Summary of Evolution Petroleum (EPM) Conference Call Company Overview - **Company Name**: Evolution Petroleum (EPM) - **Focus**: The company emphasizes sustainable dividend payments and has paid out over $130 million in dividends over the last ten years, with a current yield of approximately 9.8% [4][5][44]. Key Points Business Model and Strategy - **Non-Operated Business Model**: Evolution Petroleum operates with a lean team of 11 people, allowing for efficient management of a diversified asset portfolio [6][7]. - **Asset Diversification**: The company has expanded from a single asset in Louisiana to multiple fields across various states, including Wyoming and Texas, to mitigate risks associated with geographic and commodity concentration [9][10][12][17]. - **Acquisition Strategy**: The company focuses on acquiring long-life, low-decline production assets that are accretive to cash flow per share, which is critical for maintaining dividends [30][44]. Financial Performance - **Enterprise Value**: The current enterprise value is just under $200 million [5]. - **Dividend History**: The company has maintained a consistent dividend, raising it to 12 cents per share in September 2022, despite fluctuations in commodity prices [40][44]. - **Cash Flow Management**: The company has historically funded its growth through internally generated cash flow and has maintained low leverage, with plans to keep net leverage below 1.5 times [41][68]. Market Outlook - **Natural Gas Demand**: The U.S. is currently producing approximately 107 billion cubic feet (BCF) of natural gas per day, with projections indicating an increase in demand due to industrial growth and LNG exports [21][25][26]. - **Oil Demand Resilience**: Despite concerns about declining oil demand, the company notes that global oil demand has shown robustness, typically growing between 1% to 3% annually [26][44]. Recent Acquisitions - **SCOOPSTACK Minerals**: Recently closed a deal for minerals in the SCOOPSTACK area for approximately $17 million, which is expected to enhance cash flow without incurring significant costs [49][51]. - **Tex Mex Acquisition**: Acquired a field producing about 440 net barrels of oil equivalent (BOE) per day at an attractive discount, contributing positively to cash flow [51][52]. Risk Management - **Hedging Strategy**: The company has begun to hedge its natural gas production, currently hedging about 60% of its gas output to ensure price stability [60][61]. - **Operator Relationships**: Strong relationships with operators are crucial for the company, allowing for better insights and management of assets [35][66]. Additional Insights - **Future Growth Potential**: The company is well-positioned for future growth with a robust portfolio that can maintain dividends even in low commodity price environments, while also having significant upside potential as prices recover [74]. - **Market Conditions**: The current market environment is favorable for acquisitions, with prices not excessively high or low, allowing for strategic buying opportunities [57][58]. This summary encapsulates the key points discussed during the Evolution Petroleum conference call, highlighting the company's strategic focus, financial performance, market outlook, and recent activities.

Group 1 - Evolution Petroleum (NYSE: EPM) has exercised its right to audit the operator of its Barnett Shale natural gas properties for the years 2022 and 2023 [2] - The oil and gas industry is characterized as a boom-bust, cyclical sector, requiring patience and experience for successful investment [2] Group 2 - The analysis provided in the article focuses on identifying undervalued companies within the oil and gas sector, including a breakdown of balance sheets, competitive positions, and development prospects [1]

Core Insights - Evolution Petroleum Corporation has announced the initial results of its joint interest audit of its Barnett Shale properties and provided an update on its Chaveroo drilling results [1] Joint Interest Audit Results - In fiscal year 2024, Evolution conducted a joint interest audit of expenses charged by Diversified Energy Company for the years 2022-2023, with assistance from BRI Consulting Group [2] - The audit revealed that Evolution was overcharged, with approximately $1.8 million owed to the company for the period from September 2021 to December 2023, which will be recognized as a reduction in lease operating expenses and accounts payable in fiscal year 2025 [3] - The company plans to continue exercising its rights under the joint operating agreement for future audits [3] Chaveroo New Drill Wells Update - The recent four wells at Chaveroo have exceeded expectations, continuing to perform well after more than 50 days of production, following initial reports of being completed on schedule and under budget [5] Company Overview - Evolution Petroleum Corporation is an independent energy company focused on maximizing shareholder returns through ownership and investment in onshore oil and natural gas properties in the U.S., aiming to maintain a diversified portfolio through acquisitions and production enhancements [6]

Group 1 - Evolution Petroleum (NYSE: EPM) is characterized as a small-cap oil and gas company with modest production and a focus on profitability rather than aggressive expansion [1] - The company does not aim to be the largest player in the industry, instead prioritizing steady profitability [1] - The investment strategy highlighted involves a blend of fundamental momentum, technical chart structure, and sentiment analysis to identify high-potential stocks [1]

[Forward-Looking Statements](index=3&type=section&id=Forward-Looking%20Statements) This section outlines cautionary language for forward-looking statements, detailing factors and assumptions that could cause actual results to differ - The report contains forward-looking statements on topics such as capital spending, acquisition strategy, production estimates, commodity prices, and dividend payments[9](index=9&type=chunk) - Key assumptions include future commodity prices, access to credit, and expectations consistent with historical experience and industry trends[13](index=13&type=chunk) - Readers are warned that these statements are subject to significant risks and uncertainties, with actual results potentially differing materially[10](index=10&type=chunk)[11](index=11&type=chunk) [PART I. FINANCIAL INFORMATION](index=6&type=section&id=PART%20I.%20FINANCIAL%20INFORMATION) [Item 1. Condensed Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Condensed%20Consolidated%20Financial%20Statements%20(Unaudited)) This section presents Evolution Petroleum Corporation's unaudited condensed consolidated financial statements, including balance sheets, operations, cash flows, and equity changes [Condensed Consolidated Balance Sheets](index=6&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Total assets decreased to **$156.4 million**, liabilities increased to **$84.7 million**, and stockholders' equity decreased to **$71.7 million** Condensed Consolidated Balance Sheets (in thousands) | Account | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | | **Total current assets** | $19,794 | $21,723 | | **Oil and natural gas properties, net** | $133,514 | $139,685 | | **Total assets** | **$156,394** | **$162,877** | | **Total current liabilities** | $22,522 | $15,813 | | **Senior secured credit facility** | $35,500 | $39,500 | | **Total liabilities** | **$84,734** | **$81,750** | | **Total stockholders' equity** | **$71,660** | **$81,127** | [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company reported a **net loss of $2.2 million** for Q3 FY2025 and **$1.9 million** for the nine months, driven by derivative losses and higher interest expense Statements of Operations Highlights (in thousands, except per share data) | Metric | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | :--- | :--- | | **Total revenues** | $22,561 | $23,025 | $64,732 | $64,650 | | **Income (loss) from operations** | $1,586 | $2,084 | $2,835 | $5,503 | | **Net gain (loss) on derivative contracts** | $(3,802) | $(1,183) | $(3,223) | $(1,183) | | **Net income (loss)** | **$(2,179)** | **$289** | **$(1,939)** | **$2,845** | | **Diluted EPS** | **$(0.07)** | **$0.01** | **$(0.07)** | **$0.08** | [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased to **$22.6 million**, investing outflow decreased to **$10.1 million**, and financing shifted to a **$13.4 million** outflow for the nine months Cash Flow Summary (in thousands) | Cash Flow Activity | Nine Months Ended Mar 31, 2025 | Nine Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $22,596 | $14,742 | | **Net cash used in investing activities** | $(10,053) | $(52,141) | | **Net cash provided by (used in) financing activities** | $(13,388) | $29,432 | | **Net (decrease) in cash** | $(845) | $(7,967) | [Notes to Unaudited Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Unaudited%20Condensed%20Consolidated%20Financial%20Statements) These notes detail accounting policies, operations, acquisitions, credit facility, derivatives, equity, and subsequent events like the TexMex Acquisition - **Acquisitions**: The company closed SCOOP/STACK Acquisitions in February 2024 for approximately **$39.1 million** and entered a joint development agreement in September 2023[42](index=42&type=chunk)[44](index=44&type=chunk) - **Credit Facility**: As of March 31, 2025, **$35.5 million** was outstanding under the **$50.0 million** senior secured credit facility, with all covenants in compliance[54](index=54&type=chunk)[55](index=55&type=chunk) - **Derivatives**: A net loss of **$3.2 million** on derivative contracts was reported for the nine months, including a **$0.2 million** realized gain and a **$3.4 million** unrealized loss[70](index=70&type=chunk) - **Stockholders' Equity**: The company paid **$12.2 million** in dividends and raised **$3.1 million** from its ATM equity program during the nine months[84](index=84&type=chunk)[85](index=85&type=chunk) - **Subsequent Events**: The TexMex Acquisition closed on April 14, 2025, for approximately **$9.0 million**, and a **$0.120** per share dividend was declared on May 12, 2025[106](index=106&type=chunk)[108](index=108&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=31&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses business, developments, and financial performance, noting a 5% production increase, flat revenues, and a **$3.4 million** unrealized derivative loss [Executive Overview](index=31&type=section&id=Executive%20Overview) The company aims to maximize shareholder returns from diversified US oil and gas properties, with a 5% production increase offset by flat revenue and derivative losses - The company's strategy focuses on maximizing shareholder return from a diversified portfolio of long-life oil and gas properties[111](index=111&type=chunk) - For the nine months ended March 31, 2025, production increased **5%** year-over-year, but revenues remained flat due to lower commodity prices[120](index=120&type=chunk) - Financial results were negatively impacted by a **$3.4 million** non-cash unrealized loss on derivative contracts for the nine months[121](index=121&type=chunk) [Liquidity and Capital Resources](index=35&type=section&id=Liquidity%20and%20Capital%20Resources) As of March 31, 2025, liquidity included **$5.6 million** cash and **$14.5 million** available credit, with FY2025 capital expenditures projected between **$12.5 million** and **$14.5 million** - As of March 31, 2025, liquidity comprised **$5.6 million** in cash and **$14.5 million** available under the Senior Secured Credit Facility[131](index=131&type=chunk)[136](index=136&type=chunk) - The company anticipates extending its credit facility maturity to April 2028 and increasing total commitments to **$65.0 million**[132](index=132&type=chunk) - Fiscal year 2025 capital expenditure budget is projected between **$12.5 million** and **$14.5 million**, excluding potential acquisitions[140](index=140&type=chunk) [Results of Operations](index=39&type=section&id=Results%20of%20Operations) This section analyzes the company's financial performance for the three and nine-month periods ended March 31, 2025, detailing changes in revenues, costs, and production Q3 FY2025 vs Q3 FY2024 Performance | Metric | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | **Total Revenues (in thousands)** | $22,561 | $23,025 | (2.0)% | | **Net Loss (in thousands)** | $(2,179) | $289 | (854.0)% | | **Avg. Daily Production (BOEPD)** | 6,667 | 7,209 | (7.5)% | | **Avg. Realized Price per BOE** | $37.60 | $35.10 | 7.1% | Nine Months FY2025 vs FY2024 Performance | Metric | 9M 2025 | 9M 2024 | % Change | | :--- | :--- | :--- | :--- | | **Total Revenues (in thousands)** | $64,732 | $64,650 | 0.1% | | **Net Loss (in thousands)** | $(1,939) | $2,845 | (168.2)% | | **Avg. Daily Production (BOEPD)** | 7,033 | 6,651 | 5.7% | | **Avg. Realized Price per BOE** | $33.59 | $35.35 | (5.0)% | [Item 3. Quantitative and Qualitative Disclosures about Market Risks](index=45&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20about%20Market%20Risks) The company identifies energy commodity price risk, managed with derivatives, and interest rate risk from its variable-rate Senior Secured Credit Facility - The company is exposed to energy commodity price risk, partially mitigated by derivative instruments[175](index=175&type=chunk) - Interest rate risk arises from variable rates on the Senior Secured Credit Facility, tied to SOFR or the Prime Rate[177](index=177&type=chunk) [Item 4. Controls and Procedures](index=46&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of March 31, 2025, with no material changes to internal control over financial reporting - Management concluded that disclosure controls and procedures were effective as of March 31, 2025[179](index=179&type=chunk) - No material changes occurred in internal control over financial reporting during the quarter ended March 31, 2025[180](index=180&type=chunk) [PART II. OTHER INFORMATION](index=46&type=section&id=PART%20II.%20OTHER%20INFORMATION) This section covers other disclosures, confirming no material legal proceedings or risk factor changes, detailing equity repurchases, and noting other items as not applicable [Item 1. Legal Proceedings](index=46&type=section&id=Item%201.%20Legal%20Proceedings) The company reports no material pending legal proceedings, referencing Note 10 of its financial statements for general claims - The company reports no material legal proceedings, referencing Note 10 of the financial statements[181](index=181&type=chunk) [Item 1A. Risk Factors](index=46&type=section&id=Item%201A.%20Risk%20Factors) No material changes to risk factors have occurred since the Annual Report on Form 10-K for the fiscal year ended June 30, 2024 - The company refers to its Annual Report on Form 10-K for a detailed description of risk factors[182](index=182&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=47&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) This section summarizes equity security purchases for Q3 FY2025, noting shares were acquired solely for employee tax withholding on vested stock awards Issuer Purchases of Equity Securities (Q3 FY2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | January 2025 | — | $— | | February 2025 | 13,288 | $5.12 | | March 2025 | 741 | $4.90 | [Other Items (3, 4, 5)](index=47&type=section&id=Other%20Items%20(3,%204,%205)) The company reports no defaults upon senior securities, no mine safety disclosures, and no other information for these items - Item 3, Defaults Upon Senior Securities, is Not Applicable[186](index=186&type=chunk) - Item 4, Mine Safety Disclosures, is Not Applicable[187](index=187&type=chunk) - Item 5, Other Information, reports 'None'[188](index=188&type=chunk) [Item 6. Exhibits](index=48&type=section&id=Item%206.%20Exhibits) This section lists documents filed as exhibits with the Form 10-Q, including credit facility agreements and officer certifications - A letter agreement dated March 7, 2025, related to the Credit Agreement with MidFirst Bank, was filed as an exhibit[190](index=190&type=chunk) - Certifications from the Principal Executive Officer and Principal Financial Officer under Sarbanes-Oxley Act Sections 302 and 906 are included as exhibits[190](index=190&type=chunk) [Signatures](index=49&type=section&id=Signatures) The report is signed and authorized by CEO Kelly W. Loyd and CFO Ryan Stash on May 14, 2025 - The Form 10-Q was signed on May 14, 2025, by Kelly W. Loyd (CEO) and Ryan Stash (CFO)[195](index=195&type=chunk)

Financial Data and Key Metrics Changes - Total revenues for fiscal Q3 were $22.6 million, down 2% year over year, primarily due to lower production volumes, partially offset by a 7% increase in average realized commodity prices driven by stronger natural gas and NGL prices [21][22] - Net loss for the third quarter was $2.2 million or $0.07 per share, compared to net income of $0.3 million or $0.01 per share in the prior year [22] - Adjusted EBITDA was $7.4 million, down from $8.5 million in the year-ago period, primarily due to lower revenue volumes and higher operating costs [22] Business Line Data and Key Metrics Changes - Natural gas revenue rose 33% year over year to $7.8 million, while NGL revenue increased 14% to $3 million, partially offsetting a 19% decline in oil revenue [10] - Total production declined 7.5% year over year to 6,667 barrels of oil equivalent per day, primarily due to planned maintenance and weather-related downtime [11] Market Data and Key Metrics Changes - Oil prices softened during April, falling nearly $12 a barrel to below $60, while natural gas prices strengthened, providing a partial offset to weaker crude prices [10] - Approximately 40% of oil volumes are hedged at prices above $70 through the fiscal year end, providing a safety net for capital expenditures and dividends [11] Company Strategy and Development Direction - The company remains focused on disciplined capital allocation, sustaining dividends, and pursuing opportunistic growth, particularly in low decline assets [6][13] - The recent Tex Mex acquisition adds approximately 440 barrels of oil equivalent per day of stable production, aligning with the company's long-term strategy [8][9] - Development activities are being shifted towards gas-weighted opportunities, particularly in the SCOOPSTACK area, while delaying oil-weighted drilling [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to sustain dividends despite ongoing commodity price volatility, highlighting a strong operating cash flow driven by a diversified portfolio [12][13] - The company anticipates that the effects of recent acquisitions will be evident in fiscal Q4, with production and cash flow expected to improve [13][26] Other Important Information - The company declared a cash dividend of $0.12 per share, marking the 47th consecutive quarter of issuing a dividend [12][24] - The company has negotiated with lenders to extend the maturity of its credit facility and increase total commitments, enhancing financial flexibility [24][66] Q&A Session Summary Question: Insights on M&A market and bid-ask spreads - Management noted that while bid-ask spreads may widen with weaker oil prices, there are still encouraging opportunities in the M&A market, particularly for low decline assets [29][35] Question: Performance of new wells at Chavaroo - New wells were drilled and completed under budget, approximately 5% below AFE, with initial production rates exceeding expectations [39][41] Question: Impact of Delhi EOR project shift - The shift from CO2 floods to waterflood development is expected to result in significant cost savings, estimated at $400,000 per month, without impacting performance [49][53] Question: Clarification on production increases - The combined production from Tex Mex and Chavaroo is expected to exceed initial projections, with Tex Mex contributing approximately 440 BOE per day [56][58]

Financial Data and Key Metrics Changes - Total revenues for fiscal Q3 were $22.6 million, a decrease of 2% year over year, primarily due to lower volumes, partially offset by a 7% increase in average realized commodity prices driven by stronger natural gas and NGL prices [21] - Net loss for the third quarter was $2.2 million or $0.07 per share, compared to net income of $0.3 million or $0.01 per share in the prior year [22] - Adjusted EBITDA for Q3 was $7.4 million, down from $8.5 million in the year-ago period, primarily due to lower revenue volumes and higher operating costs [22] Business Line Data and Key Metrics Changes - Natural gas revenue rose 33% year over year to $7.8 million, while NGL revenue increased 14% to $3 million, partially offsetting a 19% decline in oil revenue [10] - Total production declined 7.5% year over year to 6,667 barrels of oil equivalent per day, primarily due to planned maintenance and weather-related downtime [11] Market Data and Key Metrics Changes - Oil prices softened during April, falling nearly $12 a barrel to below $60, while natural gas prices strengthened, providing a partial offset to the decline in crude prices [10] - Approximately 40% of oil volumes are hedged at prices above $70 through the fiscal year end, providing a safety net for capital expenditures and dividends [11] Company Strategy and Development Direction - The company remains focused on disciplined capital allocation, sustaining dividends, and pursuing opportunistic growth, particularly in gas-weighted opportunities [14][15] - The recent Tex Mex acquisition adds approximately 440 barrels of oil equivalent per day of stable low decline production, aligning with the company's long-term strategy to own cash-generative low-risk assets [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to sustain dividends despite ongoing commodity price volatility, highlighting a strong operating cash flow driven by a diversified portfolio [13] - The decision to delay the start of the third development block reflects a prudent approach to focus on gas-weighted opportunities in light of recent market volatility [14] Other Important Information - The company declared a cash dividend of $0.12 per share, marking the 47th consecutive quarter of issuing a dividend [12] - The company has returned approximately $131 million or $3.93 per share to shareholders in common stock dividends to date [13] Q&A Session Summary Question: Insights on M&A market and bid-ask spreads - Management noted that while bid-ask spreads may widen with weaker oil prices, there are still encouraging opportunities in the M&A market, particularly for low decline assets [30][34] Question: Performance of new wells at Chavaroo - The new wells were completed approximately 5% under budget and are performing about 50% above initial expectations, attributed to favorable drilling conditions [39][41] Question: Impact of shifting from CO2 floods to waterflood in Delhi EOR project - Management highlighted significant cost savings of approximately $400,000 per month from this shift, with no expected negative impact on performance [51][52] Question: Clarification on production increase from Tex Mex and Chavaroo - The combined production from Tex Mex and Chavaroo is expected to exceed initial estimates, with Tex Mex contributing around 440 BOE per day [56][59] Question: Rationale for adding a new bank for credit facility - The addition of a new bank was to increase total commitments and provide flexibility while maintaining favorable terms with existing lenders [64][66]

Over the last four quarters, the company has not been able to surpass consensus EPS estimates. Evolution Petroleum (EPM) came out with quarterly earnings of $0.02 per share, missing the Zacks Consensus Estimate of $0.04 per share. This compares to earnings of $0.03 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of -50%. A quarter ago, it was expected that this oil and gas company would post a loss of $0.01 per share when it act ...

Evolution Petroleum Fiscal Third Quarter 2025 Results [Financial and Operational Highlights](index=1&type=section&id=Financial%20and%20Operational%20Highlights) In fiscal Q3 2025, Evolution Petroleum reported a net loss of **$2.2 million** despite an **11%** sequential increase in revenue to **$22.6 million**, driven by strong natural gas prices Q3 2025 Key Financial & Operational Metrics | Metric | Q3 2025 | Q2 2025 | Q3 2024 | % Change (QoQ) | % Change (YoY) | | :--- | :--- | :--- | :--- | :--- | :--- | | Average BOEPD | 6,667 | 6,935 | 7,209 | (4)% | (8)% | | Revenues ($ in thousands) | $22,561 | $20,275 | $23,025 | 11% | (2)% | | Net Income (Loss) ($ in thousands) | $(2,179) | $(1,825) | $289 | NM | NM | | Adjusted Net Income ($ in thousands) | $806 | $(841) | $978 | NM | (18)% | | Adjusted EBITDA ($ in thousands) | $7,421 | $5,688 | $8,476 | 30% | (12)% | - Fiscal Q3 production was **6,667 BOEPD**, with revenue composed of **52%** oil, **35%** natural gas, and **13%** NGLs[3](index=3&type=chunk) - Subsequent to the quarter's end, the company brought **four new wells** online at Chaveroo Field and closed the TexMex acquisition, collectively adding over **850 net BOEPD** to production[3](index=3&type=chunk) - The company returned **$4.1 million** to shareholders through dividends and repaid **$4.0 million** of principal on its credit facility during the quarter[3](index=3&type=chunk) [Management Commentary](index=3&type=section&id=Management%20Commentary) CEO Kelly Loyd highlighted the company's commitment to shareholder returns, maintaining the quarterly dividend at **$0.12 per share** for the **twelfth consecutive quarter** - The quarterly dividend is maintained at **$0.12 per share** for the **twelfth consecutive quarter**, underscoring a commitment to sustainable shareholder returns[4](index=4&type=chunk) - Despite weather and maintenance-related production downtime, the company met all capital obligations, including **~$8.5 million** in dividends and capex, and repaid **$4.0 million** of debt[5](index=5&type=chunk) - The company is delaying the next Chaveroo development block until fiscal year 2026 to focus on acquiring oil-weighted, low-decline properties at discounted prices and preserving high-value locations for better market conditions[7](index=7&type=chunk) [Financial Performance Analysis](index=3&type=section&id=Fiscal%20Third%20Quarter%202025%20Financial%20Results) Total revenues for fiscal Q3 2025 decreased by **2%** year-over-year to **$22.6 million**, primarily due to an **8%** drop in production volumes, partially offset by a **7%** rise in average realized commodity prices - Total revenues decreased **2%** YoY to **$22.6 million**, driven by an **8%** decrease in production volumes, partially offset by a **7%** increase in average realized commodity prices[8](index=8&type=chunk) - Lease operating costs (LOE) rose to **$13.4 million** from **$12.6 million** in the year-ago quarter, mainly due to resumed CO2 purchases at Delhi Field and the inclusion of SCOOP/STACK properties[9](index=9&type=chunk) - The company reported a net loss of **$2.2 million** (**$(0.07) per share**), compared to a net income of **$0.3 million** (**$0.01 per share**) in the year-ago period[12](index=12&type=chunk) - Adjusted EBITDA decreased to **$7.4 million** from **$8.5 million** in the prior-year period, primarily due to lower production and higher operating costs[13](index=13&type=chunk) [Production & Pricing](index=4&type=section&id=Production%20%26%20Pricing) Total production for Q3 fiscal 2025 decreased by **7.5%** year-over-year to **6,667 net BOEPD**, attributed to maintenance at Delhi Field, weather impacts at Barnett Shale, and natural declines Average Realized Price per Unit (YoY Comparison) | Commodity | Q3 2025 | Q3 2024 | % Change | | :--- | :--- | :--- | :--- | | Crude oil (BBL) | $68.42 | $73.06 | (6)% | | Natural gas (MCF) | $3.87 | $2.77 | 40% | | Natural Gas Liquids (BBL) | $32.28 | $25.26 | 28% | | Equivalent (BOE) | $37.60 | $35.10 | 7% | - Total production decreased **7.5%** YoY to **6,667 net BOEPD**, comprising **1,911 BOPD** of crude oil, **3,723 BOEPD** of natural gas, and **1,033 BOEPD** of NGLs[14](index=14&type=chunk) - The production decrease was driven by planned maintenance at Delhi Field, winter weather impacts at Barnett Shale, and natural declines, partially offset by new production from SCOOP/STACK properties[14](index=14&type=chunk) [Operations Update](index=5&type=section&id=Operations%20Update) Operational activity was robust across several assets, including **13 gross wells** brought online at SCOOP/STACK and **four new wells** completed at Chaveroo Field under budget - **SCOOP/STACK:** Brought **13 gross wells** online fiscal year-to-date, with five more in progress[17](index=17&type=chunk) - **Chaveroo:** Successfully completed and brought online **four new gross wells** under budget, with early production rates significantly exceeding expectations[17](index=17&type=chunk) - **Delhi:** Production was affected by planned maintenance, and the company switched from purchasing CO2 to additional water injection to reduce operating costs and maximize cash flow[19](index=19&type=chunk) - **Barnett Shale:** Delivered consistent cash flow, with improved realized pricing for natural gas and NGLs offsetting brief winter storm downtime[21](index=21&type=chunk) [Balance Sheet, Liquidity, and Capital Spending](index=5&type=section&id=Balance%20Sheet,%20Liquidity,%20and%20Capital%20Spending) As of March 31, 2025, the company had **$5.6 million** in cash and **$35.5 million** outstanding on its revolving credit facility, with total liquidity of **$20.1 million** - As of March 31, 2025, the company had **$5.6 million** in cash, **$35.5 million** of borrowings outstanding, and total liquidity of **$20.1 million**[22](index=22&type=chunk) - Key cash uses in Q3 included **$4.1 million** in dividends, **$4.0 million** in debt repayments, and **$4.4 million** in capital expenditures[23](index=23&type=chunk) - The Senior Secured Credit Facility maturity has been extended to April 2028, and total commitments are expected to increase from **$50.0 million** to **$65.0 million** with the addition of a new lender[24](index=24&type=chunk) [Shareholder Returns](index=6&type=section&id=Cash%20Dividend%20on%20Common%20Stock) Evolution's Board of Directors declared a quarterly cash dividend of **$0.12 per share**, marking the **47th consecutive quarterly dividend** - The Board of Directors declared a cash dividend of **$0.12 per share** of common stock for the fiscal fourth quarter[25](index=25&type=chunk) - This marks the **47th consecutive quarterly cash dividend** paid by the company since December 31, 2013[25](index=25&type=chunk) - Cumulatively, Evolution has returned approximately **$130.7 million**, or **$3.93 per share**, to stockholders in dividends[25](index=25&type=chunk) [Financial Statements](index=8&type=section&id=Financial%20Statements) The unaudited financial statements detail the company's performance, showing a net loss of **$2.18 million** and total assets of **$156.4 million** as of March 31, 2025 [Condensed Consolidated Statements of Operations](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended March 31, 2025, total revenues were **$22.56 million**, down from **$23.03 million** in the prior-year quarter, resulting in a net loss of **$2.18 million** Q3 2025 Statement of Operations Summary (in thousands) | Line Item | Three Months Ended Mar 31, 2025 | Three Months Ended Mar 31, 2024 | | :--- | :--- | :--- | | Total revenues | $22,561 | $23,025 | | Total operating costs | $20,975 | $20,941 | | Income (loss) from operations | $1,586 | $2,084 | | Net gain (loss) on derivative contracts | $(3,802) | $(1,183) | | Net income (loss) | $(2,179) | $289 | | Diluted EPS | $(0.07) | $0.01 | [Condensed Consolidated Balance Sheets](index=9&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets stood at **$156.4 million**, a decrease from **$162.9 million** at June 30, 2024, while total liabilities increased to **$84.7 million** Balance Sheet Summary (in thousands) | Account | March 31, 2025 | June 30, 2024 | | :--- | :--- | :--- | | Total current assets | $19,794 | $21,723 | | Total assets | $156,394 | $162,877 | | Total current liabilities | $22,522 | $15,813 | | Senior secured credit facility | $35,500 | $39,500 | | Total liabilities | $84,734 | $81,750 | | Total stockholders' equity | $71,660 | $81,127 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the three months ended March 31, 2025, net cash provided by operating activities was **$7.3 million**, with significant cash used in investing and financing activities Q3 2025 Cash Flow Summary (in thousands) | Cash Flow Item | Three Months Ended Mar 31, 2025 | | :--- | :--- | | Net cash provided by operating activities | $7,263 | | Net cash used in investing activities | $(6,224) | | Net cash provided by (used in) financing activities | $(7,105) | | Net decrease in cash and cash equivalents | $(6,066) | | Cash and cash equivalents, end of period | $5,601 | [Non-GAAP Reconciliations](index=11&type=section&id=Non-GAAP%20Reconciliations) The company provides reconciliations for non-GAAP measures, with Adjusted EBITDA reconciled from a net loss of **$2.2 million** to **$7.4 million** for Q3 2025 [Adjusted EBITDA Reconciliation](index=11&type=section&id=Adjusted%20EBITDA%20Reconciliation) For the third quarter of fiscal 2025, the company reconciled its GAAP net loss of **$2.18 million** to a non-GAAP Adjusted EBITDA of **$7.42 million** Q3 2025 Adjusted EBITDA Reconciliation (in thousands) | Line Item | Q3 2025 | | :--- | :--- | | Net income (loss) | $(2,179) | | Interest expense | $705 | | Income tax expense (benefit) | $(687) | | Depletion, depreciation, and accretion | $5,014 | | Stock-based compensation | $642 | | Unrealized loss on derivative contracts | $3,926 | | **Adjusted EBITDA** | **$7,421** | [Adjusted Net Income Reconciliation](index=12&type=section&id=Adjusted%20Net%20Income%20Reconciliation) The company's reported GAAP net loss of **$2.18 million** for Q3 2025 was adjusted to a non-GAAP Adjusted Net Income of **$0.81 million** Q3 2025 Adjusted Net Income Reconciliation (in thousands) | Line Item | Q3 2025 | | :--- | :--- | | Net income (loss), as reported | $(2,179) | | Unrealized loss on commodity contracts | $3,926 | | Income tax effect of selected items | $941 | | Selected items, net of tax | $2,985 | | **Net income, excluding selected items** | **$806** | [Supplemental Information](index=13&type=section&id=Supplemental%20Information) Supplemental data provides a detailed breakdown of operations, including total production of **600 MBOE** and total lease operating costs of **$22.32 per BOE** for Q3 2025 [Oil and Natural Gas Operations](index=13&type=section&id=Supplemental%20Information%20on%20Oil%20and%20Natural%20Gas%20Operations) In Q3 2025, total production was **600 MBOE**, down from **656 MBOE** in the prior-year quarter, while the average sales price per BOE increased to **$37.60** Q3 2025 Production and Cost per BOE | Metric | Q3 2025 | Q3 2024 | | :--- | :--- | :--- | | Equivalent Production (MBOE) | 600 | 656 | | Average Daily Production (BOEPD) | 6,667 | 7,209 | | Average Sales Price ($/BOE) | $37.60 | $35.10 | | Total Lease Operating Costs ($/BOE) | $22.32 | $19.24 | | Depletion ($/BOE) | $7.68 | $8.43 | [Production Volumes and Sales Price by Field](index=14&type=section&id=Summary%20of%20Production%20Volumes%20and%20Average%20Sales%20Price) For Q3 2025, total crude oil production was **172 MBBL** at an average price of **$68.42/BBL**, with Barnett Shale being the largest producing field at **2,256 BOEPD** Q3 2025 Average Daily Production by Field (BOEPD) | Field | Q3 2025 BOEPD | | :--- | :--- | | SCOOP/STACK | 1,044 | | Chaveroo Field | 89 | | Jonah Field | 1,567 | | Williston Basin | 522 | | Barnett Shale | 2,256 | | Hamilton Dome Field | 378 | | Delhi Field | 811 | | **Total** | **6,667** | [Production Costs by Field](index=15&type=section&id=Summary%20of%20Average%20Production%20Costs) In Q3 2025, total lease operating costs were **$13.4 million**, averaging **$22.32 per BOE**, with Delhi Field having the highest cost per unit at **$48.04/BOE** Q3 2025 Lease Operating Costs by Field ($/BOE) | Field | LOE per BOE | | :--- | :--- | | SCOOP/STACK | $11.74 | | Chaveroo Field | $15.77 | | Jonah Field | $15.51 | | Williston Basin | $31.45 | | Barnett Shale | $18.47 | | Hamilton Dome Field | $36.36 | | Delhi Field | $48.04 | | **Total Average** | **$22.32** | [Open Derivative Contracts](index=16&type=section&id=Summary%20of%20Open%20Derivative%20Contracts) As of May 12, 2025, the company had multiple open derivative contracts to hedge crude oil and natural gas prices, including fixed-price swaps and collars extending through December 2027 - The company utilizes a combination of fixed-price swaps and collars to hedge its crude oil and natural gas production[45](index=45&type=chunk) - Natural gas hedges include fixed-price swaps at approximately **$3.60/MMBTU** extending through December 2027 and collars with floors ranging from **$3.50** to **$4.00/MMBTU**[45](index=45&type=chunk)

Core Viewpoint - Evolution Petroleum Corporation reported its financial and operational results for the fiscal third quarter ended March 31, 2025, declaring a quarterly cash dividend of $0.12 per share, marking the 47th consecutive dividend payment, reflecting the company's commitment to shareholder returns despite market volatility [1][3][23]. Financial & Operational Highlights - Average production for Q3 2025 was 6,667 BOEPD, a decrease of 4% from Q2 2025 and 8% from Q3 2024 [2][6]. - Revenues increased by 11% to $22.6 million compared to Q2 2025 but decreased by 2% compared to Q3 2024 [2][8]. - The company reported a net loss of $2.2 million, or $(0.07) per share, compared to a net income of $0.3 million, or $0.01 per share, in the year-ago period [12][40]. - Adjusted EBITDA for Q3 2025 was $7.4 million, a 30% increase from Q2 2025 but a decrease from $8.5 million in the year-ago period [2][13]. Production & Pricing - The average realized commodity price increased by 7% to $37.60 per BOE, driven by a 40% increase in realized natural gas prices year-over-year [15][14]. - Total production for Q3 2025 included 1,911 BOPD of crude oil, 3,723 BOEPD of natural gas, and 1,033 BOEPD of NGLs, with oil accounting for 52% of revenue [6][14]. Operations Update - The company successfully completed and brought online four new gross wells in the Chaveroo Field, exceeding early production expectations [16][5]. - The TexMex acquisition, closed after the quarter end, is expected to contribute over 850 net BOEPD to production [5][4]. Balance Sheet, Liquidity, and Capital Spending - As of March 31, 2025, cash and cash equivalents totaled $5.6 million, with a working capital deficit of $2.7 million [21]. - The company had $35.5 million in borrowings under its revolving credit facility and total liquidity of $20.1 million [21][22]. - In Q3, the company paid $4.1 million in dividends and $4.0 million in repayments of its Senior Secured Credit Facility [21][4]. Dividend Declaration - The Board of Directors declared a cash dividend of $0.12 per share, to be paid on June 30, 2025, to stockholders of record on June 13, 2025 [23][1].