	(2,706)		(6,180)
Other	—		(2)
Net cash provided by Operating Activities	$	39,419	$	39,213
Cash Flows from Investing Activities
Acquisition of oil and gas properties	(6,755)		(1,138)
Development of oil and gas properties	(25,432)		(21,585)
Purchase of property and equipment	(26)		(9)

Net cash used in Investing Activities	(32,213)		(22,732)
Cash Flows from Financing Activities
Proceeds from revolving credit facility	17,000		4,000
Repayments of revolving credit facility	—		(7,000)
Repayments of Vitesse Oil revolving credit facility	—		(5,000)
Dividends paid	(16,311)		(14,499)
Repurchases of common stock	—		(248)
Stock exchanged for tax withholding	(6,940)		—
Debt issuance costs	(130)		(366)
Net cash used in Financing Activities	(6,381)		(23,113)
Net Increase (Decrease) in Cash	825		(6,632)
Cash—Beginning of period	552		10,007
Cash—End of period	$	1,377	$	3,375
Supplemental Disclosure of Cash Flow Information
Cash paid for interest	$	1,998	$	1,183
Cash paid for income taxes	—		—
Supplemental Disclosure of Noncash Activity
Oil and gas properties included in accounts payable and accrued liabilities	$	34,948	$	19,701
Asset retirement obligations capitalized to oil and gas properties	—		392
Issuance of common stock to acquire Vitesse Oil	—		30,628



(in thousands)	GROSS RECOGNIZED FAIR VALUE ASSETS/ LIABILITIES		GROSS AMOUNTS OFFSET		NET RECOGNIZED FAIR VALUE ASSETS/ LIABILITIES
Commodity derivative assets:
Current derivative assets	$	988	$	(840)	$	148
Noncurrent derivative assets	68		(34)		34
Total	$	1,056	$	(874)	$	182
Commodity derivative liabilities:
Current derivative liabilities	$	4,463	$	(840)	$	3,623
Noncurrent derivative liabilities	102		(34)		68
Total	$	4,565	$	(874)	$	3,691



INDEX	SETTLEMENT PERIOD	VOLUME HEDGED (Bbls)	WEIGHTED AVERAGE ROUNDED FIXED PRICE
WTI-NYMEX	Q2 2024	502,500	$	78
WTI-NYMEX	Q3 2024	462,500	78
WTI-NYMEX	Q4 2024	415,000	78
WTI-NYMEX	Q1 2025	285,000	73
WTI-NYMEX	Q2 2025	180,000	74



	Shares of restricted stock unit awards	Weighted-Average Price on Date of Grant
Outstanding at January 1, 2024	3,152,247	$	14.99
Granted	69,403	21.48
Vested	(792,000)	14.40
Forfeited	(50,000)	14.40
Outstanding at March 31, 2024	2,379,650	$	15.39



	Shares of restricted stock unit awards	Weighted-Average Price on Date of Grant
Outstanding at January 1, 2023	—	$	—
Granted	3,136,456	14.43
Vested	—	—
Forfeited	—	—
Outstanding at March 31, 2023	3,136,456	$	14.43



Grant date			February 23, 2024
Forecast period (years)			2.85
Risk-free rates			4.4%
Expected equity volatility			55%
Stock price on grant date			$21.48
Grant date fair value			$22.02



Year	Restricted stock units	Restricted stock awards	Total
2024	114,727	8,389	123,116
2025	93,580	17,262	110,842
2026	323,138	48,619



	Shares of performance stock unit awards (at target)	Weighted-Average Price on Date of Grant
Outstanding at January 1, 2024	—	$	—
Granted	104,104	22.02
Vested	—	—
Forfeited	—	—
Outstanding at March 31, 2024	104,104	$	22.02

SEC Form 10-Q filed by Vitesse Energy Inc.