Name: Texas Pacific Land Corp. (NYSE:TPL) | Income Statement
Creator: Stock Analysis on Net

Income Statement

The income statement presents information on the financial results of a company business activities over a period of time. The income statement communicates how much revenue the company generated during a period and what cost it incurred in connection with generating that revenue.

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Texas Pacific Land Corp., consolidated income statement

US$ in thousands

12 months ended:	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Oil and gas royalties	357,394)	452,434)	286,468)	137,948)	154,729)
Water sales	112,203)	84,725)	67,766)	54,862)	84,949)
Produced water royalties	84,260)	72,234)	58,081)	50,640)	39,119)
Easements and other surface-related income	70,932)	48,057)	37,616)	41,398)	76,243)
Land sales and other operating revenue	6,806)	9,972)	1,027)	17,706)	135,456)
Revenues	631,595)	667,422)	450,958)	302,554)	490,496)
Salaries and related employee expenses	(43,384)	(41,402)	(40,012)	(32,173)	(35,041)
Water service-related expenses	(33,566)	(17,463)	(13,233)	(14,233)	(20,808)
General and administrative expenses	(14,928)	(13,285)	(11,638)	(13,724)	(9,765)
Legal and professional fees	(31,522)	(8,735)	(7,281)	(10,778)	(16,403)
Ad valorem and other taxes	(7,385)	(8,854)	(144)	—)	—)
Depreciation, depletion and amortization	(14,757)	(15,376)	(16,257)	(14,395)	(8,906)
Operating expenses	(145,542)	(105,115)	(88,565)	(85,303)	(90,923)
Operating income	486,053)	562,307)	362,393)	217,251)	399,573)
Interest earned on cash and cash equivalents, net	28,630)	6,207)	78)	—)	—)
Other employee pension costs	514)	363)	113)	—)	—)
Miscellaneous other income (expense), net	2,364)	(22)	433)	2,411)	2,682)
Other income, net	31,508)	6,548)	624)	2,411)	2,682)
Income before income taxes	517,561)	568,855)	363,017)	219,662)	402,255)
Income tax expense	(111,916)	(122,493)	(93,037)	(43,613)	(83,527)
Net income	405,645)	446,362)	269,980)	176,049)	318,728)

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

The financial performance between 2019 and 2023 is characterized by significant volatility in primary revenue streams, followed by a period of substantial growth and a subsequent stabilization. Total revenues experienced a sharp decline in 2020 before recovering and peaking in 2022 at 667.4 million USD. While 2023 saw a slight contraction in total revenue to 631.6 million USD, the overall trend remains upward compared to the 2019 baseline.

Revenue Stream Analysis: Oil and gas royalties serve as the primary volatility driver, fluctuating from 154.7 million USD in 2019 to a peak of 452.4 million USD in 2022, before settling at 357.4 million USD in 2023. Conversely, water-based income streams demonstrate consistent growth; water sales increased from 84.9 million USD in 2019 to 112.2 million USD in 2023, and produced water royalties rose steadily from 39.1 million USD to 84.3 million USD over the same period. Land sales and other operating revenue shifted from a significant contributor in 2019 (135.5 million USD) to a negligible component by 2023 (6.8 million USD), indicating a strategic shift away from asset liquidation toward recurring royalty and service income.
Operating Expense Trends: Operating expenses remained relatively stable from 2019 through 2021, hovering between 85 million USD and 91 million USD. However, a notable escalation occurred in 2023, with expenses rising to 145.5 million USD. This increase was primarily driven by a surge in legal and professional fees, which grew from 8.7 million USD in 2022 to 31.5 million USD in 2023, and a significant increase in water service-related expenses, which rose to 33.6 million USD in 2023 from 17.5 million USD in the prior year.
Profitability and Operating Margins: Operating income mirrored the trajectory of oil and gas royalties, reaching a high of 562.3 million USD in 2022. Despite the revenue dip and expense spike in 2023, operating income remained robust at 486.1 million USD. The company maintained high operational efficiency, although the 2023 margin was compressed by the aforementioned increase in professional and water-related costs.
Non-Operating Income and Net Earnings: A significant shift is observed in interest income, which grew from near-zero levels in 2021 to 28.6 million USD in 2023, suggesting an increase in cash reserves or a more favorable interest rate environment. Net income followed the general trend of operating results, dipping to 176.0 million USD in 2020 and peaking at 446.4 million USD in 2022, before ending the period at 405.6 million USD in 2023. The tax burden scaled proportionally with income, peaking at 122.5 million USD in 2022.

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