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Company Overview - Gulfport Energy's Utica and Marcellus shale holdings include approximately 249,000 net reservoir acres with year-end 2024 proved reserves of 30 Tcfe and 3Q25 net production of approximately 917 MMcfe/day[7] - The company's SCOOP holdings include approximately 73,000 net reservoir acres with year-end 2024 proved reserves of 10 Tcfe and 3Q25 net production of approximately 203 MMcfe/day[7] - Gulfport Energy has a market capitalization of $35 billion and an enterprise value of $42 billion, with an EV/2026 EBITDA multiple of 42x[9] - The company's liquidity is approximately $903 million and leverage is approximately 081x[9] - Gulfport Energy estimates its 2025 total base capital to be approximately $390 million and total net equivalent production to be approximately 1,040 MMcfe/day[9] Financial Performance and Strategy - Gulfport Energy's equity repurchase program authorizes purchases up to $15 billion, with approximately $785 million repurchased as of September 30, 2025, retiring approximately 67 million shares[18] - The company expects to repurchase approximately $325 million of its outstanding equity during 2025, inclusive of approximately $125 million planned for 4Q2025[18] - Gulfport Energy estimates $28 billion to $36 billion in cumulative adjusted free cash flow from 2026E to 2030E under different NYMEX price scenarios[21] - The company plans to invest $75 million to $100 million on discretionary acreage acquisitions by the end of 1Q2026, expanding net inventory by approximately 2 years[31, 55] Operational Highlights - Gulfport Energy's gross undeveloped inventory has increased by more than 40% since year-end 2022, driven by targeted discretionary acreage acquisitions, Marcellus delineation, and U-development initiatives[31] - The company estimates approximately 700 gross locations and roughly 15 years of net inventory with break-evens below $250 per MMBtu[31] - Gulfport Energy expanded undeveloped Marcellus inventory by approximately 125 gross locations, an increase of 200% in Ohio Marcellus inventory[48]

分组1 - Gulfport Energy reported quarterly earnings of $3.29 per share, missing the Zacks Consensus Estimate of $4.77 per share, and showing a decrease from $3.37 per share a year ago, resulting in an earnings surprise of -31.03% [1] - The company posted revenues of $379.75 million for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 10.66%, and up from $253.91 million year-over-year [2] - Gulfport has surpassed consensus revenue estimates two times over the last four quarters [2] 分组2 - The stock has added about 5.8% since the beginning of the year, underperforming the S&P 500's gain of 16.5% [3] - The current consensus EPS estimate for the coming quarter is $5.50 on revenues of $359.42 million, and for the current fiscal year, it is $20.93 on revenues of $1.36 billion [7] - The Zacks Industry Rank for Oil and Gas - Exploration and Production - United States is currently in the bottom 20% of over 250 Zacks industries, indicating potential underperformance [8]

Revenue and Income - Total revenues for the three months ended September 30, 2025, increased to $379.745 million, up from $253.912 million in the same period of 2024, representing a 49.5% increase[10] - For the nine months ended September 30, 2025, total revenues reached $968.038 million, compared to $643.771 million in the same period of 2024, marking a 50.4% increase[11] - Total revenues for the nine months ended September 30, 2025, increased to $1,024,395 thousand, up 42.5% from $718,258 thousand in the same period of 2024[12] - Net income attributable to common stockholders for the three months ended September 30, 2025, was $81.407 million, compared to a net loss of $15.060 million in the same period of 2024[10] - Net income attributable to common stockholders for the nine months ended September 30, 2025, was $263,743 thousand, compared to $7,304 thousand in 2024, representing a significant increase[12] - Basic net income per common share rose to $14.73 for the nine months ended September 30, 2025, compared to $0.40 in the prior year[12] - Net income for the nine months ended September 30, 2025, was $295,395 thousand, a significant increase from $11,856 thousand in the same period of 2024[44] Production and Sales - Natural gas production volumes for the three months ended September 30, 2025, were 90.873 million Mcf, compared to 88.920 million Mcf in the same period of 2024, reflecting a 2.2% increase[7] - Total sales from oil and condensate for the three months ended September 30, 2025, were $37.406 million, up from $29.467 million in the same period of 2024, a 27% increase[10] - Natural gas production volumes for the nine months ended September 30, 2025, were 247.390 million Mcf, down from 266.011 million Mcf in the same period of 2024, a decrease of 7%[8] - Average price of natural gas, including settled derivatives, rose to $2.95 per Mcf for the three months ended September 30, 2025, compared to $2.75 per Mcf in the same period of 2024, a 7.3% increase[7] - Average price of oil and condensate, including settled derivatives, decreased to $63.31 per Bbl for the nine months ended September 30, 2025, from $71.72 per Bbl in the same period of 2024, a decline of 11.7%[8] Operating Expenses and Cash Flow - Total operating expenses decreased to $602,624 thousand for the nine months ended September 30, 2025, from $640,024 thousand in 2024, a reduction of approximately 5.8%[12] - The company reported a net cash provided by operating activities of $617,761 thousand for the nine months ended September 30, 2025, compared to $501,185 thousand in 2024, an increase of 23.2%[20] - Adjusted free cash flow for the nine months ended September 30, 2025, was $204,628 thousand, compared to $131,601 thousand in 2024, representing a growth of approximately 55%[51] - For the three months ended September 30, 2025, adjusted free cash flow was $103,436 thousand, compared to $72,557 thousand in 2024, marking an increase of approximately 42%[46] Capital Expenditures and Debt - Capital expenditures for 2025 are estimated at approximately $390 million for base operations, with an additional $30 million for discretionary appraisal and $35 million for discretionary development[22] - Capital expenditures incurred for the nine months ended September 30, 2025, totaled $379,615 thousand, an increase from $332,633 thousand in the same period of 2024[51] - The company’s long-term debt as of September 30, 2025, was $691,666 thousand, slightly down from $702,857 thousand as of December 31, 2024[16] - Interest expense for the nine months ended September 30, 2025, was $40,677 thousand, down from $46,027 thousand in 2024, reflecting a decrease of about 12%[51] Adjusted Metrics - Adjusted net income for the three months ended September 30, 2025, is reported at $90.25 million, compared to $61.85 million for the same period in 2024[36] - Adjusted EBITDA for the three months ended September 30, 2025, is $213.10 million, an increase from $178.09 million in the prior year[41] - Adjusted EBITDA for the nine months ended September 30, 2025, reached $643,682 thousand, compared to $528,252 thousand for the same period in 2024, reflecting a growth of approximately 22%[44] Operational Efficiency - The company reported a total change in operating assets and liabilities of $(14,555) thousand for the nine months ended September 30, 2025, compared to $(21,247) thousand in 2024, indicating improved operational efficiency[51] - Non-recurring general and administrative expenses for the nine months ended September 30, 2025, were $1,438 thousand, slightly lower than $1,561 thousand in 2024[51] Future Guidance and Plans - The company plans to maintain its 2025 guidance based on commodity strip prices as of October 14, 2025, without any property acquisitions or divestitures[21] - Average daily gas equivalent production is projected to be approximately 1,040 MMcfe/day for the year ending December 31, 2025[22] - Average daily liquids production is expected to range from 18.0 MBbl/day to 20.5 MBbl/day, with gas comprising about 89% of total production[22] - The company anticipates lease operating expenses to be between $0.19 and $0.22 per Mcfe for 2025[22] - The company anticipates total discretionary acreage acquisitions between $75 million and $100 million, with targeted acquisitions of $15.7 million for the nine months ended September 30, 2025[52] Derivative Gains and Losses - Non-cash derivative gains/losses for the three months ended September 30, 2025, include a gain of $33.05 million, contrasting with a loss of $46.91 million in the same period of 2024[41] - The company has fixed price swaps for natural gas totaling 270 BBtupd at a weighted average price of $3.82 per MMBtu for 2025[25] - The company’s oil fixed price swaps volume is 3,000 Bblpd at a weighted average price of $73.29 per Bbl[25]

Core Points - Gulfport Energy Corporation will host a teleconference and webcast to discuss its third quarter 2025 financial and operating results [1] - The teleconference is scheduled for November 5, 2025, at 9:00 a.m. ET [1] - Gulfport plans to announce its third quarter 2025 results on November 4, 2025, after market close [1]

Core Insights - Gulfport Energy Corporation (NYSE: GPOR) experienced a share price increase of 6.08% from September 25 to October 2, 2025, making it one of the top-performing energy stocks for that week [1] - The company is primarily focused on natural gas exploration and production, with assets located in the Appalachia and Anadarko basins [2] - The surge in Gulfport's share price is attributed to a significant rise in natural gas prices, with Henry Hub increasing by over 30%, driven by seasonal demand expectations as colder months approach [3] - Recent EIA storage data indicated a bullish outlook, with natural gas inventories rising by only 53 billion cubic feet (bcf) for the week ending September 26, which was below the forecast of 67 bcf and the 5-year average build of 85 bcf [3] - Over the past year, Gulfport's share price has increased by more than 23% [4]

Group 1: AI Investment Opportunity - Artificial intelligence is considered the greatest investment opportunity of our lifetime, with a strong emphasis on the urgency to invest now [1] - Wall Street is investing hundreds of billions into AI, but there is a critical question regarding the energy supply needed to support this technology [2] - AI data centers consume as much energy as small cities, leading to concerns about power grid strain and rising electricity prices [2] Group 2: Company Overview - A specific company, largely overlooked by AI investors, is positioned to benefit from the increasing demand for energy due to AI [3] - This company owns critical energy infrastructure assets and is involved in the U.S. LNG exportation sector, which is expected to grow under the current administration's energy policies [7] - The company is debt-free and has a significant cash reserve, equating to nearly one-third of its market cap, making it financially robust [8] Group 3: Market Position and Valuation - The company is trading at less than 7 times earnings, indicating it is undervalued compared to its potential [10] - It also holds a substantial equity stake in another AI-related company, providing indirect exposure to multiple growth engines in the AI sector [9] - Wall Street is beginning to take notice of this company as it benefits from various market trends without the high valuations typical of the sector [8] Group 4: Future Outlook - The future of AI is closely tied to energy infrastructure, and this company is strategically positioned to capitalize on the upcoming energy demands [6][14] - The influx of talent into the AI sector ensures continuous innovation, making investments in AI a strong bet for future growth [12] - The company is seen as a key player in the AI energy boom, linking AI, energy, tariffs, and onshoring trends together [6][14]

Group 1 - Gulfport Energy's Q2 2025 production was impacted by midstream issues, resulting in a decrease of several percent, but these issues have been largely resolved [2] - The company anticipates a double-digit increase in production for the second half of 2025 [2] - The analysis is provided by Aaron Chow, a seasoned analyst with over 15 years of experience, who has a background in mobile gaming and focuses on value and distressed investment opportunities, particularly in the energy sector [2]

PART I FINANCIAL INFORMATION [Item 1. Consolidated Financial Statements (Unaudited)](index=6&type=section&id=Item%201.%20Consolidated%20Financial%20Statements%20(Unaudited)) Unaudited consolidated financial statements for June 30, 2025, show total assets increased to $2.96 billion, with Q2 2025 net income of $184.5 million, a significant turnaround driven by natural gas sales and derivative gains [Consolidated Balance Sheets](index=6&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to $2.96 billion by June 30, 2025, driven by net property and equipment, with total liabilities at $1.16 billion and stockholders' equity at $1.77 billion Consolidated Balance Sheet Highlights (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total current assets** | $197,923 | $231,313 | | **Total property and equipment, net** | $2,189,797 | $2,018,271 | | **Total assets** | **$2,959,457** | **$2,865,697** | | **Total current liabilities** | $389,619 | $345,508 | | **Long-term debt** | $695,154 | $702,857 | | **Total liabilities** | **$1,162,422** | **$1,116,956** | | **Total stockholders' equity** | **$1,765,679** | **$1,711,393** | [Consolidated Statements of Operations](index=7&type=section&id=Consolidated%20Statements%20of%20Operations) Q2 2025 net income reached $184.5 million, a substantial improvement from a prior year loss, fueled by a 147% revenue increase to $447.6 million from natural gas sales and derivative gains Q2 Statement of Operations Highlights (in thousands, except per share data) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Total revenues** | $447,616 | $181,117 | | Natural gas sales | $241,236 | $144,458 | | Net gain (loss) on derivatives | $136,101 | $(8,615) | | **Total operating expenses** | $196,848 | $199,236 | | **Net income (loss)** | **$184,466** | **$(26,212)** | | **Diluted EPS** | **$9.12** | **$(1.51)** | YTD Statement of Operations Highlights (in thousands, except per share data) | Metric | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Total revenues** | $644,650 | $464,346 | | Natural gas sales | $522,742 | $332,744 | | Net (loss) gain on derivatives | $(10,447) | $36,521 | | **Total operating expenses** | $381,868 | $400,699 | | **Net income** | **$184,002** | **$25,823** | | **Diluted EPS** | **$9.01** | **$1.09** | [Consolidated Statements of Stockholders' Equity](index=9&type=section&id=Consolidated%20Statements%20of%20Stockholders'%20Equity) Total stockholders' equity increased to $1.77 billion by June 30, 2025, primarily due to $184.0 million in net income, partially offset by $125.9 million in common stock repurchases - Key changes in stockholders' equity for the six months ended June 30, 2025 include net income of **$184.5 million**, stock repurchases under the Repurchase Program of **$125.9 million**, and stock compensation expense of **$9.4 million**[41](index=41&type=chunk) [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operations for the first six months of 2025 totaled $408.7 million, with significant outflows for investing ($254.0 million) and financing ($152.4 million) activities Consolidated Cash Flow Summary (in thousands) | Cash Flow Activity | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | **$408,683** | **$311,487** | | Net cash used in investing activities | $(253,965) | $(246,498) | | Net cash used in financing activities | $(152,397) | $(65,685) | | **Net change in cash and cash equivalents** | **$2,321** | **$(696)** | | Cash and cash equivalents at end of period | $3,794 | $1,233 | [Notes to Consolidated Financial Statements](index=12&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Notes detail accounting policies, segment operations, debt, equity, and derivatives, with key updates including 2026 Senior Notes redemption, an expanded share repurchase program, and preferred stock redemption notice - The company operates as a single reportable segment focused on the exploration, acquisition, and production of natural gas, crude oil, and NGL in the Appalachia and Anadarko basins[47](index=47&type=chunk)[54](index=54&type=chunk) - The company did not record any impairment of its oil and natural gas properties for the three or six months ended June 30, 2025 or 2024, as the net book value was below the calculated ceiling[63](index=63&type=chunk) - Subsequent to quarter end, on August 4, 2025, the Board of Directors increased the authorized share repurchase program from **$1.0 billion to $1.5 billion** and extended it through December 31, 2026[172](index=172&type=chunk) - On August 5, 2025, the company issued a notice of redemption for all its outstanding preferred stock, effective September 5, 2025[173](index=173&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Conditions and Results of Operations](index=36&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Conditions%20and%20Results%20of%20Operations) Improved Q2 2025 results are attributed to higher natural gas prices and derivative gains, despite a slight production decline, supported by strong liquidity of $884.9 million and ongoing capital return initiatives [2025 Operational and Financial Highlights](index=37&type=section&id=2025%20Operational%20and%20Financial%20Highlights) Q2 2025 highlights include **1,006.3 MMcfe/day** net production, **13.8 net wells** turned to sales, **$231.4 million** operating cash flow, **$65.0 million** in share repurchases, and **$884.9 million** total liquidity - Reported total net production of **1,006.3 MMcfe per day**[185](index=185&type=chunk) - Turned to sales **14 gross (13.8 net) operated wells**[185](index=185&type=chunk) - Generated **$231.4 million of operating cash flows**[185](index=185&type=chunk) - Repurchased **338,886 shares for $65.0 million**[185](index=185&type=chunk) - Exited the quarter with total liquidity of **$884.9 million**[185](index=185&type=chunk) [2025 Production and Drilling Activity](index=37&type=section&id=2025%20Production%20and%20Drilling%20Activity) Q2 2025 net production averaged **1,006.3 MMcfe/day**, a decrease from Q2 2024 due to natural declines and midstream issues, with drilling focused in Utica/Marcellus and SCOOP regions Average Daily Production by Basin (Q2) | Basin | Q2 2025 (Mcfe/day) | Q2 2024 (Mcfe/day) | | :--- | :--- | :--- | | Utica & Marcellus | 800,557 | 836,892 | | SCOOP | 205,742 | 213,245 | | **Total** | **1,006,299** | **1,050,137** | - The decline in daily production was primarily due to natural declines from the timing of development programs and the impact of unplanned, third-party midstream outages and constraints[184](index=184&type=chunk) - Drilling activity in Q2 2025 included spudding **4.0 net wells** in the Utica and turning to sales **8.0 net Utica wells**, **4.0 net Marcellus wells**, and **1.8 net SCOOP wells**[188](index=188&type=chunk)[189](index=189&type=chunk) [Comparison of Quarter-to-Date (Q2 2025 vs Q2 2024)](index=39&type=section&id=Comparison%20of%20Quarter-to-Date) Q2 2025 total sales revenue increased **64% to $311.5 million**, driven by an **82% rise** in natural gas prices, while LOE increased **11%** and interest expense decreased **9%** Average Realized Price Comparison (Q2) | Commodity | Avg. Price Q2 2025 (w/o derivatives) | Avg. Price Q2 2024 (w/o derivatives) | | :--- | :--- | :--- | | Natural Gas ($/Mcf) | $2.97 | $1.63 | | Oil & Condensate ($/Bbl) | $58.20 | $76.51 | | NGL ($/Bbl) | $27.91 | $28.18 | - The increase in natural gas sales was due to an **82% increase in realized prices**, driven by a higher Henry Hub index, partially offset by an **8% decrease in sales volumes**[194](index=194&type=chunk) - Total lease operating expenses (LOE) increased by **11% to $17.6 million**, primarily due to higher water hauling and labor expenses[198](index=198&type=chunk) - Interest expense decreased by **9%** due to the tender offer and redemption of the 2026 Senior Notes, partially offset by interest on the new 2029 Senior Notes[203](index=203&type=chunk) [Comparison of Year-to-Date (Six Months 2025 vs 2024)](index=44&type=section&id=Comparison%20of%20Year-to-Date) YTD 2025 total sales revenue increased **53% to $655.1 million**, driven by a **78% rise** in natural gas prices, with LOE up **16%** and DD&A expense down **12%** Average Realized Price Comparison (YTD) | Commodity | Avg. Price YTD 2025 (w/o derivatives) | Avg. Price YTD 2024 (w/o derivatives) | | :--- | :--- | :--- | | Natural Gas ($/Mcf) | $3.34 | $1.88 | | Oil & Condensate ($/Bbl) | $61.22 | $73.84 | | NGL ($/Bbl) | $30.92 | $29.48 | - The increase in natural gas sales was due to a **78% increase in realized prices**, partially offset by a **12% decrease in sales volumes**[207](index=207&type=chunk) - Total LOE increased by **16% to $37.9 million**, primarily due to higher costs for water hauling, labor, and weather-related operations[211](index=211&type=chunk) - Depreciation, depletion, and amortization (DD&A) decreased by **12%** due to a lower depletion rate resulting from full cost ceiling test impairments recorded in 2024[214](index=214&type=chunk) [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, Gulfport reported **$3.8 million** in cash and **$705.0 million** in funded debt, supported by a **$1.1 billion** credit facility borrowing base and **$408.7 million** in YTD operating cash flow - As of June 30, 2025, the company had **$3.8 million in cash**, **$55.0 million outstanding** on its Credit Facility, and **$650.0 million of 2029 Senior Notes**[222](index=222&type=chunk) - The Credit Facility borrowing base was reaffirmed at **$1.1 billion** with elected commitments of **$1.0 billion** as of May 5, 2025[226](index=226&type=chunk) - The company redeemed the remaining **$25.7 million balance** of its 2026 Senior Notes in May 2025[224](index=224&type=chunk) 2025 Capital Expenditure Guidance | Category | Estimated Range | | :--- | :--- | | Operated Drilling & Completion | $335.0M - $355.0M | | Maintenance Leasehold & Land | $35.0M - $40.0M | | Discretionary Acreage Acquisitions | $75.0M - $100.0M | [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=53&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Gulfport faces commodity price and interest rate risks, mitigated by derivative instruments like swaps and costless collars, with a net derivative liability of **$32.9 million** as of June 30, 2025 - The company's primary market risks are commodity price volatility and interest rate fluctuations on its Credit Facility[248](index=248&type=chunk)[256](index=256&type=chunk) - Gulfport uses derivative instruments, including swaps and costless collars, to manage commodity price risk and enhance revenue predictability[248](index=248&type=chunk)[254](index=254&type=chunk) - As of June 30, 2025, the company's derivative portfolio had a net liability fair value of **$32.9 million**. A hypothetical **10% increase** in commodity prices would increase this liability by approximately **$99.3 million**[255](index=255&type=chunk) [Item 4. Controls and Procedures](index=54&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded that disclosure controls and procedures were effective as of June 30, 2025, with no material changes to internal control over financial reporting during Q2 2025 - Based on an evaluation as of June 30, 2025, the CEO and CFO concluded that the company's disclosure controls and procedures are effective[258](index=258&type=chunk) - No changes in internal control over financial reporting occurred during the last fiscal quarter that have materially affected, or are reasonably likely to materially affect, internal controls[260](index=260&type=chunk) PART II OTHER INFORMATION [Item 1. Legal Proceedings](index=55&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal and regulatory proceedings, including lawsuits related to lease formations, environmental compliance, and royalty disputes, as detailed in Note 9 - Information regarding legal proceedings is detailed in Note 9 of the consolidated financial statements[262](index=262&type=chunk) [Item 1A. Risk Factors](index=55&type=section&id=Item%201A.%20Risk%20Factors) There have been no material changes to the risk factors previously disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - The company refers to the Risk Factors section in its Annual Report on Form 10-K for the year ended December 31, 2024, for a description of factors that could materially affect its business[263](index=263&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=55&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) During Q2 2025, Gulfport repurchased **350,896 shares** of common stock at an average price of **$191.70 per share**, with **338,886 shares** under its publicly announced program Common Stock Repurchase Activity (Q2 2025) | Period | Total Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | April 2025 | 49,264 | $171.91 | | May 2025 | 250,865 | $194.51 | | June 2025 | 50,767 | $196.98 | | **Total** | **350,896** | **$191.70** | - As of June 30, 2025, the approximate maximum dollar value of shares that may yet be purchased under the plans or programs was **$290.9 million**[265](index=265&type=chunk) [Item 5. Other Information](index=55&type=section&id=Item%205.%20Other%20Information) During the second quarter of 2025, none of the company's officers or directors adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements - No officers or directors adopted or terminated any Rule 10b5-1 trading arrangements during the three months ended June 30, 2025[268](index=268&type=chunk) [Item 6. Exhibits](index=57&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and XBRL data files - The report includes required certifications from the Chief Executive Officer and Chief Financial Officer pursuant to SEC rules, as well as XBRL interactive data files[271](index=271&type=chunk)

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of approximately $212 million during the quarter, with adjusted free cash flow of $64.6 million, reflecting over 70% growth quarter over quarter [15][16] - Net cash provided by operating activities before changes in working capital totaled approximately $198 million, more than funding capital expenditures and common share repurchases while maintaining balance sheet strength [15][16] - The trailing twelve-month net leverage as of June 30 was approximately 0.85 times, down from the prior quarter, benefiting from increasing EBITDA [17][18] Business Line Data and Key Metrics Changes - Average daily production totaled 1,006 million cubic feet equivalent per day, an increase of 8% over the previous year, despite midstream outages impacting production [9][10] - The company executed across all five development areas, with strong well performance noted, particularly in the Utica condensate pad in Southwest Harrison County, which delivered approximately 65% more cumulative oil than Gulfport's lake pad [10][11] Market Data and Key Metrics Changes - The all-in realized price for the second quarter was $3.61 per Mcfe, which is $0.17 above the NYMEX Henry Hub index price, highlighting the benefits of Gulfport's differentiated hedge position [16] - Rising natural gas demand is driven by LNG expansion and increased power generation needs, presenting opportunities for Gulfport and its peers [17] Company Strategy and Development Direction - The company plans to allocate up to $100 million toward discretionary acreage acquisitions to secure future drilling opportunities in the Utica Shale [6][8] - The share repurchase program authorization has been increased by 50% from $1 billion to $1.5 billion, with $65 million of common shares purchased during the quarter [7][21] - The company is committed to maintaining a strong balance sheet while pursuing strategic initiatives that enhance long-term shareholder value [8][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's financial position and operational performance, emphasizing a focus on efficiency and shareholder returns [13][22] - The company anticipates a strong natural gas commodity environment in late 2025 and 2026, which should support cash flow growth [19][20] Other Important Information - The company has invested approximately $17 million on maintenance leasehold and land investment through June 30, 2025, with plans to allocate $75 million to $100 million in total during 2025 and early 2026 [12] - The redemption of all outstanding preferred stock is expected to simplify the capital structure and potentially accelerate share repurchase efforts [19][21] Q&A Session Summary Question: Can you elaborate on the leasehold spend and its geographical focus? - The company is targeting 40 to 50 wells in Belmont County, Ohio, and Northern Monroe County, focusing on low breakeven high-quality acreage [24][25] Question: What are the mechanics of the preferred stock redemption? - The company issued a notice for preferred stockholders to decide on conversion or repurchase by September 5, with plans to use liquidity for the redemption [28][30] Question: How will the company allocate free cash flow post-redemption? - The company aims for a leverage target of around one times and will continue to evaluate opportunities for shareholder returns and reinvestment in high-quality locations [35][36] Question: What is the competitive return outlook for the condensate area? - The condensate area remains strong with above 70% IRR, and the company will continue to monitor commodity prices for future activity [41][42] Question: How does the company view participation in power contracting? - The company is likely to participate in power contracting through intermediaries, expecting rising in-basin prices due to increased demand [56][58] Question: What is the production outlook considering midstream constraints? - Most midstream issues have been mitigated, and production is expected to return to normal rates as ongoing projects are completed [84][86] Question: Will there be any impact on share repurchases due to preferred stock redemption? - The company can still execute share repurchases while managing cash flow for the preferred stock redemption, with flexibility in its approach [90][92] Question: Can you discuss the potential for ongoing discretionary acreage acquisitions? - The company has successfully identified opportunities for acquisitions in the Utica and is optimistic about continuing this strategy in the coming years [94][96]