Cover Page
Cover Page - shares | 3 Months Ended | |
Mar. 31, 2023 | Apr. 28, 2023 | |
Cover [Abstract] | ||
Document type | 10-Q | |
Document Quarterly Report | true | |
Document period end date | Mar. 31, 2023 | |
Document transition report | false | |
Entity file number | 1-39804 | |
Entity registrant name | Texas Pacific Land Corporation | |
Entity incorporation, state or country code | DE | |
Entity tax identification number | 75-0279735 | |
Entity address, address line one | 1700 Pacific Avenue | |
Entity address, address line two | Suite 2900 | |
Entity address, city or town | Dallas | |
Entity address, state or province | TX | |
Entity address, postal zip code | 75201 | |
City area code | (214) | |
Local phone number | 969-5530 | |
Title of 12(b) security | Common Stock(par value $.01 per share) | |
Trading symbol | TPL | |
Security exchange name | NYSE | |
Entity current reporting status | Yes | |
Entity interactive data current | Yes | |
Entity filer category | Large Accelerated Filer | |
Entity small business | false | |
Entity emerging growth company | false | |
Entity shell company | false | |
Entity common stock, shares outstanding | 7,692,178 | |
Entity central index key | 0001811074 | |
Current fiscal year end date | --12-31 | |
Document fiscal year focus | 2023 | |
Document fiscal period focus | Q1 | |
Amendment flag | false |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
ASSETS | ||
Cash and cash equivalents | $ 590,619 | $ 510,834 |
Accounts receivable and accrued receivables, net | 106,044 | 103,983 |
Prepaid expenses and other current assets | 7,586 | 7,427 |
Tax like-kind exchange escrow | 6,757 | 6,348 |
Prepaid income taxes | 0 | 4,809 |
Total current assets | 711,006 | 633,401 |
Real estate acquired | 109,704 | 109,704 |
Property, plant and equipment, net | 86,192 | 85,478 |
Royalty interests acquired, net | 44,720 | 45,025 |
Other assets | 3,629 | 3,819 |
Real estate and royalty interests assigned through the 1888 Declaration of Trust, no value assigned: | ||
Total assets | 955,251 | 877,427 |
LIABILITIES AND EQUITY | ||
Accounts payable and accrued expenses | 27,263 | 23,443 |
Ad valorem and other taxes payable | 4,560 | 8,497 |
Income taxes payable | 22,430 | 3,167 |
Unearned revenue | 6,784 | 4,488 |
Total current liabilities | 61,037 | 39,595 |
Deferred taxes payable | 40,845 | 41,151 |
Unearned revenue - noncurrent | 22,395 | 21,708 |
Accrued liabilities - noncurrent | 1,923 | 2,086 |
Total liabilities | 126,200 | 104,540 |
Commitments and contingencies | 0 | 0 |
Equity: | ||
Preferred stock, $0.01 par value; 1,000,000 shares authorized, none outstanding as of March 31, 2023 and December 31, 2022 | 0 | 0 |
Common stock, $0.01 par value; 7,756,156 shares authorized and 7,693,320 and 7,695,679 outstanding as of March 31, 2023 and December 31, 2022, respectively | 78 | 78 |
Treasury stock, at cost; 62,836 and 60,477 shares as of March 31, 2023 and December 31, 2022, respectively | (108,794) | (104,139) |
Additional paid-in capital | 7,733 | 8,293 |
Accumulated other comprehensive income | 2,491 | 2,516 |
Retained earnings | 927,543 | 866,139 |
Total equity | 829,051 | 772,887 |
Total liabilities and equity | 955,251 | 877,427 |
Land (surface rights) | ||
Real estate and royalty interests assigned through the 1888 Declaration of Trust, no value assigned: | ||
Land (surface rights) | 0 | 0 |
1/16th nonparticipating perpetual royalty interest | ||
Real estate and royalty interests assigned through the 1888 Declaration of Trust, no value assigned: | ||
1/16th nonparticipating perpetual royalty interest | 0 | 0 |
1/128th nonparticipating perpetual royalty interest | ||
Real estate and royalty interests assigned through the 1888 Declaration of Trust, no value assigned: | ||
1/128th nonparticipating perpetual royalty interest | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parentheticals) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Dec. 31, 2022 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock authorized (in shares) | 1,000,000 | 1,000,000 |
Preferred stock, outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock authorized (in shares) | 7,756,156 | 7,756,156 |
Common stock, outstanding (in shares) | 7,693,320 | 7,695,679 |
Treasury stock, at cost (in shares) | 62,836 | 60,477 |
1/16th nonparticipating perpetual royalty interest | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 6.25% | |
1/128th nonparticipating perpetual royalty interest | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 0.78125% |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND TOTAL COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenues: | ||
Total revenues | $ 146,362 | $ 147,335 |
Expenses: | ||
Salaries and related employee expenses | 10,593 | 9,385 |
Water service-related expenses | 5,656 | 2,782 |
General and administrative expenses | 3,552 | 2,967 |
Legal and professional fees | 16,628 | 1,719 |
Ad valorem and other taxes | 1,574 | 2,043 |
Land sales expenses | 3 | 0 |
Depreciation, depletion and amortization | 3,404 | 4,126 |
Total operating expenses | 41,410 | 23,022 |
Operating income | 104,952 | 124,313 |
Other income, net | 5,389 | 76 |
Income before income taxes | 110,341 | 124,389 |
Income tax expense | 23,773 | 26,489 |
Net income | 86,568 | 97,900 |
Total other comprehensive income (loss) | (25) | 8 |
Total comprehensive income | $ 86,543 | $ 97,908 |
Net income per share of common stock | ||
Net income per sub-share certificate - basic (in dollars per share) | $ 11.25 | $ 12.65 |
Net income per sub-share certificate - diluted (in dollars per share) | $ 11.24 | $ 12.64 |
Weighted average number of shares of common stock outstanding | ||
Weighted average number of shares of common stock outstanding - basic (in shares) | 7,693,084 | 7,741,365 |
Weighted average number of shares of common stock outstanding - diluted (in shares) | 7,698,398 | 7,742,710 |
Dividend paid per common stock (in USD per share) | $ 3.25 | $ 3 |
Oil and gas royalties | ||
Revenues: | ||
Total revenues | $ 89,130 | $ 104,172 |
Water sales | ||
Revenues: | ||
Total revenues | 21,729 | 18,820 |
Produced water royalties | ||
Revenues: | ||
Total revenues | 20,134 | 14,870 |
Easements and other surface-related income | ||
Revenues: | ||
Total revenues | 14,969 | 9,192 |
Land sales and other operating revenue | ||
Revenues: | ||
Total revenues | $ 400 | $ 281 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND TOTAL COMPREHENSIVE INCOME (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Statement [Abstract] | ||
Periodic pension costs, net of income taxes | $ 6 | $ (2) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 86,568 | $ 97,900 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred taxes | (306) | (406) |
Depreciation, depletion and amortization | 3,404 | 4,126 |
Share-based compensation | 2,473 | 1,505 |
Changes in operating assets and liabilities: | ||
Receivables and other assets | (2,076) | (12,959) |
Operating liabilities, excluding income taxes | 640 | (3,328) |
Income taxes payable | 19,263 | 20,897 |
Prepaid income taxes | 4,809 | 0 |
Cash provided by operating activities | 114,775 | 107,735 |
Cash flows from investing activities: | ||
Proceeds from sale of fixed assets | 5 | 96 |
Acquisition of real estate | 0 | (13) |
Acquisition of royalty interests | 0 | (1,637) |
Purchase of fixed assets | (1,749) | (3,624) |
Cash used in investing activities | (1,744) | (5,178) |
Cash flows from financing activities: | ||
Repurchases of common stock | (6,837) | (219) |
Shares exchanged for tax withholdings | (939) | 0 |
Dividends paid | (25,061) | (23,224) |
Cash used in financing activities | (32,837) | (23,443) |
Net increase in cash, cash equivalents and restricted cash | 80,194 | 79,114 |
Cash, cash equivalents and restricted cash, beginning of period | 517,182 | 428,242 |
Cash, cash equivalents and restricted cash, end of period | 597,376 | 507,356 |
Supplemental disclosure of cash flow information: | ||
Income taxes paid | 0 | 6,000 |
Supplemental non-cash investing and financing information: | ||
Nonmonetary exchange of assets | 0 | 4,174 |
Increase (decrease) in accounts payable related to capital expenditures | 2,024 | (619) |
Share repurchases not yet settled | $ 266 | $ 0 |
Organization and Description of
Organization and Description of Business Segments | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Description of Business Segments | Organization and Description of Business Segments Organization Texas Pacific Land Corporation (which, together with its subsidiaries as the context requires, may be referred to as “TPL”, the “Company”, “our”, “we” or “us”) is a Delaware corporation and one of the largest landowners in the State of Texas with approximately 874,000 surface acres of land in West Texas, with the majority of our ownership concentrated in the Permian Basin. Additionally, we own a 1/128th nonparticipating perpetual oil and gas royalty interest (“NPRI”) under approximately 85,000 acres of land, a 1/16th NPRI under approximately 371,000 acres of land, and approximately 4,000 additional net royalty acres (normalized to 1/8th) in the western part of Texas. TPL’s income is derived primarily from oil, gas and produced water royalties, sales of water and land, easements and commercial leases of the land. On January 11, 2021, we completed our reorganization from a business trust, Texas Pacific Land Trust (the “Trust”), organized under a Declaration of Trust dated February 1, 1888 (the “Declaration of Trust”), into Texas Pacific Land Corporation, a corporation formed and existing under the laws of the state of Delaware (the “Corporate Reorganization”). Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on the same basis as the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. The condensed consolidated financial statements herein include all adjustments which are, in the opinion of management, necessary to fairly state the financial position of the Company as of March 31, 2023 and the results of its operations and its cash flows for the three months ended March 31, 2023 and 2022, respectively. Such adjustments are of a normal nature and all intercompany accounts and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, and accordingly these interim financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2022. The results for the interim periods shown in this report are not necessarily indicative of future financial results. We operate our business in two segments: Land and Resource Management and Water Services and Operations. Our segments provide management with a comprehensive financial view of our key businesses. The segments enable the alignment of strategies and objectives of TPL and provide a framework for timely and rational allocation of resources within businesses. See Note 11, “Business Segment Reporting” for further information regarding our segments. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Use of Estimates in the Preparation of Financial Statements The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. In the event estimates and/or assumptions prove to be different from actual amounts, adjustments are made in subsequent periods to reflect more current information. Cash, Cash Equivalents and Restricted Cash We consider investments in bank deposits, money market funds, and other highly-liquid cash investments, such as U.S. Treasury bills and commercial paper, with original maturities of three months or less to be cash equivalents. Our cash equivalents are considered Level 1 assets in the fair value hierarchy. The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Cash and cash equivalents $ 590,619 $ 510,834 Tax like-kind exchange escrow 6,757 6,348 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 597,376 $ 517,182 Reclassifications Certain financial information on the condensed consolidated balance sheet and condensed consolidated statement of income and total comprehensive income as of and for the three months ended March 31, 2022 has been revised to conform to the current year presentation. These revisions include a balance sheet reclassification of $454,000 of other taxes payable previously included in accounts payable and accrued expenses to ad valorem and other taxes payable and an income statement reclassification of $33,000 of property taxes previously included in general and administrative expenses to ad valorem and other taxes for the three months ended March 31, 2022. |
Real Estate Activity
Real Estate Activity | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Real Estate Activity | Real Estate Activity As of March 31, 2023 and December 31, 2022, TPL owned the following land and real estate (in thousands, except number of acres): March 31, December 31, Number of Acres Net Book Value Number of Acres Net Book Value Land (surface rights) (1) 817,051 $ — 817,060 $ — Real estate acquired 57,306 109,704 57,306 109,704 Total real estate situated in Texas 874,357 $ 109,704 874,366 $ 109,704 (1) Real estate assigned through the Declaration of Trust. |
Property, Plant and Equipment
Property, Plant and Equipment | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment, net consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Property, plant and equipment, at cost: Water service-related assets $ 128,675 $ 125,166 Furniture, fixtures and equipment 9,937 9,718 Other 598 598 Total property, plant and equipment, at cost 139,210 135,482 Less: accumulated depreciation (53,018) (50,004) Property, plant and equipment, net $ 86,192 $ 85,478 |
Oil and Gas Royalty Interests
Oil and Gas Royalty Interests | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Oil and Gas Royalty Interests | Oil and Gas Royalty Interests As of March 31, 2023 and December 31, 2022, we owned the following oil and gas royalty interests (in thousands): March 31, December 31, 1/16th nonparticipating perpetual royalty interests $ — $ — 1/128th nonparticipating perpetual royalty interests — — Royalty interests acquired 47,928 47,928 Total royalty interests, gross 47,928 47,928 Less: accumulated depletion (3,208) (2,903) Total royalty interests, net $ 44,720 $ 45,025 Acquisitions There were no oil and gas royalty interest transactions during the three months ended March 31, 2023. For the three months ended March 31, 2022, we acquired oil and gas royalty interests in 92 net royalty acres (normalized to 1/8th) for an aggregate purchase price of approximately $1.6 million, an average price of approximately $17,750 per net royalty acre. Depletion expense was $0.3 million and $0.2 million for the three months ended March 31, 2023 and 2022, respectively. |
Share-Based Compensation
Share-Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Share-Based Compensation | Share-Based CompensationThe Company grants share-based compensation to employees under the Texas Pacific Land Corporation 2021 Incentive Plan (the “2021 Plan”) and to its directors under the 2021 Non-Employee Director Stock and Deferred Compensation Plan (the “2021 Directors Plan”). Share-based compensation granted to date under the plans has included restricted stock awards (“RSAs”), restricted stock units (“RSUs”) and performance-based units “(PSUs”). Currently, all awards granted under the plans are entitled to receive dividends (which are accrued and distributed to award recipients upon vesting) or have dividend equivalent rights. Dividends and dividend equivalent rights are subject to the same vesting conditions as the awards to which they relate and are forfeitable if the related awards are forfeited. RSUs granted under the 2021 Plan vest in one-third increments and PSUs granted under the 2021 Plan cliff vest at the end of three Incentive Plan for Employees The maximum aggregate number of shares of the Company’s common stock, par value $0.01 per share (“Common Stock”) that may be issued under the 2021 Plan is 75,000 shares, which may consist, in whole or in part, of authorized and unissued (if any), treasury shares, or shares reacquired by the Company in any manner. As of March 31, 2023, 54,718 shares of Common Stock remained available under the 2021 Plan for future grants. The following table summarizes activity related to RSAs and RSUs under the 2021 Plan for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and units, and per share amounts): Three Months Ended March 31, 2023 2022 Restricted Stock Awards Restricted Stock Units Restricted Stock Awards Restricted Stock Units Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSUs Weighted-Average Grant-Date Fair Value per Share Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSUs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period (1) 1,337 $ 1,252 5,612 $ 1,323 3,330 $ 1,252 — $ — Granted (2) — — 2,848 1,924 — — 3,824 1,105 Vested (3) — — (1,270) 1,105 — — — — Cancelled and forfeited — — — — — — — — Nonvested at end of period 1,337 $ 1,252 7,190 $ 1,600 3,330 $ 1,252 3,824 $ 1,105 (1) The RSAs were granted on December 29, 2021: 1,993 shares vested on December 29, 2022 and 1,337 shares will vest on December 29, 2023. (2) The RSUs were granted on February 10, 2023 and vest in one-third increments over a three-year period. (3) Of the 1,270 shares that vested on February 11, 2023, 488 shares were surrendered by employees to the Company to settle tax withholdings. The following table summarizes activity related to PSUs for the three months ended March 31, 2023 and 2022 (in thousands, except number of units and per share amounts): Performance Stock Units Three Months Ended March 31, 2023 2022 Number of Target PSUs Weighted-Average Grant-Date Fair Value per Share Number of Target PSUs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period (1) 2,394 $ 1,355 — $ — Granted (2) 1,852 2,342 2,394 1,355 Vested — — — — Cancelled and forfeited — — — — Nonvested at end of period 4,246 $ 1,786 2,394 $ 1,355 (1) The PSUs were granted on February 11, 2022 and include 1,197 RTSR (as defined below) PSUs (based on target) with a grant date fair value of $1,605 per share and 1,197 FCF (as defined below) PSUs (based on target) with a grant date fair value of $1,105 per share. If the maximum performance potential metrics described in the PSU agreements are achieved, the actual number of units that will ultimately be awarded under the PSU agreements will exceed target units by 100% (i.e., a collective 2,394 additional units would be issued). (2) The PSUs were granted on February 10, 2023 and include 926 RTSR PSUs (based on target) with a grant date fair value of $2,761 per share and 926 FCF PSUs (based on target) with a grant date fair value of $1,924 per share. If the maximum performance potential metrics described in the PSU agreements are achieved, the actual number of units that will ultimately be awarded under the PSU agreements will exceed target units by 100% (i.e., a collective 1,852 additional units would be issued). Each PSU has a value equal to one share of Common Stock. The PSUs will vest three years after grant if certain performance metrics are met, as follows: 50% of the PSUs may be earned based on the Company’s relative total stockholder return (“RTSR”) over the applicable three-year measurement period compared to the XOP Index, and 50% of the PSUs may be earned based on the cumulative free cash flow per share (“FCF”) over the three-year vesting period. As the RTSR PSU is a market-based award, its grant date fair value was determined using a Monte Carlo simulation model that uses the same input assumptions as the Black-Scholes model to determine the expected potential ranking of the Company against the XOP Index, i.e. the probability of satisfying the market condition defined in the award. Expected volatility in the model was estimated based on the volatility of historical stock prices over a period matching the expected term of the award. The risk-free interest rate was based on U.S. Treasury yield constant maturities for a term matching the expected term of the award. Equity Plan for Non-Employee Directors The maximum aggregate number of shares of Common Stock that may be issued under the 2021 Directors Plan is 10,000 shares, which may consist, in whole or in part, of authorized and unissued shares (if any), treasury shares, or shares reacquired by the Company in any manner. As of March 31, 2023, 8,815 shares of Common Stock remained available under the 2021 Directors Plan for future grants. The following table summarizes activity related to the RSAs under the 2021 Directors Plan for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and per share amounts): Restricted Stock Awards Three Months Ended March 31, 2023 2022 Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSAs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period 699 $ 1,281 — $ — Granted (1) 486 2,344 680 1,249 Vested (595) 1,249 — — Cancelled and forfeited — — (85) 1,249 Nonvested at end of period 590 $ 2,189 595 $ 1,249 (1) The RSAs were granted on January 1, 2023 and will vest on the first anniversary of the grant. Share-Based Compensation Expense The following table summarizes our share-based compensation expense by line item in the condensed consolidated statements of income (in thousands): Three Months Ended 2023 2022 Salaries and related employee expenses (employee awards) $ 2,156 $ 1,319 General and administrative expenses (director awards) 317 186 Total share-based compensation expense (1) $ 2,473 $ 1,505 (1) The Company recognized a tax benefit of $0.5 million and $0.3 million related to share-based compensation for the three months ended March 31, 2023 and 2022, respectively. As of March 31, 2023, there was $17.1 million of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under existing share-based plans expected to be recognized over a weighted average period of 1.7 years. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesThe calculation of our effective tax rate is as follows for the three months ended March 31, 2023 and 2022 (in thousands, except percentages): Three Months Ended 2023 2022 Income before income taxes $ 110,341 $ 124,389 Income tax expense $ 23,773 $ 26,489 Effective tax rate 21.5 % 21.3 % |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per ShareBasic earnings per share (“EPS”) is computed based on the weighted average number of shares outstanding during the period. Diluted EPS is computed based upon the weighted average number of shares outstanding during the period plus unvested restricted stock and other unvested awards granted pursuant to our incentive and equity compensation plans. The computation of diluted EPS reflects the potential dilution that could occur if all outstanding awards under the incentive and equity compensation plans were converted into shares of Common Stock or resulted in the issuance of shares of Common Stock that would then share in the earnings of the Company. The number of dilutive securities is computed using the treasury stock method. The following table sets forth the computation of EPS for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and per share data): Three Months Ended 2023 2022 Net income $ 86,568 $ 97,900 Basic earnings per share: Weighted average shares outstanding for basic earnings per share 7,693,084 7,741,365 Basic earnings per share $ 11.25 $ 12.65 Diluted earnings per share: Weighted average shares outstanding for basic earnings per share 7,693,084 7,741,365 Effect of dilutive securities: Incentive and equity compensation plans 5,314 1,345 Weighted average shares outstanding for diluted earnings per share 7,698,398 7,742,710 Diluted earnings per share $ 11.24 $ 12.64 Restricted stock is included in the number of shares of Common Stock issued and outstanding, but omitted from the basic EPS calculation until such time as the shares of restricted stock vest. Certain stock awards granted are not included in the dilutive securities in the table above as they are anti-dilutive for the three months ended March 31, 2023 and March 31, 2022. |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Litigation Management is not aware of any legal, environmental or other commitments or contingencies that would have a material effect on the Company’s financial condition, results of operations or liquidity as of March 31, 2023. Prior to January 1, 2022, ad valorem taxes with respect to our historical royalty interests were paid directly by third parties pursuant to an existing arrangement. Since the completion of our Corporate Reorganization, we have received notice from certain third parties that they no longer intend to pay the ad valorem taxes related to such historical royalty interests. In order to protect the historical royalty interests from any potential tax liens for non-payment of ad valorem taxes, we have accrued and/or paid such ad valorem taxes since January 1, 2022. While we intend to seek reimbursement from the third parties for such taxes, we are unable to estimate the amount and/or likelihood of such reimbursement, and accordingly, no loss recovery receivable has been recorded as of March 31, 2023. Ongoing Arbitration with an Operator. |
Changes in Equity
Changes in Equity | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Changes in Equity | Changes in Equity The following tables present changes in our equity for the three months ended March 31, 2023 and 2022 (in thousands, except shares and per share amounts): Common Stock Treasury Stock Additional Paid-in Capital Accum. Retained Earnings Total Shares Amount Shares Amount For the three months ended March 31, 2023: Balances as of December 31, 2022 7,695,679 $ 78 60,477 $ (104,139) $ 8,293 $ 2,516 $ 866,139 $ 772,887 Net income — — — — — — 86,568 86,568 Dividends paid — $3.25 per share of common stock — — — — — — (25,061) (25,061) Share-based compensation, net of forfeitures 1,756 — (1,756) 3,033 (560) — (103) 2,370 Repurchases of common stock (3,627) — 3,627 (6,749) — — — (6,749) Shares exchanged for tax withholdings (488) — 488 (939) — — — (939) Periodic pension costs, net of income taxes of $6 — — — — — (25) — (25) Balances as of March 31, 2023 7,693,320 $ 78 62,836 $ (108,794) $ 7,733 $ 2,491 $ 927,543 829,051 Common Stock Treasury Stock Additional Paid-in Capital Accum. Retained Earnings Total Shares Amount Shares Amount For the three months ended March 31, 2022: Balances as of December 31, 2021 7,744,695 $ 78 11,461 $ (15,417) $ 28 $ (1,007) $ 668,029 $ 651,711 Net income — — — — — — 97,900 97,900 Dividends paid — $3.00 per share of common stock — — — — — — (23,224) (23,224) Share-based compensation, net of forfeitures 595 — (595) 800 1,477 — (796) 1,481 Periodic pension costs, net of income taxes of $2 — — — — — 8 — 8 Balances as of March 31, 2022 7,745,290 $ 78 10,866 $ (14,617) $ 1,505 $ (999) $ 741,909 $ 727,876 Stock Repurchase Program On November 1, 2022, our board of directors approved a stock repurchase program to purchase up to an aggregate of $250 million of our outstanding Common Stock which became effective January 1, 2023. The Company intends to purchase stock under the repurchase program opportunistically with funds generated by cash from operations. This repurchase program may be suspended from time to time, modified, extended or discontinued by the board of directors at any time. Purchases under the stock repurchase program may be made through a combination of open market repurchases in compliance with Rule 10b-18 promulgated under the Securities Exchange Act of 1934, as amended, privately negotiated transactions, and/or other transactions at the Company’s discretion, including under a Rule 10b5-1 trading plan implemented by the Company, and will be subject to market conditions, applicable legal requirements and other factors. |
Business Segment Reporting
Business Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Business Segment Reporting | Business Segment Reporting During the periods presented, we reported our financial performance based on the following segments: Land and Resource Management and Water Services and Operations. Our segments provide management with a comprehensive financial view of our key businesses. The segments enable the alignment of our strategies and objectives and provide a framework for timely and rational allocation of resources within businesses. We eliminate any inter-segment revenues and expenses upon consolidation. The Land and Resource Management segment encompasses the business of managing our approximately 874,000 surface acres of land and our oil and gas royalty interests in West Texas, principally concentrated in the Permian Basin. The revenue streams of this segment consist primarily of royalties from oil and gas, revenues from easements and commercial leases and land and material sales. The Water Services and Operations segment encompasses the business of providing a full-service water offering to operators in the Permian Basin. The revenue streams of this segment primarily consist of revenue generated from sales of sourced and treated water as well as revenue from produced water royalties. Segment financial results were as follows for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended 2023 2022 Revenues: Land and resource management $ 104,023 $ 113,347 Water services and operations 42,339 33,988 Total consolidated revenues $ 146,362 $ 147,335 Net income: Land and resource management $ 65,343 $ 81,156 Water services and operations 21,225 16,744 Total consolidated net income $ 86,568 $ 97,900 Capital expenditures: Land and resource management $ 175 $ 122 Water services and operations 3,598 2,883 Total capital expenditures $ 3,773 $ 3,005 Depreciation, depletion and amortization: Land and resource management $ 618 $ 536 Water services and operations 2,786 3,590 Total depreciation, depletion and amortization $ 3,404 $ 4,126 The following table presents total assets and property, plant and equipment, net by segment as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Assets: Land and resource management $ 814,927 $ 735,193 Water services and operations 140,324 142,234 Total consolidated assets $ 955,251 $ 877,427 Property, plant and equipment, net: Land and resource management $ 5,904 $ 5,998 Water services and operations 80,288 79,480 Total consolidated property, plant and equipment, net $ 86,192 $ 85,478 |
Oil and Gas Producing Activitie
Oil and Gas Producing Activities | 3 Months Ended |
Mar. 31, 2023 | |
Extractive Industries [Abstract] | |
Oil and Gas Producing Activities | Oil and Gas Producing Activities We measure our share of oil and gas produced in barrels of equivalency (“Boes”). One Boe equals one barrel of crude oil, condensate, NGLs (natural gas liquids) or approximately 6,000 cubic feet of gas. As of March 31, 2023 and 2022, our share of oil and gas produced was approximately 20.9 and 20.8 thousand Boes per day, respectively. Reserves related to our royalty interests are not presented because the information is unavailable. There are a number of oil and gas wells that have been drilled but are not yet completed (“DUC”) where we have a royalty interest. The number of DUC wells is determined using uniform drilling spacing units with pooled interests for all wells awaiting completion. We have identified 565 and 584 DUC wells subject to our royalty interest as of March 31, 2023 and December 31, 2022, respectively. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events We evaluated events that occurred after the balance sheet date through the date these financial statements were issued, and the following events that met recognition or disclosure criteria were identified: Dividends Declared |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and on the same basis as the audited financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2022. The condensed consolidated financial statements herein include all adjustments which are, in the opinion of management, necessary to fairly state the financial position of the Company as of March 31, 2023 and the results of its operations and its cash flows for the three months ended March 31, 2023 and 2022, respectively. Such adjustments are of a normal nature and all intercompany accounts and transactions have been eliminated in consolidation. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted from this report, and accordingly these interim financial statements and footnotes should be read in conjunction with the audited financial statements and footnotes included in our Annual Report on Form 10-K for the year ended December 31, 2022. The results for the interim periods shown in this report are not necessarily indicative of future financial results. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash |
Segment Reporting | We operate our business in two segments: Land and Resource Management and Water Services and Operations. Our segments provide management with a comprehensive financial view of our key businesses. The segments enable the alignment of strategies and objectives of TPL and provide a framework for timely and rational allocation of resources within businesses. |
Use of Estimates in the Preparation of Financial Statements | Use of Estimates in the Preparation of Financial Statements The preparation of condensed consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and reported amounts of income and expenses during the reporting period. Actual results could differ from those estimates. In the event estimates and/or assumptions prove to be different from actual amounts, adjustments are made in subsequent periods to reflect more current information. |
Reclassifications | Reclassifications Certain financial information on the condensed consolidated balance sheet and condensed consolidated statement of income and total comprehensive income as of and for the three months ended March 31, 2022 has been revised to conform to the current year presentation. These revisions include a balance sheet reclassification of $454,000 of other taxes payable previously included in accounts payable and accrued expenses to ad valorem and other taxes payable and an income statement reclassification of $33,000 of property taxes previously included in general and administrative expenses to ad valorem and other taxes for the three months ended March 31, 2022. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Schedule of Cash, Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash reported within the consolidated balance sheets that sum to the total of the same such amounts shown in the consolidated statements of cash flows as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Cash and cash equivalents $ 590,619 $ 510,834 Tax like-kind exchange escrow 6,757 6,348 Total cash, cash equivalents and restricted cash shown in the statement of cash flows $ 597,376 $ 517,182 |
Real Estate Activity (Tables)
Real Estate Activity (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Schedule of Real Estate Activity | As of March 31, 2023 and December 31, 2022, TPL owned the following land and real estate (in thousands, except number of acres): March 31, December 31, Number of Acres Net Book Value Number of Acres Net Book Value Land (surface rights) (1) 817,051 $ — 817,060 $ — Real estate acquired 57,306 109,704 57,306 109,704 Total real estate situated in Texas 874,357 $ 109,704 874,366 $ 109,704 (1) Real estate assigned through the Declaration of Trust. |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | Property, plant and equipment, net consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Property, plant and equipment, at cost: Water service-related assets $ 128,675 $ 125,166 Furniture, fixtures and equipment 9,937 9,718 Other 598 598 Total property, plant and equipment, at cost 139,210 135,482 Less: accumulated depreciation (53,018) (50,004) Property, plant and equipment, net $ 86,192 $ 85,478 |
Oil and Gas Royalty Interests (
Oil and Gas Royalty Interests (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
Schedule of Royalty Interests | As of March 31, 2023 and December 31, 2022, we owned the following oil and gas royalty interests (in thousands): March 31, December 31, 1/16th nonparticipating perpetual royalty interests $ — $ — 1/128th nonparticipating perpetual royalty interests — — Royalty interests acquired 47,928 47,928 Total royalty interests, gross 47,928 47,928 Less: accumulated depletion (3,208) (2,903) Total royalty interests, net $ 44,720 $ 45,025 |
Share-Based Compensation (Table
Share-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Restricted Stock Awards and Units Activity | The following table summarizes activity related to RSAs and RSUs under the 2021 Plan for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and units, and per share amounts): Three Months Ended March 31, 2023 2022 Restricted Stock Awards Restricted Stock Units Restricted Stock Awards Restricted Stock Units Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSUs Weighted-Average Grant-Date Fair Value per Share Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSUs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period (1) 1,337 $ 1,252 5,612 $ 1,323 3,330 $ 1,252 — $ — Granted (2) — — 2,848 1,924 — — 3,824 1,105 Vested (3) — — (1,270) 1,105 — — — — Cancelled and forfeited — — — — — — — — Nonvested at end of period 1,337 $ 1,252 7,190 $ 1,600 3,330 $ 1,252 3,824 $ 1,105 (1) The RSAs were granted on December 29, 2021: 1,993 shares vested on December 29, 2022 and 1,337 shares will vest on December 29, 2023. (2) The RSUs were granted on February 10, 2023 and vest in one-third increments over a three-year period. (3) Of the 1,270 shares that vested on February 11, 2023, 488 shares were surrendered by employees to the Company to settle tax withholdings. The following table summarizes activity related to the RSAs under the 2021 Directors Plan for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and per share amounts): Restricted Stock Awards Three Months Ended March 31, 2023 2022 Number of RSAs Weighted-Average Grant-Date Fair Value per Share Number of RSAs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period 699 $ 1,281 — $ — Granted (1) 486 2,344 680 1,249 Vested (595) 1,249 — — Cancelled and forfeited — — (85) 1,249 Nonvested at end of period 590 $ 2,189 595 $ 1,249 (1) The RSAs were granted on January 1, 2023 and will vest on the first anniversary of the grant. |
Schedule of Performance Share Units Activity | The following table summarizes activity related to PSUs for the three months ended March 31, 2023 and 2022 (in thousands, except number of units and per share amounts): Performance Stock Units Three Months Ended March 31, 2023 2022 Number of Target PSUs Weighted-Average Grant-Date Fair Value per Share Number of Target PSUs Weighted-Average Grant-Date Fair Value per Share Nonvested at beginning of period (1) 2,394 $ 1,355 — $ — Granted (2) 1,852 2,342 2,394 1,355 Vested — — — — Cancelled and forfeited — — — — Nonvested at end of period 4,246 $ 1,786 2,394 $ 1,355 (1) The PSUs were granted on February 11, 2022 and include 1,197 RTSR (as defined below) PSUs (based on target) with a grant date fair value of $1,605 per share and 1,197 FCF (as defined below) PSUs (based on target) with a grant date fair value of $1,105 per share. If the maximum performance potential metrics described in the PSU agreements are achieved, the actual number of units that will ultimately be awarded under the PSU agreements will exceed target units by 100% (i.e., a collective 2,394 additional units would be issued). |
Schedule of Share-Based Compensation Expense | The following table summarizes our share-based compensation expense by line item in the condensed consolidated statements of income (in thousands): Three Months Ended 2023 2022 Salaries and related employee expenses (employee awards) $ 2,156 $ 1,319 General and administrative expenses (director awards) 317 186 Total share-based compensation expense (1) $ 2,473 $ 1,505 (1) The Company recognized a tax benefit of $0.5 million and $0.3 million related to share-based compensation for the three months ended March 31, 2023 and 2022, respectively. |
Income Taxes (Tables)
Income Taxes (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The calculation of our effective tax rate is as follows for the three months ended March 31, 2023 and 2022 (in thousands, except percentages): Three Months Ended 2023 2022 Income before income taxes $ 110,341 $ 124,389 Income tax expense $ 23,773 $ 26,489 Effective tax rate 21.5 % 21.3 % |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table sets forth the computation of EPS for the three months ended March 31, 2023 and 2022 (in thousands, except number of shares and per share data): Three Months Ended 2023 2022 Net income $ 86,568 $ 97,900 Basic earnings per share: Weighted average shares outstanding for basic earnings per share 7,693,084 7,741,365 Basic earnings per share $ 11.25 $ 12.65 Diluted earnings per share: Weighted average shares outstanding for basic earnings per share 7,693,084 7,741,365 Effect of dilutive securities: Incentive and equity compensation plans 5,314 1,345 Weighted average shares outstanding for diluted earnings per share 7,698,398 7,742,710 Diluted earnings per share $ 11.24 $ 12.64 |
Changes in Equity (Tables)
Changes in Equity (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | The following tables present changes in our equity for the three months ended March 31, 2023 and 2022 (in thousands, except shares and per share amounts): Common Stock Treasury Stock Additional Paid-in Capital Accum. Retained Earnings Total Shares Amount Shares Amount For the three months ended March 31, 2023: Balances as of December 31, 2022 7,695,679 $ 78 60,477 $ (104,139) $ 8,293 $ 2,516 $ 866,139 $ 772,887 Net income — — — — — — 86,568 86,568 Dividends paid — $3.25 per share of common stock — — — — — — (25,061) (25,061) Share-based compensation, net of forfeitures 1,756 — (1,756) 3,033 (560) — (103) 2,370 Repurchases of common stock (3,627) — 3,627 (6,749) — — — (6,749) Shares exchanged for tax withholdings (488) — 488 (939) — — — (939) Periodic pension costs, net of income taxes of $6 — — — — — (25) — (25) Balances as of March 31, 2023 7,693,320 $ 78 62,836 $ (108,794) $ 7,733 $ 2,491 $ 927,543 829,051 Common Stock Treasury Stock Additional Paid-in Capital Accum. Retained Earnings Total Shares Amount Shares Amount For the three months ended March 31, 2022: Balances as of December 31, 2021 7,744,695 $ 78 11,461 $ (15,417) $ 28 $ (1,007) $ 668,029 $ 651,711 Net income — — — — — — 97,900 97,900 Dividends paid — $3.00 per share of common stock — — — — — — (23,224) (23,224) Share-based compensation, net of forfeitures 595 — (595) 800 1,477 — (796) 1,481 Periodic pension costs, net of income taxes of $2 — — — — — 8 — 8 Balances as of March 31, 2022 7,745,290 $ 78 10,866 $ (14,617) $ 1,505 $ (999) $ 741,909 $ 727,876 |
Business Segment Reporting (Tab
Business Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Financial Results | Segment financial results were as follows for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended 2023 2022 Revenues: Land and resource management $ 104,023 $ 113,347 Water services and operations 42,339 33,988 Total consolidated revenues $ 146,362 $ 147,335 Net income: Land and resource management $ 65,343 $ 81,156 Water services and operations 21,225 16,744 Total consolidated net income $ 86,568 $ 97,900 Capital expenditures: Land and resource management $ 175 $ 122 Water services and operations 3,598 2,883 Total capital expenditures $ 3,773 $ 3,005 Depreciation, depletion and amortization: Land and resource management $ 618 $ 536 Water services and operations 2,786 3,590 Total depreciation, depletion and amortization $ 3,404 $ 4,126 |
Schedule of Total Assets And Property, Plant and Equipment | The following table presents total assets and property, plant and equipment, net by segment as of March 31, 2023 and December 31, 2022 (in thousands): March 31, December 31, Assets: Land and resource management $ 814,927 $ 735,193 Water services and operations 140,324 142,234 Total consolidated assets $ 955,251 $ 877,427 Property, plant and equipment, net: Land and resource management $ 5,904 $ 5,998 Water services and operations 80,288 79,480 Total consolidated property, plant and equipment, net $ 86,192 $ 85,478 |
Organization and Description _2
Organization and Description of Business Segments (Details) a in Thousands | 3 Months Ended | |
Mar. 31, 2023 a segment | Mar. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Number of operating segments | segment | 2 | |
1/16th nonparticipating perpetual royalty interest | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 6.25% | 6.25% |
1/128th nonparticipating perpetual royalty interest | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 0.78125% | 0.78125% |
1/8th Net royalty acres | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 12.50% | |
West Texas | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Area of land (in acres) | 874 | |
West Texas | 1/128th Nonparticipating perpetual oil and gas royalty interest | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Area of land (in acres) | 85 | |
West Texas | 1/16th Nonparticipating perpetual oil and gas royalty interest | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Area of land (in acres) | 371 | |
West Texas | 1/8th Net royalty acres | ||
Organization, Consolidation and Presentation of Financial Statements [Line Items] | ||
Area of land (in acres) | 4 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Reclassifications (Details) - Revision of prior period, reclassification, adjustment $ in Thousands | 3 Months Ended |
Mar. 31, 2022 USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |
Accrual for ad valorem taxes | $ 454 |
Ad valorem taxes payable | $ 33 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 | Dec. 31, 2021 |
Accounting Policies [Abstract] | ||||
Cash and cash equivalents | $ 590,619 | $ 510,834 | ||
Tax like-kind exchange escrow | 6,757 | 6,348 | ||
Total cash, cash equivalents and restricted cash shown in the statement of cash flows | $ 597,376 | $ 517,182 | $ 507,356 | $ 428,242 |
Real Estate Activity - Schedule
Real Estate Activity - Schedule of Land and Real Estate Ownership (Details) $ in Thousands | Mar. 31, 2023 USD ($) a | Dec. 31, 2022 USD ($) a |
Number of Acres | ||
Land (surface rights) (acre) | a | 817,051 | 817,060 |
Real estate acquired (acre) | a | 57,306 | 57,306 |
Total Real Estate Situated in Texas (acre) | a | 874,357 | 874,366 |
Net Book Value | ||
Land (surface rights) | $ | $ 0 | $ 0 |
Real estate acquired | $ | 109,704 | 109,704 |
Total real estate situated in Texas (in USD) | $ | $ 109,704 | $ 109,704 |
Property, Plant and Equipment_2
Property, Plant and Equipment (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment, at cost | $ 139,210 | $ 135,482 | |
Less: accumulated depreciation | (53,018) | (50,004) | |
Property, plant and equipment, net | 86,192 | 85,478 | |
Depreciation expense | 3,000 | $ 3,800 | |
Water service-related assets | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment, at cost | 128,675 | 125,166 | |
Furniture, fixtures and equipment | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment, at cost | 9,937 | 9,718 | |
Other | |||
Property, Plant and Equipment [Line Items] | |||
Total property, plant and equipment, at cost | $ 598 | $ 598 |
Oil and Gas Royalty Interests_2
Oil and Gas Royalty Interests (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Net Book Value of Royalty Interests [Abstract] | ||
Royalty interests acquired | $ 47,928 | $ 47,928 |
Total royalty interests, gross | 47,928 | 47,928 |
Less: accumulated depletion | (3,208) | (2,903) |
Total royalty interests, net | 44,720 | 45,025 |
1/16th nonparticipating perpetual royalty interest | ||
Net Book Value of Royalty Interests [Abstract] | ||
1/16th nonparticipating perpetual royalty interest | 0 | 0 |
1/128th nonparticipating perpetual royalty interest | ||
Net Book Value of Royalty Interests [Abstract] | ||
1/128th nonparticipating perpetual royalty interest | $ 0 | $ 0 |
Oil and Gas Royalty Interests -
Oil and Gas Royalty Interests - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 USD ($) | Mar. 31, 2022 USD ($) a $ / shares | |
Real Estate Properties [Line Items] | ||
Acquisition of royalty interests | $ 0 | $ 1,637 |
Depletion expense | $ 300 | $ 200 |
Additional real estate acquisitions | ||
Real Estate Properties [Line Items] | ||
Net royalty interests (in acres) | a | 92 | |
Acquisition of royalty interests | $ 1,600 | |
Acquisition in conjunction with sale of 1/8th interest royalty acres | ||
Real Estate Properties [Line Items] | ||
Average price per net royalty acre acquired (in USD per acre) | $ / shares | 17,750 | |
1/16th nonparticipating perpetual royalty interest | ||
Real Estate Properties [Line Items] | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 6.25% | 6.25% |
1/128th nonparticipating perpetual royalty interest | ||
Real Estate Properties [Line Items] | ||
Nonparticipating perpetual royalty interest rate (in percentage) | 0.78125% | 0.78125% |
Share-Based Compensation - Narr
Share-Based Compensation - Narrative (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | ||||
Feb. 10, 2023 | Feb. 11, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |||
Total unrecognized compensation cost | $ 17.1 | ||||
Total unrecognized compensation cost, period for recognition | 1 year 8 months 12 days | ||||
Common Stock | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for future grants (in shares) | 54,718 | ||||
Common Stock | 2021 Plan | Maximum | Employee | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares authorized (in shares) | 75,000 | ||||
Common Stock | 2021 Directors Plan | Director | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Number of shares available for future grants (in shares) | 8,815 | ||||
Performance Shares | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
PSU conversion ration (in shares) | 1 | ||||
Award vesting period | 3 years | ||||
Award vesting rights, percentage | 100% | ||||
Granted (in shares) | 1,852 | 2,394 | 1,852 | 2,394 | |
Cancelled and forfeited (in shares) | 0 | 0 | |||
Performance Shares | Shares vesting December 29, 2022 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 50% | ||||
Performance Shares | Shares vesting December 29, 2023 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 50% | ||||
Restricted Stock Awards | Shares vesting December 29, 2022 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 33% | ||||
Restricted Stock Awards | Shares vesting December 29, 2023 | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 33% | ||||
Restricted Stock Awards | Tranche Three | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Award vesting rights, percentage | 33% | ||||
Restricted Stock Awards | 2021 Plan | Employee | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in shares) | 0 | 0 | |||
Cancelled and forfeited (in shares) | 0 | 0 | |||
Restricted Stock Awards | 2021 Directors Plan | Director | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Granted (in shares) | 486 | 680 | |||
Cancelled and forfeited (in shares) | 0 | (85) |
Share-Based Compensation - Rest
Share-Based Compensation - Restricted Stock Transactions (Details) - $ / shares | 3 Months Ended | |||||
Dec. 29, 2022 | Dec. 29, 2021 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Restricted Stock Awards | Shares vesting December 29, 2022 | ||||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Awards granted (in shares) | 1,993 | |||||
Restricted Stock Awards | Shares vesting December 29, 2023 | ||||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Awards granted (in shares) | 1,337 | |||||
Restricted Stock Awards | Employee | 2021 Plan | ||||||
Number of RSAs | ||||||
Non-vested, beginning of period (in shares) | 1,337 | 3,330 | ||||
Granted (in shares) | 0 | 0 | ||||
Vested (in shares) | 0 | 0 | ||||
Cancelled and forfeited (in shares) | 0 | 0 | ||||
Non-vested, at end of period (in shares) | 1,337 | 3,330 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 1,252 | $ 1,252 | $ 1,252 | $ 1,252 | ||
Granted (in dollars per share) | 0 | 0 | ||||
Vested (in dollars per share) | 0 | 0 | ||||
Cancelled and forfeited (in dollars per share) | 0 | 0 | ||||
Non-vested, at end of period (in dollars per share) | $ 1,252 | $ 1,252 | ||||
Surrendered (in shares) | 488 | |||||
Restricted Stock Awards | Director | 2021 Directors Plan | ||||||
Number of RSAs | ||||||
Non-vested, beginning of period (in shares) | 699 | 0 | ||||
Granted (in shares) | 486 | 680 | ||||
Vested (in shares) | (595) | 0 | ||||
Cancelled and forfeited (in shares) | 0 | (85) | ||||
Non-vested, at end of period (in shares) | 590 | 595 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 2,189 | $ 1,249 | 1,281 | 0 | ||
Granted (in dollars per share) | 2,344 | 1,249 | ||||
Vested (in dollars per share) | 1,249 | 0 | ||||
Cancelled and forfeited (in dollars per share) | 0 | 1,249 | ||||
Non-vested, at end of period (in dollars per share) | $ 2,189 | $ 1,249 | ||||
Restricted Stock Units (RSUs) | Employee | 2021 Plan | ||||||
Number of RSAs | ||||||
Non-vested, beginning of period (in shares) | 5,612 | 0 | ||||
Granted (in shares) | 2,848 | 3,824 | ||||
Vested (in shares) | (1,270) | 0 | ||||
Cancelled and forfeited (in shares) | 0 | 0 | ||||
Non-vested, at end of period (in shares) | 7,190 | 3,824 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 1,600 | $ 1,105 | $ 1,323 | $ 0 | ||
Granted (in dollars per share) | 1,924 | 1,105 | ||||
Vested (in dollars per share) | 1,105 | 0 | ||||
Cancelled and forfeited (in dollars per share) | 0 | 0 | ||||
Non-vested, at end of period (in dollars per share) | $ 1,600 | $ 1,105 |
Share-Based Compensation - Perf
Share-Based Compensation - Performance Share Units (Details) - Performance Shares - $ / shares | 3 Months Ended | |||||
Feb. 10, 2023 | Feb. 11, 2022 | Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | |
Number of RSAs | ||||||
Non-vested, beginning of period (in shares) | 2,394 | 0 | ||||
Granted (in shares) | 1,852 | 2,394 | 1,852 | 2,394 | ||
Vested (in shares) | 0 | 0 | ||||
Cancelled and forfeited (in shares) | 0 | 0 | ||||
Non-vested, at end of period (in shares) | 4,246 | 2,394 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 1,786 | $ 1,355 | $ 1,355 | $ 0 | ||
Granted (in dollars per share) | 2,342 | 1,355 | ||||
Vested (in dollars per share) | 0 | 0 | ||||
Cancelled and forfeited (in dollars per share) | 0 | 0 | ||||
Non-vested, at end of period (in dollars per share) | $ 1,786 | $ 1,355 | ||||
Relative total stockholder return | ||||||
Number of RSAs | ||||||
Granted (in shares) | 926 | 1,197 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 2,761 | $ 1,605 | ||||
Non-vested, at end of period (in dollars per share) | $ 2,761 | $ 1,605 | ||||
Free cash flow | ||||||
Number of RSAs | ||||||
Granted (in shares) | 926 | 1,197 | ||||
Weighted-Average Grant-Date Fair Value per Share | ||||||
Non-vested, beginning of period (in dollars per share) | $ 1,924 | $ 1,105 | ||||
Non-vested, at end of period (in dollars per share) | $ 1,924 | $ 1,105 |
Share-Based Compensation - Shar
Share-Based Compensation - Share-Based Compensation - (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | $ 2,473 | $ 1,505 |
Tax benefit related to share-based compensation | 500 | 300 |
Salaries and related employee expenses (employee awards) | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | 2,156 | 1,319 |
General and administrative expenses (director awards) | ||
Share-based Payment Arrangement, Expensed and Capitalized, Amount [Line Items] | ||
Total share-based compensation expense | $ 317 | $ 186 |
Income Taxes - Calculation of E
Income Taxes - Calculation of Effective Tax Rate (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income before income taxes | $ 110,341 | $ 124,389 |
Income tax expense | $ 23,773 | $ 26,489 |
Effective tax rate (in percent) | 21.50% | 21.30% |
Earnings Per Share - Schedule o
Earnings Per Share - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Earnings Per Share [Abstract] | ||
Net income | $ 86,568 | $ 97,900 |
Basic earnings per share: | ||
Weighted average shares outstanding for basic EPS (in shares) | 7,693,084 | 7,741,365 |
Basic earnings per share (in dollars per share) | $ 11.25 | $ 12.65 |
Diluted earnings per share: | ||
Weighted average shares outstanding for basic EPS (in shares) | 7,693,084 | 7,741,365 |
Stock-based incentive plan (in shares) | 5,314 | 1,345 |
Weighted average shares outstanding for diluted EPS (in shares) | 7,698,398 | 7,742,710 |
Diluted earnings per share (in dollars per share) | $ 11.24 | $ 12.64 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2023 | Mar. 31, 2022 | |
Other Commitments [Line Items] | |||
Total consolidated revenues | $ 146,362 | $ 147,335 | |
Oil and gas royalties | |||
Other Commitments [Line Items] | |||
Total consolidated revenues | $ 8,700 | $ 89,130 | $ 104,172 |
Changes in Equity (Details)
Changes in Equity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ 772,887 | $ 651,711 |
Beginning balance, treasury stock (in shares) | 60,477 | |
Net income | $ 86,568 | 97,900 |
Share-based compensation, net of forfeitures | 2,370 | 1,481 |
Repurchases of common stock | (6,749) | |
Shares exchanged for tax withholdings | (939) | |
Periodic pension costs, net of income taxes | (25) | 8 |
Ending balance | $ 829,051 | $ 727,876 |
Ending balance, treasury stock (in shares) | 62,836 | |
Dividend paid per common stock (in USD per share) | $ 3.25 | $ 3 |
Periodic pension costs, net of income taxes | $ (6) | $ 2 |
Common Stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance (in shares) | 7,695,679 | 7,744,695 |
Beginning balance | $ 78 | $ 78 |
Share-based compensation, net of forfeitures (in shares) | 1,756 | 595 |
Repurchases of common stock (in shares) | (3,627) | |
Surrendered (in shares) | 488 | |
Ending balance (in shares) | 7,693,320 | 7,745,290 |
Ending balance | $ 78 | $ 78 |
Treasury Stock | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ (104,139) | $ (15,417) |
Beginning balance, treasury stock (in shares) | 60,477 | 11,461 |
Share-based compensation, forfeitures (in shares) | (1,756) | (595) |
Share-based compensation, net of forfeitures | $ 3,033 | $ 800 |
Repurchases of common stock (in shares) | 3,627 | |
Repurchases of common stock | $ (6,749) | |
Surrendered (in shares) | 488 | |
Shares exchanged for tax withholdings | $ (939) | |
Ending balance | $ (108,794) | $ (14,617) |
Ending balance, treasury stock (in shares) | 62,836 | 10,866 |
Additional Paid-in Capital | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | $ 8,293 | $ 28 |
Share-based compensation, net of forfeitures | (560) | 1,477 |
Ending balance | 7,733 | 1,505 |
Accum. Other Comp. Income (Loss) | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | 2,516 | (1,007) |
Periodic pension costs, net of income taxes | (25) | 8 |
Ending balance | 2,491 | (999) |
Retained Earnings | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Beginning balance | 866,139 | 668,029 |
Net income | 86,568 | 97,900 |
Share-based compensation, net of forfeitures | (103) | (796) |
Ending balance | 927,543 | 741,909 |
Dividend Paid | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Dividends paid | (25,061) | (23,224) |
Dividend Paid | Retained Earnings | ||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||
Dividends paid | $ (25,061) | $ (23,224) |
Changes in Equity - Narrative (
Changes in Equity - Narrative (Details) $ in Millions | Nov. 01, 2022 USD ($) |
Equity [Abstract] | |
Stock repurchase program, authorized amount | $ 250 |
Business Segment Reporting - Na
Business Segment Reporting - Narrative (Details) a in Thousands | Mar. 31, 2023 a |
West Texas | |
Segment Reporting Information [Line Items] | |
Area of land (in acres) | 874 |
Business Segment Reporting - Fi
Business Segment Reporting - Financial Results (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Segment Reporting Information [Line Items] | ||
Total consolidated revenues | $ 146,362 | $ 147,335 |
Net income | 86,568 | 97,900 |
Total capital expenditures | 3,773 | 3,005 |
Depreciation, depletion and amortization | 3,404 | 4,126 |
Land and resource management | ||
Segment Reporting Information [Line Items] | ||
Total consolidated revenues | 104,023 | 113,347 |
Net income | 65,343 | 81,156 |
Total capital expenditures | 175 | 122 |
Depreciation, depletion and amortization | 618 | 536 |
Water services and operations | ||
Segment Reporting Information [Line Items] | ||
Total consolidated revenues | 42,339 | 33,988 |
Net income | 21,225 | 16,744 |
Total capital expenditures | 3,598 | 2,883 |
Depreciation, depletion and amortization | $ 2,786 | $ 3,590 |
Business Segment Reporting - As
Business Segment Reporting - Assets and Property, Plant and Equipment, Net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Segment Reporting Information [Line Items] | ||
Total consolidated assets | $ 955,251 | $ 877,427 |
Total consolidated property, plant and equipment, net | 86,192 | 85,478 |
Land and resource management | ||
Segment Reporting Information [Line Items] | ||
Total consolidated assets | 814,927 | 735,193 |
Total consolidated property, plant and equipment, net | 5,904 | 5,998 |
Water services and operations | ||
Segment Reporting Information [Line Items] | ||
Total consolidated assets | 140,324 | 142,234 |
Total consolidated property, plant and equipment, net | $ 80,288 | $ 79,480 |
Oil and Gas Producing Activit_2
Oil and Gas Producing Activities (Unaudited) (Details) | 3 Months Ended | ||
Mar. 31, 2023 Boe well | Mar. 31, 2022 Boe | Dec. 31, 2022 well | |
Extractive Industries [Abstract] | |||
Share of oil and gas produced in thousands per day | Boe | 20,900 | 20,800 | |
Number of oil and gas wells | well | 565 | 584 |
Subsequent Events (Details)
Subsequent Events (Details) | May 02, 2023 $ / shares |
Dividend declared | Subsequent event | |
Subsequent Event [Line Items] | |
Annual cash dividend (in dollars per share) | $ 3.25 |