Granite Ridge Resources, Inc. Reports Fourth Quarter and Full-Year 2025 Results and Provides Outlook for 2026

DALLAS--( BUSINESS WIRE)--Granite Ridge Resources, Inc. (NYSE: GRNT) (“Granite Ridge” or the “Company”) today reported financial and operating results for the fourth quarter and full-year 2025 and provided initial guidance for 2026.

Fourth Quarter 2025 Highlights

See “Supplemental Non-GAAP Financial Measures” below for descriptions of the above non-GAAP measures as well as a reconciliation of these measures to the associated GAAP (as defined herein) measures.

Tyler Farquharson, President and CEO of Granite Ridge, commented, “Granite Ridge continued its evolution in 2025 from a traditional non-operated production company to a capital allocator focused on controlled, short-cycle development through Operated Partnerships. This strategic shift has resulted in greater control over development timing, and increased deal flow and exposure to high-quality resource in the Permian Basin. We have executed over fifty of these transactions and added approximately 100 net locations since the program began in 2023.

“For the year, we grew production 28% to an average of 32,000 Boe per day while investing $279 million in development capital. Our strategy remains straightforward: underwrite projects to 25% full-cycle returns at strip pricing, compound production and cash flow growth, and protect downside through disciplined leverage.

“In 2025, we added 331 gross, 77.2 net, locations for $122 million across both the Operated Partnership and non-operated portfolio. In the Permian Basin, we acquired 59.3 Operated Partnership net wells at $1.4 million per location. By underwriting transactions on a unit-by-unit basis at strip pricing, we moderate commodity price volatility and avoid execution and valuation risk associated with large-format acquisitions.

“Our 2026 guidance reflects the benefits of increased scale. Production growth is moderating and development capital expenditures align closely with expected cash flow.

“We remain committed to disciplined capital allocation, operational execution through our partners, and returning capital to shareholders. The scalability and resilience of our platform position Granite Ridge to generate durable shareholder value through disciplined growth and capital returns across commodity cycles.”

Financial Results

Net loss for the quarter was $25.1 million, or $(0.19) per share of common stock. Excluding non-cash and special items, Adjusted Net Income (non-GAAP) was $1.5 million for the quarter, or $0.01 per diluted share of common stock. Adjusted EBITDAX (non-GAAP) and cash flow from operating activities for the quarter totaled $69.5 million and $64.5 million, respectively.

Net income for the year was $24.4 million or $0.18 per diluted share of common stock. Excluding non-cash and special items, Adjusted Net Income (non-GAAP) was $56.2 million or $0.43 per diluted share of common stock. Adjusted EBITDAX (non-GAAP) and cash flow from operating activities for the year totaled $315.0 million and $296.4 million, respectively.

Production Results

Total production for the quarter increased 27% from the prior year quarter to 35,120 Boe per day (49% oil), including a 17% increase in oil production to 17,152 barrels (“Bbls”) per day. Natural gas production for the quarter totaled 107,804 thousand cubic feet of natural gas (“Mcf”) per day.

Total production for the year increased 28% to 31,984 Boe per day (50% oil), including a 31% increase in oil production to 16,041 Bbls per day. Natural gas production for the year totaled 95,649 Mcf per day.

Oil, Natural Gas and Related Product Sales

During the quarter, NYMEX West Texas Intermediate ("WTI") crude oil averaged $59.64 per Bbl, and NYMEX natural gas at Henry Hub averaged $3.75 per Mcf. The Company’s average realized price for oil and natural gas, excluding the effect of commodity derivatives, was $55.49 per Bbl (a $4.15 differential to WTI) and $1.81 per Mcf (a 48% realization of Henry Hub), respectively.

Operating Costs

Lease operating expenses were $24.9 million for the quarter, or $7.72 per Boe, a 29% increase on a per unit basis compared to the prior year quarter. Production and ad valorem taxes were $6.2 million for the quarter, or 5.9% of oil and natural gas sales. During the quarter general and administrative ("G&A") costs totaled $8.0 million, inclusive of $1.4 million of non-cash stock-based compensation.

Lease operating expenses were $84.9 million for the year, or $7.27 per Boe, an 16% increase on a per unit basis compared to the prior year. Production and ad valorem taxes were $27.6 million for the year, or 6.1% of oil and natural gas sales. G&A costs for the year totaled $31.0 million, inclusive of $3.8 million of non-cash stock-based compensation.

Capital Expenditures and Operational Activity

Capital expenditures for the quarter were $127.5 million comprised of $66.4 million of drilling and completion ("D&C") capital and $61.1 million of property acquisition costs. Total 2025 capital expenditures were $401.0 million comprised of $279.0 million of D&C capital and $122.0 million of property acquisition costs.

The table below provides capital expenditures incurred for oil and natural gas producing activities for the periods indicated:

Three Months Ended

December 31,

Year Ended

December 31,

(in thousands)

2025

2024

2025

2024

Property acquisition costs:

Proved

606

612

14,754

3,436

Unproved

60,445

9,207

107,239

60,721

Development costs

66,400

83,522

278,993

290,283

Total costs incurred for oil and natural gas properties

127,451

93,341

400,986

354,440

The table below provides a summary of gross and net wells completed and put on production for the three months and year ended December 31, 2025:

Three Months Ended

December 31, 2025

Twelve Months Ended

December 31, 2025

Gross

Net

Gross

Net

Permian

7.5

148

31.8

Eagle Ford

—

0.5

Bakken

0.1

0.3

Haynesville

0.7

1.9

0.8

1.4

Appalachian

1.4

2.5

Total

10.5

322

38.4

On December 31, 2025, the Company had 137 gross (12.18 net) wells for which drilling was either in-progress or were pending completion.

Liquidity and Capital Resources

As of December 31, 2025, Granite Ridge had $350.0 million of principal debt outstanding on 8.875% senior unsecured notes and $50.0 million of debt outstanding under our senior secured revolving credit agreement (as amended, the “Credit Agreement”). We had $339.5 million of liquidity as of December 31, 2025, consisting of $324.7 million of committed borrowing availability under the Credit Agreement and $14.8 million of cash on hand.

2025 Proved Reserves

As of December 31, 2025, Granite Ridge’s estimated proved reserves totaled 62,347 MBoe, compared to 54,315 MBoe as of December 31, 2024. The Company’s proved reserves are approximately 49% oil and 51% natural gas. Proved developed reserves totaled 47,525 MBoe, or 76% of total proved reserves. The table below provides a summary of changes in total proved reserves for the year ended December 31, 2025, as well as the proved developed reserves balance at the beginning and end of the year.

Oil

(MBbl)

Natural Gas

(MMcf)

MBoe

Proved developed and undeveloped reserves at December 31, 2024

28,187

156,769

54,315

Revisions of previous estimates

(3,089

)

13,494

(840

)

Extensions and discoveries

5,727

37,612

11,996

Acquisition of reserves

5,603

17,680

8,550

Production

(5,855

)

(34,912

)

(11,674

)

Proved developed and undeveloped reserves at December 31, 2025

30,573

190,643

62,347

Oil

(MBbl)

Natural Gas

(MMcf)

MBoe

Proved developed reserves:

December 31, 2024

19,269

118,103

38,953

December 31, 2025

21,498

156,161

47,525

Proved undeveloped reserves:

December 31, 2024

8,918

38,666

15,362

December 31, 2025

9,075

34,482

14,822

2026 Guidance

The Company’s initial 2026 guidance anticipates approximately 34,000 to 36,000 Boe per day of production for 2026, an increase at the midpoint of approximately 9% from 2025.

The following table summarizes the Company’s operational and financial guidance for 2026.

2026 Guidance

Annual production (Boe per day)

34,000 - 36,000

Oil production (% of total production)

50% - 52%

Acquisitions ($ in millions)

$20 - $30

Development capital expenditures ($ in millions)

$300 - $330

Total capital expenditures ($ in millions)

$320 - $360

Lease operating expenses (per Boe)

$6.75 - $7.75

Production and ad valorem taxes (% of total revenue)

6% - 7%

Cash general and administrative expense ($ in millions)

$25 - $27

Conference Call

Granite Ridge will host a webcast and conference call on Friday, March 6, 2026, at 10:00 AM central time to discuss its fourth quarter and full-year 2025 financial and operating results. A brief Q&A session for security analysts will immediately follow the discussion.

The details are as follows:

When:

Friday, March 6, 2026, at 10:00 a.m. CT

Where:

https://ir.graniteridge.com

Webcast:

To access the webcast, please go to this link: Registration Link

Dial-in / Q&A Participation:

If you would like to access the call by phone or to participate in the Q&A, please register here: Q&A Registration Link. You will be provided with dial-in details. To avoid delays, we encourage participants to dial into the conference fifteen minutes ahead of the scheduled start time.

Upcoming Investor Events

Granite Ridge management will also be participating in the following upcoming investor event:

Any investor presentations to be used for such events will be posted prior to the respective event on Granite Ridge’s website. Information on Granite Ridge’s website does not constitute a portion of, and is not incorporated by reference into this press release.

About Granite Ridge

Granite Ridge is a scaled energy company which aims to provide shareholders with exposure similar to energy private equity through operated partnerships and traditional non-operated assets. We own assets in six prolific unconventional basins across the United States. We aim to deliver a diversified portfolio with best-in-class full cycle returns by investing in a large number of high-graded deals developed by proven public and private operators. We focus on success as measured by total shareholder returns, which we seek to balance with a low leverage profile. For more information, visit Granite Ridge’s website at www.graniteridge.com.

Forward-Looking Statements and Cautionary Statements

This press release contains forward-looking statements regarding future events and future results that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this press release regarding, without limitation, Granite Ridge’s 2026 outlook, financial position, operating and financial performance, business strategy, plans and objectives of management for future operations, industry conditions, and indebtedness covenant compliance are forward-looking statements. When used in this release, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcomes. Items contemplating or making assumptions about actual or potential future production and sales, market size, collaborations, cash flows, and trends or operating results also constitute such forward-looking statements.

Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond Granite Ridge’s control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following: changes in Granite Ridge’s strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans, changes in current or future commodity prices and interest rates, supply chain disruptions, infrastructure constraints and related factors affecting our properties, ability to acquire additional development opportunities and potential or pending acquisition transactions, as well as the effects of such acquisitions on the Company’s cash position and levels of indebtedness, changes in reserves estimates or the value thereof, operational risks including, but not limited to, the pace of drilling and completions activity on our properties, changes in the markets in which Granite Ridge competes, geopolitical risk and changes in applicable laws, legislation, or regulations, including those relating to environmental matters, cyber-related risks, the fact that reserve estimates depend on many assumptions that may turn out to be inaccurate and that any material inaccuracies in reserve estimates or underlying assumptions will materially affect the quantities and present value of the Granite Ridge’s reserves, the outcome of any known and unknown litigation and regulatory proceedings, limited liquidity and trading of Granite Ridge’s securities, acts of war, terrorism or uncertainty regarding the effects and duration of global hostilities, including the Israel-Hamas conflict, the Russia-Ukraine war, the joint U.S.-Israel strikes on Iran, continued instability in the Middle East, and any associated armed conflicts or related sanctions which may disrupt commodity prices and create instability in the financial markets, and market conditions and global, regulatory, technical, and economic factors beyond Granite Ridge’s control, including the potential adverse effects of world health events, affecting capital markets, general economic conditions, global supply chains and Granite Ridge’s business and operations, increasing regulatory and investor emphasis on, and attention to, environmental, social and governance matters, Granite Ridge’s ability to establish and maintain effective internal control over financial reporting, and the other risks described under the heading “Item 1A. Risk Factors” in Granite Ridge’s Annual Report on Form 10-K for the year ended December 31, 2025 to be filed with the Securities and Exchange Commission (“SEC”), as updated by any subsequent Quarterly Reports on Form 10-Q, which Granite Ridge files with the SEC.

Granite Ridge has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond Granite Ridge’s control. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Granite Ridge does not undertake any duty to update or revise any forward-looking statements, except as may be required by the federal securities laws.

Use of Non-GAAP Financial Measures

To supplement the presentation of the Company’s financial results prepared in accordance with U.S. Generally Accepted Accounting Principles (“GAAP”), this press release contains certain financial measures that are not prepared in accordance with GAAP, including Adjusted Net Income, Adjusted Earnings Per Share, Adjusted EBITDAX, and Net Debt.

See “Supplemental Non-GAAP Financial Measures” below for a description and reconciliation of each non-GAAP measure presented in this press release to the most directly comparable financial measure calculated in accordance with GAAP.

Granite Ridge Resources, Inc.

Consolidated Balance Sheets

(Unaudited)

December 31,

(in thousands, except par value and share data)

2025

2024

ASSETS

Current assets:

Cash

14,846

9,419

Revenue receivable

74,166

69,692

Advances to operators

2,682

19,959

Prepaid and other current assets

2,251

3,831

Derivative assets - commodity derivatives

13,978

537

Equity investments

10,960

31,783

Total current assets

118,883

135,221

Property and equipment:

Oil and gas properties, successful efforts method

1,897,388

1,540,021

Accumulated depletion

(857,832

)

(643,051

)

Total property and equipment, net

1,039,556

896,970

Long-term assets:

Derivative assets - commodity derivatives

3,743

—

Other long-term assets

5,889

4,288

Total long-term assets

9,632

4,288

Total assets

1,168,071

1,036,479

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:

Accounts payable and accrued liabilities

76,847

99,440

Current portion of long-term debt

17,500

—

Other liabilities

810

546

Derivative liabilities - commodity derivatives

1,822

Total current liabilities

95,181

101,808

Long-term liabilities:

Long-term debt, net

367,832

205,000

Derivative liabilities - commodity derivatives

—

3,679

Asset retirement obligations

11,968

10,693

Deferred tax liability

87,330

79,946

Total long-term liabilities

467,130

299,318

Total liabilities

562,311

401,126

Stockholders' Equity:

Common stock, $0.0001 par value, 431,000,000 shares authorized, 136,941,978 and 136,417,677 issued at December 31, 2025 and 2024, respectively

Additional paid-in capital

659,228

655,472

Retained earnings

(17,286

)

16,047

Treasury stock, at cost, 5,686,711 and 5,683,921 shares at December 31, 2025 and 2024, respectively

(36,196

)

(36,180

)

Total stockholders' equity

605,760

635,353

Total liabilities and stockholders' equity

1,168,071

1,036,479

Granite Ridge Resources, Inc.

Consolidated Statements of Operations

(Unaudited)

Three Months Ended December 31,

Year Ended December 31,

(in thousands, except per share data)

2025

2024

2025

2024

Revenues:

Oil and natural gas sales

105,485

106,307

450,306

380,030

Operating costs and expenses:

Lease operating expenses

24,949

15,287

84,903

57,461

Production and ad valorem taxes

6,198

7,032

27,554

26,007

Depletion and accretion expense

57,897

49,847

215,701

176,529

Impairments of long-lived assets

44,654

35,637

44,654

36,369

General and administrative

8,041

5,944

31,009

24,649

Other, net

185

(524

)

(241

)

Total operating costs and expenses

141,924

113,223

403,886

320,774

Net operating income (loss)

(36,439

)

(6,916

)

46,420

59,256

Other income (expense):

Gain (loss) on derivatives - commodity derivatives

12,829

(8,803

)

27,121

(908

)

Interest expense, net

(8,502

)

(4,673

)

(25,500

)

(18,470

)

Gain (loss) on equity investments

(615

)

4,132

(15,833

)

(15,183

)

Other income (expense)

)

—

(94

)

271

Total other income (expense)

3,711

(9,344

)

(14,306

)

(34,290

)

Income (loss) before income taxes

(32,728

)

(16,260

)

32,114

24,966

Income tax expense (benefit)

(7,665

)

(4,638

)

7,761

6,207

Net income (loss)

(25,063

)

(11,622

)

24,353

18,759

Net income (loss) per share:

Basic

(0.19

)

(0.09

)

0.18

0.14

Diluted

(0.19

)

(0.09

)

0.18

0.14

Weighted-average number of shares outstanding:

Basic

130,476

130,210

130,439

130,189

Diluted

130,476

130,210

130,501

130,227

Granite Ridge Resources, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

Year Ended December 31,

(in thousands)

2025

2024

Operating activities:

Net income

24,353

18,759

Adjustments to reconcile net income to net cash provided by operating activities:

Depletion and accretion expense

215,701

176,529

Impairments of long-lived assets

44,654

36,369

Unrealized (gain) loss on derivatives - commodity derivatives

(22,662

)

17,271

Stock-based compensation

3,756

2,298

Amortization of deferred financing costs and original issue discount

2,208

3,540

(Gain) loss on equity investments

15,833

15,183

Deferred income taxes

7,383

5,958

Other

(359

)

(1,034

)

Increase (decrease) in cash attributable to changes in operating assets and liabilities:

Revenue receivable

(4,449

)

3,288

Accounts payable and accrued liabilities

9,561

(1,153

)

Prepaid and other current assets

693

(1,228

)

Other liabilities

(258

)

(47

)

Net cash provided by operating activities

296,414

275,733

Investing activities:

Capital expenditures for oil and natural gas properties

(300,768

)

(285,796

)

Acquisition of oil and natural gas properties

(118,491

)

(61,197

)

Deposit on acquisition

—

(887

)

Refund of advances to operators

4,285

19,655

Proceeds from the disposal of oil and natural gas properties

175

13,995

Proceeds from the sale of equity investments

4,991

3,462

Net cash used in investing activities

(409,808

)

(310,768

)

Financing activities:

Proceeds from borrowing on credit facilities

190,000

110,000

Repayments of borrowing on credit facilities

(345,000

)

(15,000

)

Proceeds from senior notes, net of discount

336,000

—

Deferred financing costs

(4,477

)

(3,340

)

Purchase of treasury shares

(16

)

(442

)

Payment of dividends

(57,686

)

(57,494

)

Net cash provided by financing activities

118,821

33,724

Net change in cash

5,427

(1,311

)

Cash at beginning of year

9,419

10,730

Cash at end of year

14,846

9,419

Supplemental disclosure of cash flow information:

Cash paid during the year for interest, net of capitalized interest

(24,748

)

(14,472

)

Cash paid during the year for income taxes, net of refunds

(549

)

(197

)

Supplemental disclosure of non-cash investing activities:

Change in accrued capital expenditures included in accounts payable and accrued liabilities

(10,900

)

36,736

Advances to operators applied to development of oil and natural gas properties

150,692

121,922

Granite Ridge Resources, Inc.

Summary Production and Price Data

The following table sets forth summary information concerning production and operating data for the periods indicated:

Three Months Ended December 31,

Year Ended December 31,

2025

2024

2025

2024

Net Sales (in thousands):

Oil sales

87,563

88,730

360,832

327,491

Natural gas sales

17,922

17,577

89,474

52,539

Total revenues

105,485

106,307

450,306

380,030

Net Production:

Oil (MBbl)

1,578

1,354

5,855

4,483

Natural gas (MMcf)

9,918

7,186

34,912

27,944

Total (MBoe) (1)

3,231

2,552

11,674

9,140

Average Daily Production:

Oil (Bbl)

17,152

14,717

16,041

12,248

Natural gas (Mcf)

107,804

78,104

95,649

76,350

Total (Boe) (1)

35,120

27,734

31,984

24,973

Average Sales Prices:

Oil (per Bbl)

55.49

65.53

61.63

73.06

Effect of gain on settled oil derivatives on average price (per Bbl)

0.60

0.85

0.28

0.34

Oil net of settled oil derivatives (per Bbl) (2)

56.09

66.38

61.91

73.40

Natural gas sales (per Mcf)

1.81

2.45

2.56

1.88

Effect of gain on settled natural gas derivatives on average price (per Mcf)

0.09

0.39

0.08

0.53

Natural gas sales net of settled natural gas derivatives (per Mcf) (2)

1.90

2.84

2.64

2.41

Realized price on a Boe basis excluding settled commodity derivatives

32.65

41.66

38.57

41.58

Effect of gain on settled commodity derivatives on average price (per Boe)

0.57

1.56

0.38

1.79

Realized price on a Boe basis including settled commodity derivatives (2)

33.22

43.22

38.95

43.37

Operating Expenses (in thousands):

Lease operating expenses

24,949

15,287

84,903

57,461

Production and ad valorem taxes

6,198

7,032

27,554

26,007

Depletion and accretion expense

57,897

49,847

215,701

176,529

Impairments of long-lived assets

44,654

35,637

44,654

36,369

General and administrative

8,041

5,944

31,009

24,649

Costs and Expenses (per Boe):

Lease operating expenses

7.72

5.99

7.27

6.29

Production and ad valorem taxes

1.92

2.76

2.36

2.85

Depletion and accretion

17.92

19.53

18.48

19.31

Impairments of long-lived assets

13.82

13.96

3.83

3.98

General and administrative

2.49

2.33

2.66

2.70

Net Producing Wells at Period-End:

244.74

202.40

244.74

202.40

(1) Natural gas is converted to Boe using the ratio of one barrel of oil to six Mcf of natural gas.

(2) The presentation of realized prices including settled commodity derivatives is a result of including the net cash receipts from (payments on) commodity derivatives to realized pricing. This presentation of average prices with derivatives is a means by which to reflect the actual cash performance of our commodity derivatives for the respective periods and presents oil and natural gas prices with derivatives in a manner consistent with the presentation generally used by the investment community.

Granite Ridge Resources, Inc.

Derivatives Information

The table below provides data associated with the Company’s current derivatives, for the periods indicated:

2026

2027

2028

First

Quarter

Second

Quarter

Third

Quarter

Fourth

Quarter

Total

Collars (oil)

Volume (Bbl)

733,085

1,049,430

909,612

795,038

3,487,165

961,153

—

Weighted-average floor price ($/Bbl)

58.73

61.32

60.53

59.97

60.26

52.50

—

Weighted-average ceiling price ($/Bbl)

70.11

70.65

69.93

68.53

69.87

74.24

—

Swaps (oil)

Volume (Bbl)

134,684

95,082

73,484

53,974

357,224

452,936

—

Weighted-average price ($/Bbl)

60.41

60.33

60.27

60.24

60.33

60.21

—

Collars (natural gas)

Volume (Mcf)

6,804,503

1,851,019

1,727,756

3,868,320

14,251,598

6,099,088

2,211,640

Weighted-average floor price ($/Mcf)

3.62

3.25

3.66

3.54

3.89

3.60

Weighted-average ceiling price ($/Mcf)

4.55

4.00

4.44

4.38

4.97

4.73

Swaps (natural gas)

Volume (Mcf)

—

4,546,849

3,961,363

1,222,218

9,730,430

9,323,814

—

Weighted-average price ($/Mcf)

—

3.73

3.60

—

Swaps (Platts IFERC Waha)

Volume (Mcf)

—

2,540,087

—

Weighted-average price ($/Mcf)

—

(1.08

)

—

Granite Ridge Resources, Inc.

Supplemental Non-GAAP Financial Measures

The Company reports its financial results in accordance with GAAP. However, the Company believes certain non-GAAP performance measures may provide financial statement users with additional meaningful comparisons between current results, the results of its peers and the results of prior periods. In addition, the Company believes these measures are used by analysts and others in the valuation, rating and investment recommendations of companies within the oil and natural gas exploration and production industry. See the reconciliations throughout this release of GAAP financial measures to non-GAAP financial measures for the periods indicated.

Reconciliation of Net Income to Adjusted EBITDAX

Adjusted EBITDAX is presented herein and reconciled from the GAAP measure of net income because of its wide acceptance by the investment community as a financial indicator.

The Company defines Adjusted EBITDAX as net income before depletion and accretion expense, unrealized (gain) loss on derivatives – commodity derivatives, interest expense, non-cash stock-based compensation, income tax expense, impairment of long-lived assets, (gain) loss on equity investments and other, net. Adjusted EBITDAX is not a measure of net income or cash flows as determined by GAAP.

The Company’s Adjusted EBITDAX measure provides additional information that may be used to better understand the Company’s operations. Adjusted EBITDAX is one of several metrics that the Company uses as a supplemental financial measurement in the evaluation of its business and should not be considered in isolation or as an alternative to, or more meaningful than, net income as an indicator of operating performance. Certain items excluded from Adjusted EBITDAX are significant components in understanding and assessing a company’s financial performance, such as a company’s cost of capital and tax structure, as well as the historic cost of depreciable and depletable assets. Adjusted EBITDAX, as used by the Company, may not be comparable to similarly titled measures reported by other companies. The Company believes that Adjusted EBITDAX is a widely followed measure of operating performance and is one of many metrics used by the Company’s management team and by other users of the Company’s consolidated financial statements. For example, Adjusted EBITDAX can be used to assess the Company’s operating performance and return on capital in comparison to other independent exploration and production companies without regard to financial or capital structure, and to assess the financial performance of the Company’s assets and the Company without regard to capital structure or historical cost basis.

The following table provides a reconciliation of the GAAP measure of net income to Adjusted EBITDAX for the periods indicated:

Three Months Ended December 31,

Year Ended December 31,

(in thousands)

2025

2024

2025

2024

Net income (loss)

(25,063

)

(11,622

)

24,353

18,759

Interest expense, net

8,502

4,673

25,500

18,470

Income tax expense (benefit)

(7,665

)

(4,638

)

7,761

6,207

Other, net

185

(524

)

(241

)

Depletion and accretion expense

57,897

49,847

215,701

176,529

Non-cash stock-based compensation

1,369

615

3,756

2,298

Impairments of long-lived assets

44,654

35,637

44,654

36,369

Unrealized (gain) loss on derivatives - commodity derivatives

(10,996

)

12,777

(22,662

)

17,271

(Gain) loss on equity investments

615

(4,132

)

15,833

15,183

Adjusted EBITDAX

69,498

82,633

314,961

290,845

Reconciliation of Debt to Net Debt

The Company provides Net Debt, which is a non-GAAP financial measure. The Company defines Net Debt as current portion of long-term debt, long-term debt, net, less cash as of the balance sheet date. The Company’s Net Debt to Adjusted EBITDAX provides investors with insight into the Company’s leverage as of the measurement date.

The following table provides a reconciliation from the GAAP measure of Debt to Net Debt and Net Debt to Adjusted EBITDAX ratio:

December 31,

(in thousands except for ratio)

2025

Current portion of long-term debt

17,500

Long-term debt, net

367,832

Cash

(14,846

)

Net Debt

370,486

Net Debt to Adjusted EBITDAX ratio

1.2

Reconciliation of Net Income to Adjusted Net Income and Adjusted Earnings Per Share

The Company provides Adjusted Net Income and Adjusted Earnings Per Share, which are non-GAAP financial measures. Adjusted Net Income and Adjusted Earnings Per Share represent earnings and diluted earnings per share determined under GAAP without regard to certain non-cash and nonrecurring items. The Company defines Adjusted Net Income as net income as determined under GAAP excluding impairments of long-lived assets, unrealized (gain) loss on derivatives - commodity derivatives, (gain) loss on equity investments, deferred finance cost amortization acceleration, nonrecurring general and administrative expenses - severance costs, nonrecurring general and administrative expenses - capital markets transaction costs, and tax impact on above adjustments.

The Company defines Adjusted Earnings Per Share as Adjusted Net Income divided by weighted average number of diluted shares of common stock outstanding.

The Company believes these measures provide useful information to analysts and investors for analysis of its operating results on a recurring, comparable basis from period to period. Adjusted Net Income and Adjusted Earnings Per Share should not be considered in isolation or as a substitute for earnings or diluted earnings per share as determined in accordance with GAAP and may not be comparable to other similarly titled measures of other companies.

The following table provides a reconciliation from the GAAP measure of net income to Adjusted Net Income, both in total and on a per diluted share basis, for the periods indicated:

Three Months Ended December 31,

Year Ended December 31,

(in thousands, except share data)

2025

2024

2025

2024

Net income (loss)

(25,063

)

(11,622

)

24,353

18,759

Impairments of long-lived assets

44,654

35,637

44,654

36,369

Unrealized (gain) loss on derivatives - commodity derivatives

(10,996

)

12,777

(22,662

)

17,271

(Gain) loss on equity investments

615

(4,132

)

15,833

15,183

Deferred finance cost amortization acceleration

—

2,167

Nonrecurring general and administrative expenses - severance costs

—

1,757

—

Nonrecurring general and administrative expenses - capital markets transaction costs

(11

)

—

1,501

—

Tax impact on above adjustments (a)

(7,685

)

(9,963

)

(9,215

)

(15,973

)

Adjusted Net Income

1,514

22,697

56,221

73,776

Earnings per diluted share - as reported

(0.19

)

(0.09

)

0.18

0.14

Impairments of long-lived assets

0.34

0.27

0.34

0.28

Unrealized (gain) loss on derivatives - commodity derivatives

(0.08

)

0.10

(0.17

)

0.13

(Gain) loss on equity investments

—

(0.03

)

0.12

Deferred finance cost amortization acceleration

—

0.02

Nonrecurring general and administrative expenses - severance costs

—

0.01

—

Nonrecurring general and administrative expenses - capital markets transaction costs

—

0.01

—

Tax impact on above adjustments (a)

(0.06

)

(0.08

)

(0.06

)

(0.12

)

Adjusted Earnings Per Diluted Share

0.01

0.17

0.43

0.57

Adjusted earnings per share:

Basic earnings

0.01

0.17

0.43

0.57

Diluted earnings

0.01

0.17

0.43

0.57

(a) Estimated using statutory tax rate in effect for the period.