Analysis of Reportable Segments
Texas Pacific Land Corp. operates in 2 segments: Land and Resource Management and Water Services and Operations.
Paying user area
Try for free
Texas Pacific Land Corp. pages available for free this week:
- Statement of Comprehensive Income
- Analysis of Profitability Ratios
- Analysis of Solvency Ratios
- Analysis of Short-term (Operating) Activity Ratios
- Common Stock Valuation Ratios
- Operating Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Price to Operating Profit (P/OP) since 2005
- Price to Book Value (P/BV) since 2005
- Price to Sales (P/S) since 2005
The data is hidden behind: . Unhide it.
Get full access to the entire website from $10.42/mo, or
get 1-month access to Texas Pacific Land Corp. for $22.49.
This is a one-time payment. There is no automatic renewal.
We accept:
Segment Profit Margin
Texas Pacific Land Corp., profit margin by reportable segment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations |
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 analysis of the annual reportable segment profit margin data reveals distinct trends for the two business segments over the five-year period ending December 31, 2023.
- Land and Resource Management Segment
-
This segment exhibited a fluctuating profit margin trend. Starting at 71.11% in 2019, the margin decreased to 65.58% in 2020 and remained relatively stable at 65.2% in 2021. A recovery is noted in 2022 with an increase to 72%, surpassing the initial 2019 level. However, the margin slightly declined to 70.98% in 2023. Overall, the profit margin for this segment experienced a dip in the early years followed by a rebound, maintaining a generally strong profit margin exceeding 65% throughout the period.
- Water Services and Operations Segment
-
The profit margin of this segment displayed a modest but generally upward trajectory. From 47.47% in 2019, it decreased slightly to 44.75% in 2020. Subsequently, there was a steady improvement, rising to 46.78% in 2021 and continuing upward to a peak of 50.68% in 2022. A minor reduction to 49.6% was observed in 2023, but the margin remained above the initial levels of the period. This pattern indicates gradual improvement and relative stability in profitability within this segment.
In summary, the Land and Resource Management segment demonstrated higher profitability overall with some variability, while the Water Services and Operations segment showed a lower but progressively improving profit margin across the reported years. Both segments ended the period with profit margins higher than or near their respective starting points, indicating resilience and potential operational improvements.
Segment Profit Margin: Land and Resource Management
Texas Pacific Land Corp.; Land and Resource Management; segment profit margin calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net income | |||||
| Revenues | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
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).
1 2023 Calculation
Segment profit margin = 100 × Net income ÷ Revenues
= 100 × ÷ =
The segment data over the five-year period exhibits notable fluctuations and overall growth in key financial metrics.
- Net Income
- Net income saw a significant decline from 258,366 thousand USD in 2019 to 127,977 thousand USD in 2020, representing a reduction of approximately 50.5%. Following this, net income recovered strongly in 2021, reaching 208,897 thousand USD, and continued to increase substantially in 2022 to a peak of 365,041 thousand USD. In 2023, net income moderated to 306,706 thousand USD, still maintaining a level well above the initial years.
- Revenues
- Revenues followed a similar pattern to net income, with a sharp decline from 363,328 thousand USD in 2019 to 195,132 thousand USD in 2020, a decrease of about 46.3%. Revenues then rebounded significantly to 320,387 thousand USD in 2021 and experienced further growth to a peak of 506,975 thousand USD in 2022. In 2023, revenues decreased to 432,105 thousand USD, maintaining a strong level relative to the earlier years.
- Segment Profit Margin
- The segment profit margin displayed relative stability over the period, remaining within a narrow range between approximately 65% and 72%. It declined from 71.11% in 2019 to its lowest point of 65.2% in 2021, before recovering to a peak of 72% in 2022. In 2023, it slightly decreased to 70.98%, suggesting consistent profitability despite fluctuations in net income and revenues.
Overall, the segment experienced a noticeable downturn in 2020, followed by a robust recovery and growth in both net income and revenues through 2022. Despite some moderation in 2023, performance remains strong relative to the earlier years. Profit margins have remained consistently high, indicating sustained operational efficiency throughout the period analyzed.
Segment Profit Margin: Water Services and Operations
Texas Pacific Land Corp.; Water Services and Operations; segment profit margin calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net income | |||||
| Revenues | |||||
| Segment Profitability Ratio | |||||
| Segment profit margin1 | |||||
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).
1 2023 Calculation
Segment profit margin = 100 × Net income ÷ Revenues
= 100 × ÷ =
- Net Income
- Net income exhibited fluctuation over the analyzed periods. It decreased from approximately 60.4 million USD in 2019 to 48.1 million USD in 2020, representing a notable decline. However, subsequent years saw a steady recovery and growth, reaching 61.1 million USD in 2021, then increasing significantly to 81.3 million USD in 2022, and further to 98.9 million USD in 2023. This trajectory indicates a strong upward trend in profitability after the 2020 downturn.
- Revenues
- Revenues showed a similar pattern to net income, beginning at about 127.2 million USD in 2019, dipping to 107.4 million USD in 2020—a reduction indicative of external or operational challenges during that year. From 2021 onwards, revenues consistently increased, rising to 130.6 million USD in 2021, then experiencing more robust growth in 2022 and 2023, reaching 160.4 million and 199.5 million USD respectively. This consistent upward trend after 2020 suggests effective revenue generation improvements or market recovery.
- Segment Profit Margin
- The segment profit margin decreased from 47.47% in 2019 to 44.75% in 2020, reflecting the same adverse impact observed in net income and revenues during that year. Following this, the margin recovered to 46.78% in 2021, increased more notably to 50.68% in 2022, and slightly declined to 49.6% in 2023. Overall, the margin remained relatively high, demonstrating strong operational efficiency and profitability within the segment.
- Overall Analysis
- The overall patterns indicate that the segment experienced a decline in financial performance in 2020, likely due to external economic conditions or sector-specific challenges. Subsequently, the segment demonstrated robust recovery and growth in revenues and net income through 2023, supported by improved profit margins. This suggests a strong operational turnaround and effective management strategies that enhanced profitability and revenue generation. Despite a minor decline in the profit margin in the last year, the margin remains near the highest observed levels, reinforcing the segment's solid performance and resilience.
Segment Return on Assets (Segment ROA)
Texas Pacific Land Corp., ROA by reportable segment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations |
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 analysis of the annual reportable segment ROA data reveals distinct trends across the two business segments over the five-year period from 2019 to 2023.
- Land and Resource Management
- This segment experienced notable fluctuations in ROA during the period. Initially, in 2019, ROA was relatively high at 55.23%, followed by a sharp decline to 27.82% in 2020. A modest recovery occurred in 2021, with ROA increasing to 32.88%. The segment saw a more significant improvement in 2022, as ROA rose to 49.65%, before dropping again to 31.45% in 2023. Overall, this pattern indicates volatility in asset profitability, with alternating periods of recovery and decline.
- Water Services and Operations
- This segment demonstrated a generally positive trajectory in ROA over the same period. Starting at 46.28% in 2019, the ROA showed a slight decrease in 2020 to 43.08%, followed by a steady increase in subsequent years. The ROA improved to 47.45% in 2021 and significantly increased to 57.17% in 2022, before experiencing a slight decline to 54.58% in 2023. Despite minor fluctuations, this segment maintained a relatively higher and more stable return on assets compared to the Land and Resource Management segment, with an overall upward trend.
In summary, Water Services and Operations exhibited stronger and more consistent asset profitability trends compared to the Land and Resource Management segment, which showed more instability and greater variability in ROA during the period analyzed.
Segment ROA: Land and Resource Management
Texas Pacific Land Corp.; Land and Resource Management; segment ROA calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net income | |||||
| Assets | |||||
| Segment Profitability Ratio | |||||
| Segment ROA1 | |||||
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).
1 2023 Calculation
Segment ROA = 100 × Net income ÷ Assets
= 100 × ÷ =
- Net Income
- Net income experienced a significant decline from 258,366 thousand USD in 2019 to 127,977 thousand USD in 2020. However, it rebounded sharply in 2021 to 208,897 thousand USD and continued increasing to a peak of 365,041 thousand USD in 2022. In 2023, net income decreased to 306,706 thousand USD, indicating some volatility after the 2022 peak but remaining well above the 2020 levels.
- Assets
- The total assets showed a steady upward trend over the period. From 467,758 thousand USD in 2019, there was a slight decrease in 2020 to 460,053 thousand USD. Subsequently, assets increased significantly, reaching 635,338 thousand USD in 2021, 735,193 thousand USD in 2022, and further growing to 975,136 thousand USD in 2023. This demonstrates consistent asset growth, particularly after 2020.
- Segment Return on Assets (ROA)
- Segment ROA exhibited notable fluctuations during the period. It started at a high level of 55.23% in 2019 but dropped substantially to 27.82% in 2020. There was a moderate recovery to 32.88% in 2021, followed by an increase to 49.65% in 2022. However, in 2023, ROA declined again to 31.45%. The pattern indicates varying efficiency in asset utilization, with peak profitability in 2019 and 2022, and lower performance in other years.
Segment ROA: Water Services and Operations
Texas Pacific Land Corp.; Water Services and Operations; segment ROA calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Net income | |||||
| Assets | |||||
| Segment Profitability Ratio | |||||
| Segment ROA1 | |||||
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).
1 2023 Calculation
Segment ROA = 100 × Net income ÷ Assets
= 100 × ÷ =
The net income reported for the segment has shown a generally upward trajectory from 2019 through 2023. Starting at $60,362 thousand in 2019, it dipped to $48,072 thousand in 2020 but then increased in the subsequent years, reaching $98,939 thousand by the end of 2023. This suggests a recovery after 2020 and continued growth in profitability.
Total assets for the segment exhibit some fluctuation but an overall increasing trend. Assets decreased from $130,418 thousand in 2019 to $111,582 thousand in 2020, followed by a steady rise each year, culminating in $181,262 thousand by 2023. This growth in asset base may reflect investments or acquisitions contributing to the segment's capacity expansion.
The segment return on assets (ROA) percentage demonstrates a resilient improvement over the observed period. Although it dipped from 46.28% in 2019 to 43.08% in 2020, the ROA increased to 47.45% in 2021 and jumped significantly in 2022 to 57.17%, before slightly declining to 54.58% in 2023. The high double-digit ROA values indicate efficient utilization of assets to generate earnings within the segment.
Overall, the data portrays a segment that faced some setbacks in 2020 but subsequently achieved stronger financial performance through increasing net income and asset growth, accompanied by high and improving asset efficiency as reflected in the ROA.
Segment Asset Turnover
Texas Pacific Land Corp., asset turnover by reportable segment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations |
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).
- Land and Resource Management Segment Asset Turnover
- The asset turnover ratio for the Land and Resource Management segment exhibits notable fluctuations over the five-year period. Beginning at 0.78 in 2019, the ratio sharply declined to 0.42 in 2020. Following this downturn, a partial rebound occurred, with the ratio increasing to 0.5 in 2021 and further to 0.69 in 2022. However, this improvement was not sustained, as the ratio decreased again to 0.44 in 2023. Overall, the trend reflects volatility and a generally lower turnover ratio in the latter years compared to the starting point.
- Water Services and Operations Segment Asset Turnover
- The asset turnover ratio for the Water Services and Operations segment remained relatively stable and consistently higher than the Land and Resource Management segment throughout the period. Starting at 0.98 in 2019, the ratio showed a slight decline to 0.96 in 2020. From 2021 onwards, the ratio demonstrated a steady but moderate increase, reaching 1.01 in 2021, 1.13 in 2022, and settling at 1.10 in 2023. This upward trajectory from 2020 indicates improved efficiency in asset utilization within this segment.
- Comparative Insights
- When comparing the two segments, Water Services and Operations consistently achieved higher asset turnover ratios than Land and Resource Management. The former's ratio trends suggest greater operational efficiency and more effective asset usage over time. In contrast, the latter segment has experienced greater instability and lower turnover efficiency, particularly after 2019. These divergent patterns may indicate differing operational challenges or strategic focuses between the segments that affect their asset turnover performance.
Segment Asset Turnover: Land and Resource Management
Texas Pacific Land Corp.; Land and Resource Management; segment asset turnover calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenues | |||||
| Assets | |||||
| Segment Activity Ratio | |||||
| Segment asset turnover1 | |||||
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).
1 2023 Calculation
Segment asset turnover = Revenues ÷ Assets
= ÷ =
- Revenues
- Revenues exhibited significant fluctuations over the five-year period. Starting at $363,328 thousand in 2019, revenues declined sharply to $195,132 thousand in 2020. Subsequently, there was a notable recovery and upward trend in 2021 and 2022, reaching a peak of $506,975 thousand. However, in 2023, revenues decreased to $432,105 thousand, representing a decline from the previous year's peak but still remaining well above the 2019 and 2020 levels.
- Assets
- The asset base demonstrated a consistent and marked increase throughout the period, growing from $467,758 thousand in 2019 to $975,136 thousand in 2023. This steady expansion reflects an accumulation of resources or investments, with the most substantial growth occurring in the latter years, particularly from 2022 to 2023, indicating a nearly 33% increase in assets in that interval.
- Segment Asset Turnover
- The segment asset turnover ratio, which measures the efficiency of asset utilization in generating revenues, showed variability with an overall declining trend from 0.78 in 2019 to 0.44 in 2023. Notably, the ratio dropped sharply in 2020 to 0.42, rebounded slightly in the next two years reaching 0.69 in 2022, before declining again in 2023. This suggests fluctuating efficiency in using assets to generate revenue, with the lowest turnover occurring in 2020 and the highest efficiency in 2019.
- Overall Insights
- The data indicates a business experiencing significant revenue volatility alongside a steadily increasing asset base. The declining asset turnover ratio over time implies that asset growth has outpaced revenue generation capacity, leading to lower efficiency. The peak in revenues in 2022 coupled with high asset levels that year contrasts with the reduced efficiency in 2023. This pattern suggests potential challenges in leveraging asset growth to sustain revenue expansion consistently. Monitoring asset utilization and focusing on improving operational efficiency may be key areas for management attention.
Segment Asset Turnover: Water Services and Operations
Texas Pacific Land Corp.; Water Services and Operations; segment asset turnover calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Revenues | |||||
| Assets | |||||
| Segment Activity Ratio | |||||
| Segment asset turnover1 | |||||
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).
1 2023 Calculation
Segment asset turnover = Revenues ÷ Assets
= ÷ =
The data presents financial information for the Water Services and Operations segment over five consecutive years.
- Revenues
- Revenues exhibit a generally increasing trend throughout the period. Beginning at approximately 127.2 million US dollars in 2019, revenues declined by around 15% in 2020 to about 107.4 million. However, from 2020 onward, revenues recovered strongly, increasing to roughly 130.6 million in 2021, followed by further growth to 160.4 million in 2022 and reaching nearly 199.5 million in 2023. This progression indicates a significant upward momentum in revenue generation after the dip in 2020.
- Assets
- Assets demonstrate a pattern broadly similar to revenues, although the year-to-year variations are less pronounced. Starting at approximately 130.4 million US dollars in 2019, the asset base declined to roughly 111.6 million in 2020. Subsequently, assets increased each year, rising to about 128.7 million in 2021, 142.2 million in 2022, and 181.3 million in 2023. This suggests a renewed investment or accumulation of assets following the 2020 decline.
- Segment Asset Turnover Ratio
- The segment asset turnover ratio, which reflects the efficiency of asset utilization to generate revenues, remained around 0.96 to 0.98 from 2019 to 2020, indicating relatively stable efficiency despite the revenue and asset declines. It improved to 1.01 in 2021 and increased more substantially to 1.13 in 2022, before slightly declining to 1.10 in 2023. This overall upward trend suggests enhanced efficiency in using assets to generate revenue over the period, particularly after 2020, even as assets increased.
In summary, the segment experienced a temporary downturn in both revenues and assets in 2020, followed by a robust recovery and growth phase through 2023. Asset investment correspondingly increased while the efficiency of asset utilization improved, reflecting positive operational performance and growth momentum across the latter part of the period analyzed.
Segment Capital Expenditures to Depreciation
Texas Pacific Land Corp., capital expenditures to depreciation by reportable segment
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations |
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 analysis of the annual reportable segment capital expenditures to depreciation ratios for Texas Pacific Land Corp. reveals distinct trends across the two segments: Land and Resource Management, and Water Services and Operations.
- Land and Resource Management
- The ratio exhibits significant volatility over the five-year period. Starting at 1.33 in 2019, it sharply declines to a low of 0.10 in 2020. This is followed by a notable rebound to 1.96 in 2021, which marks the highest point in the observed timeline. However, the ratio once again decreases substantially in 2022 and 2023, reaching 0.18 and 0.08 respectively. Overall, this pattern indicates fluctuating capital expenditure relative to depreciation, with substantial decreases in the most recent years, suggesting reduced investment or increased depreciation in this segment.
- Water Services and Operations
- This segment's ratio starts relatively high at 3.97 in 2019, indicating capital expenditures significantly outpacing depreciation. A sharp decline occurs in 2020, dropping to 0.38, which may reflect a contraction or fiscal adjustment in capital outlays. From 2020 onwards, the ratio gradually increases, reaching 0.85 in 2021, then further rising to 1.41 in 2022. However, it slightly decreases again to 1.30 in 2023. The overall trend suggests an initial steep reduction followed by moderate recovery in capital investment relative to depreciation, stabilizing at a level above 1.0 through the last two years.
In summary, both segments demonstrate notable volatility in capital expenditure relative to depreciation, with Land and Resource Management showing more pronounced fluctuations and a downward trend towards the end of the period. Water Services and Operations experienced a steep decline initially but has shown stabilization with moderate capital activity in recent years. These patterns may reflect strategic shifts in asset investment priority between the segments over time.
Segment Capital Expenditures to Depreciation: Land and Resource Management
Texas Pacific Land Corp.; Land and Resource Management; segment capital expenditures to depreciation calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Capital expenditures | |||||
| Depreciation, depletion and amortization | |||||
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | |||||
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).
1 2023 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation, depletion and amortization
= ÷ =
The analysis of the annual financial data for the Land and Resource Management segment reveals distinct trends in capital expenditures, depreciation, and their relationship over the five-year period from 2019 to 2023.
- Capital Expenditures
- Capital expenditures show significant volatility throughout the period. After a relatively high level of $1.603 million in 2019, expenditures drop sharply to $0.152 million in 2020. The following year, there is a pronounced spike to $4.688 million, the highest within the observed timeframe. However, this increase is short-lived, as capital expenditures fall back substantially to $0.393 million in 2022 and further to $0.241 million in 2023. This pattern reflects an inconsistent investment approach, with extreme fluctuations likely driven by specific project cycles or resource management strategies.
- Depreciation, Depletion, and Amortization
- Depreciation, depletion, and amortization expenses display a generally upward trend over the period. Starting at $1.201 million in 2019, the value increases moderately to $1.514 million in 2020, then escalates more significantly to $2.397 million in 2021. While there is a slight decline to $2.234 million in 2022, the expense peaks at $3.073 million in 2023. This steady increase suggests growing asset base consumption or a greater allocation of amortization charges, which may reflect asset aging or the acquisition of higher-value resources in previous years.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of capital expenditures to depreciation highlights the imbalance between investment and asset consumption. The ratio starts at 1.33 in 2019, indicating capital expenditures exceeded depreciation expenses. This ratio plunges drastically to 0.10 in 2020, showing minimal reinvestment relative to asset usage. In 2021, the ratio peaks at 1.96, signaling a substantial increase in capital spending disproportionate to depreciation. Thereafter, the ratio falls sharply to 0.18 in 2022 and declines further to 0.08 in 2023, implying that capital reinvestment has been significantly lower than the rate at which assets are depreciated and depleted during these years.
Overall, the segment exhibits a pattern of cyclical and erratic capital expenditure activity contrasted with a rising consumption of existing assets as reflected by increasing depreciation charges. The widening gap in recent years between depreciation and capital expenditures may suggest potential underinvestment, which could affect future resource availability or operational capacity if the trend continues.
Segment Capital Expenditures to Depreciation: Water Services and Operations
Texas Pacific Land Corp.; Water Services and Operations; segment capital expenditures to depreciation calculation
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Selected Financial Data (US$ in thousands) | |||||
| Capital expenditures | |||||
| Depreciation, depletion and amortization | |||||
| Segment Financial Ratio | |||||
| Segment capital expenditures to depreciation1 | |||||
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).
1 2023 Calculation
Segment capital expenditures to depreciation = Capital expenditures ÷ Depreciation, depletion and amortization
= ÷ =
- Capital Expenditures
- Capital expenditures experienced significant fluctuation over the five-year period. In 2019, expenditures were markedly high at $30.6 million, followed by a sharp decline to approximately $4.9 million in 2020. Subsequent years showed a recovery trend with expenditures increasing to $11.7 million in 2021, peaking at $18.6 million in 2022, and then moderating slightly to $15.2 million in 2023. Overall, capital spending exhibited a pronounced initial decrease, followed by a gradual upward trend, though not reaching the 2019 level again.
- Depreciation, Depletion, and Amortization (DD&A)
- Depreciation, depletion, and amortization expense rose significantly from $7.7 million in 2019 to $12.9 million in 2020, continuing to grow to $13.9 million in 2021. However, in 2022 and 2023, DD&A declined modestly to $13.1 million and further to $11.7 million respectively. This pattern suggests an increasing amortizable asset base through 2021 followed by some reduction or slower asset utilization impacting the amortization in later years.
- Segment Capital Expenditures to Depreciation Ratio
- The ratio of segment capital expenditures to depreciation values illustrates changing investment intensity relative to asset consumption. Starting at a high ratio of 3.97 in 2019, reflecting very high capital spending compared to depreciation, the ratio plunged sharply to 0.38 in 2020, indicating capital expenditures were significantly lower than depreciation. In 2021, the ratio recovered to 0.85, then climbed to 1.41 in 2022, and slightly decreased to 1.3 in 2023. These shifts indicate an initial underinvestment phase in 2020 relative to asset depreciation, followed by increased reinvestment and asset base replenishment in the subsequent years, although not reaching the same investment intensity as in 2019.
- Overall Insights
- The data reveals a considerable reduction in capital investment in 2020, possibly due to external factors or strategic shifts, which led to capital expenditures falling well below depreciation levels, potentially indicating underinvestment. Recovery in 2021 through 2023 suggests a renewed commitment to asset investment, aiming to restore or expand operational capacity. Depreciation trends confirm growing asset bases initially, then a slight contraction or reduced amortization expense in the later years. The overall pattern indicates a period of contraction or caution around 2020, followed by progressive capital deployment to support the segment’s operational needs.
Revenues
Texas Pacific Land Corp., revenues by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations | |||||
| Total |
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 revenue data across the five-year period demonstrates varying trends in the two reportable segments, as well as the consolidated total.
- Land and Resource Management Segment
- This segment experienced a significant decline in revenue from 2019 to 2020, dropping from approximately 363.3 million US dollars to 195.1 million US dollars. However, the segment recovered strongly in 2021, with revenues rising to around 320.4 million US dollars. The upward trend continued into 2022, reaching a peak of about 507.0 million US dollars. In 2023, revenues decreased moderately to approximately 432.1 million US dollars, though still substantially higher than the 2020 and 2021 levels.
- Water Services and Operations Segment
- This segment's revenues showed a modest decline from 2019 (127.2 million US dollars) to 2020 (107.4 million US dollars). From 2020 onwards, revenues increased steadily each year, with 2021 revenues reaching 130.6 million US dollars, 2022 revenues rising further to 160.4 million US dollars, and 2023 revenues peaking at 199.5 million US dollars. This represents a consistent growth trajectory after the initial dip in 2020.
- Total Revenues
- The total segment revenues reflect the combined performance of the two segments. The total declined sharply between 2019 and 2020, falling from about 490.5 million US dollars to 302.6 million US dollars. A strong rebound occurred in 2021, lifting total revenues close to 451.0 million US dollars. This upward momentum accelerated in 2022, with total revenues reaching approximately 667.4 million US dollars, the highest in the observed period. In 2023, total revenues slightly decreased to around 631.6 million US dollars but remained significantly above the 2019 and 2020 figures.
Overall, the data indicates a pronounced impact in 2020 with reduced revenues in both segments, possibly due to external factors influencing the market or operations. Subsequent years demonstrate a recovery and growth trend, particularly strong in the Land and Resource Management segment until 2022, and steady growth in Water Services and Operations throughout the latter years. The total revenue growth after 2020 suggests successful strategic or operational adjustments, despite the slight decline in 2023.
Net income
Texas Pacific Land Corp., net income by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations | |||||
| Total |
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).
- Land and Resource Management Segment
- The net income for the Land and Resource Management segment showed a significant decline from 2019 to 2020, falling from $258,366 thousand to $127,977 thousand. This was followed by a recovery in 2021, increasing to $208,897 thousand. The upward trend continued in 2022 with a notable rise to $365,041 thousand, the highest in the period analyzed. However, in 2023, there was a decrease to $306,706 thousand, indicating some contraction compared to the previous year but still maintaining a higher level than 2019 through 2021.
- Water Services and Operations Segment
- This segment experienced a reduction in net income from $60,362 thousand in 2019 to $48,072 thousand in 2020. Subsequently, the amount increased steadily over the following years, reaching $61,083 thousand in 2021, $81,321 thousand in 2022, and $98,939 thousand in 2023. The trend indicates consistent growth after the initial drop in 2020, with the segment nearly doubling its net income by 2023 compared to 2019.
- Total Net Income
- The total net income followed a pattern similar to the Land and Resource Management segment, with an initial sharp decline from $318,728 thousand in 2019 to $176,049 thousand in 2020. A recovery phase ensued, with total net income rising to $269,980 thousand in 2021 and then strongly increasing to $446,362 thousand in 2022. A reduction occurred in 2023, with total net income decreasing to $405,645 thousand but remaining substantially higher than the 2019 and 2020 levels.
- Overall Analysis
- The financial data reveals a clear impact in 2020, with declines across both segments and total net income, suggesting challenges during that period. The Land and Resource Management segment exhibited more volatility but remained the largest contributor to total net income throughout the timeframe. The Water Services and Operations segment showed a steady growth trajectory after 2020, progressively enhancing its contribution. The overall total income trends indicate a recovery and growth phase post-2020, with a slight downturn in 2023, which may warrant further investigation to understand the underlying causes.
Capital expenditures
Texas Pacific Land Corp., capital expenditures by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations | |||||
| Total |
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).
- Capital Expenditures Overview
- Over the analyzed period, total capital expenditures exhibit significant fluctuations rather than a consistent trend. The total amount significantly dropped from 32,209 thousand US dollars at the end of 2019 to 5,086 thousand in 2020, followed by a partial recovery in 2021 and 2022 before declining again in 2023.
- Land and Resource Management Segment
-
Capital expenditures in this segment show notable volatility. Starting at 1,603 thousand US dollars in 2019, there is a steep decrease to 152 thousand in 2020. This is followed by a sharp increase to 4,688 thousand in 2021, then a decrease again to 393 thousand in 2022 and further down to 241 thousand in 2023. These fluctuations suggest varying levels of investment activity or project scope changes within this segment over the years.
- Water Services and Operations Segment
-
The Water Services and Operations segment demonstrates a different pattern, with a major contraction from 30,606 thousand US dollars in 2019 to 4,934 thousand in 2020. Subsequently, the expenditures increase again to 11,727 thousand in 2021 and reach a peak of 18,574 thousand in 2022 before a moderate decline to 15,190 thousand in 2023. This pattern indicates a recovery phase post-2020 with renewed investment focus in this area, albeit with some reduction in the most recent year.
- Segment Contribution to Total Capital Expenditures
- Throughout the entire period examined, the Water Services and Operations segment consistently accounts for the majority of the capital expenditures compared to Land and Resource Management. This dominance underscores the relative strategic or operational importance of Water Services and Operations in capital allocation decisions.
Depreciation, depletion and amortization
Texas Pacific Land Corp., depreciation, depletion and amortization by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations | |||||
| Total |
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).
- Overall Trend in Depreciation, Depletion, and Amortization Expenses
- There is a general upward trend in the total depreciation, depletion, and amortization expenses from 2019 through 2021, followed by a moderate decline in the subsequent years 2022 and 2023. The total amount increased significantly from 8.9 million USD in 2019 to a peak of approximately 16.3 million USD in 2021. After this peak, the total expenses decreased to around 15.4 million USD in 2022 and further to approximately 14.8 million USD in 2023.
- Land and Resource Management Segment
- The Land and Resource Management segment shows a consistent growth pattern across the entire period. Starting at 1.2 million USD in 2019, the expenses rose to about 3.1 million USD by 2023. Although there was a slight decline between 2021 and 2022, from 2.4 million USD to 2.2 million USD, the segment rebounded in the following year, reaching its highest level. This indicates increased investment or amortization activity in land and resource assets over time.
- Water Services and Operations Segment
- The Water Services and Operations segment exhibits a different pattern, with substantial growth from 7.7 million USD in 2019 to a peak of 13.9 million USD in 2021. However, unlike the Land and Resource Management segment, this area experienced a gradual decline over the next two years, decreasing to approximately 11.7 million USD by 2023. This suggests either reduced amortization or a potential shift in asset composition or operational intensity within this segment.
- Segment Contributions and Dynamics
- The Water Services and Operations segment consistently comprises the larger portion of total depreciation, depletion, and amortization expenses throughout the period. Despite the recent declining trend, it remains the dominant contributor, accounting for roughly 79% of the total expense on average. The steady increase in the Land and Resource Management segment somewhat offsets the decline in the Water Services segment, resulting in a more stable overall expense profile in recent years.
- Implications
- The upward trend in Land and Resource Management expenses may reflect continued capital investment or greater amortization related to land and resource holdings. Conversely, the decline in Water Services and Operations expenses might indicate asset disposals, lower capital expenditures, or improved operational efficiencies. The divergence in trends between the two segments could impact future asset management strategies and investment focus.
Assets
Texas Pacific Land Corp., assets by reportable segment
US$ in thousands
| Dec 31, 2023 | Dec 31, 2022 | Dec 31, 2021 | Dec 31, 2020 | Dec 31, 2019 | |
|---|---|---|---|---|---|
| Land and Resource Management | |||||
| Water Services and Operations | |||||
| Total |
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).
- Land and Resource Management Segment Assets
- Over the five-year period from 2019 to 2023, assets in this segment displayed a consistent upward trend. Starting at approximately $467.8 million in 2019, the value experienced a slight decrease in 2020 to around $460.1 million. Following this, there was a significant increase in 2021, reaching roughly $635.3 million, and the positive momentum continued with further growth in 2022 and 2023. By the end of 2023, assets in this segment reached approximately $975.1 million, indicating substantial expansion and investment in land and resource management activities.
- Water Services and Operations Segment Assets
- This segment showed some variability in asset values over the same period. Starting at $130.4 million in 2019, the assets decreased to about $111.6 million in 2020, representing the lowest point within these years. Subsequently, there was a steady increase from 2021 onward, with assets growing to $128.7 million in 2021, $142.2 million in 2022, and reaching $181.3 million in 2023. This trajectory suggests a recovery and expansion in water services and operational assets.
- Total Reportable Segment Assets
- The aggregate segment assets followed the trends observed in the individual segments, with an initial decrease from $598.2 million in 2019 to $571.6 million in 2020. After 2020, total assets increased substantially each year, reaching $764.1 million in 2021, $877.4 million in 2022, and peaking at approximately $1.156 billion in 2023. The significant growth in total assets is predominantly driven by the expansion in the Land and Resource Management segment, supplemented by increasing assets within the Water Services and Operations segment.
- Overall Insights
- The data indicate a strategic emphasis on expanding land and resource management capabilities, as evidenced by the sharp increase in assets allocated to this area, especially post-2020. The recovery and growth in water services assets also suggest renewed focus or investment in that area, though on a smaller scale compared to land management. The initial dip in 2020 across all segments likely reflects external factors impacting asset values or company operations during that period, followed by a phase of robust growth and asset accumulation in subsequent years.