VET - Vermillion pre-announces Q1 results - beats on production while free cash flow lags

Vermillion (VET) pre-announced Q1 results Tuesday, exceeding annual production guidance during the quarter and generating ~$300m CAD of free cash flow. Production during Q1 was 86.2kboe/d, exceeding the upper end of the Company's 83-85kboe/d annual guidance. Production guidance for 2022 was raised to 86-88kboe/d in late March, on the back of the Leucrotta Exploration acquisition. The Company's 2022 capital budget was also increased in late March, to $500m CAD, from a $400m target released with year-end 2021 earnings. Free cash flow during Q1 came in at ~$300m CAD, or ~8.5% of Vermillion's (VET) current market cap; the company previously guided to $1.4b of free cash flow during 2022 (excluding the Corrib acquisition) suggesting free cash flow (ex. Corrib) will need to increase in coming quarters for management to hit annual targets. Vermillion (VET) remains well placed to take advantage of historically high European natural gas prices in 2022.

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Vermillion pre-announces Q1 results - beats on production while free cash flow lags