Talos Energy Inc. reported significant financial developments in its 10-Q filing for the quarter ending September 30, 2024. The company achieved total revenues of $509.3 million for the three months ended September 30, 2024, a notable increase from $383.1 million in the same period of 2023. Oil revenues specifically rose to $467.6 million, up from $359.4 million year-over-year. For the nine months ended September 30, 2024, total revenues reached $1.5 billion, compared to $1.1 billion in the prior year.

Despite the revenue growth, Talos experienced a decline in operating income, which fell to $23.5 million from $126.8 million in the third quarter of 2023. Total operating expenses surged to $485.7 million, up from $256.4 million, largely due to increased lease operating expenses and general and administrative costs associated with the QuarterNorth Acquisition. The company reported net income of $88.2 million for the third quarter of 2024, a recovery from a net loss of $2.1 million in the same quarter of 2023. However, for the nine-month period, Talos reported a net loss of $11.9 million, a significant decline from a net income of $101.4 million in the previous year.

Strategically, Talos completed the acquisition of QuarterNorth Energy Inc. on March 4, 2024, for a total consideration of approximately $1.25 billion, which included cash and stock. This acquisition contributed $150.5 million in revenue for the third quarter and $367.6 million for the nine months ended September 30, 2024. The company also divested its Talos Low Carbon Solutions subsidiary for $125 million, recognizing a gain of $100.4 million.

The company’s total assets increased to $6.4 billion as of September 30, 2024, up from $4.8 billion at the end of 2023. Long-term debt rose to $1.34 billion, compared to $992.6 million at the end of 2023, reflecting the financing of acquisitions. Cash and cash equivalents also improved, totaling $45.5 million, up from $33.6 million at year-end 2023.

Operationally, Talos reported increased production volumes, with oil production rising to 6.3 million barrels in the third quarter, compared to 4.5 million barrels in the prior year. The company faced challenges, including a 52-day production shut-in due to maintenance on the Helix Producer I, which impacted overall production.

In terms of governance, Talos underwent a leadership transition with the departure of its President and CEO, Timothy S. Duncan, on August 29, 2024, and the appointment of Joseph A. Mills as Interim CEO. The company also identified material weaknesses in its internal controls over financial reporting, prompting a remediation plan to address these issues.