Financial Performance - Ring Energy generated $13.9 million of Adjusted Free Cash Flow in Q3 2025, maintaining cash flow positivity for 24 consecutive quarters[3] - The company reported a net loss of $51.6 million, including $72.9 million of non-cash ceiling test impairment charges, with Adjusted Net Income of $13.1 million[4] - Oil, natural gas, and natural gas liquids revenues for Q3 2025 were $78.6 million, a decrease of 5.5% from $82.6 million in Q2 2025 and a decrease of 12% from $89.2 million in Q3 2024[18] - Net loss for Q3 2025 was $51.6 million, compared to a net income of $20.6 million in Q2 2025 and $33.9 million in Q3 2024[18] - Basic earnings per share for Q3 2025 were $(0.25), compared to $0.10 in Q2 2025 and $0.17 in Q3 2024[18] - Adjusted Net Income for Q3 2025 was $13.12 million, or $0.06 per diluted share, compared to $10.98 million, or $0.05 per diluted share in Q2 2025[34] - Adjusted EBITDA for Q3 2025 was $47.73 million, with an Adjusted EBITDA margin of 61%[37] - Adjusted EBITDA for Q3 2025 was $47,728,721, down from $51,458,788 in Q2 2025 and down from $54,010,932 in Q3 2024[40] Sales and Production - Average daily sales volumes were 20,789 Boe/d, a 3% increase compared to Q3 2024, while crude oil sales were 13,332 Bo/d, a 1% increase year-over-year[5] - Average daily oil sales volumes for Q3 2025 were 13,332 Bbls/d, a decrease from 14,511 Bbls/d in Q2 2025 and 13,204 Bbls/d in Q3 2024[20] - The percentage of oil in total sales volumes for Q3 2025 was 64%, down from 68% in Q2 2025 and 66% in Q3 2024[20] - Total net sales volumes for Q3 2025 were 1,912,611 Boe, slightly down from 1,937,850 Boe in Q2 2025 and up from 1,849,934 Boe in Q3 2024[20] - For Q4 2025, the company projects total oil sales volumes between 12,700 and 13,600 Bo/d, with a midpoint of 13,150 Bo/d[11] Expenses and Costs - Total costs and operating expenses for Q3 2025 were $133.6 million, significantly higher than $59.1 million in Q2 2025 and $59.4 million in Q3 2024[18] - Lease Operating Expense (LOE) was $10.73 per Boe, 2% below the low end of guidance, reflecting ongoing cost reduction efforts[4] - General and Administrative Expense (G&A) for Q3 2025 was $8,139,771, an increase from $7,138,519 in Q2 2025 and $6,421,567 in Q3 2024[44] - G&A excluding share-based compensation for Q3 2025 was $6,521,171, compared to $5,786,680 in Q2 2025 and $6,389,480 in Q3 2024[44] - All-in cash operating costs for the three months ended September 30, 2025, were $42,743,297, with a per Boe cost of $22.35[58] - Cash operating margin per Boe for the three months ended September 30, 2025, was $18.75, compared to $21.12 for the same period in 2024[61] Capital Expenditures and Guidance - Capital expenditures for Q3 2025 were $24.6 million, below the midpoint of guidance, and the company plans to reduce capital spending by 36% year-over-year[4] - The full-year capital spending guidance is set at $92 to $102 million, with a midpoint of $97 million, allocating 60% for drilling and completion activities[12] - Capital expenditures for Q3 2025 totaled $24,589,282, compared to $16,827,513 in Q2 2025 and $42,691,163 in Q3 2024[40] Impairments and Non-Cash Charges - The company recorded a non-cash impairment charge of $72.9 million due to a decrease in average commodity pricing, which had no impact on cash flows[8] - The company reported a ceiling test impairment of $72.9 million in Q3 2025, with no impairments reported in Q2 2025[18] - The company incurred a ceiling test impairment of $72.91 million during the three months ended September 30, 2025[25] - Total non-cash charges acceptable to the Administrative Agent amounted to $(29,695,076) for the three months ended September 30, 2025[55] Liquidity and Debt - The company exited Q3 2025 with $157.3 million in liquidity, having paid down $20 million of debt, exceeding guidance by $2 million[4] - Cash and cash equivalents decreased to $286,907 from $1.87 million at the end of the previous year, indicating a significant decline in liquidity[25] - The company reported a consolidated total debt of $440,277,655, with a leverage ratio of 2.10 as of September 30, 2025[53] - The revolving line of credit increased to $428 million from $385 million, indicating a rise of about 11.1%[23] - The leverage ratio as of September 30, 2024, was 1.59, well below the maximum allowed of 3.00x[55] Shareholder Information - The company has a total of 206,688,003 diluted weighted-average shares outstanding as of Q3 2025[34] - Total stockholders' equity decreased to $847.66 million from $858.64 million, a decline of approximately 1.3%[23] - Share-based compensation for the three months ended September 30, 2025, was $2,458,682[55] Hedging Activities - The company has hedged 241,755 barrels of oil for Q4 2025 at a weighted average swap price of $65.56 per barrel[27] - The company has hedged 84,300 MMBtu of natural gas for Q4 2025 at a weighted average swap price of $4.25 per MMBtu[27] - The total hedged volume for oil in Q1 2026 is 608,350 barrels at a weighted average swap price of $67.95 per barrel[27] Operational Efficiency - Ring Energy drilled and completed five wells in Q3 2025, maintaining a focus on operational efficiency and capital discipline[9]

Financial Data and Key Metrics Changes - The company reported oil sales of 13,332 barrels per day, slightly below the midpoint of guidance, while total sales were 20,789 barrels of oil equivalent per day, exceeding the midpoint of guidance [5][6] - Adjusted free cash flow for the quarter was $13.9 million, down from $24.8 million in the previous quarter, primarily due to higher capital spending and lower EBITDA [8][14] - The net loss for Q3 was $51.6 million or $0.25 per diluted share, including $72.9 million in non-cash impairment charges, compared to a net income of $20.6 million or $0.10 per diluted share in Q2 [13] Business Line Data and Key Metrics Changes - Lifting costs were reported at $10.73 per BOE, below the low end of guidance for the second consecutive quarter [7][11] - The company achieved a reduction in debt by $20 million during the quarter, exceeding guidance by $2 million [8][14] Market Data and Key Metrics Changes - Realized pricing for the third quarter decreased by 4% to $41.10 per BOE, driven by a 16% reduction in NGL prices [10] - The average realized oil price increased by 3% to $64.32, while realized gas prices remained negative but improved from the previous quarter [10][11] Company Strategy and Development Direction - The company focuses on maximizing adjusted free cash flow and reducing debt, with a disciplined approach to capital spending [5][8] - There is an emphasis on organic growth through reserves and inventory growth rather than acquisitions, especially in a challenging price environment [19][64] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's operational performance despite weak commodity prices and indicated a commitment to maintaining capital discipline [5][8] - The company plans to continue prioritizing debt reduction and improving leverage ratios, with expectations of potential growth when commodity prices recover [17][19] Other Important Information - The company updated its production guidance for the full year to 13,100-13,500 barrels of oil per day and 19,800-20,400 BOE per day [15] - The company is exploring opportunities for non-core divestitures to further reduce debt [18][41] Q&A Session Summary Question: Thoughts on terming out the revolver in the current interest rate environment - Management indicated that all options are on the table for strengthening the balance sheet, including evaluating the credit facility [24][25] Question: Expectations for service costs in the upcoming year - Management noted that service costs remain under pressure, and while they hope for stability, the situation is uncertain [29][30] Question: Positioning of Ring Energy's stock relative to peers - Management believes the stock is undervalued compared to peers and expects gradual improvement in stock performance [34][36] Question: Scenarios for further debt reduction in 2026 - Management projected a potential debt reduction of around $10 million in Q4, with uncertainties affecting the final amount [38][39] Question: Clarification on the $10 million deferred payment related to Lime Rock - Management confirmed that the deferred payment impacts the overall debt reduction strategy, emphasizing the focus on paying down debt [40][41] Question: Organic growth opportunities with existing assets - Management highlighted the potential for organic growth through developing existing reserves and inventory, particularly in the Central Basin Platform and Northwest Shelf [63][64]

Q3 2025 Performance - Q3 2025 net production reached 20,789 Boe/d, with 64% oil and 84% liquids[7] - The company sold 13,332 barrels of oil per day[15] - Lifting costs were reduced to $10.73 per Boe, a 2% improvement compared to guidance[15] - Capital expenditures totaled $24.6 million[16] - Adjusted Free Cash Flow was $13.9 million, marking the 24th consecutive quarter of positive cash flow[17] - Debt was reduced by $20 million, exceeding guidance by $2 million, increasing liquidity to $157.3 million[17] Financial Highlights - Q3 2025 realized price was $41.10 per Boe[19] - Adjusted EBITDA for Q3 2025 was $47.7 million[19] - All-in cash operating costs were $22.35 per Boe in Q3 2025[19] - The company's leverage ratio was 2.10x in Q3 2025[19] - 2024 SEC Proved Reserves are 134 MMBoe with PV10 ~$1.5 Billion[7] Acquisitions and Strategy - The Lime Rock Acquisition added ~12 MMBoe with PV10 ~$160 million[7] - The Lime Rock Acquisition added ~18,000 net acres and ~40 locations[7] - The company operates ~96% of its working interest[7] - The company's net revenue interest is ~79% for oil and ~82% for gas[7]

Core Insights - Ring Energy (REI) reported quarterly earnings of $0.06 per share, exceeding the Zacks Consensus Estimate of $0.05 per share, but down from $0.07 per share a year ago, indicating an earnings surprise of +20.00% [1] - The company posted revenues of $78.6 million for the quarter ended September 2025, surpassing the Zacks Consensus Estimate by 1.03%, but down from $89.24 million year-over-year [2] - Ring Energy shares have declined approximately 29.3% year-to-date, contrasting with the S&P 500's gain of 15.6% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.03 on revenues of $75.6 million, and for the current fiscal year, it is $0.18 on revenues of $315.1 million [7] - The estimate revisions trend for Ring Energy was mixed prior to the earnings release, resulting in a Zacks Rank 3 (Hold), suggesting the stock is expected to perform in line with the market [6] Industry Context - The Oil and Gas - Exploration and Production - United States industry is currently ranked in the bottom 21% of over 250 Zacks industries, indicating potential challenges for stocks in this sector [8]

Financial Performance - Total revenues for the three months ended September 30, 2025, were $78.6 million, a decrease of 12% compared to $89.2 million for the same period in 2024[17]. - Net income for the three months ended September 30, 2025, was a loss of $51.6 million, compared to a net income of $33.9 million for the same period in 2024[17]. - For the nine months ended September 30, 2025, the net income was a loss of $21,885,905 compared to a net income of $61,812,795 for the same period in 2024[21]. - The company reported a net loss of $51.63 million compared to a net income of $33.88 million for the same period in 2024[93]. - For the three months ended September 30, 2025, oil, natural gas, and natural gas liquids revenues were $78,601,336, a decrease from $89,244,383 in the same period of 2024[144]. - Oil revenues decreased by $11.5 million, or 13%, from $90.4 million to $78.9 million, primarily due to a price variance of $(12.4) million from a decrease in the average realized price per barrel from $74.43 to $64.32[168]. - For the nine months ended September 30, 2025, total sales decreased by approximately $42.6 million, or 15%, to $240.3 million compared to $282.9 million in 2024[171]. Assets and Liabilities - Total current assets increased to $55.8 million as of September 30, 2025, compared to $50.4 million as of December 31, 2024, reflecting a growth of 10%[15]. - The company's total assets reached $1.43 billion as of September 30, 2025, up from $1.41 billion as of December 31, 2024[15]. - Total liabilities increased to $587.0 million as of September 30, 2025, compared to $549.5 million as of December 31, 2024, marking an increase of 7%[15]. - The company’s retained earnings decreased to $36.1 million as of September 30, 2025, down from $58.0 million as of December 31, 2024[15]. - The company’s total stockholders' equity was $847.7 million as of September 30, 2025, compared to $858.6 million as of December 31, 2024[15]. Cash Flow and Investments - Cash provided by operating activities for the nine months ended September 30, 2025, was $106,160,584, down from $147,144,031 in 2024[21]. - Total cash used in investing activities for the nine months ended September 30, 2025, was $144,231,398, compared to $113,166,061 in 2024[21]. - The cash at the end of the period for September 30, 2025, was $286,907, compared to no cash at the end of the period in 2024[21]. - The company reported cash paid for interest of $23,559,423 for the nine months ended September 30, 2025, down from $30,208,974 in 2024[23]. Impairments and Expenses - The company reported a ceiling test impairment of $72.9 million for the three months ended September 30, 2025[17]. - The Company recorded impairments on oil and natural gas properties of $72,912,330 for both the three and nine months ended September 30, 2025, due to lower oil prices impacting the present value of estimated future net revenues[54]. - General and administrative expenses increased by approximately $2.3 million from $21.6 million to $23.9 million, driven by higher salaries and bonuses[193]. - The depletion expense for the three months ended September 30, 2025, was $24,902,199, with a depletion rate of $13.02 per barrel-of-oil-equivalent[52]. Derivative Instruments and Hedging - The company utilized derivative strategies to manage cash flow variability associated with future oil and natural gas production[101]. - The company recorded a current state income tax provision of $(39,816) for the three months ended September 30, 2025, compared to $(74,899) in 2024[67]. - The total gain or loss on derivative contracts is reflected as an adjustment to net cash provided by operating activities[75]. - The company recorded a gain on derivative contracts of $14.2 million for the nine months ended September 30, 2025, compared to a gain of $3.9 million for the same period in 2024[201]. Operational Activities - The company drilled and completed three 1-mile horizontal wells in the Northwest Shelf and multiple vertical wells in the Central Basin Platform, demonstrating ongoing operational activity and resource development[156][157][158]. - The company plans to reduce long-term debt primarily through excess cash flow and potential sales of non-core assets, aiming to strengthen its balance sheet[153][154]. - The company intends to employ industry-leading drilling and completion techniques to maximize returns and build future development opportunities[154]. Tax Provisions - The provision for income taxes changed from a provision of $10.1 million for the three months ended September 30, 2024, to a benefit of $12.8 million for the same period in 2025, representing a change of $22.9 million or 227%[203]. - For the nine months ended September 30, 2025, the provision for income taxes changed from a provision of $18.6 million in 2024 to a benefit of $3.7 million in 2025, reflecting a change of $22.3 million or 120%[204]. Future Outlook - The Company expects ongoing oil price volatility, which could materially impact oil revenue, although hedge contracts provide some mitigation[33]. - The company aims to maximize cash flow in 2025 through cost monitoring and prudent capital allocation, focusing on high-return projects in the current commodity price environment[206]. - The company is actively pursuing acquisitions and business combinations to enhance its portfolio with high-margin properties[206].

Core Insights - Ring Energy, Inc. reported strong cash generation and operational discipline in Q3 2025 despite volatile commodity prices, achieving $13.9 million in Adjusted Free Cash Flow and reducing debt by $20 million [3][9][11] - The company reaffirmed its plan to reduce capital spending by 36% year-over-year while maintaining a production growth rate of 2% or more [3][4] Financial Performance - Average daily sales volumes were 20,789 Boe/d, a 2% decrease from Q2 2025 but a 3% increase year-over-year [5] - Crude oil production averaged 13,332 Bo/d, down 8% from Q2 2025 but up 1% from Q3 2024 [5] - Revenues for Q3 2025 were $78.6 million, a 5% decrease from Q2 2025 and a 12% decrease from Q3 2024 [5] - The company reported a net loss of $51.6 million, significantly impacted by a non-cash ceiling test impairment charge of $72.9 million [5][12] Operational Highlights - Lease Operating Expense (LOE) was $10.73 per Boe, 2% below the low end of guidance due to cost reduction efforts [9][10] - Capital expenditures for Q3 2025 were $24.6 million, below the mid-point of guidance [9] - The company drilled and completed five wells in Q3 2025, all in the Central Basin Platform [13][14] Liquidity and Debt Management - Total liquidity as of September 30, 2025, was approximately $157.3 million, with $428 million in borrowings outstanding on its credit facility [11] - The company aims for continued debt reduction, having reduced its debt by $20 million during the quarter [11] Future Guidance - For Q4 2025, the company expects total oil sales volumes between 12,700 and 13,600 Bo/d and total equivalent sales volumes between 19,100 and 20,700 Boe/d [16] - Capital spending guidance for FY 2025 is set at $92 to $102 million, with a midpoint of $97 million [17]

Core Points - Ring Energy, Inc. announced the timing of its third quarter 2025 earnings release and conference call [1] - The earnings release will be issued after the close of trading on November 6, 2025, with a conference call scheduled for November 7, 2025, at 11:00 a.m. ET [2] - The company focuses on oil and gas exploration, development, and production, particularly in the Permian Basin [3] Earnings Release and Conference Call - The third quarter 2025 earnings release will be available after market close on November 6, 2025 [2] - A conference call to discuss the results will take place on November 7, 2025, at 11:00 a.m. ET, with participation details provided [2] - The call will be accessible via a webcast on the company's website, and an audio replay will be available afterward [2] Company Overview - Ring Energy, Inc. specializes in oil and gas exploration, development, and production [3] - The company's current operations are primarily focused on developing its assets in the Permian Basin [3]

Company Performance - Ring Energy, Inc. reported a revenue of $82.60 million for the fiscal second quarter of 2025, which represents a 16.68% decrease year-over-year and fell short of expectations by $265,910 [2] - The company achieved an EPS of $0.05, exceeding Wall Street estimates by $0.02 [2] - Following the earnings release, the stock price increased by more than 48.5% [1] Analyst Ratings - Michael Markidis from BMO Capital raised the price target for Ring Energy from C$19 to C$20, maintaining a Buy rating [2] - Pammir Bir from RBC Capital reiterated a Buy rating with a price target of C$21 [2] Debt Management - Ring Energy announced a target to reduce its debt by approximately $18 million during the third quarter [3] - The company is focused on exploration, development, and production in the Permian Basin of Texas [3]

Company Overview - Ring Energy, Inc. is a Texas-based independent oil and natural gas company founded in 2004, focused on delivering competitive and sustainable returns [4] Investment Activity - Goldman Sachs Group Inc. reduced its holdings in Ring Energy by 33.5%, selling 394,814 shares, resulting in ownership of 783,618 shares valued at approximately $901,000, representing about 0.38% of the company [1] Debt Management Strategy - The company has been actively reducing its debt by acquiring assets to increase production, which has led to cost savings and a relatively low debt ratio [2] Production Forecast - For the second half of 2025, Ring Energy anticipates an average total sales volume of around 20,000 BOEPD, including 13,250 barrels per day of oil sales, with increased credit facility utilization in the mid-70% range due to the Lime Rock acquisition [3]

Group 1 - The Chief Financial Officer of Ring Energy, Inc., Travis T. Thomas, has resigned effective immediately to pursue other opportunities, and his resignation was not due to any disagreements with the company [1] - Rocky Kwon, the Vice President of Accounting, has been appointed as the Interim Chief Financial Officer while the company searches for a new CFO; Kwon has been with Ring since 2021 and has extensive financial leadership experience [2] - Paul D. McKinney, the Chairman and CEO, expressed confidence in the company's financial goals and thanked Thomas for his five years of service, emphasizing the company's commitment to shareholder value and debt reduction [3] Group 2 - Ring Energy, Inc. is focused on oil and gas exploration, development, and production, with current operations centered on its Permian Basin assets [4]