Talos Energy, Inc. · NYSE:TALO
Talos Energy — Q2 2025 Earnings Presentation
33 slides from Talos Energy's earnings presentation, Aug 7, 2025
Slide 1: 2Q 2025 Earnings Conference Call & Webcast
2Q 2025 Earnings Conference Call & Webcast August 7, 2025 www.talosenergy.com NYSE: TALO 1
Slide 2: Cautionary Statements
Cautionary Statements Cautionary Statements Reserve Information The information in this presentation includes “forward-looking statements” within the meaning of Section 27A of the Securities Act Reserve engineering is a process of estimating underground accumulations of oil, natural gas and NGLs tha
Slide 3: Talos Overview
Talos Overview LA TX FL • High margin oil weighted production Offshore Gulf of America • High quality and stable asset base • Infrastructure focused Gulf of America • Short cycle offshore drilling inventory • Capital discipline MEXICO • Free cash flow generator Zama • Committed to low leverage Mexic
Slide 4: Talos's Enhanced Strategy
Talos’s Enhanced Strategy Transforming Into a Leading Pure-Play E&P Company Three Strategic Pillars Disciplined Capital Allocation Framework INVEST in projects that generate robust returns IMPROVE OUR BUSINESS EVERY DAY throughout the commodity cycles • Improve business performance and reduce costs
Slide 5: 2Q 2025 Accomplishments – Delivering on Our Commitments
2Q 2025 Accomplishments – Delivering on Our Commitments • Announced Talos’s Enhanced Strategy • Delivered Strong Financial Results • Delivered on Major Operational Milestone • Advanced Optimal Performance Plan for Cash Delivering Flow Improvements on Our Commitments • Generated Significant Free Cash
Slide 6: 2Q 2025 and Recent Financial and Operational Highlights
2Q 2025 and Recent Financial and Operational Highlights 2Q 2025 93.3 MBOE/D ~$294 MM $126 MM Average Daily Production Adj. EBITDA(1) CAPEX(2) 69% / 77% ~$35/BOE ~$99 MM Oil / Liquids Adj. EBITDA/BOE(1) Adj. FCF(1)(3) $0 DRAWN Credit Facility 0.7x $1.0 BN $357 MM Leverage Ratio(1) Liquidity(4) Cash o
Slide 7: Improve Our Business Every Day: Optimal Performance Plan
Improve Our Business Every Day Optimal Performance Plan for Cash Flow Enhancements CAPITAL MARGIN COMMERCIAL ORGANIZATIONAL EFFICIENCY ENHANCEMENT OPPORTUNITIES IMPROVEMENT Optimize capital planning process and Maximize profit margins via Enhance value by increasing Deliver meaningful efficiency gai
Slide 8: Optimal Performance Plan for Cash Flow Enhancements
Optimal Performance Plan for Cash Flow Enhancements Improving Our Business Every Day Established Early Momentum Targeted Cash Flow Improvement Executing on Planned Opportunities… …Advancing 2026 Initiatives Estimated Category Breakdown • ~$10.0 MM Arnold P&A Program • Transportation and Logistics •
Slide 9: Consistently Achieve Top Quartile Ranking for EBITDA Margin
Consistently Achieve Top Quartile Ranking for EBITDA Margin One of the highest EBITDA/BOE margins in the E&P sector(1) – 2Q 2025: ~$35 per BOE 2Q 2025E EBITDA Margin 2025E EBITDA Margin Consensus $/BOE Consensus $/BOE $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $0 $5 $10 $15 $20 $25 $30 $35 $40 $45 $34.64
Slide 10: 2025 – 1H 2026 Proposed Drill Calendar
2025 – 1H 2026 Proposed Drill Calendar 2025 2026 Prospect Category Host Facility 1Q 2Q 3Q 4Q 1Q 2Q Brutus Platform Development Brutus Rig Prep D&C Katmai West #2 Development Tarantula Drilling Comp Daenerys Exploration TBD Drilling Sunspear Development Prince Comp SCSSV Cardona Development Pompano D
Slide 11: Delivering Operationally
Delivering Operationally KATMAI WEST #2 Initiated Production SUNSPEAR Initiated Production(1) DAENERYS Drilling operations underway MONUMENT Project on track (1) In July, production from Sunspear was temporarily shut in due to an early failure of the surface-controlled subsurface safety valve ("SCSS
Slide 12: Katmai West #2 On-Line and Flowing
Katmai West #2 On-Line and Flowing Tarantula Strategic Elements Lower Miocene Structure Map Talos: 100% WI Katmai West #2 • Katmai West #2 tied into and flowing to Tarantula • Project delivered on under budget and Katmai West #1 ahead of schedule Katmai West #2 Producing Spud 4Q 2024 (50% WI) • Rock
Slide 13: Sunspear Discovery
Sunspear Discovery Strategic Elements Structure Map Prince • Sunspear tied into the Prince facility Sunspear • Initial productive capacity at high-end of ~350 Pay Sand expectations and well is still in cleanup A’ Acres phase Sunspear • Recently shut-in due to early failure of (GC 78 SS2) surface-con
Slide 14: Prioritizing Safety and Environment in Everything We Do
Prioritizing Safety and Environment in Everything We Do Employee Safety TRIR and SIFR Performance 0.35 TRIR 1.0 0.8 In 3.46 MM work hours GOA Average TRIR 0.6 Significantly below GOA average of 0.51 Talos TRIR 0.4 Talos SIFR 0.2 0.0 2021 2022 2023 2024 2Q 2025 BBLS Spilled per 1 MM BBL Produced Liqu
Slide 15: 2025 Capital Budget
2025 Capital Budget Highlights • Robust development projects economic at an average price of ~$35 per barrel • Lowered Upstream CAPEX: $490 - $530 MM P&A 17% Investment in Mexico • P&A, Decommissioning on track: $100 - $120 MM 2% • Balanced portfolio of drilling opportunities Cap G&A / Other 5% $590
Slide 16: Revised 2025 Operational and Financial Guidance
Revised 2025 Operational and Financial Guidance • Improved full-year 2025 guidance reflects higher production, lower operating expenses and capital expenditures • 3Q 2025 production guidance 86 - 90 MBOE/D Previous Revised 2025E Guidance Guidance Oil (MMBBL) 22.7 – 24.0 23.0 – 24.0 Natural Gas (BCF)
Slide 17: 2025 Production Guidance Considerations
2025 Production Guidance Considerations 2025E Average Daily Production (MBOE/D) • Talos’s 2025 guidance accounts for expected production impacts, including maintenance, third-party 100.0+ projects, and timing-related ~(5.0) considerations ~(4.0) • Key 2025 major planned downtime events include Katma
Slide 18: Talos is Well Hedged
Talos is Well Hedged Average Daily Hedged Oil Volumes MBO/D • Hedge positions help protect $72.62 cash flow in a volatile commodity Realized w/ Hedging $69.86 Realized w/ Hedging $71.42 price environment WTI $63.68 WTI $72.22 HEDGE FLOOR $73.45 • Over 38% of the balance of 2025 ~40 HEDGE FLOOR oil p
Slide 19: Deliver Shareholder Value Through Disciplined Capital Allocation
Deliver Shareholder Value Through Disciplined Capital Allocation INVEST in projects that generate robust returns throughout the commodity cycles GROW RETURN via selective accretive up to 50% of growth opportunities annual FCF to shareholders STRENGTHEN the balance sheet Target long-term leverage of
Slide 20: Strong Balance Sheet and No Near-Term Maturities
Strong Balance Sheet and No Near-Term Maturities Cash Balance and Debt Maturities $ Millions • Paid down $550 MM of debt in 2024 since closing QuarterNorth $700(2) acquisition, accreting over $3.00 Availability per share to shareholders $625 $625 • $0 drawn credit facility • Cash increased from $203
Slide 21: Returning Cash to Shareholders
Returning Cash to Shareholders Cumulative Value of Shares Repurchased $ Millions ~$100 TOTAL $33 ~6% $67 (1) TOTAL $22 $22 $45 TOTAL Of OUTSTANDING STOCK $45 $45 $45 REPURCHASED for ~$100 MM 2024 1Q 2025 2Q 2025 (1) 10.1 MM share repurchased divided by 183.9 MM shares outstanding as of April 29, 202
Slide 22: 2Q 2025 Scorecard
2Q 2025 Scorecard Delivered strong 2Q 2025 financial performance • Beat quarterly consensus on Adj. EBITDA, and Adj. FCF Committed to Balance Sheet Strength Delivering • $0 drawn credit facility, 0.7x leverage ratio, $1.0 BN in liquidity, and $357 MM in cash on Our Commitments Delivered Operationall
Slide 23: Appendix
Appendix 23
Slide 24: Daenerys
Daenerys High-Impact Subsalt Miocene Exploration Opportunity Strategic Elements Lower Miocene Structure Map TBD • Currently Drilling • 23,000 gross acres • Large Middle and Lower Miocene 4-way turtle structure • Evaluating several host facility options Proposed Location • Working Interest: Proposed
Slide 25: Monument – High-Impact Subsalt Wilcox Discovery
Monument – High-Impact Subsalt Wilcox Discovery Acquisition of Major Discovery with Material Resource Life Strategic Elements Wilcox Structure Map 2P Reserves Shenandoah • Wilcox discovery with two well penetrations (FID Feb 2024) • Good seismic image, faulted 4-way Discovery Well WR 271 #1 Future P
Slide 26: Ewing Bank 953
Ewing Bank 953 Strategic Elements Structure Map Megalodon • Discovered 127 ft of net hydrocarbon pay • Excellent rock properties and collected pressure and fluid samples • Expect production in mid-2026 • Current plan is for a short tieback to EW 953 #1 ST 311 Megalodon Platform SALT • Partnership: •
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended ($ Thousands) June 30, 2025 March 31, 2025 December 31, 2024 September 30, 2024 Reconciliation of Net Income (Loss) to Adjusted EBITDA: Net Income (loss) $(185,937) $(9,868) $(64,508) $88,173 Interest expense $40,811 $40,927 $41,536 $46,275 Income tax expe
Slide 28: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended ($ Thousands) June 30, 2025 Reconciliation of Adjusted EBITDA to Adjusted Free Cash Flow (before changes in working capital): Adjusted EBITDA $294,247 Capital expenditures $(124,061) Plugging & abandonment $(28,497) Decommissioning obligations settled $(35
Slide 29: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended ($ Thousands) June 30, 2025 Reconciliation of General & Administrative Expenses to Adjusted General & Administrative Expenses: Total General and administrative expense $39,430 Transaction and other expenses $(663) Non-cash equity-based compensation expense
Slide 30: Non-GAAP Reconciliations
Non-GAAP Reconciliations Three Months Ended, June 30, 2025 ($ Thousands, except per share amounts) Basic per Share Diluted per Share Reconciliation of Net Income (Loss) to Adjusted Net Income (Loss): Net Income (loss) $(185,937) $(1.05) $(1.05) Impairment of oil and natural gas properties $223,881 $
Slide 31: Non-GAAP Reconciliations
Non-GAAP Reconciliations ($ Thousands) June 30, 2025 Reconciliation of Net Debt: 9.000% Second-Priority Senior Secured Notes – due February 2029 $625,000 9.375% Second-Priority Senior Secured Notes – due February 2031 $625,000 Bank Credit Facility – matures March 2027 — Total Debt $1,250,000 Less: C
Slide 32: Talos Hedge Book as of June 30, 2025
Talos Hedge Book as of June 30, 2025 Instrument Type Avg. Daily Volume W.A. Swap W.A. Floor W.A. Ceiling Crude – WTI (BBLs) (Per BBL) (Per BBL) (Per BBL) July – September 2025 Fixed Swaps 25,370 $71.57 — — October – December 2025 Fixed Swaps 22,967 $71.33 — — January – March 2026 Fixed Swaps 14,000
Slide 33: www.talosenergy.com NYSE: TALO
www.talosenergy.com NYSE: TALO 33