Crescent Energy Q1 Earnings Call Highlights

Key Points

• Crescent delivered a record 341,000 boe/d (including 140,000 bbl/d of oil) in Q1 and reported roughly $690 million adjusted EBITDA and $192 million levered free cash flow, with management forecasting about $1 billion levered FCF for 2026.
• Permian integration is ahead of plan, with approximately $120 million of synergies captured and cost improvements equating to over $500,000 savings per well and about $25/ft lower lateral costs from rebidding services and fuel changes.
• The company strengthened its balance sheet via an opportunistic refinancing, finished the quarter with roughly $2 billion of liquidity, declared a $0.12 per-share quarterly dividend, and said it has flexibility to pay down debt, pursue M&A or repurchase shares.

Crescent Energy NYSE: CRGY reported first-quarter 2026 results that management said reflected production outperformance, meaningful free cash flow generation and early integration gains from its Permian acquisition. On the company’s earnings call, CEO David Rockecharlie said Crescent “delivered another strong quarter,” citing faster cycle times, optimization in the producing base and an “opportunistic refinancing” that lowered the company’s cost of capital.

Rockecharlie characterized Crescent as a “top 10 U.S. independent oil and gas producer” and said the company’s strategy—combining investing and operating expertise—has supported “better returns, more free cash flow, and profitable growth.”

Production outperformance and free cash flow

Rockecharlie said Crescent produced a record 341,000 barrels of oil equivalent per day during the first quarter, including 140,000 barrels of oil per day. He attributed the beat versus expectations to base production outperformance and acceleration in the Permian driven by improved cycle times.

CFO Brandi Kendall said Crescent generated approximately $690 million of adjusted EBITDA and approximately $192 million of levered free cash flow during the quarter. She added that the results reflected “strong execution and a portfolio built to generate outsized free cash flow.”

While Rockecharlie said the company’s development plan “remains fundamentally unchanged,” he noted Crescent is “selectively accelerating volumes to capture higher near-term returns while continuing to drive operational efficiencies and lower well costs across our asset base.”

Permian integration: synergies, well costs, and faster cycle times

Management said integration of the company’s Permian assets is ahead of plan. Rockecharlie said Crescent has already captured $120 million in synergies to date, exceeding its initial target, and is seeing early improvements in both well costs and production.

In prepared remarks, Rockecharlie said Crescent has added roughly 100,000 incremental lateral feet to its 2026 plan through offset acreage trades and land optimization and is “100 producing days ahead” on its 2026 development plan after accelerating cycle times.

COO Joey Hall provided additional detail during Q&A, describing a shift from stabilizing the acquired assets to optimization. One key cost lever, he said, was rebidding services and moving away from “100% diesel fleets” toward “dynamically gas blending fleets,” which he said displaced “55%-75% of the diesel.” Hall pointed to a “$25 a foot reduction” shown in the company’s materials.

Rockecharlie also said Crescent has achieved over $500,000 of savings per well versus the prior operator through actions including rebidding service contracts, changing fuel usage and adjusting facility design. Kendall later added she believes “there’s outperformance to the $500,000 reduction in well cost that we’ve captured.”

Asked whether Crescent might boost activity similar to peers, Rockecharlie said the company is focused on “grabbing as much cash flow as we can for the benefit of investors,” adding, “We don’t see increasing rig activity into a… higher price environment.” He emphasized producing “barrels at really high margin and returning cash to the balance sheet and investors.”

Operational updates: Eagle Ford, Uinta, and minerals

In the Eagle Ford, Rockecharlie said Crescent continues to realize efficiency gains, including increased use of simul-frac completions that reduce costs and accelerate volumes. He also said the company has strengthened its 2026 program through an “active ground game,” including increasing lateral lengths and working interests.

In the Uinta Basin, Rockecharlie said well costs are down roughly 20% year-over-year, as the company applies a similar approach used in the Eagle Ford. He said activity remains focused on the core Uteland Butte development, while Crescent is also investing in “prudent delineation” of its broader resource opportunity after “strong results in additional formations.”

EVP of Investments Clay Rynd provided more color on Uinta delineation plans, saying the company has been focused on Uteland Butte early in the year and expects in the back half of the year to “continue to drill with confidence, but take passive delineation opportunities.” Rynd also cited interest in the “Upper Cube,” referencing activity and early results on Crescent’s acreage.

On the minerals and royalties business, Rockecharlie said the portfolio provides “valuable exposure to cost-free organic growth.” He said that at current prices, Crescent expects the portfolio to generate approximately $200 million of EBITDA this year, which he described as a meaningful increase versus original guidance. Kendall later said the minerals asset base at “today’s commodity prices is generating close to $200 million of free cash flow.”

Balance sheet, capital returns, and guidance commentary

Kendall said Crescent improved its cost of capital through an “opportunistic refinancing,” which she said reduced interest expense, extended maturities and strengthened the balance sheet. She said the company ended the quarter with approximately $2 billion of liquidity and “no near-term debt maturities.”

On shareholder returns, Kendall said Crescent declared a $0.12 per share dividend for the quarter. She also said that at current prices the company expects to generate approximately $1 billion of levered free cash flow in 2026, providing flexibility to reduce debt, pursue M&A and repurchase shares when appropriate.

During Q&A, Kendall said there is “no formal change to production or capital guidance for the full year,” but added that given performance to date and commodity prices, management would “expect to be between the mid and the high point on both production and capital.” When asked about the drivers of first-quarter outperformance, Kendall said the upside was “roughly 50/50” between better cycle times in the Permian and base optimization.

Kendall also said the company expects a first-quarter working capital draw of about $140 million to unwind next quarter, largely tied to A&D transactions that closed at the end of the fourth quarter. On cash taxes, she said Crescent has significant tax assets to offset expected taxable income in 2026, and that over the longer term the company would expect to become a cash taxpayer in an “$80+ WTI environment.”

On commodity exposures, Kendall said Crescent is “very well hedged from a Waha standpoint over the next probably 24 months in the… mid-$2s.” She also addressed oil realizations, noting the company printed 99% of WTI in the quarter and that roughly 70%-75% of Crescent’s crude prices off MEH. Kendall said second-quarter oil realizations should be “kind of in the ZIP code” of the first quarter.

Looking further out, Rockecharlie said early thoughts on 2027 center on “more of the same,” including a steady focus on production levels, “maintaining flat to very modest growth through the drill bit,” continued improvements in performance and costs, and generating significant free cash flow guided by corporate targets such as decline rate, reinvestment rate and returns.

About Crescent Energy NYSE: CRGY

Crescent Energy Co NYSE: CRGY is an independent exploration and production company focused on the acquisition, development and production of oil and natural gas resources in North America. Headquartered in Oklahoma City, the company's core business activities include the identification and appraisal of prospective acreage, the design and execution of drilling and completion programs, and the ongoing operation and optimization of producing wells. Crescent Energy's integrated approach emphasizes capital efficiency, reservoir quality and operational reliability to support sustainable cash flow generation over the commodity cycle.

Crescent Energy's operations are concentrated in the Permian Basin, with a particular focus on the Delaware Basin's stacked pay intervals.

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