Vital Energy Inc (VTLE)

[littlejohn]

LPI, cash flow higher than operating profit

because of tricky accounting

for hedge losses...

2nd quarter, 2021...

about $187 million operating cash
flow...from cash flow statement...

about $108 million operating profit
from statement of operations...


How do you get more cash flow

than profit?!...excellent question...


Write off about $217 million of
paper losses on hedge contracts...


But only pay out about $57 million
of cash for actual hedge losses...

Three months ended June 30,2021
(in thousands)

Net settlements (paid) received for
matured commodity derivatives:

Oil $ (34,466)

NGL (16,953)

Natural gas (6,126)

Total $ (57,545)


First you have to get past tricky

hedge accounting...


Before thinking about 34,000 bbls/day

of oil production potential in 3rd quarter

versus 26,000 bbls/day in 2nd quarter...


About 30% or more increase in revenue

possible in 3rd quarter whether it is

hedged, unhedged, or in bird feathers...


Big short wheels can easily manipulate

price down more until 08/20 and clean

up even more on put positions...


Unless peon holders hold strong or

even add to pressure them...


Think about a rubber band popping

when short pressure disappears...


Oh yeah, LPI doesn't account for

recent acquisition sale deal until

3rd quarter which should give a boost

back up on balance sheet on current

asset value prices versus depressed

value pricing from 12/30/2020 on the

added assets...


But someone else has to do the math

because it is above my pay grade...


so we watch...LJ



LPI 2nd quarter 10Q link...

https://www.sec.gov/ix?doc=/Archives/edgar/data/1528129/000152812921000129/lpi-20210630.htm