Merger and Acquisition - The company entered into a merger agreement with Fury Resources, with a total transaction value of approximately $450.0 million, converting each share of common stock into $9.80 in cash[112][113] - As of September 19, 2024, the merger consideration was amended to $7.00 per share of common stock, reflecting a significant reduction[117] - The company has incurred approximately $4.6 million in costs related to the merger as of November 8, 2024, with ongoing expenses expected[122] Financing Activities - The company raised $19.5 million from the sale of 20,000 shares of Series A-3 Convertible Preferred Stock in March 2024, net of $0.5 million in original issue discount[123] - An additional $19.5 million was raised from the sale of 20,000 shares of Series A-4 Redeemable Convertible Preferred Stock in May 2024, also net of $0.5 million in original issue discount[124] - The company issued $95.6 million in preferred equity funding during 2023 and an additional $19.5 million in Q1 2024 from its three largest existing stockholders[137] - The company received $38.8 million from preferred stock equity issuances during the nine months ended September 30, 2024[167] Operational Performance - The AGI Facility has processed over 3.7 Bcf of gas since its operation began on March 9, 2024, despite facing delays and higher costs[132] - The company advanced approximately $18.5 million for workover operations at the AGI Facility, with multiple remedies available for recovery[131] - The company generated a net loss of $33.2 million for the nine months ended September 30, 2024, with negative working capital of $64.5 million[134] - Operating revenues for the nine months ended September 30, 2024 were $143.7 million, down from $171.6 million in 2023, primarily due to lower average realized prices and production volumes[173] - Production averaged 12,639 Boe/d for the nine months ended September 30, 2024, down from 14,377 Boe/d in 2023, attributed to capital expenditure timing and natural production declines[174] Cash Flow and Liquidity - As of September 30, 2024, the company had $29.8 million in cash and cash equivalents and $50.0 million in debt repayments due through September 2025[134] - The company’s liquidity is susceptible to commodity price declines, despite using derivative instruments for partial protection[111] - Net cash flows provided by operating activities for the nine months ended September 30, 2024 were $28.7 million, an increase from $11.1 million for the same period in 2023[161] - Net cash flows used in investing activities for the nine months ended September 30, 2024 were approximately $52.6 million, compared to $37.1 million in 2023, primarily for drilling and completion activities[162] - Net cash flows used in financing activities for the nine months ended September 30, 2024 were $3.8 million, a decrease from $35.9 million provided in 2023[167] Debt and Interest - As of September 30, 2024, the company had $147.7 million in outstanding indebtedness under the Amended Term Loan Agreement, with a maturity date of November 24, 2025[151] - The weighted average interest rate on borrowings for the quarter ended September 30, 2024, was approximately 12.98%[151] - The company is required to make a final payment of $97.7 million at maturity on November 24, 2025[134] - The principal amount of term loan debt was $147.7 million as of September 30, 2024, with a weighted average interest rate of 12.79%[192] Cost Management - The company plans to reduce operating and capital costs to improve cash flow, having issued preferred stock totaling $134.6 million as of September 30, 2024[139] - Lease operating expenses for the nine months ended September 30, 2024 were $34.2 million, consistent with the same period in 2023, but per unit costs increased due to inflationary pressures[175] Compliance and Covenants - The Amended Term Loan Agreement includes financial covenants such as a Current Ratio of not less than 0.90 to 1.00 for the fiscal quarter ending September 30, 2024[155] - The company is not in compliance with the Total Net Leverage Ratio covenant as of March 31, 2024, but cured this noncompliance with a prepayment of $17.3 million[138] Strategic Initiatives - The company is exploring strategic transactions and alternative liquidity sources, including potential asset sales and refinancing options[141] - The company has a joint venture with Caracara Services, LLC to develop an acid gas treatment and carbon sequestration facility in Texas[128] Market Sensitivity - The company’s financial results are significantly influenced by oil and natural gas production volumes and commodity prices, which are subject to market fluctuations[110] - A 10% change in market interest rates would impact cash flows by approximately $2.5 million per year based on the current variable interest rate debt[192] - The company expects to hedge approximately 50% to 85% of anticipated oil and natural gas production over the next four years[188] Expense Management - Workover and other expenses decreased to $1.2 million for Q3 2024 from $0.7 million in Q3 2023, and for the nine months, they decreased to $3.1 million from $4.7 million[176] - Taxes other than income decreased to $2.5 million for Q3 2024 from $3.3 million in Q3 2023, and for the nine months, they decreased to $8.9 million from $9.7 million[177] - Gathering and other expenses decreased to $12.4 million for Q3 2024 from $15.5 million in Q3 2023, and for the nine months, they decreased to $41.9 million from $48.9 million[178] - General and administrative expenses decreased to $3.8 million for Q3 2024 from $3.9 million in Q3 2023, and for the nine months, they decreased to $11.1 million from $14.8 million[180] - Depletion expense decreased to $12.1 million for Q3 2024 from $13.1 million in Q3 2023, and for the nine months, it decreased to $37.6 million from $43.2 million[182] Derivative Gains and Interest Expense - The company recorded a net derivative gain of $26.9 million for Q3 2024 compared to a net derivative loss of $53.7 million in Q3 2023[184] - Interest expense decreased to $6.3 million for Q3 2024 from $6.9 million in Q3 2023, and for the nine months, it decreased to $19.8 million from $24.2 million[185]

Production Performance - Average daily net production for Q3 2024 was 12,076 Boe/d (52% oil), a decrease from 12,717 Boe/d (46% oil) in Q3 2023[4] - Crude oil production increased to 577 MBbls in Q3 2024 from 539 MBbls in Q3 2023, representing a growth of 7.1%[18] - Natural gas production decreased to 1,844 MMcf in Q3 2024 from 2,054 MMcf in Q3 2023, a decline of 10.2%[18] - Total production volumes for Q3 2024 were 1,111 MBoe, down from 1,170 MBoe in Q3 2023, a decrease of 5.0%[18] - The Glacier and Rio pads continue to perform above expectations, with cumulative production averaging 370 Mboe (64% oil) and 132 Mboe (86% oil) respectively[3] Financial Performance - Total operating revenue for Q3 2024 was $45.3 million, down from $54.1 million in Q3 2023, primarily due to a $5.07 decrease in average realized prices[4] - The company reported a net income of $5.6 million or $0.34 per share for Q3 2024, with an adjusted diluted net loss of $21.5 million or $1.31 per share[5] - Net income for the three months ended September 30, 2024, was $21,628, compared to a net loss of $53,799 for the same period in 2023[15] - Net income available to common stockholders for Q3 2024 was $5.587 million, compared to a net loss of $57.662 million in Q3 2023[19] - The company reported a basic net income per share of $0.34 for the three months ended September 30, 2024, compared to a loss of $3.50 per share in the same period of 2023[15] Expenses and Costs - Lease operating and workover expense increased to $11.56 per Boe in Q3 2024 from $10.13 per Boe in Q3 2023, attributed to inflationary market increases[5] - Total operating expenses for the three months ended September 30, 2024, were $44,212, down from $47,289 in the same period of 2023, a decrease of 4.6%[15] - Total operating costs, as reported, were $28.50 per Boe in Q3 2024, slightly down from $28.94 per Boe in Q3 2023[18] - The company experienced a decrease in depletion, depreciation, and accretion expenses, which were $12,533 for the three months ended September 30, 2024, compared to $13,426 in the same period of 2023[21] Cash Flow and Liquidity - Total liquidity as of September 30, 2024, was $29.8 million, with $147.8 million of indebtedness outstanding[6] - Cash flows from operating activities showed a net cash used of $5,072 thousand for the three months ended September 30, 2024, compared to a net cash provided of $2,416 thousand in the same period last year[17] - The company reported a net decrease in cash, cash equivalents, and restricted cash of $(24,596) thousand for the three months ended September 30, 2024, compared to an increase of $24,076 thousand in the same period last year[17] - Cash, cash equivalents, and restricted cash at the end of the period were $29,925 thousand, down from $42,680 thousand at the end of the same period in 2023[17] Derivative Contracts and Unrealized Losses - The company reported a net gain on derivative contracts of $26,896 for the three months ended September 30, 2024, compared to a loss of $53,687 in the same period of 2023[15] - The company experienced a significant unrealized loss on derivative contracts of $(28,091) thousand for the three months ended September 30, 2024, compared to a gain of $46,805 thousand in the same period of 2023[17] - Unrealized losses on derivatives contracts were reported at $28,091 for the three months ended September 30, 2024, a significant improvement from unrealized gains of $46,805 in the same period of 2023[21] Strategic Developments - Battalion amended its merger agreement with Fury Resources, reducing the purchase price to $7.00 per share and requiring preferred equity holders to roll over 100% of their equity[2] - The company plans to hold a special meeting of stockholders on November 19, 2024, to vote on the merger agreement with Fury Resources[8] - Battalion Oil Corporation continues to focus on strategic adjustments to enhance financial performance, as indicated by the adjustments made in their EBITDA calculations[21] Adjusted EBITDA - Adjusted EBITDA for Q3 2024 was $13.5 million, slightly down from $13.6 million in Q3 2023[5] - Adjusted EBITDA for the three months ended September 30, 2024, was $13,458, slightly down from $13,625 in the same period of the previous year[21] - For the nine months ended September 30, 2024, Battalion reported an adjusted EBITDA of $38,473, down from $56,543 in the same period of 2023[21] - The company’s adjusted LTM EBITDA was reported at $48,445, indicating a focus on improving operational efficiency[23]

Core Insights - Battalion Oil Corporation reported its financial and operational results for Q3 2024, highlighting a decrease in production and revenue compared to the same period in 2023 [1][5]. Financial Performance - Average daily net production for Q3 2024 was 12,076 Boe/d (52% oil), down from 12,717 Boe/d (46% oil) in Q3 2023 [5][21]. - Total operating revenue for Q3 2024 was $45.3 million, a decrease from $54.1 million in Q3 2023, primarily due to a $5.07 drop in average realized prices and a decrease in production [5][6]. - The company reported a net income available to common stockholders of $5.6 million, or $0.34 per share, compared to a net loss of $57.7 million, or $(3.50) per share, in Q3 2023 [7][24]. Operational Highlights - The acid gas injection (AGI) facility treated approximately 18 MMcf/d on average and processed over 4.6 Bcf of sour gas, leading to expected savings of up to $2 million per month in gas treating costs [4][6]. - The company completed its six-well campaign ahead of schedule and under budget, with capital costs trending lower [3][5]. - The Vermejo two-well pad has been completed and is currently flowing back, with initial rates meeting company expectations [2][3]. Merger Agreement - Battalion amended its merger agreement with Fury Resources, reducing the purchase price to $7.00 per share and requiring existing preferred equity holders to roll over 100% of their preferred equity [2][9]. - A special meeting of stockholders is scheduled for November 19, 2024, to vote on the merger agreement [10]. Liquidity and Balance Sheet - As of September 30, 2024, the company had $147.8 million in outstanding indebtedness and total liquidity of $29.8 million [8][17]. - Current assets decreased to $57.6 million from $90.5 million at the end of 2023, while total assets were reported at $458 million [17][18].

Market Overview - U.S. stocks showed mixed performance with the Nasdaq Composite down more than 0.2% on Friday [1] - The Dow increased by 0.09% to 42,064.34, while the S&P 500 fell by 0.22% to 5,701.29 [1] Company Performance - Lennar Corporation reported better-than-expected financial results for Q3, projecting new orders between 19,000 to 19,300 and deliveries between 22,500 to 23,000 for Q4, with an average sales price of approximately $425,000 [2] - Banzai International, Inc. shares surged 131% to $6.62 following a 1-for-50 reverse stock split [2] - Battalion Oil Corporation shares increased by 120% to $6.48 after amending its merger agreement with Fury Resources for a cash acquisition at $7.00 per share [2] - Constellation Energy Corporation shares rose by 13% to $235.54 after signing a 20-year power purchase agreement with Microsoft [2] Declining Stocks - Corbus Pharmaceuticals Holdings, Inc. shares dropped 59% to $21.12 despite an Outperform rating and a price target of $82 from RBC Capital [3] - Sable Offshore Corp. shares fell 19% to $22.79 after announcing a $150 million private placement [3] - FedEx Corporation shares decreased by 15% to $254.45 due to weaker-than-expected Q1 results and lowered full-year guidance [3] Commodities - Oil prices increased by 0.1% to $72.03, while gold rose by 1.3% to $2,649.40 [4] - Silver prices were up 0.1% to $31.455, and copper fell by 0.4% to $4.33 [4] European Market Insights - European shares declined, with the eurozone's STOXX 600 down 1.34% and Germany's DAX down 1.43% [4] - Spain's trade deficit narrowed to EUR 3.2 billion in July from EUR 4.9 billion year-over-year [4] - The manufacturing climate indicator in France decreased to 98.6 in September from 98.9 [4] Asia Pacific Market Performance - Asian markets closed higher, with Japan's Nikkei 225 gaining 1.53% and Hong Kong's Hang Seng Index up 1.36% [5] - The Reserve Bank of India's foreign exchange reserves reached $689.5 billion as of September 13 [5] - The Bank of Japan maintained its key short-term interest rate at around 0.25% [5]

Core Insights - Two stocks in the energy sector are showing signs of being overbought, which may concern momentum-focused investors [1] Group 1: Brooge Energy Ltd (BROG) - Brooge Energy received a Nasdaq non-compliance letter on June 5 [2] - The stock has increased approximately 82% over the past month, reaching a 52-week high of $6.66 [2] - The RSI value for Brooge Energy is 83.55, indicating it is overbought [2] - On the latest trading day, shares gained 14.9% to close at $1.77 [2] Group 2: Battalion Oil Corp (BATL) - Battalion Oil amended its merger agreement with Fury Resources for an acquisition at $7.00 per share in cash [3] - The stock has risen around 17% over the past month, with a 52-week high of $9.69 [3] - The RSI value for Battalion Oil is 83.48, also indicating it is overbought [3] - On the latest trading day, shares fell 3.6% to close at $2.94 [3]

Core Points - Battalion Oil Corporation has entered into a merger agreement with Fury Resources, Inc., where Fury will acquire all outstanding shares of Battalion's common stock for $7.00 per share in cash [1] - The transaction is expected to close in the fourth quarter of 2024, pending stockholder approval and other closing conditions [2] - Fury Resources has secured capital commitments totaling $200 million in debt, $188 million in preferred stock, and $160 million in equity to facilitate the acquisition [2] Company Overview - Battalion Oil Corporation is an independent energy company focused on the acquisition, production, exploration, and development of onshore oil and natural gas properties in the United States [6] - Fury Resources, Inc. is a privately held exploration and production company targeting value creation through asset acquisition and exploitation in the Permian Basin [7] Shareholder Involvement - Luminus Management and Oaktree Capital Management, owning 61.61% of Battalion's common stock, have agreed to vote in favor of the merger, representing 38% of the total voting power [3] - The Rollover Stockholders will exchange their preferred shares for new preferred shares of Fury, indicating strong institutional support for the transaction [1][4] Management Commentary - Fury's Co-Founder and Chairman expressed confidence in the acquisition, highlighting the potential for rapid scaling and significant returns for investors [4] - Battalion's CEO acknowledged the efforts of both teams in reaching the merger agreement, emphasizing the focus on achieving the best outcome for shareholders [5]

Battalion Oil Corporation (BATL) faced challenges in second-quarter 2024, with the company's financial results reflecting ongoing pressures from declining production and lower natural gas prices.Despite these hurdles, BATL has managed to control costs effectively, supported by the operationalization of its new acid gas injection facility. As the company navigates these difficult conditions, its strategic initiatives, including a significant drilling campaign and ongoing merger discussions with Fury Resource ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended June 30, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-35467 | --- | --- | --- | --- | --- | |-------------------------------------------------------------------------|------- ...

Exhibit 99.1 Battalion Oil Corporation Announces Second Quarter 2024 Financial and Operating Results HOUSTON, TEXAS – August 14, 2024 – Battalion Oil Corporation (NYSE American: BATL, "Battalion" or the "Company") today announced financial and operating results for the second quarter of 2024. Key Highlights ● AGI facility online and treated 1.82 Bcf for the second quarter 2024 reducing operating expenses by $4.26/Boe compared to the first quarter 2024 ● On August 12, 2024, the AGI facility processed 26.6 MM ...

HOUSTON, Aug. 14, 2024 (GLOBE NEWSWIRE) -- Battalion Oil Corporation (NYSE American: BATL, “Battalion” or the “Company”) today announced financial and operating results for the second quarter of 2024. Key Highlights AGI facility online and treated 1.82 Bcf for the second quarter 2024 reducing operating expenses by $4.26/Boe compared to the first quarter 2024On August 12, 2024, the AGI facility processed 26.6 MMcf/d which allowed the Company to return wells to production and realize approximately 7,500 Bbls ...