Brigham Minerals, Inc. Reports Record Second Quarter 2021 Operating and Financial Results and Provides Updated Full Year 2021 Guidance

Rhea-AI Summary

Brigham Minerals (MNRL) reported record financial results for Q2 2021, achieving daily production of 8,988 Boe/d, a 1% increase from Q1. Royalty revenues rose by 15% to $37 million, driven by a 13% increase in realized prices. Net income reached $15.3 million, with Adjusted EBITDA of $30.8 million, up 14% sequentially. The company declared a quarterly dividend of $0.35 per share, marking a 9% increase, supported by a payout ratio of 80% of discretionary cash flow. Updated production guidance for 2021 is set between 9,000 Boe/d and 9,500 Boe/d.

Positive

• Royalty revenues increased by 15% to $37 million sequentially.
• Net income of $15.3 million, a strong performance compared to prior quarters.
• Adjusted EBITDA grew 14% to $30.8 million sequentially.
• Declared a Q2 dividend of $0.35 per share, a 9% increase from Q1.

Negative

• Production guidance was reduced slightly to 9,000 - 9,500 Boe/d, a 3% decrease from the original guidance.
• Mineral acquisition capital reduced by 35% to $65 million due to market conditions.

Brigham Minerals, Inc. (NYSE: MNRL) (“Brigham Minerals,” “Brigham,” or the “Company”), a leading mineral and royalty interest acquisition company, today announced record operating and financial results for the quarter ended June 30, 2021.

SECOND QUARTER 2021 OPERATIONAL AND FINANCIAL HIGHLIGHTS AND RECENT DEVELOPMENTS

• Daily production volumes of 8,988 Boe/d (70% liquids, 52% oil)
  • Production up 1% sequentially from Q1 2021 driven by a 7% increase in Permian volumes

• Record royalty revenues of $37.0 million
  • Up 15% sequentially from Q1 2021 driven by 13% higher realized prices and 1% higher volumes

• Continued record low general and administrative costs (before share based compensation) of $3.1 million
  • Generated through continued cost reduction efforts initiated in Q2 2020
  • See cost guidance reduction in Operational and Financial Guidance Update table below

• Net income totaling $15.3 million
  • Record Adjusted EBITDA⁽¹⁾ totaling $30.8 million up 14% sequentially from Q1 2021

• Declared Q2 2021 dividend of $0.35 per share of Class A common stock and implemented Base Plus Variable Dividend structure⁽²⁾
  • Comprised of Base Dividend of $0.14 per share of Class A common stock and Variable Dividend of $0.21 per share of Class A common stock, which in total represents a 9% sequential total dividend increase from Q1 2021
  • Represents 80% payout ratio of Discretionary Cash Flow ex lease bonus⁽¹⁾ with retained cash utilized to fund mineral acquisitions focused on activity wells
  • Sustainable Base Dividend supported by PDP base and multi decade, high quality inventory

• 9.1 net (1,415 gross) activity wells at the end of Q2 2021 comprised of 5.0 net (732 gross) DUCs and 4.1 net (683 gross) permits
  • 14% increase in net DUCs to 5.0 net locations driven by a 31% increase in net wells spud
  • Permian Basin net activity wells increased to a record 5.4 net locations

• Acquired 640 net royalty acres deploying $14.4 million in mineral acquisition capital
  • Deployed 96% of mineral acquisition capital to the Permian Basin
  • 63% of acquired net locations comprised of PDP, DUCs and permits
  • Approximately 40% of acquisitions internally funded

• $6.4 million cash balance and undrawn revolver capacity of $92 million as of June 30, 2021
  • Conservative leverage at 0.3x last quarter annualized Adjusted EBITDA ⁽¹⁾
  • Borrowing base increased to $165 million effective July 7, 2021 resulting in pro-forma liquidity of $128.4 million

• Portfolio optimization underway with anticipated Q3 2021 impact totaling approximately $6 million
  • Anticipate initial water royalty sales this month from Southern Delaware surface ownership with total potential water royalty revenue of $0.5 million to $1 million beginning in Q3 2021
  • In July, divested certain non-core Oklahoma minerals generating proceeds of $3.3 million (net royalty acres included in "Other" in ownership table below)
  • In July, sold 50% of mineral interest in five Stack/Merge sections as well as leased open minerals to private operator to accelerate development generating proceeds of $1.6 million

(1) Non-GAAP measure. See “Non-GAAP Financial Measures” below.

(2) See Quarterly Cash Dividend section below regarding Board approval of future dividends

2021 UPDATED GUIDANCE

• Updated full year 2021 production guidance of 9,000 Boe/d to 9,500 Boe/d
  • See additional detail in Operational and Financial Guidance Update table below
  • General and administrative costs reduced 13% at the mid-point to $13.4 million from $15.4 million
  • Mineral acquisition capital reduced 35% at the mid-point to $65 million from $100 million
    • Maintaining discipline in environment with higher seller expectations and transitory competition
  • Mid-point of daily production volumes reduced 3% attributable to reduced mineral acquisitions

Robert M. (“Rob”) Roosa, Chief Executive Officer, commented, “Drilling activity continued to rebound in the second quarter with a 16% gross (31% net) increase in wells spud compared to the first quarter, which substantially outpaced the 9% industry-wide rig increase in our liquids rich basins. Drilling activity drove a 14% increase in net DUCs to 5.0 net locations, which we anticipate will be highly contributory to production volumes over the next twelve months as operators such as Chevron Corporation, Pioneer Natural Resources Inc., Exxon Mobil Corporation, PDC Energy, Inc. and Diamondback Energy, Inc. turn our DUCs in line to production. Collectively, these large, well-capitalized E&Ps operate 60% of our DUCs and are running an aggregate 19 frac crews in our basins. Driven by this high-quality DUC inventory, we anticipate our production volumes over the next twelve months, or the period from Q3 2021 through Q2 2022, will average between 9,000 Boe/d and 10,000 Boe/d. Our acquisition team remained highly disciplined as commodity prices increased throughout the second quarter targeting highly accretive acquisitions focused on activity wells and continued to deliver, deploying $14.4 million in mineral acquisition capital, almost entirely to the Permian Basin. As a result of higher seller price expectations and the desire to maintain discipline in the face of increased competition, which has historically proven to be transitory, we anticipate deploying $15 million of acquisition capital over the next two quarters, which will be majority funded by retained cash and our portfolio optimization and rationalization activities.”

Blake C. Williams, Chief Financial Officer, added, “Our high-quality asset base delivered strong second quarter results highlighted by both record revenues and Adjusted EBITDA⁽¹⁾. Realized pricing improved 13% over the first quarter, which along with our production uplift drove a 9% increase in our dividend to $0.35 per share this quarter. Further, we were able to internally fund approximately 40% of our second quarter mineral acquisition capital, which is up from 30% in the first quarter. Finally, we are excited to implement a base plus variable dividend structure⁽²⁾ with a quarterly base dividend of $0.14 per share, which represents an attractive and sustainable fixed base yield relative to broader market indices. We believe the base dividend has been battle tested as it equates to our second quarter 2020 dividend, which incorporates the substantial commodity price, economic and activity disruptions attributable to the COVID-19 pandemic and the actions of OPEC +. In addition to the base dividend, our second quarter dividend includes a variable amount of $0.21 per share, bringing our total payout to 80% of Discretionary Cash Flow ex lease bonus⁽¹⁾ for the second quarter. The variable dividend represents an incremental 4.4% annualized yield for a total dividend yield of 7.3% to our Class A shareholders at our current stock price. In summary, the implementation of this dividend structure⁽²⁾ represents the confidence in both our team and our assets’ ability to consistently return capital to shareholders regardless of commodity prices or activity.”

(1) Non-GAAP measure. See “Non-GAAP Financial Measures” below.

(2) See Quarterly Cash Dividend section below regarding Board approval of future dividends

OPERATIONAL UPDATE

Mineral and Royalty Interest Ownership Update

During the second quarter 2021, the Company executed 22 transactions acquiring approximately 640 net royalty acres (standardized to a 1/8th royalty interest) and deployed $14.4 million in capital. The Company focused approximately 96% of its mineral acquisition capital in the second quarter towards the Permian Basin. Second quarter acquisitions are expected to deliver near-term production and cash flow growth with the addition of 24 gross DUCs (0.3 net) and 28 gross permits (0.2 net) to inventory counts.

The table below summarizes the Company’s approximate mineral and royalty interest ownership as of the dates indicated.

		Delaware		Midland		SCOOP		STACK		DJ		Williston		Other		Total
Net Royalty Acres
June 30, 2021		29,270		6,105		11,415		10,650		16,345		7,995		6,790		88,570
March 31, 2021		28,940		5,775		11,400		10,725		16,320		7,980		6,790		87,930
Acres Added (Revised) Q/Q		330		330		15		(75)		25		15		—		640
% Added Q/Q		1%		6%		—%		(1)%		—%		—%		—%		1%

DUC Conversions Updates

During the second quarter 2021, the Company identified approximately 204 gross (0.7 net) horizontal wells converted to production, which represented 26% of its gross DUC inventory as of the first quarter 2021 (16% of net DUCs). Well conversions to proved developed producing during second quarter are summarized in the table below:

Q2 2021 Wells Converted to Proved Developed Producing(1)
		Gross				Net
DUCs		204		75%		0.7		61%
Acquired		59		22%		0.4		31%
Converted Permitted and Other		10		4%		0.1		8%
Total		273		100%		1.2		100%

(1) Individual amounts may not add to totals due to rounding.

Drilling Activity Update

During the second quarter 2021, the Company identified 153 gross (1.3 net) wells spud on its mineral position, which represents a 31% sequential increase from the first quarter 2021 on a net well basis. Brigham’s gross and net wells spud activity over the past ten quarters is summarized in the table below:

	Q1 19		Q2 19		Q3 19		Q4 19		Q1 20		Q2 20		Q3 20		Q4 20		Q1 21		Q2 21
Gross Wells Spud	230		248		214		185		209		36		57		79		132		153
Net Wells Spud	1.2		1.3		1.3		1.7		1.6		0.2		0.4		0.4		1.0		1.3
Four Quarter Rolling Average Net Wells Spud	1.2		1.2		1.2		1.4		1.5		1.1		1.0		0.6		0.5		0.8

DUC and Permit Inventory Update

The Company expects 2021 production growth will be driven by the continued conversion of its DUC and permit inventory. Brigham’s gross and net DUC and permit inventory as of June 30, 2021 by basin is outlined in the table below:

		Development Inventory by Basin(1)
		Delaware		Midland		SCOOP		STACK		DJ		Williston		Other		Total
Gross Inventory
DUCs		176		232		50		10		124		123		17		732
Permits		162		99		5		—		149		258		10		683
Net Inventory
DUCs		1.9		1.4		0.3		—		1.1		0.2		0.1		5.0
Permits		1.0		1.1		—		—		1.3		0.6		—		4.1

(1) Individual amounts may not add to totals due to rounding.

FINANCIAL UPDATE

For the three months ended June 30, 2021, crude oil, natural gas and NGL production volumes increased 1% to 8,988 Boe/d as compared to the three months ended March 31, 2021 and increased 2% as compared to the same prior-year period. The majority of the operator activity and production volumes affected by Winter Storm Uri in February 2021 returned over the course of the quarter resulting in flat production volumes relative to the first quarter 2021.

For the three months ended June 30, 2021, average realized prices were $63.11 per barrel of oil, $4.58 per Mcf of natural gas, and $23.77 per barrel of NGL, for a total equivalent price of $45.24 per Boe. This represents a 13% increase relative to the three months ended March 31, 2021 and a 191% increase relative to the same prior-year period.

The Company saw general and administrative costs (before share-based compensation) continue to remain at record lows of $3.1 million for the three months ended June 30, 2021 as compared to the three months ended March 31, 2021 and decrease 22% relative to the same prior-year period.

The Company's net income for the three months ended June 30, 2021 was $15.3 million. Adjusted EBITDA was $30.8 million for the three months ended June 30, 2021, up 14% from the three months ended March 31, 2021 and up 421% relative to the same prior-year period. Adjusted EBITDA ex lease bonus was $30.0 million for the three months ended June 30, 2021, up 18% from the three months ended March 31, 2021 and up 413% from the same prior-year period. Adjusted EBITDA and Adjusted EBITDA ex lease bonus are Non-GAAP financial measures. For a definition of Adjusted EBITDA and Adjusted EBITDA ex lease bonus and a reconciliation to our most directly comparable measure calculated and presented in accordance with GAAP, please read "Non-GAAP Financial Measures” below.

As of June 30, 2021, the Company had a cash balance of $6.4 million and $92.0 million of undrawn revolver capacity under its credit facility, providing the Company with total liquidity of $98.4 million. In connection with the Company's semi-annual borrowing base redetermination, the Company's borrowing base was increased to $165.0 million effective July 7, 2021 resulting in pro forma liquidity of $128.4 million.

Results of Operations

Unaudited Financial and Operational Results		Three Months Ended								Six Months Ended
($ in thousands, except per unit of production data)		June 30, 2021				March 31, 2021				June 30, 2021				June 30, 2020
Operating Revenues
Oil sales		$	26,729			$	22,813			$	49,542			$	33,353
Natural gas sales			6,704				5,437				12,141				4,346
NGL sales			3,572				3,926				7,498				3,218
Total mineral and royalty revenue		$	37,005			$	32,176			$	69,181			$	40,917
Lease bonus and other revenue			806				1,597				2,403				3,968
Total Revenues		$	37,811			$	33,773			$	71,584			$	44,885
Production
Oil (MBbls)			424				411				834				921
Natural gas (MMcf)			1,465				1,451				2,916				2,986
NGLs (MBbls)			150				151				301				333
Equivalents (MBoe)			818				804				1,621				1,752
Equivalents per day (Boe/d)			8,988				8,931				8,959				9,628
Realized Prices ($/Boe)
Oil ($/Bbl)		$	63.11			$	55.55			$	59.39			$	36.20
Natural gas ($/Mcf)			4.58				3.75				4.16				1.46
NGLs ($/Bbl)			23.77				25.97				24.88				9.66
Average Realized Price		$	45.24			$	40.03			$	42.66			$	23.35
Operating Expenses
Gathering, transportation and marketing		$	1,593			$	1,733			$	3,326			$	3,404
Severance and ad valorem taxes			2,300				1,833				4,133				2,786
Depreciation, depletion, and amortization			9,080				9,367				18,447				24,026
General and administrative (before share-based compensation)			3,142				3,142				6,284				7,664
Total operating expenses (before share-based compensation)		$	16,115			$	16,075			$	32,190			$	37,880
General and administrative, share-based compensation			2,555				2,300				4,855				3,736
Total Operating Expenses		$	18,670			$	18,375			$	37,045			$	41,616
Income from Operations		$	19,141			$	15,398			$	34,539			$	3,269
Other expenses:
Interest expense, net			(387	)			(267	)			(654	)			(577	)
Other income, net			2				13				15				25
Income Before Taxes		$	18,756			$	15,144			$	33,900			$	2,717
Income tax expense			3,430				3,073				6,503				732
Net Income		$	15,326			$	12,071			$	27,397			$	1,985
Less: net income attributable to non-controlling interest			(4,138	)			(3,475	)			(7,613	)			(1,329	)
Net income attributable to Brigham Minerals, Inc. shareholders		$	11,188			$	8,596			$	19,784			$	656

		Three Months Ended								Six Months Ended
Unit Expenses ($/Boe)		June 30, 2021				March 31, 2021				June 30, 2021				June 30, 2020
Gathering, transportation and marketing		$	1.95			$	2.16			$	2.05			$	1.94
Severance and ad valorem taxes			2.81				2.28				2.55				1.59
Depreciation, depletion and amortization			11.10				11.65				11.38				13.71
General and administrative (before share-based compensation)			3.84				3.91				3.87				4.37
General and administrative, share-based compensation			3.12				2.86				2.99				2.13
Interest expense, net			0.47				0.33				0.40				0.33

Quarterly Cash Dividend

The Company’s Board of Directors (the “Board”) has declared a quarterly cash dividend incorporating results for the second quarter 2021 of $0.35 per share of Class A common stock. This represents a 9% increase in payout compared to the dividend declared for the first quarter of 2021. The second quarter dividend represents a base dividend of $0.14 per share and a variable dividend of $0.21 per share and will be paid on August 27, 2021 to holders of record as of August 20, 2021. An amount equal to the cash dividend per share will also be set aside for each outstanding award granted under the long-term incentive plan for payment upon the vesting of such awards in accordance with their terms.

Future declarations of dividends are subject to approval by the Board and to the Board’s continuing determination that the declarations of dividends are in the best interests of the Company and its shareholders. Future dividends may be adjusted at the Board’s discretion based on market conditions and capital availability.

OPERATIONAL AND FINANCIAL GUIDANCE UPDATE

Below is Brigham's updated guidance for the full year 2021.

		Original 2021 Guidance					Updated 2021 Guidance				Change
Guidance Ranges		Low		High			Low		High
Daily Net Production (Boe/d)		9,200	—	9,900			9,000	—	9,500		(3.0)%
Oil Cut (%)		52%	—	55%			No Change
Expenses
Cash G&A Expense ($ millions)		$14.40	—	$16.40			$12.40	—	$14.40		(13.0)%
Share Based Compensation Expense ($ millions)		$9.20	—	$10.00			No Change
Gathering, Transportation, and Marketing ($/Boe)		$1.65	—	$2.25			No Change
Production Taxes (% of Revenue)		7%	—	9%			No Change
Taxes
Tax Depletion ($/Boe)		$10.00	—	$12.50			No Change
Percent of Dividend Expected to be Return of Capital		70%	—	90%			No Change
Mineral Acquisition Capital
Ground Game Acquisition Budget ($ millions)		$90	—	$110			$55	—	$75		(35.0)%

Brigham Minerals Second Quarter 2021 Earnings Conference Call

• Thursday, August 5, 2021 at 9:00 a.m. Eastern Time (8:00 a.m. Central Time)
• Pre-register by visiting: https://www.incommglobalevents.com/registration/q4inc/8365/brigham-minerals-second-quarter-2021-earnings-conference-call-/
• Listen to a live audio webcast of the call by visiting the Company’s website
  • https://investors.brighamminerals.com
• A recording of the webcast will be available on the Company’s website after the call

Non-GAAP Financial Measures

Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus are non-GAAP supplemental financial measures used by our management and by external users of our financial statements such as investors, research analysts and others to assess the financial performance of our assets and their ability to sustain dividends over the long term without regard to financing methods, capital structure or historical cost basis.

We define Adjusted EBITDA as Net Income (Loss) before depreciation, depletion and amortization, share-based compensation expense, interest expense, and income tax expense, less other income. We define Adjusted EBITDA ex lease bonus as Adjusted EBITDA further adjusted to eliminate the impacts of lease bonus and other revenues we receive due to the unpredictability of timing and magnitude of the revenue. We define Discretionary Cash Flow as Adjusted EBITDA, less cash interest expense and cash taxes. We define Discretionary Cash Flow ex lease bonus as Discretionary Cash Flow further adjusted to eliminate the impacts of lease bonus revenue.

Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus do not represent and should not be considered alternatives to, or more meaningful than, net income or any other measure of financial performance presented in accordance with GAAP as measures of our financial performance. Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus have important limitations as analytical tools because they exclude some but not all items that affect net income, the most directly comparable GAAP financial measure. Our computation of Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus may differ from computations of similarly titled measures of other companies.

The following tables present a reconciliation of Adjusted EBITDA, Adjusted EBITDA ex lease bonus, Discretionary Cash Flow and Discretionary Cash Flow ex lease bonus to the most directly comparable GAAP financial measure for the periods indicated.

SUPPLEMENTAL SCHEDULES

Reconciliation of Adjusted EBITDA and Adjusted EBITDA ex Lease Bonus

		Three Months Ended													Six Months Ended
($ In thousands)		June 30, 2021				March 31, 2021				June 30, 2020					June 30, 2021				June 30, 2020
Net Income (Loss)		$	15,326			$	12,071			$	(6,816	)			$	27,397			$	1,985
Add:
Depreciation, depletion, and amortization			9,080				9,367				11,200					18,447				24,026
Share-based compensation expense			2,555				2,300				1,853					4,855				3,736
Interest expense, net			387				267				545					654				577
Income tax expense			3,430				3,073				—					6,503				732
Less:
Other income, net			2				13				23					15				25
Income tax benefit			—				—				850					—				—
Adjusted EBITDA		$	30,776			$	27,065			$	5,909				$	57,841			$	31,031
Less:
Lease bonus and other revenue			806				1,597				62					2,403				3,968
Adjusted EBITDA ex Lease Bonus		$	29,970			$	25,468			$	5,847				$	55,438			$	27,063

Reconciliation of Discretionary Cash Flow and Discretionary Cash Flow ex Lease Bonus

		Three Months Ended
($ In thousands, except per share amounts)		June 30, 2021				March 31, 2021				December 31, 2020				September 30, 2020
Adjusted EBITDA(1)		$	30,776			$	27,065			$	17,233			$	16,777
Less:
Adjusted EBITDA attributable to non-controlling interest			(6,315	)			(6,230	)			(4,000	)			(3,912	)
Adjusted EBITDA attributable to Class A common stock		$	24,461			$	20,835			$	13,233			$	12,865
Less:
Cash interest expense			178				206				111				437
Cash taxes			3,200				1,800				—				—
Dividend equivalent rights			616				384				316				192
Discretionary cash flow to Class A common stock		$	20,467			$	18,445			$	12,806			$	12,236
Less:
Lease bonus			641				1,229				—				1,158
Discretionary cash flow ex lease bonus to Class A common stock		$	19,826			$	17,216			$	12,806			$	11,078
Payout Ratio:			80	%			80	%			90	%			95	%
Distributed cash flow to Class A common stock		$	15,861			$	13,773			$	11,483			$	10,524
Shares of Class A common stock			45,134				43,666				43,558				43,316
Distributed cash flow per share of Class A common stock - Dividend		$	0.35			$	0.32			$	0.26			$	0.24

(1) Refer to Reconciliation of Adjusted EBITDA from Net Income (Loss) above.

Unaudited Condensed Consolidated Balance Sheets

		June 30,				December 31,
(In thousands, except share amounts)		2021				2020
ASSETS
Current assets:
Cash and cash equivalents		$	6,414			$	9,144
Accounts receivable			25,672				17,632
Prepaid expenses and other			3,075				3,693
Total current assets			35,161				30,469
Oil and gas properties, at cost, using the full cost method of accounting:
Unevaluated property			333,082				325,091
Evaluated property			520,082				488,301
Less accumulated depreciation, depletion, and amortization			(207,875	)			(189,546	)
Total oil and gas properties, net			645,289				623,846
Other property and equipment			5,614				5,587
Less accumulated depreciation			(4,750	)			(4,632	)
Other property and equipment, net			864				955
Deferred tax asset			25,821				24,920
Other assets, net			688				771
Total assets		$	707,823			$	680,961
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable and accrued liabilities		$	8,200			$	7,905
Total current liabilities			8,200				7,905
Long-term bank debt			43,000				20,000
Other non-current liabilities			1,503				1,126
Temporary equity			—				146,280
Equity:
Preferred stock, $0.01 par value; 50,000,000 authorized; no shares issued and outstanding at June 30, 2021 and December 31, 2020			—				—
Class A common stock, $0.01 par value; 400,000,000 authorized, 45,570,421 shares issued and 45,133,791 shares outstanding at June 30, 2021; 43,995,124 issued and 43,558,494 outstanding at December 31, 2020			456				440
Class B common stock, $0.01 par value; 150,000,000 authorized, 11,652,761 shares issued and outstanding at June 30, 2021; 13,167,687 shares issued and outstanding at December 31, 2020			—				—
Additional paid-in capital			580,181				601,129
Accumulated deficit			(99,303	)			(92,392	)
Treasury stock, at cost; 436,630 shares at June 30, 2021 and December 31, 2020			(3,527	)			(3,527	)
Total equity attributable to Brigham Minerals, Inc.			477,807				505,650
Non-controlling interest			177,313				—
Total equity		$	655,120			$	505,650
Total liabilities and equity		$	707,823			$	680,961

Unaudited Condensed Consolidated Statements Of Operations

		Three Months Ended June 30,								Six Months Ended June 30,
(In thousands, except per share data)		2021				2020				2021				2020
REVENUES
Mineral and royalty revenues		$	37,005			$	12,543			$	69,181			$	40,917
Lease bonus and other revenues			806				62				2,403				3,968
Total revenues			37,811				12,605				71,584				44,885
OPERATING EXPENSES
Gathering, transportation and marketing			1,593				1,625				3,326				3,404
Severance and ad valorem taxes			2,300				1,034				4,133				2,786
Depreciation, depletion, and amortization			9,080				11,200				18,447				24,026
General and administrative			5,697				5,890				11,139				11,400
Total operating expenses			18,670				19,749				37,045				41,616
INCOME (LOSS) FROM OPERATIONS			19,141				(7,144	)			34,539				3,269
Interest expense, net			(387	)			(545	)			(654	)			(577	)
Other income, net			2				23				15				25
Income (loss) before income taxes			18,756				(7,666	)			33,900				2,717
Income tax expense (benefit)			3,430				(850	)			6,503				732
NET INCOME (LOSS)		$	15,326			$	(6,816	)		$	27,397			$	1,985
Less: net (income) loss attributable to non-controlling interest			(4,138	)			2,766				(7,613	)			(1,329	)
Net income (loss) attributable to Brigham Minerals, Inc. shareholders		$	11,188			$	(4,050	)		$	19,784			$	656
NET INCOME (LOSS) PER COMMON SHARE
Basic		$	0.25			$	(0.11	)		$	0.45			$	0.02
Diluted		$	0.25			$	(0.11	)		$	0.44			$	0.02
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
Basic			43,916				35,282				43,717				34,631
Diluted			45,281				35,282				45,091				34,631

Unaudited Condensed Consolidated Statement of Cash Flows

		Six Months Ended June 30,
(In thousands)		2021				2020
CASH FLOWS FROM OPERATING ACTIVITIES
Net income		$	27,397			$	1,985
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation, depletion and amortization			18,447				24,026
Share-based compensation expense			4,855				3,736
Amortization of debt issuance costs			141				485
Deferred income taxes			1,286				463
Bad debt expense			—				299
Changes in operating assets and liabilities:
(Increase) decrease in accounts receivable			(8,040	)			11,980
Decrease (increase) in other current assets			581				(592	)
Increase (decrease) in accounts payable and accrued liabilities			448				(3,509	)
Increase (decrease) in other long-term liabilities			16				(256	)
Net cash provided by operating activities		$	45,131			$	38,617
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to oil and gas properties			(36,331	)			(28,755	)
Additions to other fixed assets			(27	)			(286	)
Proceeds from sale of oil and gas properties, net			—				1,565
Net cash used in investing activities		$	(36,358	)		$	(27,476	)
CASH FLOWS FROM FINANCING ACTIVITIES
Payments of long-term debt			(4,000	)			—
Borrowing of long-term debt			27,000				—
Dividends paid			(25,537	)			(25,772	)
Distribution to holders of non-controlling interest			(7,809	)			(19,834	)
Debt issuance costs			(21	)			(203	)
Payment of employee tax withholding for settlement of equity compensation awards			(1,136	)			—
Net cash used in financing activities		$	(11,503	)		$	(45,809	)
Decrease in cash and cash equivalents and restricted cash			(2,730	)			(34,668	)
Cash and cash equivalents and restricted cash, beginning of period			9,144				51,133
Cash and cash equivalents and restricted cash, end of period		$	6,414			$	16,465
Supplemental disclosure of non-cash activity:
Accrued capital expenditures		$	100			$	23
Capitalized share-based compensation cost		$	3,487			$	2,998
Temporary equity cumulative adjustment to carrying value		$	54,294			$	(168,572	)
Supplemental cash flow information:
Cash payments for loan commitment fees and interest		$	(437	)		$	(442	)
Tax (payment) /refund received		$	(2,881	)		$	113

ABOUT BRIGHAM MINERALS, INC.

Brigham Minerals is an Austin, Texas, based company that acquires and actively manages a portfolio of mineral and royalty interests in the core of some of the most active, highly economic, liquids-rich resource basins across the continental United States. Brigham Minerals’ assets are located in the Permian Basin in Texas and New Mexico, the SCOOP and STACK plays in the Anadarko Basin of Oklahoma, the DJ Basin in Colorado and Wyoming, and the Williston Basin in North Dakota. The Company’s primary business objective is to maximize risk-adjusted total return to its shareholders by both capturing organic growth in its existing assets as well as leveraging its highly experienced technical evaluation team to continue acquiring minerals.

Cautionary Statement Concerning Forward-Looking Statements

This press release contains forward-looking statements. All statements, other than statements of historical facts, included in this press release that address activities, events or developments that the Company expects, believes or anticipates will or may occur in the future are forward-looking statements. Without limiting the generality of the foregoing, forward-looking statements contained in this press release specifically include the expectations of plans, strategies, objectives and anticipated financial and operating results of the Company, including production and other guidance within this press release. These statements are based on certain assumptions made by the Company based on management’s experience and perception of historical trends, current conditions, anticipated future developments and other factors believed to be appropriate. Such statements are subject to a number of assumptions, risks and uncertainties, many of which are beyond the control of the Company, which may cause actual results to differ materially from those implied or expressed by the forward-looking statements. These include, but are not limited to, continued downturns or delays in resuming operator activity due to commodity price fluctuations, the Company’s ability to integrate acquisitions into its existing business, changes in oil, natural gas and NGL prices, weather and environmental conditions, the timing of planned capital expenditures, availability of and competition for acquisitions, operational factors affecting the commencement or maintenance of producing wells on the Company’s properties, the condition of the capital markets generally, as well as the Company’s ability to access them, the proximity to and capacity of transportation, uncertainties regarding environmental regulations or litigation, global or national health events, including the ongoing spread and economic effects of the ongoing COVID-19 pandemic, potential future pandemics, the actions of the Organization of Petroleum Exporting Countries and other significant producers and governments and the ability of such producers to agree to and maintain oil price and production controls and other legal or regulatory developments affecting the Company’s business and other important factors. These and other applicable uncertainties, factors and risks are described more fully in the Company's filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the year ended December 31, 2020, and any subsequently filed Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, the Company’s actual results and plans could differ materially from those expressed in any forward-looking statements.

Any forward-looking statement speaks only as of the date on which such statement is made and the Company undertakes no obligation to correct or update any forward-looking statement, whether as a result of new information, future events or otherwise except as required by applicable law.

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FAQ

What were Brigham Minerals' Q2 2021 production results?

Brigham Minerals reported daily production volumes of 8,988 Boe/d in Q2 2021.

How much did Brigham Minerals earn in royalty revenues in Q2 2021?

Brigham Minerals earned record royalty revenues of $37 million in Q2 2021.

What is the dividend declared by Brigham Minerals for Q2 2021?

Brigham Minerals declared a quarterly dividend of $0.35 per share for Q2 2021.

What is the updated production guidance for Brigham Minerals in 2021?

Brigham Minerals updated its production guidance for 2021 to a range of 9,000 to 9,500 Boe/d.