DALLAS - Granite Ridge Resources, Inc. (NYSE: GRNT), a non-operated oil and gas exploration and production company, announced an increase in its borrowing base from $275 million to $300 million following the successful semi-annual borrowing base redetermination. The company also entered into the third amendment of its existing credit agreement.
The amendment, which was finalized today, includes a 25% increase in the aggregate elected commitments, bringing the total to $300 million. Additionally, Bank of America, N.A. has been appointed as the successor Administrative Agent and Letter of Credit Issuer. The lender syndicate has expanded with the addition of nine new banks.
President and CEO Luke Brandenberg commented on the development, stating, "This expansion is a testament to our financial strength and provides additional liquidity and flexibility to support our growing business."
Granite Ridge, which holds a portfolio of wells and acreage across the Permian and other unconventional basins in the United States, focuses on diversifying assets and reducing overhead by investing in wells drilled by other operators.
The company's next scheduled bank redetermination is expected to occur in the fall of 2024. The announcement today reflects the company's current financial position and strategy for growth, with an emphasis on sustainable, risk-adjusted returns for investors and the responsible delivery of energy solutions.
It is important to note that this press release contains forward-looking statements about future events and results. These statements are based on current expectations and assumptions and involve risks and uncertainties that could cause actual results to differ materially.
The information in this article is based on a press release statement from Granite Ridge Resources, Inc.
InvestingPro Insights
Granite Ridge Resources, Inc. (NYSE: GRNT) has recently demonstrated financial resilience and strategic growth, as evidenced by the increase in its borrowing base. This financial maneuvering is further reflected in the company's real-time data and analyst insights.
InvestingPro data shows that Granite Ridge has a market capitalization of $859.01 million, indicating a significant presence in the industry. The company's P/E ratio stands at 10.84, with an adjusted P/E ratio for the last twelve months as of Q4 2023 at a lower 8.31, suggesting that the company may be undervalued compared to its earnings. Moreover, Granite Ridge maintains a robust gross profit margin of 82.85%, highlighting its ability to generate revenue efficiently.
Two notable InvestingPro Tips for Granite Ridge include the fact that analysts predict the company will be profitable this year and that it has been profitable over the last twelve months. This aligns with the company's recent announcement of increased financial flexibility and liquidity.
Moreover, Granite Ridge operates with a moderate level of debt and has liquid assets that exceed its short-term obligations, providing it with a stable financial foundation.
While the company has experienced a revenue decline of 21.54% over the last twelve months, the stability in its financial metrics and analyst predictions of profitability suggest a potential for recovery and growth. Investors looking for more in-depth analysis can find additional InvestingPro Tips on Granite Ridge Resources by visiting Investing.com/pro/GRNT. Use coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and discover why analysts have revised their earnings downwards for the upcoming period, among other valuable insights.
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