LandBridge Company LLC Announces Fourth Quarter and Fiscal Year 2024 Results
LB
Delivers Q4 revenue growth of 109% year-over-year Fiscal Year 2024 year-over-year revenue growth of 51% Re-affirms FY25 EBITDA outlook of $170 million to $190 million Added approximately 53,000 acres through previously announced acquisitions
LandBridge Company LLC (NYSE: LB) (the “Company,” “LandBridge”) today announced its financial and operating results for the fourth quarter and fiscal year ended December 31, 2024.
Fourth Quarter 2024 Financial Highlights
(1) 4Q24 net income and net income margin include a non-cash expense of $11.1 million attributable to share-based compensation, including $8.9 million attributable to management incentive units issued by LandBridge Holdings LLC ("Incentive Units"). Any actual cash expense associated with such Incentive Units will be borne solely by LandBridge Holdings LLC and not the Company.
(2) Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are non-GAAP financial measures. See “Comparison of Non-GAAP Financial Measures” included within the Appendix of this press release for related disclosures and reconciliations to the most directly comparable financial measures calculated and presented in accordance with GAAP.
(3) Fiscal Year 2024 net loss and net loss margin include a non-cash expense of $95.3 million attributable to share-based compensation, including $72.6 million attributable to NDB Incentive Units issued prior to the IPO and $18.7 million attributable to Incentive Units. Any actual cash expense associated with such Incentive Units will be borne solely by LandBridge Holdings LLC and not the Company.
(4) Surface use economic efficiency is calculated as (i) total revenues less oil and gas royalty revenues divided by (ii) applicable acreage.
Fiscal Year 2024 Financial Highlights
Recent Milestones
Jason Long, Chief Executive Officer of the Company, stated, “In 2024, we tripled the size of our land holdings, delivered high-double-digit revenue growth year-over-year, and demonstrated our ability to deliver industry-leading adjusted EBITDA and free cash flow margins. With more than 270,000 acres across the most active oil and natural gas development and production region of the prolific Permian Basin, we are uniquely positioned to capitalize on opportunities in energy and digital infrastructure to create sustainable value for our shareholders.”
Scott McNeely, Chief Financial Officer of the Company, said, “Our triple-digit revenue growth during the fourth quarter is clear evidence of our momentum across the business. For 2025, we anticipate another year of strong revenue growth and profitability as we execute on our active land management strategy.”
Fourth Quarter 2024 Consolidated Financial Information
Revenue for the fourth quarter of 2024 was $36.5 million as compared to $28.5 million in the third quarter of 2024 and $17.5 million in the fourth quarter of 2023. The sequential increase was primarily attributable to increases in easements and other surface-related revenue of $8.2 million, oil and gas royalties of $1.6 million and surface use royalties of $0.7 million, partially offset by sequential decreases of $1.8 million and $0.7 million in resource sales and resource royalties, respectively. Net income for the fourth quarter of 2024 was $8.2 million as compared to net loss of $2.8 million in the third quarter of 2024 and net income of $2.5 million in the fourth quarter of 2023.(1)
Adjusted EBITDA was $31.7 million in the fourth quarter of 2024 as compared to $25.0 million in the third quarter of 2024 and $15.2 million in the fourth quarter of 2023. (2) Adjusted EBITDA during the fourth quarter of 2024 reflects $8.9 million of non-cash charges related to Incentive Units and $2.2 million of non-cash charges related to restricted stock units.
Net income margin was 22% in the fourth quarter of 2024 as compared to net loss margin of 10% in the third quarter of 2024 and net income margin of 14% in the fourth quarter of 2023. (1) Adjusted EBITDA margin was 87% in the fourth quarter of 2024 as compared to 88% in the third quarter of 2024 and 87% in the fourth quarter of 2023. (2)
Diversified Revenue Streams
Surface Use Royalties and Revenue: Generated revenues of $25.5 million in the fourth quarter of 2024 as compared to $16.5 million in the third quarter of 2024 and $7.7 million in the fourth quarter of 2023. Surface Use Royalties and Revenue increased 54% sequentially, primarily driven by a non-refundable $8.0 million option payment received in December in connection with a data center lease development agreement and an increase in produced water royalty volumes from 775 MBbls/d to 831 MBbls/d.
Resources Sales and Royalties: Generated revenues of $6.6 million in the fourth quarter of 2024 as compared to $9.1 million in the third quarter of 2024 and $3.9 million in the fourth quarter of 2023. Revenue from Resource Sales and Royalties decreased 28% sequentially, primarily driven by decreased brackish water sales and royalty volumes.
Oil and Gas Royalties: Generated revenues of $4.5 million in the fourth quarter of 2024 as compared to $2.9 million in the third quarter of 2024 and $5.8 million in the fourth quarter of 2023. Revenue from Oil and Gas Royalties increased 54% sequentially, primarily driven by net royalty production increasing to 1,199 boe/d, up from 895 boe/d in the third quarter.
Free Cash Flow Generation
Cash flow from operations for the fourth quarter of 2024 was $26.9 million as compared to $7.5 million in the third quarter of 2024 and $12.5 million in the fourth quarter of 2023. Capital expenditures for the fourth quarter of 2024 were $0.2 million. Free cash flow during the fourth quarter of 2024 was $26.7 million.(2)
Net cash used in investing activities during the fourth quarter of 2024 was $292.3 million.
Net cash provided by financing activities during the fourth quarter of 2024 consisted of approximately $339.3 million of net proceeds from the previously-announced private placement of Class A shares representing limited liability company interests (the “Class A Shares”) at a price of $60.03 per Class A Share to persons reasonably believed to be accredited investors or qualified institutional buyers (the “Private Placement”). Approximately $145.4 million of proceeds from the Private Placement were used to purchase units representing membership interests in DBR Land Holdings LLC (“OpCo Units”) held by LandBridge Holdings LLC, an affiliate of LandBridge’s financial sponsor, Five Point Energy LLC. A corresponding number of Class B shares representing limited liability company interests in the Company held by LandBridge Holdings LLC were contemporaneously cancelled. Other net inflows consisted of $137.5 million of debt facility proceeds, of which $33.8 million were paid down during the quarter.
Strong Balance Sheet with Ample Liquidity
Total cash and cash equivalents were $37.0 million as of December 31, 2024, as compared to $14.4 million as of September 30, 2024. The Company had $385.0 million of borrowings outstanding under its term loan and revolving credit facility as of December 31, 2024, versus $281.3 million outstanding as of September 30, 2024.
As of December 31, 2024, the Company had approximately $70.0 million of available borrowing capacity under its revolving credit facility.
Total liquidity was $107.0 million as of December 31, 2024.
Outlook
The Company re-affirms the following outlook for fiscal year 2025:
For fiscal year 2025, the Company expects Adjusted EBITDA to be between $170 million and $190 million, driven by:
Reconciliations of forward-looking non-GAAP financial measures to comparable GAAP measures are not available due to the challenges and impracticability of estimating certain items, particularly non-recurring gains or losses, unusual or non-recurring items, income tax benefit or expense, or one-time transaction costs and cost of revenue. We are unable to reasonably predict these because they are uncertain and depend on various factors not yet known, which could have a material impact on GAAP results for the guidance period. Because of those challenges, a reconciliation of forward-looking non-GAAP financial measures is not available without unreasonable effort.
Annual Report on Form 10-K
Our financial statements and related footnotes will be available in our Annual Report on Form 10-K for the year ended December 31, 2024, which is expected to be filed with the U.S. Securities and Exchange Commission (the “SEC”) on March 5, 2025.
Conference Call and Webcast Information
The Company will hold a conference call on Thursday, March 6, 2025, at 8:00 a.m. Central Time to discuss fourth quarter and fiscal year 2024 results. A live webcast of the conference call will be available on the Events and Presentations section of the LandBridge Investor Relations website at https://ir.landbridgeco.com/events-and-presentations/default.aspx. To listen to the live broadcast, go to the site at least 10-15 minutes prior to the scheduled start time to register and install any necessary audio software.
To access the live conference call, participants must pre-register online at https://registrations.events/direct/Q4I3477978 to receive unique dial-in information. Pre-registration may be completed at any time up to the call start time. An audio replay will be available following the conclusion of the call and remain available through March 20, 2025. The replay can be accessed by registering online at https://registrations.events/direct/Q4I3477978.
About LandBridge
LandBridge owns approximately 276,000 surface acres across Texas and New Mexico, located primarily in the heart of the Delaware sub-region in the Permian Basin, the most active region for oil and natural gas exploration and development in the United States. LandBridge actively manages its land and resources to support and encourage energy and infrastructure development and other land uses, including digital infrastructure. LandBridge was formed by Five Point Energy LLC, a private equity firm with a track record of investing in and developing energy, environmental water management and sustainable infrastructure companies within the Permian Basin. For more information, please visit: www.landbridgeco.com
Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on LandBridge’s beliefs, as well as assumptions made by, and information currently available to, LandBridge, and therefore involve risks and uncertainties that are difficult to predict. Generally, future or conditional verbs such as “will,” “would,” “should,” “could,” or “may” and the words “believe,” “anticipate,” “continue,” “intend,” “expect” and similar expressions identify forward-looking statements. Forward-looking statements include, but are not limited to, strategies, plans, objectives, expectations, intentions, assumptions, future operations and prospects and other statements that are not historical facts, including our estimated future financial performance. You should not place undue reliance on forward-looking statements. Although LandBridge believes that plans, intentions and expectations reflected in or suggested by any forward-looking statements made herein are reasonable, LandBridge may be unable to achieve such plans, intentions or expectations and actual results, and performance or achievements may vary materially and adversely from those envisaged in this news release due to a number of factors including, but not limited to: our customers’ demand for and use of our land and resources; the success of our affiliates, WaterBridge, Desert Environmental and the counterparty to the lease development agreement in executing their business strategies, including their ability to construct infrastructure, attract customers and operate successfully on our land; our customers’ willingness and ability to develop our land or any potential acquired acreage to accommodate any future surface use developments, such as the site under contract for the lease development agreement for the data center; the domestic and foreign supply of, and demand for, energy sources, including the impact of actions relating to oil price and production controls by the members of the Organization of Petroleum Exporting Countries, Russia and other allied producing countries with respect to oil production levels and announcements of potential changes to such levels; our ability to enter into favorable contracts regarding surface uses, access agreements and fee arrangements, including the prices we are able to charge and the margins we are able to realize; the initiation or outcome of potential litigation; our ability to continue the payment of dividends; our ability to successfully implement our growth plans, including through the future acquisitions of acreage and/or introduction of new revenue streams; and any changes in general economic and/or industry specific conditions. These risks, as well as other risks associated with LandBridge are also more fully discussed in our final prospectus filed with the SEC on December 31, 2024, and our subsequent SEC filings. You can access LandBridge’s filings with the SEC through the SEC's website at http://www.sec.gov. Except as required by applicable law, LandBridge undertakes no obligation to update any forward-looking statements or other statements herein for revisions or changes after this communication is made.
The historical financial information presented below reflects only our historical financial results and the historical financial results of our predecessor, DBR Land Holdings LLC, as applicable.
FOURTH QUARTER 2024 RESULTS
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended December 31,
Year Ended December 31,
2024
2023
2024
2023
Revenues:
Surface use royalties
$
3,992
$
2,464
$
13,121
$
7,780
Surface use royalties - Related party
6,597
2,162
18,499
5,436
Easements and other surface-related revenues
5,611
2,733
20,629
8,395
Easements and other surface-related revenues - Related party
9,262
385
13,486
4,249
Resource sales
3,056
2,138
14,964
18,045
Resource sales - Related party
58
158
387
1,785
Oil and gas royalties
4,464
5,795
16,027
20,743
Resource royalties
2,976
1,622
9,779
6,432
Resource royalties - Related party
483
-
3,062
-
Total revenues
36,499
17,457
109,954
72,865
Resource sales-related expense
374
364
2,113
3,445
Other operating and maintenance expense
1,337
784
3,174
2,740
General and administrative expense (income)
14,188
8,519
112,302
(12,091
)
Depreciation, depletion, amortization and accretion
2,581
2,366
8,875
8,762
Operating income (loss)
18,019
5,424
(16,510
)
70,009
Interest expense, net
7,100
2,843
23,335
7,016
Other income
-
(8
)
(241
)
(549
)
Income (loss) from operations before taxes
10,919
2,589
(39,604
)
63,542
Income tax expense
2,765
67
1,875
370
Net income (loss)
$
8,154
$
2,522
$
(41,479
)
$
63,172
Net loss prior to the IPO
-
(46,877
)
Net income attributable to noncontrolling interest
5,701
288
Net income attributable to LandBridge Company LLC
$
2,453
$
5,110
CONSOLIDATED BALANCE SHEETS
December 31,
2024
2023
Current assets:
Cash and cash equivalents
$
37,032
$
37,823
Accounts receivable, net
12,544
12,383
Related party receivable
2,111
1,037
Prepaid expenses and other current assets
1,628
1,035
Total current assets
53,315
52,278
Non-current assets:
Property, plant and equipment, net
902,742
203,018
Intangible assets, net
45,265
28,642
Deferred tax assets
411
-
Other assets
1,741
5,011
Total non-current assets
950,159
236,671
Total assets
$
1,003,474
$
288,949
Liabilities and equity
Current liabilities:
Accounts payable
$
489
$
200
Taxes payable
2,286
385
Related party payable
686
453
Accrued liabilities
7,185
4,945
Current portion of long-term debt
424
20,339
Unearned revenue
1,221
278
Other current liabilities
2,119
500
Total current liabilities
14,410
27,100
Non-current liabilities:
Long-term debt
380,815
108,343
Other long-term liabilities
183
2,759
Total non-current liabilities
380,998
111,102
Total liabilities
395,408
138,202
Commitments and contingencies
Member's equity
-
150,747
Class A shares, unlimited shares authorized and 23,255,419 shares issued and outstanding as of December 31, 2024. None authorized, issued or outstanding as of December 31, 2023.
432,663
-
Class B shares, unlimited shares authorized and 53,227,852 shares issued and outstanding as of December 31, 2024. None authorized, issued or outstanding as of December 31, 2023.
-
-
Retained earnings
3,349
-
Total shareholders' equity attributable to LandBridge Company LLC
436,012
-
Noncontrolling interest
172,054
-
Total shareholders' and member's equity
608,066
150,747
Total liabilities and equity
$
1,003,474
$
288,949
CONSOLIDATED STATEMENTS OF CASH FLOWS
Year Ended December 31,
2024
2023
Cash flows from operating activities
Net (loss) income
$
(41,479
)
$
63,172
Adjustments to reconcile net (loss) income to net cash provided by operating activities:
Depreciation, depletion, amortization and accretion
8,875
8,762
Amortization of deferred financing fees
411
129
Amortization of debt issuance costs
1,277
259
Share-based compensation
95,335
(17,230
)
Gain on disposal of assets
-
(239
)
Deferred income tax expense
(411
)
-
Bad debt expense
5
(7
)
Changes in operating assets and liabilities:
Accounts receivable
2,113
(1,474
)
Related party receivable
(1,074
)
(613
)
Prepaid expenses and other assets
(328
)
43
Accounts payable
272
362
Related party payable
233
(109
)
Unearned revenue
940
(989
)
Accrued liabilities and other liabilities
(434
)
803
Income taxes payable
1,901
173
Net cash provided by operating activities
67,636
53,042
Cash flows from investing activities
Acquisitions
(723,367
)
-
Capital expenditures
(985
)
(2,783
)
Proceeds from disposal of assets
-
11
Net cash used in investing activities
(724,352
)
(2,772
)
Cash flows from financing activities
Proceeds from issuance of Class A shares - IPO, net of underwriter discounts & fees
278,263
-
Proceeds from issuance of Class A shares - December Private Placement, net of placement agent fees
339,291
-
Purchase of OpCo Units from LandBridge Holdings, net of placement agent fees
(145,411
)
-
Contributions from member
120,000
-
Dividends, dividend equivalents, and distributions paid
(178,244
)
(105,165
)
Proceeds from term loan
362,500
100,000
Repayments of term loan
(102,500
)
(62,417
)
Proceeds from revolver
55,000
50,000
Repayments of revolver
(60,000
)
(15,000
)
Other financing activities
(462
)
(404
)
Debt issuance costs
(4,326
)
(3,106
)
Offering costs
(8,186
)
(1,706
)
Net cash provided by (used in) financing activities
655,925
(37,798
)
Net (decrease) increase in cash and cash equivalents
(791
)
12,472
Cash and cash equivalents - beginning of period
37,823
25,351
Cash and cash equivalents - end of period
$
37,032
$
37,823
Comparison of Non-GAAP Financial Measures
Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow Margin are supplemental non-GAAP measures that we use to evaluate current, past and expected future performance. Although these non-GAAP financial measures are important factors in assessing our operating results and cash flows, they should not be considered in isolation or as a substitute for net income, gross margin or any other measures presented under GAAP.
Adjusted EBITDA and Adjusted EBITDA Margin are used to assess the financial performance of our assets over the long term to generate sufficient cash to return capital to equity holders or service indebtedness. We define Adjusted EBITDA as net income (loss) before interest; taxes; depreciation, amortization, depletion and accretion; share-based compensation; non-recurring transaction-related expenses and other non-cash or non-recurring expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenues.
We believe Adjusted EBITDA and Adjusted EBITDA Margin are useful because they allow us to more effectively evaluate our operating performance and compare the results of our operations from period to period, and against our peers, without regard to our financing methods or capital structure. We exclude the items listed above from net income (loss) in arriving at Adjusted EBITDA and Adjusted EBITDA Margin because these amounts can vary substantially from company to company within our industry depending upon accounting methods, book values of assets, capital structures and the method by which the assets were acquired.
The following table sets forth a reconciliation of net income as determined in accordance with GAAP to Adjusted EBITDA and Adjusted EBITDA Margin for the periods indicated.
Year Ended,
Three Months Ended
December 31, 2024
December 31, 2023
December 31, 2024
September 30, 2024
December 31, 2023
(In thousands)
(In thousands)
Net income (loss)
$
(41,479
)
$
63,172
$
8,154
$
(2,756
)
$
2,522
Adjustments:
Depreciation, depletion, amortization and accretion
8,875
8,762
2,581
2,038
2,366
Interest expense, net
23,335
7,016
7,100
7,071
2,843
Income tax expense (benefit)
1,875
370
2,765
(1,128
)
67
EBITDA
(7,394
)
79,320
20,600
5,225
7,798
Adjustments:
Share-based compensation - Incentive Units (1)
91,307
(17,230
)
8,905
9,830
7,204
Share-based compensation - RSUs
4,028
-
2,234
1,794
-
Transaction-related expenses (2)
1,266
598
-
351
101
Non-recurring (3)
7,825
-
-
7,825
-
Other
37
116
-
(13
)
122
Adjusted EBITDA
$
97,069
$
62,804
$
31,739
$
25,012
$
15,225
Net (loss) income margin
(38
%)
87
%
22
%
(10
%)
14
%
Adjusted EBITDA Margin
88
%
86
%
87
%
88
%
87
%
(1) Share-based compensation – Incentive Units for the three months ended December 31, 2024, consists of $8.9 million related to the Incentive Units. Share-based compensation – Incentive Units for the three months ended September 30, 2024, consists of $9.8 million related to the NDB Incentive Units. Share-based compensation – Incentive Units for the three months ended December 31, 2023, consists only of the NDB Incentive Units. NDB Incentive Units were liability awards resulting in periodic fair value remeasurement prior to the Division. Subsequent to the IPO, any actual cash expense associated with such Incentive Units is borne solely by LandBridge Holdings LLC and not the Company. Distributions attributable to Incentive Units are based on returns received by investors of LandBridge Holdings LLC once certain return thresholds have been met and are neither an obligation of the Company nor taken into consideration for distributions to investors in the Company.
(2) Transaction-related expenses consist of non-capitalizable transaction costs associated with both completed or attempted acquisitions, debt amendments and entity structuring charges.
(3) Non-recurring expenses for the three months ended September 30, 2024 consist primarily of $5.0 million in IPO-related employee compensation and $2.6 million related to lease termination expense.
Free Cash Flow and Free Cash Flow Margin are used to assess our ability to repay our indebtedness, return capital to our shareholders and fund potential acquisitions without access to external sources of financing for such purposes. We define Free Cash Flow as cash flow from operating activities less investment in capital expenditures. We define Free Cash Flow Margin as Free Cash Flow divided by total revenues.
We believe Free Cash Flow and Free Cash Flow Margin are useful because they allow for an effective evaluation of both our operating and financial performance, as well as the capital intensity of our business, and subsequently the ability of our operations to generate cash flow that is available to distribute to our shareholders, reduce leverage or support acquisition activities.
The following table sets forth a reconciliation of cash flows from operating activities determined in accordance with GAAP to Free Cash Flow and Free Cash Flow Margin, respectively, for the periods indicated.
Year Ended,
Three Months Ended
December 31, 2024
December 31, 2023
December 31, 2024
September 30, 2024
December 31, 2023
(In thousands)
(In thousands)
Net cash provided by operating activities
$
67,636
$
53,042
$
26,928
$
7,450
$
12,483
Net cash used in investing activities
(724,352
)
(2,772
)
(292,331
)
(1,053
)
(149
)
Cash (used in) provided by operating and investing activities
(656,716
)
50,270
(265,403
)
6,397
12,334
Adjustments:
Acquisitions
723,367
-
292,107
750
-
Proceeds from disposal of assets
-
(11
)
-
-
-
Free Cash Flow
$
66,651
$
50,259
$
26,704
$
7,147
$
12,334
Operating cash flow margin (1)
62
%
73
%
74
%
26
%
72
%
Free Cash Flow Margin
61
%
69
%
73
%
25
%
71
%
(1) Operating cash flow margin is calculated by dividing net cash provided by operating activities by total revenue.
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