Crescent Energy Q2 2025 Earnings Report

Crescent Energy EPS Results

• Actual EPS: $0.43
• Consensus EPS: $0.23
• Beat/Miss: Beat by +$0.20
• One Year Ago EPS: N/A

Crescent Energy Revenue Results

• Actual Revenue: $897.98 million
• Expected Revenue: $868.34 million
• Beat/Miss: Beat by +$29.65 million
• YoY Revenue Growth: N/A

Crescent Energy Announcement Details

• Quarter: Q2 2025
• Date: 8/4/2025
• Time: After Market Closes
• Conference Call Date: Tuesday, August 5, 2025
• Conference Call Time: 11:00AM ET

Crescent Energy (NYSE:CRGY) acquires, develops, and produces crude oil, natural gas, and natural gas liquids (NGLs) reserves. Its portfolio of assets comprises mid-cycle unconventional and conventional assets in the Eagle Ford and Uinta Basins. It also owns and operates various midstream assets, which provide services to customers. The company is based in Houston, Texas.

Crescent Energy Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Exceptional Q2 results: Crescent posted record production of 263 kboe/d, generated $171 M in free cash flow and exceeded all key metrics.
• Positive Sentiment: Raised 2025 outlook by reaffirming production guidance while cutting capital spending and cash tax expectations, adding roughly $100 M of incremental free cash flow.
• Positive Sentiment: Operational excellence delivered ~15% lower drilling and completion costs in the Eagle Ford and Uinta, driving stronger capital efficiency across the asset base.
• Positive Sentiment: Strengthened balance sheet with $200 M of debt repayments, $1 B of liquidity, new hedge positions, and opportunistic buybacks of $28 M at a ~12% discount plus a 7% annualized yield dividend.
• Positive Sentiment: Accretive M&A activity with mineral asset acquisitions targeting >2× MOIC and $110 M of noncore divestitures to simplify the portfolio and enhance returns.

Presentation

[Operator]

Greetings, and welcome to the Crescent Energy Q2 twenty twenty five Results Call. At this time, all participants are in a listen only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Reed Gallagher, Investor Relations. Thank you. You may begin.

[Reid Gallagher, Director at KKR]

Good morning, and thank you for joining Crescent's Second Quarter twenty twenty five Conference Call. Today's prepared remarks will come from our CEO, David Rockacharley and our CFO, Randy Kendall. Our Executive Vice President of Investments, Clay Wren, will also be available during Q and 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 our other disclosures.

[Reid Gallagher, Director at KKR]

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. For reconciliation of historical non GAAP financial measures to the most directly comparable GAAP measure, please reference our 10 Q and earnings press release available on the Investors section on our website. With that, I will hand it over to David.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Good morning, and thank you for joining us. Yesterday, Crescent posted financial and operating results for the second quarter. In summary, it was an exceptional quarter of continued execution for our business. As always, I would like to begin with a few key points that I hope you take away from this call. First, Crescent continues to deliver.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

This quarter, we once again posted strong free cash flow and overall performance. Our excellent results exceeded expectations on all key metrics, and we are enhancing our outlook for the full year. Second, we are driving long term value through operational excellence. Our strong free cash flow generation is the result of impressive operational execution with record production alongside continued capital efficiency gains and cost savings across our asset base. And finally, we are making the most of this market environment, and we see huge opportunity ahead for Crescent.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

We operate in a cyclical industry and see volatility as opportunity. We intentionally built a lower decline and less capital intensive business with commodity flexibility and a consistent hedge program to generate more durable free cash flow than our peers. Our business model allows us to see opportunity and be proactive in periods of dislocation like we are seeing today. Since our last call, we've successfully navigated the market to both acquire assets, including our own stock and divest assets, all at compelling valuations. We have continued to proactively risk manage the business, strengthening the balance sheet with debt repayment, maturity extensions and additions to our hedge position.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

And we continue to simplify the positioning of Crescent stock with our transition to a single share class. We've also been driving operational savings through excellent execution across both acquisition integration and our base business. We built this company to succeed through the inevitable cycles of our industry, and our performance this quarter demonstrates just that. Following those quick highlights, I will now discuss our results in a bit more detail. We saw record production of 263,000 barrels of oil equivalent per day with 108,000 barrels of oil per day and generated approximately $171,000,000 of free cash flow for the quarter, all well above Wall Street expectations.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Our significant outperformance was driven by capital efficiencies, strong well performance and a modest acceleration of activity. Our talented team continues to drive operational savings with increased efficiency of both drilling and completions, improving well costs by approximately 15% in both the Eagle Ford and Uinta basins since last year. With these savings, we are enhancing our outlook for the year, reaffirming production expectations alongside a reduction in capital and lower cash tax expectations, driving increased free cash flow. Our operating plan for the year remains focused on maximizing free cash flow and returns on capital invested. In the Eagle Ford, we are delivering on the flexible capital program that we highlighted in our initial 2025 guidance, taking advantage of relative commodity pricing with gas focused activity in the back half of the year.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

In Utah, we are maintaining our prudent approach to capturing the significant long term resource opportunity we own. The industry remains active with widespread positive results across the basin. Our joint venture in the Northeast portion of our position continues to show extremely strong performance. We were not focused historically in this area, and the impressive results are giving us an exciting reason to remain patient and methodical as we continue to optimize our long term development plan. As we look beyond our base business for attractive investment opportunities, the A and D market was quieter in the second quarter with continued volatility in commodity pricing.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

However, our team has been able to find pockets of compelling value and execute accretive transactions, including both acquisitions and divestitures. First, we acquired attractive minerals assets that complement our existing portfolio focused in Texas and The Rockies. We expect the acquisition to generate returns in excess of our 2x MOIC target and be accretive to free cash flow. The assets fit seamlessly into our existing minerals portfolio, which pro form a contributes roughly $100,000,000 of annual cash flow to our overall business. On the other side of the A and B market, we closed another divestiture of non operated assets.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

This accretive divestiture is a part of our ongoing plan to streamline the business and maximize the value of noncore assets in our portfolio. And it brings our year to date divestiture total to roughly $110,000,000 I'm consistently impressed with the focus, drive and creativity that our team brings to finding compelling value opportunities, whether that be in the A and D market or within our own business. This quarter has been a great example of what execution means to us. It means delivering free cash flow. It means delivering strong and consistent operations.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

It means delivering returns through accretive M and A. But most of all, it means that everyone on our team is always ready, looking for any opportunity to deliver further value for Crescent. With that, I'll turn the call over to Brandi to provide more detail on the quarter.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Thanks, David. Crescent had impressive results for the quarter with approximately $514,000,000 of adjusted EBITDA, dollars $265,000,000 of capital expenditures and approximately $171,000,000 in levered free cash flow. These results build on our strong track record of consistent and significant free cash flow generation, supported by our advantaged decline rate, lower relative capital intensity, returns focused reinvestment and consistent hedge strategy. Over the last five years, we have generated cumulative free cash flow roughly equal to our current market cap, and we continue to trade at a compelling discount on free cash flow metrics today. As David mentioned, we have capitalized on the current market volatility a number of ways since the first quarter, starting with a meaningful step in our evolution as a public company with elimination of our Up C structure in early April and the transition to a single class of common shares, reducing complexity and making our stock easier to own.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

With the significant dislocation early in the quarter, we repurchased approximately $28,000,000 worth of stock at a weighted average price of $7.88 roughly 12% below our current share price. Our buyback program is an opportunistic tool for us to capitalize on periods of volatility, and we evaluate opportunities to acquire our own stock the same way we evaluate acquisition opportunities. In addition to our repurchase activity, we announced another dividend of zero one two dollars per share, which altogether equates to an attractive 7% annualized yield. We took steps to further strengthen our balance sheet using cash flow to pay down approximately $200,000,000 of debt this quarter, increasing liquidity to $1,000,000,000.07 $5 We also successfully refinanced a portion of our long term debt to strengthen our maturity time line even further relative to our peers. On top of all that, we were able to add some opportunistic oil hedges to our 2026 portfolio at recent highs.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

With that, I'll turn the call back over to David for closing remarks.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Thanks, Brandi. Before we wrap up, I want to reiterate our key messages for investors. First, we continue to deliver. This quarter, all key metrics exceeded expectations. We are a cash flow focused company, and we generated $171,000,000 of free cash flow.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

And with our strong results, we have enhanced our outlook for the year. Second, we are driving long term value through operational excellence. Our team continues to outperform. Over many years and many transactions, we have proven our successful acquisition and integration capabilities, and we don't stop there. We are relentlessly focused on finding the gold buried within our own business to increase free cash flow and returns for our investors.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Simply put, we acquire assets and we make them better. And finally, we are making the most of this market environment, and we are always prepared to capitalize on any opportunity ahead of us. Our business model allows us to see opportunity and be proactive in periods of dislocation like we are seeing today, and this quarter's performance is a perfect example of our strategy in action. With that, we'll open it up for Q and A. Operator?

[Operator]

Thank you. We will now be conducting a question and answer session. The first question is from John Freeman from Raymond James. Please go ahead.

[John Freeman, Managing Director at Raymond James Financial]

Thanks. Good morning. We we continue to see the nice efficiency gains on the the D and C per foot falling, you know, another 6% just from from one q levels, and it looks like most of that improvement was driven by about a 10% improvement on the completion side in terms of just the amount of fluids a day that are being pumped. Just maybe if you all could elaborate on that, if there was some specific change that you all made on the completion side that would have driven that big of an improvement from what you all had just put off in 1Q?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Hey, John, it's David. Thanks for the question. I would say, quite simply, it's just more execution of what we would call best practices. And in particular, we would highlight that we're still bringing simul frac in bigger and bigger ways to our completion operations.

[John Freeman, Managing Director at Raymond James Financial]

Got it. And then I guess I was just gonna say if we then looking at the Uinta, those those well results that you're pointing out on on slide 11, obviously, pretty meaningful outperformance. And, you did mention that's an area that you previously weren't really kind of looking at. Does what you all are seeing on those wells, I get it, it's still early days, but on those that size of an outperformance, does it sort of maybe change the way you all think about maybe capital allocation decisions within the basin going forward?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yes, great question. Just as a quick reminder, you'll recall that we acquired that asset really based purely on PDP value. Early days, we were in a pretty low risk mode drilling really just one formation. What we've seen in the last three plus years is a significant expansion and economic proving up of multiple formations in that area. So long story short, we're very excited about the resource potential.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

We don't have any need to move too quickly out here. And yes, we're really pleased with what I would call an expansion across our acreage of proven economic inventory. So I think you'll see us continue to allocate capital here. And we just want to do it in the right way, given the significant stacked resource that's now been proven up over the last multiple years that we would not have gone after the day we acquired the asset.

[John Freeman, Managing Director at Raymond James Financial]

Thanks. Appreciate it. Nice quarter.

[Operator]

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

[Michael Furrow, Vice President at Pickering Energy Partners]

Congrats on the quarter. Just hoping to get a little more color on recent M and A activity during the quarter with the acquisition and divestiture. Minerals portfolio has grown to be a bit quite sizable, doing $100,000,000 in anticipated EBITDA. I think that we can all agree that Crescent is really not seeing that value reflected in the share price today and monetization of that asset would likely be the quickest way to kind of recognize that value. So our question is, what's the justification to add to the minerals portfolio here?

[Michael Furrow, Vice President at Pickering Energy Partners]

And what are you guys seeing internally that might not have been as clear to us on the outside looking in particularly on that asset package?

[Clay Rynd, EVP - Investments at Crescent Energy Co]

Hey, it's Clay. Listen, first, glad you're asking about the minerals portfolio because I agree with you, it's growing to be a decent sized business. For us, just to hit the acquisition specifically, super consistent with the strategy, right? Hits the return metrics that we all focus on, as you know, right? We've been building this minerals portfolio over a long time.

[Clay Rynd, EVP - Investments at Crescent Energy Co]

So it's a part of the market we're active in, we understand. And when we see value drive by, we thought it made sense to grab it super accretive for the business in line with kind of how we view the world, highly cash flow accretive. So I think as we thought that acquisition, especially into a volatile market where we thought we could grab great value, did it. Bigger picture, look, certainly we recognize that if you stop time today and said, are we getting the value for that business today? I don't think we are.

[Clay Rynd, EVP - Investments at Crescent Energy Co]

And so we're certainly focused on how do we get the best long term value for our investors around that business. I think there's multiple paths to do that, but something we talk about a lot and are focused on.

[Reid Gallagher, Director at KKR]

Just like to get a follow-up here on the balance sheet, kind of move a little different direction. Gross debt is still a little elevated relative to the current market cap, but it's really moving in the right direction. Leverage is quite manageable, really on a path to that one times target. I'd argue that the balance sheet is even stronger than those metrics coming to look at the weighted average maturity and the coupon rate. To us, it seems like the company is in a pretty strong position to both further reduce debt and repurchase shares.

[Reid Gallagher, Director at KKR]

So our question is, how is the company doing now continuing to buy back stock at the current valuation? How is that being balanced with your longer term leverage targets?

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Michael, it's Brandy. Good question. So no change fundamentally as to how we think about capital allocation priorities remain the balance sheet and the fixed dividend. And then after that, it's all about, right, what's the best return on the capital that we can invest, whether that we're buying our stock, it's M and A or we're drilling wells. I think Q2 and how we allocate the capital is probably a good framework to think about going forward.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

So of the free cash flow that we generated, roughly 80% went to the balance sheet. So you saw us repay $200,000,000 of debt this quarter, and the remaining 20% went back to our equity investors through the fixed dividend and the buyback. So again, I think that's an okay ZIP code to think about how we balance the two going forward.

[Michael Furrow, Vice President at Pickering Energy Partners]

That's great. Thank you. I'll turn it back.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Thank you.

[Operator]

The next question is from Charles Meade from Johnson Rice and Co. Please go ahead.

[Charles Meade, Research Analyst & Member at Johnson Rice & Company L.L.C.]

Yes. Good morning, David, you and your whole team there. Wondered if David, in your prepared remarks, you used the word dislocation to talk about the A and D market right now. And I'm wondering if you could elaborate what you're seeing to lead you to use that, that were dislocation. And if you care to offer a guess on how that dislocation might resolve going forward?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yeah. So great question. First, I'll start by saying that there's definitely what I'll call levels of dislocation, and it it's certainly functioning. So maybe the simplest explanation I can give you for our use of that word, despite the fact that we got a few things done is, as you know, we are heavily focused in our core area of the Eagle Ford, where we're a top three producer of oil and gas and have been a very active acquirer. We look at everything in the A and D market, but including the highly, what I would call transactable area in the Eagle Ford.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

And what we've seen so far this year was a fairly active market early on of assets available for sale. And the punch line is 75% or more of the asset sale processes we saw in the Eagle Ford were pulled and never transacted as a result of volatility that we saw in Q2. So our view is the market's functioning right now, and we're able to get some things done, but there's just a lot out there in our view that's still sitting on the sidelines. And so we like it when we get a chance to look at lots of things and the market environment starts to allow people to sort out where they want to focus their capital and when and how they want to transact. So I think we're well prepared to succeed in that type of environment.

[Charles Meade, Research Analyst & Member at Johnson Rice & Company L.L.C.]

Got it. Got it.

[Charles Meade, Research Analyst & Member at Johnson Rice & Company L.L.C.]

Thank you for that. And then to go back to the earlier question about those having those tantalizing results in the eastern side of your Uinta position, again recognizing it's early days, but is do you guys have any kind of leading hypotheses on why you're seeing such a good production response versus your view? Is it perhaps deeper and higher pressure? Is it a more intensive completion or a different completion design? Or you just still trying to figure it out?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yes. David, again. I'd say long story short is that we played it really safe early on. As I mentioned earlier, we acquired the assets for PDP value. And so we were really focused on just making sure we got what we paid for from a cash flow perspective.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

And the industry has continued to evolve significantly. So I think there's nothing fundamentally surprising. In other words, the reservoirs are performing very well. And yes, we had a lack of certainty around what that might look like before we allocated some capital there. But fundamentally, much like a lot of the success across the basin, I think we're very pleased and there's nothing fancy going on here. It's just good old fashioned performance of strong reservoirs.

[Charles Meade, Research Analyst & Member at Johnson Rice & Company L.L.C.]

Got it. Thank you, The

[Operator]

next question is from Oliver Huang from TPH and Co. Please go ahead.

[Oliver Huang, Director at TPH&Co]

Good morning, David, Brandy, Clay, and thanks for taking the questions.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Wanted to follow-up on

[Oliver Huang, Director at TPH&Co]

the earlier question around efficiencies and the lower D and C. Was there a deflation or a lower service cost component? Or did that have anything to do with where activity occurred during the quarter? Or was it just purely efficiency cycle time driven? And also, are there certain areas where you all see further levers to pull costs down lower over the next year or so, whether from a cash OpEx or D and C perspective?

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Yes, Oliver, it's Brandy. I'll start. So the driver for reducing our capital guide by 3% is all drilling and completion efficiencies. I would say from a kind of inflation deflation standpoint, as we sit here today and look out for the rest of the year, I would say not seeing a ton with respect to service cost deflation. We obviously were the beneficiaries of significant deflation throughout 2024.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

And then just obviously and the obvious tariff overlay is going to be slightly inflationary. So we'd expect E and C costs to creep up maybe 10 a foot in the back part of the year, specifically due to deflation, but that's still well within our updated capital guidance.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Okay. Perfect. That's And

[Oliver Huang, Director at TPH&Co]

maybe just for a second question, just on the efficiencies that you all have seen. Is there any thought to potential building of DUCs if they were to kind of hold true and lead to running ahead of schedule heading into year end? Or would the decision point be to slow down a bit or even pull forward some activity into 2025?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yes. Hey, it's David. I think we are very good at managing the business through cycles and planning for the longer term. So long story short, I think our outlook for the year remains the same. I wouldn't expect us to be doing anything different absent large moves in commodity prices that impact returns.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Maybe also I'll add, we obviously reaffirmed our full year production guidance on less capital. If we add up the capital and the tax savings, that equates to roughly $100,000,000 of incremental free cash flow for the business this year. And especially in a period of market volatility, we think retaining that $100,000,000 for the benefit of our shareholders is a better use of that extra cash flow than continue to put it into the ground.

[Operator]

The next question is from John Abbott from Wolfe Research.

[John Abbott, E&P Research Vice President at Wolfe Research, LLC]

First question is on capital allocation. Mean this year, are pivoting you are allocating more capital towards natural gas. I mean you are still expected to grow gas volumes in the second half of the year. You do have flexibility in the Eagle Ford to pivot. I guess my question is, at this point, I mean, as you sort of think about that flexibility, are you pretty much locked in, in terms of activity for the remainder of this year if we continue to see robust production for The U.

[John Abbott, E&P Research Vice President at Wolfe Research, LLC]

S. For natural gas that could lower pricing? Do you have the ability to flex? And then as you sort of look to 2026, how are thinking about the allocation of activity between oil and gas?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

John, it's David here. A quick answer on that is, yes, think we have not only the flexibility in the asset base, as you said, we've also got the ability a proven ability to ship that capital relatively quickly as we did earlier this year. But I would say in terms of timing, I think the most important thing we highlight is we can change the allocation of capital in the down market pretty quickly. So we feel like we have a lot of control over our capital. And the flexibility side, while highly flexible, I'd go back to what we talked about earlier in the year.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

At the margin quickly, it tends to be about 20% of the program that we can move pretty quickly. So I'd maybe give you those two guideposts.

[John Abbott, E&P Research Vice President at Wolfe Research, LLC]

Appreciate And then for our second question, Randy, this one is for you. You are a beneficiary of the big one beautiful bill. I mean, you know your cash taxes this year, as you just discussed, you're going to get a benefit from this year. And then I guess, over the next several years, you're probably not going to be paying much in the way of cash taxes. I guess the real question is, how do you think about your ability to offset cash taxes post 2027 when you kind of sort of look at strip pricing?

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Hey, John, it's Brandi. Good question. As you mentioned, we are a beneficiary of updated tax legislation similar to other oil and gas companies. As we look at kind of the next five years of expected cash tax payments, kind of pre legislation and post legislation, we think that's roughly two fifty million dollars of cash tax savings, so roughly $1 per share. Again, over the next couple of years, right, assuming current commodity prices and a kind of a maintenance level of capital program, expect federal taxes to essentially be zero.

[John Abbott, E&P Research Vice President at Wolfe Research, LLC]

Appreciate it. Thank you very much for taking our questions.

[Operator]

Next question is from Tim Rezvan from KeyBanc Capital Markets. Please go ahead.

[Tim Rezvan, Managing Director & Equity Research Analyst at KeyBanc Capital Markets]

Good morning, folks, and thank you for taking my questions. I wanted to sort of follow-up on prior comments on the balance sheet. In talking with you all last night, we sensed confidence on hitting or exceeding your asset sale target. It comes on top of pretty strong free cash flow. But when we see leverage in this commodity price environment, we simply don't see a lot of organic deleveraging even if we were to assume several 100,000,000 of asset sales that didn't have earnings.

[Tim Rezvan, Managing Director & Equity Research Analyst at KeyBanc Capital Markets]

So can you talk about how realistic that one times leverage target is over the next one to two years? And maybe kind of looking at it a different way, what's the appropriate debt balance that a company your size should have? Thanks.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Tim, thanks for the question. It's David. As you know, our stated framework is to operate between one and one point five times. And as you heard earlier from Brandy and in our released results as well, we're obviously no change. We're focused on managing the business through the cycle and taking care of the capital structure and making sure we've got a strong balance sheet.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

So I think you'll continue to see us pay down debt out of free cash flow. We're at the higher end of our range now. Think that's consistent with what we've said. And to your point, we do generate a lot of free cash flow and we're also well hedged with long term debt. So I think we've got a very strong path over time to reducing debt, but also, again, I think we've proven we'll stay within our leverage targets.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Maybe on a little more specific thoughts around how we see the appropriate way to leverage companies in the oil and gas sector. I'll let Randy cover this, but we're well aligned as a company strategically on how we think about asset base and leverage.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Yes, I'll add. So as Dave mentioned, right, we generate a lot of cash. We're well hedged. We have a less capital intensive business, meaning historically, we've reinvested 40% to 50% of our cash flows. I do think inherently our business has an ability to delever over time, both on an absolute basis, but then also with respect to an overall leverage metric.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

We have roughly $250,000,000 drawn on the RBL today. We would expect that to be repaid out of cash flow as we move towards the end of the year. And then the only maturity that exists before 2032 would be the remaining 500,000,000 of our 2028 notes. As we look forward, again, assuming of we're in a similar commodity price environment, we can kind of pay those off again without a cash flow. So as we move through the end of this year and into next year, we could be looking at some long term debt that matures between 2032 and 02/1934.

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

So again, feel like we're in a really great spot and really within the guidelines of how we've operated the business for the last twelve years.

[Tim Rezvan, Managing Director & Equity Research Analyst at KeyBanc Capital Markets]

Okay. That's helpful context. And I just wanted to tie that to sort of your comments on being countercyclical on the A and D front. I appreciated the comments on the Eagle Ford. So is it safe to say you will remain nimble and that we should think about guidepost as leverage on structure for a deal and that you're comfortable with net debt going up if something is leverage neutral? Is that the right way to think about opportunities?

[Brandi Kendall, Board Member & CFO at Crescent Energy Co]

Yes. Think for us, right, from an A and D perspective, we want to earn two times our money or more. We're focused on accretion, and we want to make sure the pro form a business is really strong. And for us, we're comfortable going up to 1.5 times. So that's how we evaluate M and A.

[Tim Rezvan, Managing Director & Equity Research Analyst at KeyBanc Capital Markets]

Okay. Thank you.

[Operator]

The next question is from Michael Scialla from Stephens Inc. Please go ahead.

[Michael Scialla, Analyst at Stephens Inc]

Hi, good morning. Wanted to ask this kind of high level, even after you've simplified the structure here with the elimination of the FC, your stock is still valued at about a one turn discount, at least to our mid cap peer group. I guess what do you see as holding the stock back? Anything in particular that you plan to focus on going forward?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yes, think look, it's our job to demonstrate to people how good this business is. We're just going to keep doing it. I think this quarter is a great example, free cash flow, great returns and risk management and a great operating businesses is what we're building here. So I think it's, we're not going to make it harder than that. We just got to keep showing up.

[Michael Scialla, Analyst at Stephens Inc]

Understood. I wanted to ask on Uinta, the decision to pause drilling there when it looks like you have some really good results. I guess, how do the returns between UNT and Eagle Ford compare? And if they are similar, can you just discuss the reason for keeping that asset kind of on hold here for a little bit?

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Yes. Hey, it's David. The short answer is, I think we've talked about before the oil weighted portfolio in the company in terms of our ability to allocate capital is similar across the Eagle Ford and the Uinta. But we've gotten significantly more, what I'll call stacked resource in the Uinta and we've got a larger acreage position with less development across it. So it's relatively straightforward to us to allocate capital between the two areas on the oil side.

[David Rockecharlie, CEO & Director at Crescent Energy Co]

We'll continue to do that. And all you're seeing is when we get great results in an area where we have not been as focused, we're going to stop and evaluate that and make sure we maximize the future development there. So we're really excited about it. We've got great resource on the oil side in both the Eagle Ford and Newinda, and I think you'll continue to see us allocate capital effectively across those two basins in some way.

[Operator]

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

[David Rockecharlie, CEO & Director at Crescent Energy Co]

Great. Thank you all again. As we said, we're really pleased with how the business is performing, and we're going to continue to do that and get back to work and look forward to talking to you next quarter.

[Operator]

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

Participants

Executives

• David Rockecharlie, CEO & Director
• Brandi Kendall, Board Member & CFO
• Clay Rynd, EVP - Investments

Analysts

• Reid Gallagher, Director at KKR
• John Freeman, Managing Director at Raymond James Financial
• Michael Furrow, Vice President at Pickering Energy Partners
• Charles Meade, Research Analyst & Member at Johnson Rice & Company L.L.C.
• Oliver Huang, Director at TPH&Co
• John Abbott, E&P Research Vice President at Wolfe Research, LLC
• Tim Rezvan, Managing Director & Equity Research Analyst at KeyBanc Capital Markets
• Michael Scialla, Analyst at Stephens Inc