Greetings and welcome to the Crescent Energy Q4 2025 Results Call. As a reminder, this conference is being recorded. It is now my pleasure to introduce Reid Gallagher, from Investor Relations. Thank you.

Good morning, and thank you for joining Crescent's Fourth Quarter and Full Year 2025 Conference Call. Today's prepared remarks will come from our CEO, David Rockecharlie, and our CFO, Brandi Kendall. Our Chief Operating Officer and Executive Vice President of Investments, will also be available during Q&A. Today's call may contain projections and other forward-looking statements within the meaning of the federal securities laws. These statements are subject to risks and uncertainties, including commodity price volatility, global geopolitical conflict, our business strategies, and other factors that may cause actual results to differ from those expressed or implied in these statements and other disclosures. We have no obligation to update any forward-looking statements after today's call. In addition, today's discussion may include disclosure regarding non-GAAP financial measures. A reconciliation of historical non-GAAP financial measures to the most directly comparable GAAP measure can be referenced in our 10-K and earnings press release available under the Investors section on our website. With that, I'll hand it over to David.

Good morning, and thank you for joining us. 2025 was a transformational year for Crescent. Our team delivered strong performance by executing on our consistent strategy and capitalizing on our leading combination of investing and operating skills. As a result, we entered 2026 better positioned than ever with more scale, more focus, and more opportunity. As always, I'd like to begin with three key takeaways. First, our base business continues to deliver impressive results. In 2025, we generated significant free cash flow, exceeded expectations on both production and capital, and demonstrated the durability of our investing and operating model, and we are bringing that significant momentum into our 2026 plan. Second, we are now a focused and scaled operator in three premier basins: the Eagle Ford, the Permian, and the Uinta, and we see tremendous upside potential across our portfolio. Our investing and divesting activity materially upgraded the quality and scale of our portfolio. In total, we executed nearly $5 billion of transactions in 2025, closing over $4 billion of acquisitions at less than 3x EBITDA and divesting nearly $1 billion of noncore assets at over 5x EBITDA. This is how we compound value—recycling capital out of noncore positions and into higher return, scalable assets where we can apply our operational playbook to drive value for years to come. You have seen us successfully execute our strategy in the Eagle Ford. Over multiple years, we have built a top 3 position while generating strong returns and hundreds of millions of annual synergies. It is just the beginning for us in the Permian, but we are off to a strong start, and we are doubling our original synergy target. And third, our equity value proposition is even more compelling. We will continue to build long-term value through strong free cash flow and returns from our base business, but we also have significant upside catalysts embedded in our business. We are excited to introduce one of those key catalysts today, our world-class minerals platform, present royalties. Let me now discuss our strong fourth quarter in more detail. We produced 268,000 barrels of oil equivalent per day for the quarter, including 106,000 barrels of oil per day, and generated approximately $239 million of levered free cash flow. In the fourth quarter, our activity was focused predominantly in the Eagle Ford gas and condensate windows to capitalize on strength in the natural gas curve. Early performance has been strong and our ability to allocate capital across both oil and gas weighted inventory enhances the durability of our returns in a volatile commodity environment. Operationally, we continue to raise the bar across our asset base. Over the past year, we have increased drilling and completion efficiencies, extended lateral lengths, and expanded the use of final frac operations across our footprint. These initiatives drove a 15% reduction in drilling and completion costs per foot year-over-year and contributed to full year CapEx outperformance. Our operational expertise is foundational to our strategy of buying assets and making them better, and we intend to apply the same proven playbook to our newly acquired Permian assets, which gives us confidence in our increased synergy target. Our entry into the Permian was a defining step in Crescent's evolution. Today, we operate scaled positions across three premier basins, the Eagle Ford, the Permian, and the Uinta, which is complemented by a substantial and world-class minerals portfolio. This combination provides inventory depth, commodity flexibility, and a durable free cash flow profile that positions us to outperform through cycles. Turning to our new Permian assets. Integration has progressed seamlessly. As we have spent more time with the assets, our conviction in the value creation opportunity has increased. This acquisition remains one of the most compelling we've evaluated with immediate accretion across key metrics and highly attractive cash-on-cash returns. Importantly, our synergy targets are now 100% higher than what we underwrote, which meaningfully enhances expected investment returns. That increase reflects clear visibility into incremental operational efficiencies, overhead optimization, marketing improvements, and additional balance sheet opportunities as we implement the Crescent playbook. Looking ahead to 2026, our plan reflects the consistent execution of our long-term free cash flow strategy. Our focus is on maximizing free cash flow while maintaining operational and capital allocation flexibility. We expect to run a 6- to 7-rig program across our asset footprint. Four rigs in the Eagle Ford will span multiple phase windows, providing flexibility to pursue the highest returns across commodity cycles. One rig in the Uinta will target our core Uteland Butte formation and continue prudent delineation of the upside across our significant resource base, following the success of our Eastern JV. And in the Permian, consistent with our acquisition announcement, we are rightsizing capital and operational intensity with a disciplined 1- to 2-rig program. Our upgraded portfolio, enhanced capital efficiency, and commodity flexibility position us to generate some of the strongest development returns we have seen in recent years, despite the current commodity price volatility. In addition to upgrading our operated portfolio, we're excited to announce the formation of Crescent Royalties. This is a major milestone in our strategy to build a leading royalties business. We have been active buyers of minerals and royalty assets for nearly 15 years and have built one of the largest and most established minerals and royalties platforms in the sector, anchored by a core position in the Eagle Ford under world-class operators. Today, our minerals portfolio contributes approximately $160 million of annual cash flow. By placing these assets within a dedicated capital structure, we enhance strategic flexibility and create additional pathways for long-term value recognition. With Crescent's differentiated knowledge, experience, and sourcing pipeline, we see meaningful opportunity to continue scaling this platform in a value-accretive manner. Our transformation in 2025 was significant and a testament to the power of our consistent strategy. We are relentlessly focused on building a great business with a great team that talented people feel proud to be a part of. With our success in 2025, we are well positioned to continue on our trajectory with more scale, more focus, and more opportunity than ever before. With that, I'll turn the call over to Brandi.

Thanks, David. Crescent delivered another quarter of strong financial performance, generating approximately $536 million of adjusted EBITDA with $226 million of capital expenditures and approximately $239 million of levered free cash flow. These results underscore the significant free cash flow generation capacity of our portfolio and the strength of our lower capital intensity operating model. Our free cash flow enables what we view as an all-of-the-above return to capital framework. First, it provides substantial coverage of our fixed dividend. We declared a $0.12 per share dividend for the quarter, equating to an approximate 5% annualized yield, and our cash flow profile provides significant cushion to support and sustain that return. Second, it allows us to meaningfully strengthen the balance sheet. During the quarter, we repaid more than $700 million of debt, and we retain the capacity to continue deleveraging throughout the course of 2026. And third, it gives us flexibility to repurchase shares when market dislocation occurs. We increased our buyback authorization to $400 million, providing the ability to repurchase a meaningful amount of shares when we believe doing so represents an attractive use of capital. Our balance sheet remains strong. Our liquidity is significant, and our capital allocation framework is disciplined, flexible, and focused on long-term per share value creation. With that, I'll turn the call back to David.

Thanks, Brandi. Let me close by reiterating our three key messages. First, our base business is strong, improving, and generating meaningful cash flow, and we are bringing significant momentum into our 2026 plan. Second, our 2025 investing and divesting activity materially upgraded our portfolio. We entered the Permian at compelling value with significant synergy potential and exited noncore assets at attractive multiples. And third, Crescent's value proposition has never been more compelling. We combine investing discipline with operational expertise. We generate substantial and durable free cash flow, and we have multiple pathways to drive long-term per share value creation. We are larger, more focused, and better positioned than we've ever been, and we believe we are just getting started. Thank you for your time this morning, and I will now open it up for Q&A.

The first question is from Bert Donnes from William Blair.

On Crescent royalties, could you help us understand where we are in the value creation process? It seems evident to us that the value is not really showing up in the shares if you use peer multiples. And you noted scaling the business is probably the next step. But what options are you open to or what options are you not open to eventually monetize the assets?

Yes, it's David. Great question. I think the most important place to start is that this has been a core business of ours. We've built a scale portfolio over the last 15 years. These are world-class assets and there is significant embedded value in the company, and we want to make sure that investors and Crescent understand what they are. The other couple of key messages I would give: these assets that we've put together are among the lowest cost in the Lower 48. We think they've got tremendous upside potential in just what we already own. But we see significant future growth potential just like we do in the rest of the business. I'll let Clay give you a little bit more color on that.

Yes, the only thing I'd note is we view this as realistic in terms of value creation in terms of allowing our shareholders to recognize the value that we see embedded in the business. As David mentioned, we kind of see a clear pathway for growth. We've been able to compound this business at 20% annual growth over the last five years. We continue to see a pathway for kind of accretive growth for the business. And then we're committed in 2026 to continue to unlock value for our shareholders with this business.

Sounds great. And then maybe just one for Brandi. On the upstream M&A. We've kind of heard both sides of the story that this is a seller's market, prices are reaching high watermarks, but also that inventory is drying up, and you should probably be grabbing inventory while you can. So just wondering if Crescent thinks this is a time where maybe you do whatever it takes to win a bid like maybe the Canadian Curling team? Or is it smarter just to take a step back and catch a few low-priced silvers like the hockey team?

Bert, it's David. I'll take that one, and thanks for an amazing setup. What I would say is a couple of things. Your comment just makes me want to communicate how many significant catalysts that we think we have in the company. But to run through them on the M&A side, we've just completed a transformational year. We think we made a great entry into the Permian at a fantastic value. That integration is going great. As you know, our number one thing when we make an acquisition is to get that right. What you should hear from us today is that it's going really well. We think it's going to be a tremendous long-term opportunity for us. From a preparedness perspective, we're active in the market all the time, and we're ready to be opportunistic. From an actionability perspective, which is very different, what we're telling you is we see a huge amount of opportunity even within the company. So we're focused on driving value with what we already own. We're focused on making sure investors understand all the levers we have in the business, including the royalties assets, which are world-class and scaled. And the market, from our perspective, we'll be ready when it's there. So it's an interesting time right now, but we're kind of always in the market. But the number one thing is, are we prepared to be opportunistic? And yes, we are.

The next question is from Charles Meade from Johnson Rice.

Good morning David, to you and your whole team there. On the desire to grow the mineral royalty position, can you talk about what advantage Crescent has in that process? My impression is it's generally a pretty competitive market, but it's less competitive. There are fewer players as you get to the size you guys are playing in. But what do you view as your advantages that let you compound this value 20% year-over-year? And perhaps are there one geography over another where you think there's the most opportunity?

Yes, I'd say a couple of things, and it goes back to just the core of who we are as a company, which is we're investors and operators. So we've got the core skill set and activity on the technical and operational side that we're looking at assets that we operate every day and paying attention to what others are doing. And then on the investing side, not only are we disciplined, we're very active. It's a core competency. So we see — and we try to see everything. So when you put that together, at the end of the day, we're obviously there is no difference in how we go about growing. We're investing in minerals and we do the operating business. It’s about patience. It’s about sticking to the returns and asset profiles we want. And what we found is we've been able to compound in both of these asset classes over time as long as we're patient and disciplined and prepared and acquiring the assets that we want to own. So I do think the track record speaks for itself. But the inherent advantages we have are really who we are as a company and just really what we've built, how integrated our team is and how well we combine investing and operating expertise.

Got it. And then if I could ask a question that drills down on your Midland Basin position. I know it's relatively new for you guys. But there's another operator that made a big review about the Barnett, the prospective of the Barnett in the Midland Basin. And I know there's been operators who — it’s not new that companies have been targeting the Barnett, but there were some new information with some, frankly, impressive rates. So I'm curious, I know you guys have only had your hands on those assets since December, but do you have any kind of estimate on Barnett's potential that you'd be able to share?

David again, and then I'll let Joey and Clay also give you some more context on your broader Midland question. But very specifically, I'd say two things. We think we've made a phenomenal entry into the basin. We feel really good about it. It's going well, and we think we got it at great value. So we don't feel any, what I'll call, pressure to do anything other than make sure we get that integration and then synergy capture right. The second thing I would say, kind of before I hand it off, is if you look at really our strategy in action and what we've been able to do in the Eagle Ford, we put together a very significant position really over a decade. We're now a top 3 producer in that basin. And a lot of the resources that we're developing today were not thought to be there or thought to be economic at the time we acquired it, which is fantastic. So I would just say we have high hopes for our entire business in terms of the long-term inventory potential without trying to comment specifically on the Barnett. But I'll let Joey and Clay also give you some more perspective just on how the Midland and Permian are going.

Yes. The only thing I'd add, Charles, is clearly, we mentioned a lot when we talk about M&A how active we are in the market. I think the same thing would apply to resource expansion. And so you'd expect us to be kind of very actively following where the market is and what opportunities we have. And as David mentioned, I think one of the big reasons you're hearing so much excitement from us on the Permian entry is that we think there's a ton of opportunity around that asset base. So we're really excited about where we sit today.

Yes. And Charles, in regard, we've seen the same announcements on the Barnett, and we just consider that potentially more upside to what we've already highlighted. So looking forward to exploring that with everybody else and seeing what we can do with it.

The next question is from Michael Furrow from Pickering Energy Partners.

I'd like to stick on Crescent Royalties quickly. We appreciate your comments that the strategy sounds quite clear towards adding scale. But given that this is a different business model, are the acquisition rates going to be consistent with legacy Crescent's 5-year payback period at a 2x multiple of invested capital?

Yes, that's right. It's the same lens we bring, right? So as you know, right, this is cash flow orientation on the royalty side, clear focus on 2x multiple money and a very clear focus on NAV per share and free cash flow per share accretion. So what we are excited about in the business is we've been able to build it the way we built it with those as kind of our core focus, and that is the opportunities that we see going forward.

All right. That's great. I appreciate the color there. As a follow-up, I was hoping for some clarification on one of your slides in the deck, Slide 11 here. So by our math, it looks like the implied oil rate for the fourth quarter in the Permian was nearly 70,000 barrels a day, which represents a pretty meaningful step up from the 3Q level of like 61,000. And even more impressive is that you're disclosing no turning in the fourth quarter. So are there moving pieces here in terms of what was disclosed or maybe some M&A or other transactions that occurred? Just trying to square that circle.

Michael, so no additional transaction I would say that our base business outperformed production expectations in the fourth quarter. I think we're carrying forward good momentum into 2026. I will also flag though that Vital did not bring on any new wells since early October. So that business was in decline, and that's ultimately what's translating into a pretty flat oil production cadence for 2026.

The next question is from Philip Jungwirth from BMO.

Congrats on the successful Vital integration and increase on synergies. On the well costs, I know these numbers are not always apples-to-apples across companies, but I think you're at $700 per foot in the Midland, $875 in the Delaware. I know there's a lot of tough competitors in these basins, but it does feel like there's a nice gap you could reduce. I know we're just getting started, but just wondering how much runway do you see to lower in Permian well costs beyond what's being underwritten currently in the asset?

Philip, thanks for the question. Yes, we're going to be working the DMC piece of it diligently. We do see some great opportunity for improvement. We've already seen some even in the short time that we've had things moving forward. The other part of it that I always like to encourage people, and point out to people, is just the value of slowing down. The fact that we slowed down gives us the opportunity to catch our breath, understand the past learnings from Vital, and apply that to what we're going to do going forward. Just a slower pace gives us a better opportunity for higher capital efficiency and reducing costs. So we're very bullish on our opportunity to reduce well costs in the Permian.

Okay. And slowing down is actually going to be my follow-up here. Just on the base decline, Vital used to give us a year-end figure for oil and BOE. Last year, it was 42% for oil and 36% per BOE. So I'm guessing this is a lot lower today, but any sense on where the Permian base decline is now or by year-end '26? And just to confirm an earlier comment, can we imply that Permian oil production is also going to trend flat through the year similar to the total company?

Philip, this is Brandi. I think similar to my prior comments, I would expect relatively flat oil volumes, both in the Eagle Ford and in the Permian throughout the course of 2026.

Okay. Great. And then anything on the base decline?

Yes. On a corporate level, we did pick up post the merger pro forma for divestitures were in the high 20s overall across the broader business, but expect to get back to our corporate target of 25% or below over the next 12 to 18 months.

The next question is from Jarrod Giroue from Stephens.

Congrats on a strong quarter. So my first question is around synergies from the Vital acquisition. In your release, you stated that Crescent had already hit $40 million plus in synergies from the deal, and it's causing you to double your annual target of about $190 million. I was hoping you could give a little color on what savings you've already seen and what you expect to get to the $190 million?

Hey Jarrod, it's Brandi. I'll start, and then I'll turn it over to Joey. So with respect to the $40 million that has been captured to date, I would say, largely overhead, duplicative public company expenses as well as cost of capital synergies. Of the 100% increase on synergies, I would say 50% of that is operational related. And then the remaining 50% is additional overhead, incremental marketing synergies, and then additional opportunities to further drive down the cost of capital.

And Jarrod, one of the things since I've been here at Crescent that's been incredibly impressive, this has gone back in history to their 16th asset that they've acquired since going public, and have had a very good, tried and true playbook on integration. I've been incredibly impressed by how efficiently we've been able to integrate these assets. The team integrations and operational performance are exceeding our expectations. Just some color on some things specifically. Going forward, we'll be increasing the number of wells per pad, which will allow us to implement simulfrac. We're also increasing lateral lengths by doing land trades. So we'll be able to increase our capital efficiency there. The supply chain opportunities are starting to come to us now that we're a company of scale, combining services and contracts. Some specific examples include combining contracts on generators, compression, chemicals, tubulars, and, as I was explaining to Charles, just don't underestimate the value of slowing down. Slowing down gives us better operational planning, which drives better execution. Also on the LOE side, huge opportunity on the artificial lift side with our cash flow focus. Free cash flow focus. We're focusing on long-term value versus short term rates. So that affects the ESP sizing and how we do the timing of artificial lift spots. The list is pretty long. All of these opportunities will be feathering in over 2026, but we're pretty excited and looking forward to getting through 2026 and capturing all the synergies.

That's great. And then just my second question, with the earnings release, you announced an upsized and extended share repurchase authorization of $400 million. So just kind of curious how Crescent prioritizes shareholder return between the base dividend, shareholder returns, and debt reduction in 2026?

Jarrod, this is Brandi. So no change to kind of key capital allocation priorities. The balance sheet and the dividend are top. We're prioritizing deleveraging as well, retaining flexibility, right? We talked about an all-of-the-above return to capital program. But again, I think in the immediate term, it's all about the balance sheet. The increase in the buyback, though, does allow us to be opportunistic. It allows us to move the needle with the authorization program if the stock is significantly dislocated.

The next question is from Jonathan Mardini from KeyBanc Capital Markets.

Just given the capacity or the ability for minerals companies to run at higher leverage ratios, the latest spotlighting of Crescent royalties changes the way you think about leverage over time? Or would you target that 1.5x ratio at the minerals level? So just how should we think about leverage on a consolidated basis trending through this year?

Good question. I would say no fundamental change. It's how we think about leverage across the broader business. The long-term target continues to be 1x. We do believe that we were pretty conservative in financing these latest minerals acquisitions. We expect to be below 1.5x by year-end. And then there's clearly just significant asset coverage given where this asset class trades relative to that leverage target.

Okay. I appreciate the details. And moving upstream on your Eagle Ford asset slide, we show laterals your Central and Southern regions increasing by about 2,000 feet compared to 2025. Can you just talk about what's driving this expected step-up and maybe how we should expect this to impact D&C cost per foot in 2026?

Jonathan, this is Clay. I'm happy to start, and then I'll turn it to Joey. I think part of that is, as we've talked about, our ability to kind of build scale in the Eagle Ford has given us a huge opportunity to continue to drive capital efficiency by extending laterals, assets of joint ventures, just blocking and tackling in terms of putting the position together and giving ourselves the best shot on capital efficiency. But turn to Joey also.

Yes, Jonathan. Obviously, one of the simplest ways to become more efficient is to drill longer laterals. So it's really as simple as that. But I also point to the fact that we're increasing the pad sizes as well, which allows us to increase the percentage of simulfrac. We'll be up to 70% of our pads in South Texas region beyond simulfrac. So those two things combined really push our capital efficiency higher and higher. So it's all good things happening.

The next question is from John Abbott from Wolfe Research.

I'll just jump to the Uinta for a moment here. I mean, part of your program this year is sort of delineating the other zones in that area. When you think about that asset, how do you think about the optionality of the Uinta at this point in time that is not as significant a part of your portfolio as in the past?

John, it's David. Great question. I'd say a couple of things. Just to hit optionality immediately and succinctly in our control, how we want to handle it. So that's just a fantastic asset to have. It's obviously intentional on our part as well as part of our strategy. So we feel really good about two things in that area. We can deliver really strong returns in a, I'll call it, normalized oil market. We're making great returns there and been view now. And then just the resource potential there is incredible. We've seen our offset operators continue to expand that opportunity. We entered there below PDP value. So we feel great about what I'll call just methodically going through the opportunity and expanding it over time. And as Joey said, the ability operationally to just go at the pace you want to go just provides tremendous optionality. But we think of it as more or less a 1 rig area for us and just slow and steady continued expansion of the opportunity is what we expect.

Appreciate it. And then the follow-up question is really on maintenance CapEx and long-term oil. Based on your current plans, I guess, you could exit the year with one rig maybe in the Permian. Let's say maintenance CapEx long term, I was talking to Brandi about last night, it's $1.3 billion to $1.4 billion long term, well, maybe about 130,000 barrels per day. I guess my question is, if we do see a more constructive environment in the second half of this year and as we sort of look out to 2027, '28, could you decide to plateau at a higher level? Or is one rig in the Permian really where you want to be? Or could you decide, hey, if we have a more constructive environment, let's just be a little bit higher than 130 long term?

John, it's David again. I'm happy to take that. Long story short is we feel really good about what I'll call running the business at a target reinvestment rate, and we've done that all the time. Our key goal is returns and free cash flow. So yes, back to your topic of optionality. We've got the ability to do more everywhere, which means not that we're going to do more everywhere, but we can allocate our development activity to the best return. So if oil development is higher returning, you will see us allocating more capital towards oil and vice versa. You've seen the gas market strengthen. We've had more allocation there. So I think it will be purely a function of rate of return. And then we actually have oil opportunity in the Eagle Ford, in the Uinta, and in the Permian. So I think we could do it anywhere. But yes, you're correctly pointing out that we've got good optionality in the Permian.

The next question is from Lloyd Byron from Jefferies.

Congrats on all the progress. Can I just go back and get a couple of clarifications? I don't know if it was Joe that was talking about costs, but another way to kind of ask it is, is there an optimal scale for you guys going forward? And I'm just thinking about in the Permian or the Uinta, you've done such a good job in the Eagle Ford with scale.

This is David. I'll give you a sort of simple response and then Brandi can give you maybe a little more context strategically. What we are seeing is that we've got the scale we need to continue to drive value within the current business around operations. We see tremendous upside in continuing to drive efficiencies across these assets. And in particular, as you know, the newest assets in the company are recent, call it, 12 to 18 months ago, Eagle Ford acquisitions and then the entry into the Permian. So we feel like we've got plenty of scale there to continue to drive value. However, we think this industry through cycle presents significant opportunity for our business strategy to grow through acquisition opportunistically. And so we also see significant scale potential beyond what we already have, in particular, in the Eagle Ford and the Permian. And so I think that's what we're looking for. But those acquisitions are all going to stand on their own, and they're going to be based on the value being right, because we think we're ready to do them and we see an ability to do what we do, which is buy assets and make them better. I think we would tell you we've got the scale we need today to drive significant value on our existing footprint.

Okay, that makes sense. Let me come back to that topic later. I understand there's steady growth ahead, but are there any current bottlenecks, such as takeaway rail or permitting? My question is whether you could increase growth more quickly if you wanted to.

Lloyd, I'll start. So we could grow it faster if we wanted to. I think we've always thought about this asset as kind of a one-rig asset, but the basin has really transformed over the last couple of years given rail, given kind of debottlenecking on the gas side of things. So I would say no constraint from an oil or gas midstream perspective.

There are no further questions at this time. I would like to turn the floor back over to David Rockecharlie for closing comments.

Perfect. Thank you all again. We really appreciate again, the opportunity every quarter to share how we're doing. And hopefully, the key takeaways all came through, which is base business, high performing with a lot of momentum. We completely transformed the portfolio last year into a much more focused scale business. And again, we think the company has a tremendous amount of catalysts both on the existing assets, but also one of the things we really are highlighting this quarter is the opportunity in our minerals business in that segment. So we'll continue to keep you updated as we move forward. And again, thank you for the support.

This concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.