Freehold Royalties Ltd. press release

Riley Permian Reports 2025 Results and Provides 2026 Guidance

2026-03-04

TSX - Toronto Stock Exchange · Oil · Natural Gas · Natural Gas Liquids · Potash · Canada · Corporate Finance

Riley Permian Reports 2025 Results and Provides 2026 Guidance

Riley Permian Reports 2025 Results and Provides 2026 Guidance PR Newswire

OKLAHOMA CITY, March 4, 2026 /PRNewswire/ -- Riley Exploration Permian, Inc. (NYSE American: REPX) ("Riley Permian", the "Company" or "we"), today reported financial and operating results for the fourth quarter and year ended December 31, 2025.

FOURTH QUARTER 2025 HIGHLIGHTS

Averaged 35.5 MBoe/d of total equivalent production (oil production of 20.1 MBbls/d)

Generated $65 million of operating cash flow, $85 million of net income, $66 million of Adjusted EBITDAX(1), $1 million of Total Free Cash Flow(1) and $17 million of Upstream Free Cash Flow(1)

Incurred total accrual (activity-based) capital expenditures before acquisitions of $50 million ($28 million for upstream)

Sold all of our membership interests in Dovetail Midstream LLC, a wholly owned subsidiary of the Company that held certain midstream infrastructure projects in Eddy County, New Mexico for total cash consideration of $123 million, with the right to earn up to an additional $60 million in cash payments contingent upon achieving certain volumetric performance thresholds over a five-year period ("Midstream Sale")

Reduced debt outstanding by $120 million with a year-end debt-to-Adjusted EBITDAX(1) ratio of 1.0x(2)

Announced the authorization of a stock repurchase program of up to $100 million of the currently outstanding shares of the Company's common stock

FULL-YEAR 2025 HIGHLIGHTS

Averaged 29.2 MBoe/d of total equivalent production (oil production of 17.3 MBbls/d)

Generated $213 million of operating cash flow, $161 million of net income, $261 million of Adjusted EBITDAX(1), $81 million of Total Free Cash Flow(1) and $117 million of Upstream Free Cash Flow(1)

Incurred total accrual (activity-based) capital expenditures before acquisitions of $120 million ($83 million for upstream)

Closed on the acquisition of Silverback Exploration II, LLC and its subsidiaries ("Silverback") for $120 million in cash plus contingent consideration, subject to final purchase price adjustments

Increased the dividend on our common stock in October 2025 by 5% to $0.40 quarterly and $1.60 annually

2026 GUIDANCE HIGHLIGHTS

Full-year 2026 guidance for total production of 35.0 - 37.0 MBoe/d (oil production of 21.0 - 22.0 MBbls/d)

Full-year 2026 guidance for activity-based capital expenditures before acquisitions of $190 - 210 million

Bobby Riley, Chairman of the Board and Chief Executive Officer commented, "2025 was a transformational year for Riley Permian, as we made significant progress across key strategic initiatives, including inventory expansion, infrastructure build‑out, and balance sheet improvement. The groundwork laid in 2025 positions the company for a more active and value‑enhancing development program in 2026 and beyond."

____________________

(1)

A non-GAAP financial measure as defined and reconciled in the supplemental financial tables available on the Company's website at www.rileypermian.com.

(2)

Debt leverage ratio based on principal debt outstanding as of December 31, 2025, divided by full-year Adjusted EBITDAX(1).

OPERATIONS AND DEVELOPMENT ACTIVITY UPDATE

The tables below provide a summary of our operated well activity and production by state:

Three Months Ended December 31, 2025

Year Ended December 31, 2025

Gross(1)

Net(2)

Gross(1)

Net(2)

Wells Drilled

Texas

8

8.0

18

18.0

New Mexico

—

—

—

—

Total

8

8.0

18

18.0

Wells Completed

Texas

5

5.0

12

12.0

New Mexico

—

—

10

6.3

Total

5

5.0

22

18.3

Wells Turned to Sales

Texas

3

3.0

10

10.0

New Mexico

—

—

10

6.3

Total

3

3.0

20

16.3

___________________

(1) Gross wells are the total number of operated wells in which the Company has an interest

(2) Net wells are gross wells multiplied by our fractional working interest

Average Daily Production by State

Three Months Ended December 31,

Year Ended December 31,

2025

2024

2025

2024

Combined

Texas

19.4

17.7

17.6

15.7

New Mexico

16.1

7.3

11.6

6.8

Total (MBoe/d)

35.5

25.0

29.2

22.5

Oil

Texas

11.9

12.4

11.3

11.7

New Mexico

8.2

3.5

6.0

3.4

Total (MBbls/d)

20.1

15.9

17.3

15.1

FOURTH QUARTER 2025 FINANCIAL RESULTS

Revenues totaled $97 million, net cash provided by operating activities was $65 million and net income was $85 million, or $4.02 per diluted share.

On a non-GAAP basis, Adjusted EBITDAX(1) was $66 million, cash flow from operations before changes in working capital(1) was $35 million, Total Free Cash Flow(1) was $1 million and Adjusted Net Income(1) was $22 million, or $1.01 per diluted share.

Average realized prices, before derivative settlements, were $57.18 per barrel of oil, $(0.86) per Mcf of natural gas and $(6.67) per barrel of natural gas liquids. The Company reported a $21 million gain on derivatives, net, which included an $8 million realized gain on settlements.

Operating expenses included lease operating expense ("LOE") of $23 million, or $7.16 per Boe, administrative costs of $8 million, or $2.42 per Boe, and production and ad valorem taxes of $8 million or $2.44 per Boe.

The Company incurred $50 million in total accrued capital expenditures ($28 million for upstream). On a cash basis, the Company had total capital expenditures of $51 million ($35 million for upstream).

We recognized a pre-tax gain of $72 million from the Midstream Sale, net of $3 million in transaction costs. As a result, we incurred $16 million in corresponding income tax liability. Total FCF of $1 million excludes this tax impact.

The Company sold its interest in oil and natural gas properties in Texas outside of the Company's acreage in Yoakum County for 250,000 shares of the Company's common stock, which were subsequently retired, and which led to a reduction to additional paid-in-capital of $10 million.

The Company reduced total debt by $120 million, including a principal reduction of $115 million on the Credit Facility and $5 million on the Senior Notes. As of December 31, 2025, the Company had $110 million of borrowings outstanding on its Credit Facility and $145 million principal value of its Senior Notes, for a combined principal value of debt of $255 million. Interest expense, net was $8 million.

The Company paid a cash dividend of $0.40 per share, for a total of $8 million.

YEAR ENDED 2025 FINANCIAL RESULTS

Revenues totaled $392 million, net cash provided by operating activities was $213 million and net income was $161 million, or $7.59 per diluted share.

On a non-GAAP basis, Adjusted EBITDAX(1) was $261 million, cash flow from operations before changes in working capital(1) was $192 million, Total Free Cash Flow(1) was $81 million and Adjusted Net Income(1) was $96 million or $4.53 per diluted share.

Average realized prices, before derivative settlements, were $62.95 per barrel of oil, $(0.28) per Mcf of natural gas and $(1.27) per barrel of natural gas liquids. The Company reported a $36 million gain on derivatives, net, which included a $17 million realized gain on settlements.

Operating expenses included LOE of $88 million, or $8.21 per Boe, administrative costs of $31 million, or $2.95 per Boe, and production and ad valorem taxes of $29 million or $2.73 per Boe.

The Company incurred $120 million in total accrued capital expenditures ($83 million for upstream). On a cash basis, the Company had total capital expenditures of $128 million ($91 million for upstream).

The Company reduced total debt by $25 million, including a principal reduction of $5 million on the Credit Facility and $20 million on the Senior Notes. Interest expense, net was $31 million.

The Company paid dividends of $1.54 per share for a total of $33 million.

Shareholder's equity was $634 million as of December 31, 2025, an increase of 24% year-over-year and the number of common shares outstanding was 21.7 million, an increase of 1% year-over-year.

In January 2026, as part of our stock repurchase program, the Company repurchased 152,408 shares of common stock at a weighted average price of $26.54 per share for a total of $4 million.

RESERVES

Estimates of Riley Permian's proved reserves as of December 31, 2025, were prepared by Ryder Scott Company, L.P., the Company's third-party reservoir engineer, using the SEC pricing methodology. Proved reserves at year-end 2025 of 147 MMBoe increased by 24 MMBoe or 19% over year-end 2024 reserves. Oil represented 50% of total proved reserves. Proved developed producing reserves ("PDP") increased by 13% to 87 MMBoe, which represented 59% of total proved reserves. Proved undeveloped reserves ("PUD") increased by 29% to 61 MMBoe, when compared to year-end 2024. At December 31, 2025, the standardized measure of discounted cash flows and PV-10(1) were $1.14 billion and $1.39 billion, respectively.

The net proved reserve additions resulted in a reserve replacement ratio (defined as the sum of extensions and discoveries, revisions, acquisitions and divestitures, divided by annual production) of 323% for the year ended December 31, 2025. The organic reserve replacement ratio (defined as the sum of extensions and discoveries and revisions, divided by annual production) was 230%.

Extensions and discoveries were the primary contributor to the increase in reserves of 24 MMBoe, which consisted of 23 MMBoe added to PUDs as a result of drilling activity during the year, which allowed for the booking of adjacent PUDs for locations that were previously booked as unproved reserves or not at all, and 1 MMBoe added to PDP as a result of drilling successful wells that were previously classified as unproved locations. The Company also acquired 11 MMBoe in reserves and divested 1 MMBoe. The Company had production of 11 MMBoe and positive revisions of previous estimates of 1 MMBoe.

____________________

(1)

A non-GAAP financial measure as defined and reconciled in the supplemental financial tables available on the Company's website at www.rileypermian.com.

Selected Operating and Financial Data

(Unaudited)

Three Months Ended

Year Ended

December 31,

2025

September 30,

2025

December 31,

2024

December 31,

2025

December 31,

2024

Select Financial Data (in thousands):

Oil and natural gas sales, net

$ 97,277

$ 106,852

$ 102,695

$ 391,980

$ 409,801

Income from Operations

$ 26,161

$ 28,862

$ 32,038

$ 133,279

$ 153,695

Adjusted EBITDAX(1)

$ 66,051

$ 64,041

$ 69,074

$ 260,565

$ 284,225

Cash Flow from Operations

$ 64,868

$ 63,650

$ 66,378

$ 212,539

$ 246,274

Upstream Accrual Capital Expenditures

$ 28,204

$ 13,129

$ 19,385

$ 82,785

$ 97,023

Upstream Cash Capital Expenditures

$ 34,721

$ 14,893

$ 22,299

$ 91,188

$ 99,365

Total Accrual Capital Expenditures

$ 50,357

$ 18,019

$ 30,682

$ 120,162

$ 108,320

Total Cash Capital Expenditures

$ 50,960

$ 29,027

$ 33,263

$ 127,855

$ 110,329

Upstream Free Cash Flow(1)

$ 17,238

$ 39,441

$ 28,653

$ 117,236

$ 128,033

Total Free Cash Flow(1)

$ 999

$ 25,307

$ 17,689

$ 80,569

$ 117,069

Production Data, net:

Oil (MBbls)

1,850

1,690

1,464

6,328

5,519

Natural gas (MMcf)

3,848

3,380

2,305

11,669

7,484

NGLs (MBbls)

778

722

455

2,387

1,486

Total (MBoe)

3,269

2,975

2,303

10,660

8,252

Daily combined volumes (Boe/d)

35,533

32,337

25,033

29,205

22,546

Daily oil volumes (Bbls/d)

20,109

18,370

15,913

17,337

15,079

Average Realized Prices:(2)

Oil ($ per Bbl)

$ 57.18

$ 63.94

$ 68.50

$ 62.95

$ 74.10

Natural gas ($ per Mcf)

$ (0.86)

$ (0.21)

$ 0.02

$ (0.28)

$ (0.19)

NGLs ($ per Bbl)

$ (6.67)

$ (0.66)

$ 5.18

$ (1.27)

$ 1.53

Average Realized Prices, including derivative

settlements:(2)(3)

Oil ($ per Bbl)

$ 61.06

$ 65.17

$ 69.89

$ 65.46

$ 73.67

Natural gas ($ per Mcf)

$ (0.63)

$ (0.16)

$ 0.34

$ (0.22)

$ 0.37

NGLs ($ per Bbl)(4)

$ (6.67)

$ (0.66)

$ 5.18

$ (1.27)

$ 1.53

Weighted Average Common Shares

Outstanding (in thousands):

Basic

21,120

21,164

21,094

21,134

20,712

Diluted

21,242

21,263

21,205

21,194

20,875

_____________________

(1)

A non-GAAP financial measure as defined and reconciled in the supplemental financial tables available on the Company's website at www.rileypermian.com.

(2)

The Company's oil, natural gas and NGL sales are presented net of GP&T costs. These costs, related to natural gas and NGLs, at times exceeded the price we received and resulted in negative average realized prices.

(3)

The Company's calculation of the effects of derivative settlements includes gains and losses on the settlement of our commodity derivative contracts. These gains and losses are included under other income (expense) in the Company's consolidated statements of operations.

(4)

During the periods presented, the Company did not have any NGL derivative contracts in place.

2026 GUIDANCE

Riley Permian is providing first quarter detailed guidance and select full-year 2026 activity guidance based on currently scheduled development activity and current market conditions. The average working interest on gross operated wells drilled is subject to change and may have corresponding impacts on net production volumes and investing expenditures. Total equivalent production estimates, inclusive of production from natural gas and NGLs, may be subject to variability based on third-party midstream service provider conditions.

Activity and Production

Q1 2026

Full-Year 2026

Net Operated Well Activity

Drilled (#)

14.3 - 16.3

37.0 - 43.0

Completed (#)

8.0 - 9.0

41.0 - 47.0

Turned to Sales (#)

7.0 - 8.0

43.0 - 49.0

Non-Operated, Net (#)

0.0 - 0.0

1.0 - 2.0

Net Production

Total (MBoe/d)

33.2 - 34.0

35.0 - 37.0

Oil (MBbls/d)

19.0 - 19.5

21.0 - 22.0

Capital Expenditures and Investing (in millions)(1)

Upstream

$49 - $57

$165 - $180

Infrastructure and Other

$6 - $8

$25 - $30

Total Capital Expenditures

$55 - $65

$190 - $210

Power JV Investment

$2 - $3

$6 - $8

Total Investments

$57 - $68

$196 - $218

Operating and Corporate Costs

Q1 2026

Lease Operating Expenses ($ per Boe)

$8.00 - $9.00

Production and Ad Valorem Taxes (% of revenue)

7.5% - 8.5%

Administrative Costs ($ per Boe)

$2.50 - $3.00

___________________

(1)

Accrual (activity-based) investing expenditures before acquisitions

CONFERENCE CALL

In connection with the earnings release, Riley Permian management will host a conference call for investors and analysts on March 5, 2026 at 9:00 a.m. CT to discuss the Company's results and to host a Q&A session. Interested parties are invited to participate by calling:

Toll Free Dial-In, +1 (888) 596-4144

Toll Dial-in, +1 (646) 968-2525

Conference ID number 1303008

An updated company presentation, which will include certain items to be discussed on the call, will be posted prior to the call on the Company's website (www.rileypermian.com). In addition to a webcast of the call available on the Company's website, a replay of the call will be available March 19, 2026 by calling:

Toll Free Dial-In, +1 (800) 770-2030

Toll Dial-in, +1 (609) 800-9909

Conference ID number 1303008

About Riley Exploration Permian, Inc.

Riley Permian is a growth-oriented upstream oil and gas company operating in Texas and New Mexico with infrastructure projects that complement our operations. For more information, please visit www.rileypermian.com.

Investor Contact:

405-438-0126

IR@rileypermian.com

Cautionary Statement Regarding Forward Looking Information and Guidance

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. The statements contained in this release that are not historical facts are forward-looking statements that represent management's beliefs and assumptions based on currently available information. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, need for financing, competitive position and potential growth opportunities. Our forward-looking statements do not consider the effects of future legislation or regulations. Forward-looking statements include all statements that are not historical facts and can be identified by the use of forward-looking terminology such as the words "believes," "intends," "may," "should," "anticipates," "expects," "could," "plans," "estimates," "projects," "targets," "forecasts" or comparable terminology or by discussions of strategy or trends. You should not place undue reliance on these forward-looking statements. These forward-looking statements are subject to a number of risks, uncertainties and assumptions. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. Although we believe that our plans, intentions and expectations reflected in or suggested by the forward-looking statements we make in this release are reasonable, we can give no assurance that these plans, intentions or expectations will be achieved or occur, and actual results could differ materially and adversely from those anticipated or implied by the forward-looking statements.

Among the factors that could cause actual future results to differ materially are the risks and uncertainties the Company is exposed to. While it is not possible to identify all factors, we continue to face many risks and uncertainties including, but not limited to: the volatility of oil, natural gas and NGL prices; regional supply and demand factors, any delays, curtailment delays or interruptions of production, and any governmental order, rule or regulation that may impose production limits; cost and availability of gathering, pipeline, refining, transportation, power and other midstream and downstream activities, which could result in a prolonged shut-in of our wells that may adversely affect our reserves, financial condition and results of operations; severe weather and other risks that lead to a lack of any available markets; our ability to successfully complete mergers, acquisitions or divestitures; the inability or failure of the Company to successfully integrate the acquired assets into our operations and development activities; the potential delays in the development, construction or start-up of planned projects; failure to realize any of the anticipated benefits of our joint ventures or other equity investments; risks relating to our operations, including development drilling and testing results and performance of acquired properties and newly drilled wells; inability to prove up undeveloped acreage and maintain production on leases; any reduction in our borrowing base on our Credit Facility from time to time and our ability to repay any excess borrowings as a result of such reduction; the impact of our derivative strategy and the results of future settlement; our ability to comply with the financial covenants contained in our Credit Facility and Senior Notes; changes in general economic, business or industry conditions, including changes in inflation rates, interest rates and foreign currency exchange rates; conditions in the capital, financial and credit markets and our ability to obtain capital needed to fund our exploration and development on favorable terms or at all; the loss of certain tax deductions; risks associated with executing our business strategy, including any changes in our strategy; risks associated with concentration of operations in one major geographic area; legislative or regulatory changes, including initiatives related to hydraulic fracturing, regulation of greenhouse gases, water conservation, seismic activity, weatherization, or protection of certain species of wildlife, or of sensitive environmental areas; the ability to receive drilling and other permits or approvals and rights-of-way in a timely manner (or at all), which may be restricted by governmental regulation and legislation; restrictions on the use of water, including limits on the use of produced water and a moratorium on new produced water well permits recently imposed by the Railroad Commission of Texas in an effort to control induced seismicity in the Permian Basin; changes in government environmental policies and other environmental risks; the availability of drilling equipment and the timing of production; tax consequences of business transactions; public health crisis, such as pandemics and epidemics, and any related government policies and actions and the effects of such public health crises on the oil and natural gas industry, pricing and demand for oil and natural gas and supply chain logistics; general domestic and international economic, market and political conditions, including military conflicts, global economic growth, unpredictability of new tariffs, actions of OPEC+ countries and changes to the current political environment under the new administration; risks related to litigation; and cybersecurity threats, technology system failures and data security issues.