[Highlights and CEO Commentary](index=1&type=section&id=Highlights) SM Energy reported record Q2 2025 production from Uinta Basin assets, enabling full revolving credit facility payoff and progress towards 1.0x leverage Q2 2025 Key Performance Indicators | Metric | Value | Note | | :--- | :--- | :--- | | Net Production | 19.0 MMBoe (209.1 MBoe/d) | 5% above guidance midpoint | | Oil Production | 115.7 MBbls/d (55% of total) | 59% YoY increase | | Net Income | $201.7 million | - | | Adjusted Net Income | $171.9 million | - | | Adjusted EBITDAX | $569.6 million | - | | Adjusted Free Cash Flow | $113.9 million | - | - The company fully paid down its revolving credit facility, ending the quarter with a zero balance and a cash balance of **$101.9 million**[5](index=5&type=chunk) - CEO Herb Vogel emphasized the successful integration and move to optimization of the Uinta Basin assets, which are expected to continue driving value[4](index=4&type=chunk) - The company expects to reach its target leverage metric of **1.0x** by year-end based on current commodity prices[4](index=4&type=chunk)[5](index=5&type=chunk) [Financial Performance](index=2&type=section&id=Financial%20Performance) Strong Q2 2025 financial performance, with operating cash flow up 18% and Adjusted EBITDAX up 17%, driven by higher production and oil mix [Net Income and Earnings Per Share](index=2&type=section&id=NET%20INCOME%20AND%20NET%20INCOME%20PER%20SHARE) Q2 2025 net income slightly decreased to $201.7 million ($1.76/share) due to lower realized oil prices and higher interest expense Net Income and EPS Comparison (Q2) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income | $201.7 million | $210.3 million | | Diluted EPS | $1.76/share | $1.82/share | | Adjusted Net Income | $171.9 million | $214.4 million | | Adjusted Diluted EPS | $1.50/share | $1.85/share | [Cash Flow and Adjusted EBITDAX](index=4&type=section&id=NET%20CASH%20PROVIDED%20BY%20OPERATING%20ACTIVITIES) Net cash from operating activities before working capital increased 18% to $501.9 million, with Adjusted EBITDAX up 17% Cash Flow and EBITDAX (Q2 YoY) | Metric | Q2 2025 | Q2 2024 | % Change | | :--- | :--- | :--- | :--- | | Net Cash from Ops (before WC) | $501.9 M | $426.2 M | +18% | | Adjusted EBITDAX | $569.6 M | $485.9 M | +17% | [Capital Expenditures and Adjusted Free Cash Flow](index=4&type=section&id=CAPITAL%20EXPENDITURES%20AND%20ACTIVITY) Q2 2025 capital expenditures totaled $388.0 million, resulting in $113.9 million of adjusted free cash flow Q2 2025 Capital & Free Cash Flow | Metric | Value | | :--- | :--- | | Capital Expenditures (adjusted) | $388.0 million | | Adjusted Free Cash Flow | $113.9 million | - Faster than expected drilling and completion times accelerated certain costs into Q2 2025, resulting in more wells being drilled and completed than planned[14](index=14&type=chunk) [Operational Performance](index=2&type=section&id=NET%20PRODUCTION%20BY%20OPERATING%20AREA) Record Q2 2025 production of 19.0 MMBoe (209.1 MBoe/d), up 32% YoY, driven by Uinta Basin's high oil cut [Production](index=2&type=section&id=NET%20PRODUCTION%20BY%20OPERATING%20AREA) Q2 2025 total net production was 19.0 MMBoe, with Uinta Basin outperforming at 48.0 MBoe/d and 87% oil cut Q2 2025 Production by Operating Area (MBoe/d) | Basin | Oil (MBbl/d) | Gas (MMcf/d) | NGLs (MBbl/d) | Total (MBoe/d) | | :--- | :--- | :--- | :--- | :--- | | Midland Basin | 53.9 | 177.9 | — | 83.6 | | South Texas | 19.9 | 183.5 | 26.9 | 77.4 | | Uinta Basin | 41.9 | 36.9 | — | 48.0 | | **Total** | **115.7** | **398.3** | **26.9** | **209.1** | - Total net daily production increased **32%** and net daily oil production rose **59%** compared to the second quarter of 2024[5](index=5&type=chunk) [Realized Prices and Hedges](index=2&type=section&id=REALIZED%20PRICES%20BY%20OPERATING%20AREA) Average realized price was $41.27/Boe pre-hedge, $43.36/Boe post-hedge, with Midland Basin gas prices impacted by WAHA differentials Q2 2025 Realized Prices per Boe | Metric | Price per Boe | | :--- | :--- | | Pre-hedge | $41.27/Boe | | Post-hedge | $43.36/Boe | | Net Derivative Gain | $2.09/Boe | - Realized gas prices in the Midland Basin were negatively affected by pipeline constraints pressuring WAHA basis differentials, a challenge expected to continue into **2026**[11](index=11&type=chunk) [Financial Position and Shareholder Returns](index=4&type=section&id=FINANCIAL%20POSITION%2C%20LIQUIDITY%2C%20AND%20NET%20DEBT-TO-ADJUSTED%20EBITDAX) Company strengthened financial position with zero revolving credit facility balance, $101.9 million cash, and reduced net debt to $2.63 billion (1.2x leverage) - As of June 30, 2025, the company had paid its revolving credit facility down to **zero** and held a cash balance of **$101.9 million**[17](index=17&type=chunk) Debt and Leverage Metrics (as of June 30, 2025) | Metric | Value | | :--- | :--- | | Long-Term Debt | $2.74 billion | | Net Debt | $2.63 billion | | Net debt-to-Adjusted EBITDAX | 1.2x | - Returned **$22.9 million** to stockholders through a **$0.20 per share** quarterly fixed dividend[16](index=16&type=chunk) [Outlook and Guidance](index=5&type=section&id=2025%20OPERATING%20PLAN%20AND%20GUIDANCE) SM Energy updated 2025 guidance, increasing oil mix and capex, while significantly reducing cash taxes to $10 million due to OBBBA legislation [Full Year 2025 Guidance](index=5&type=section&id=UPDATED%20GUIDANCE%20FULL%20YEAR%202025%3A) Full-year 2025 production guidance maintained at 200-215 MBoe/d, with oil mix increased to 53-54% and capex to ~$1.375 billion Full Year 2025 Guidance Updates | Metric | Previous Guidance | Updated Guidance | | :--- | :--- | :--- | | Net Production | 200-215 MBoe/d | Unchanged | | Oil as % of Total | 51-52% | 53-54% | | Capital Expenditures | ~$1.3 B | ~$1.375 B | | DD&A Expense | ~$15/Boe | ~$16/Boe | [Third Quarter 2025 Guidance](index=6&type=section&id=GUIDANCE%20THIRD%20QUARTER%202025%3A) Q3 2025 production guided to 209-215 MBoe/d, capex $300-$320 million, with 2025 cash taxes reduced to ~$10 million due to OBBBA Q3 2025 Guidance | Metric | Guidance | | :--- | :--- | | Net Production | 209-215 MBoe/d | | Oil as % of Total | 53-54% | | Capital Expenditures | $300 M - $320 M | - The company reduced its estimated cash taxes for 2025 to approximately **$10 million** (from **$75-$95 million**) due to the expected benefits of the One Big Beautiful Bill Act (OBBBA)[24](index=24&type=chunk) [Financial Statements and Non-GAAP Reconciliations](index=8&type=section&id=FINANCIAL%20HIGHLIGHTS%20%28UNAUDITED%29) This section presents unaudited condensed consolidated financial statements and detailed reconciliations for non-GAAP measures like Adjusted EBITDAX and Free Cash Flow [Condensed Consolidated Financial Statements](index=8&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) Unaudited condensed consolidated Balance Sheets, Statements of Operations, Stockholders' Equity, and Cash Flows are presented Balance Sheet Highlights (June 30, 2025 vs Dec 31, 2024) | Metric | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total Assets | $8.99 B | $8.58 B | | Total Liabilities | $4.40 B | $4.34 B | | Total Stockholders' Equity | $4.59 B | $4.24 B | Statement of Operations Highlights (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Total Operating Revenues | $792.9 M | $634.6 M | | Income from Operations | $294.9 M | $279.4 M | | Net Income | $201.7 M | $210.3 M | Statement of Cash Flows Highlights (Three Months Ended June 30) | Metric | 2025 | 2024 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $571.1 M | $476.4 M | | Net Cash used in Investing Activities | ($410.2 M) | ($322.7 M) | | Net Cash used in Financing Activities | ($59.1 M) | ($70.1 M) | [Non-GAAP Reconciliations](index=14&type=section&id=DEFINITIONS%20OF%20NON-GAAP%20MEASURES%20AND%20METRICS%20AS%20CALCULATED%20BY%20THE%20COMPANY) Reconciliations for non-GAAP measures like Adjusted EBITDAX, Adjusted Net Income, Net Debt, and Adjusted Free Cash Flow are provided - The company uses non-GAAP measures like Adjusted EBITDAX, Adjusted Net Income, Net Debt, and Adjusted Free Cash Flow to help investors assess financial condition, results of operations, and cash flows, and to compare performance[41](index=41&type=chunk) Reconciliation of Net Income to Adjusted EBITDAX (Q2) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (GAAP) | $201.7 M | $210.3 M | | Adjustments | +$367.9 M | +$275.6 M | | **Adjusted EBITDAX (non-GAAP)** | **$569.6 M** | **$485.9 M** | Reconciliation of Net Income to Adjusted Net Income (Q2) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Net Income (GAAP) | $201.7 M | $210.3 M | | Adjustments | -$29.7 M | +$4.1 M | | **Adjusted Net Income (non-GAAP)** | **$171.9 M** | **$214.4 M** |

DENVER, July 31, 2025 /PRNewswire/ -- SM Energy Company (the "Company") (NYSE: SM) today reported operating and financial results for the second quarter 2025 and provided certain full year and third quarter 2025 guidance. Highlights include: Midland Basin South Texas Uinta Basin (Pre/Post-hedge(1)) Record Net Quarterly Production: 19.0 MMBoe, or 209.1 MBoe/d, exceeded expectations at 5% above the mid-point of guidance, with oil making up 55% (115.7 MBbls/d). Strong performance from the Company's Uinta Basin ...

Core Viewpoint - Sierra Madre Gold and Silver Ltd. has successfully closed the second tranche of its brokered private placement, raising a total of $19,500,600 from the offering [1][3]. Group 1: Offering Details - The second tranche consisted of 2,500,000 units sold at a price of $0.70 per unit, generating gross proceeds of $1,750,000 [1]. - Each unit includes one common share and one half of a common share purchase warrant, with each warrant allowing the purchase of one common share at $0.85 for 12 months [2]. - The offering was facilitated by Beacon Securities Limited as the lead agent, along with Canaccord Genuity Corp. as part of the syndicate [1]. Group 2: Use of Proceeds - The net proceeds from the offering will be utilized to expand the capacity of the Guitarra mine, conduct exploration programs at the East District, and for working capital and general corporate purposes [3]. Group 3: Compensation and Fees - In connection with the closing of the second tranche, the company paid the agents a cash fee of $61,250 and issued 87,500 compensation options, each allowing the purchase of one common share at the issue price for 12 months [4]. Group 4: Company Overview - Sierra Madre Gold and Silver Ltd. focuses on the Guitarra mine in Mexico and the Tepic property, with the Guitarra mine being a permitted underground mine that restarted commercial production in January 2025 [7]. - The Tepic Project covers over 2,600 hectares and hosts low-sulphidation epithermal gold and silver mineralization with an existing historic resource [8].

Core Viewpoint - Sierra Madre Gold and Silver Ltd. has successfully closed the first tranche of its brokered private placement offering, raising gross proceeds of $17,750,600 from the issuance of 25,358,000 units at a price of $0.70 per unit, part of a larger offering of up to 27,858,000 units for total proceeds of up to $19,500,600 [1][3]. Group 1: Offering Details - The first tranche consists of 25,358,000 units, each unit comprising one common share and one half of a common share purchase warrant, with each warrant allowing the purchase of one common share at $0.85 for 12 months [2]. - The company intends to use the net proceeds from the offering to expand the Guitarra mine's capacity, conduct exploration programs, and for working capital [3]. - Certain directors and officers subscribed for 686,000 units, totaling $480,200, which is classified as a related party transaction under Multilateral Instrument 61-101 [4]. Group 2: Agent Compensation - The company paid the agents a cash fee of $1,171,933 and issued 1,674,190 compensation options, each allowing the purchase of one common share at the issue price for 12 months [5]. - Additionally, a corporate financing fee of $26,500 was paid to the agents, along with 38,010 corporate finance fee compensation options [5]. Group 3: Regulatory Compliance - The units were offered to Canadian residents (excluding Quebec) and in the United States under available exemptions from registration requirements, with no hold period for Canadian subscribers [6]. - The offering remains subject to final acceptance by the TSX Venture Exchange [6]. Group 4: Company Overview - Sierra Madre Gold and Silver Ltd. focuses on the Guitarra mine in Mexico and the Tepic property, with the Guitarra mine being a permitted underground mine that restarted commercial production in January 2025 [9]. - The Tepic Project hosts low-sulphidation epithermal gold and silver mineralization with an existing historic resource [10].

Core Viewpoint - SM Energy (SM) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ended June 2025, with the actual results being a significant factor influencing its near-term stock price [1][2]. Earnings Expectations - The upcoming earnings report is expected to be released on July 31, with a consensus EPS estimate of $1.23, reflecting a year-over-year decrease of 33.5%. Revenues are projected to be $780.12 million, which is a 22.9% increase from the previous year [3][2]. - The consensus EPS estimate has been revised 6.67% higher in the last 30 days, indicating a reassessment by analysts [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for SM Energy is lower than the Zacks Consensus Estimate, resulting in an Earnings ESP of -2.64%, suggesting a bearish outlook from analysts [12]. - The stock currently holds a Zacks Rank of 3 (Hold), complicating predictions of an earnings beat [12]. Historical Performance - In the last reported quarter, SM Energy exceeded the consensus EPS estimate of $1.6 by delivering earnings of $1.76, resulting in a surprise of +10.00%. Over the past four quarters, the company has consistently beaten consensus EPS estimates [13][14]. Industry Context - In the broader context of the Zacks Oil and Gas - Exploration and Production - United States industry, Comstock Resources (CRK) is expected to report earnings of $0.09 per share for the same quarter, indicating a year-over-year increase of 145% with revenues projected at $415.32 million, up 68.3% [18][19].

Core Viewpoint - Sierra Madre Gold and Silver Ltd. is increasing its private placement offering to issue up to 27,858,000 units at a price of $0.70 per unit, aiming for gross proceeds of up to $19,500,600 [1][2]. Group 1: Offering Details - The offering will consist of units, each comprising one common share and half a common share purchase warrant, with warrants allowing the purchase of additional shares at $0.85 for 12 months [3]. - The offering is available to Canadian residents, excluding Quebec, under the Listed Issuer Financing Exemption, with no hold period for Canadian subscribers [4]. - The expected closing date for the offering is around July 24, 2025, pending necessary regulatory approvals [7]. Group 2: Company Background - Sierra Madre Gold and Silver Ltd. focuses on precious metals development and exploration, particularly at the Guitarra mine in Mexico, which has resumed commercial production as of January 2025 [8]. - The Tepic Project, covering over 2,600 hectares, contains low-sulphidation epithermal gold and silver mineralization with an existing historic resource [9]. - The management team has extensive experience in raising capital for mining companies, having collectively raised over $1 billion [9].

Group 1 - SM Energy Company plans to release its second quarter 2025 financial and operating results after market hours on July 31, 2025 [1] - The release will include an earnings report, a pre-recorded webcast, and an associated presentation, all available on the Company's website [1] - A Q&A session with SM Energy management is scheduled for August 1, 2025, at 8:00 a.m. Mountain time/10:00 a.m. Eastern time [2] Group 2 - SM Energy is an independent energy company focused on the acquisition, exploration, development, and production of crude oil, natural gas, and NGLs in Texas and Utah [2] - Important information about SM Energy is routinely posted on its website [2] - Investor contact information includes Pat Lytle, with a provided email and phone number for inquiries [3]

Core Insights - SM Energy is an independent exploration and production firm focused on the Permian Basin, Uinta Basin, and South Texas region, owning approximately 111,000 net acres in the Midland Basin and 63,300 net acres in the Uinta Basin, along with 155,000 net acres in South Texas [1] Financial Performance - SM Energy reported first-quarter 2025 revenues of $844.5 million and net income of $182.3 million, showing significant improvement from the prior-year quarter, driven by increased daily oil production and operational efficiency [3] - The company aims for a 30% increase in oil production and a 20% increase in total production for 2025, which is expected to enhance financial performance [4] Asset Integration - Successful integration of Uinta Basin assets contributed to a 63% increase in daily oil production compared to the first quarter of 2024, with drilling and completion efficiency exceeding expectations [5] - The Uinta Basin wells are expected to contribute to a higher oil mix, particularly in the second half of 2025, driving sustained growth [5] Financial Strategy - SM Energy is strategically using free cash flows to reduce its debt burden, aiming for a leverage ratio of about 1, which will strengthen its balance sheet [6] - The company can generate free cash flows even at a flat $55 per barrel oil price, supporting capital expenditures and prioritizing debt reduction [7] Market Position - Despite strong financial performance, SM Energy's stock has underperformed compared to the broader Zacks Exploration and Production industry, with shares falling 36.9% over the past year [8] - The company faces vulnerability to commodity price volatility, with potential adjustments needed if oil prices fall below $55 per barrel [11] Dividend Considerations - SM Energy's current dividend yield lags behind industry peers, as the company prioritizes debt reduction over aggressive shareholder return measures [12]

Company Performance - SM Energy's stock closed at $25.34, reflecting a -2.28% change from the previous day's closing price, underperforming the S&P 500's daily loss of 0.79% [1] - Prior to the recent trading session, SM Energy shares had gained 4.05%, which lagged behind the Oils-Energy sector's gain of 6.03% and the S&P 500's gain of 5.22% [1] Earnings Expectations - Analysts expect SM Energy to report earnings of $1.22 per share, indicating a year-over-year decline of 34.05% [2] - The Zacks Consensus Estimate for revenue is projected at $781.71 million, representing a 23.19% increase from the previous year [2] Full-Year Estimates - For the full year, Zacks Consensus Estimates predict earnings of $5.85 per share and revenue of $3.28 billion, reflecting year-over-year changes of -13.97% and +21.91%, respectively [3] - Recent changes to analyst estimates for SM Energy may indicate shifting business dynamics, with positive revisions suggesting analyst optimism [3] Valuation Metrics - SM Energy is currently trading at a Forward P/E ratio of 4.44, significantly lower than the industry average Forward P/E of 10.83, suggesting it is trading at a discount [6] - The Oil and Gas - Exploration and Production - United States industry, to which SM Energy belongs, ranks in the bottom 39% of all industries according to the Zacks Industry Rank [6] Zacks Rank System - The Zacks Rank system, which ranges from 1 (Strong Buy) to 5 (Strong Sell), has a strong track record, with 1 rated stocks delivering an average annual return of +25% since 1988 [5] - SM Energy currently holds a Zacks Rank of 3 (Hold), with a 3.18% increase in the Zacks Consensus EPS estimate over the last 30 days [5]

Group 1 - SM Energy Company will participate in the TD Cowen 23rd Annual Calgary Energy, Power & Utilities Conference on July 8, 2025, with CEO Herb Vogel engaging in a panel discussion and one-on-one meetings with investors [1] - The conference will not be webcast, indicating a more personal engagement approach with investors [1] Group 2 - SM Energy is an independent energy company focused on the acquisition, exploration, development, and production of crude oil, natural gas, and NGLs in Texas and Utah [3] - The company regularly updates important information on its website, providing transparency and accessibility to stakeholders [3]