Epsilon Energy Ltd.NASDAQ: EPSN

Epsilon Announces Third Quarter 2025 Results

Nov 5, 2025 at 9:05 PM UTC · Issued by Epsilon Energy Ltd. via GlobeNewswire

Watch Epsilon Energy explain itEpsilon Energy Ltd. (EPSN) Q2 2026 Earnings Call · Replay · Aug 13

HOUSTON, Nov. 05, 2025 (GLOBE NEWSWIRE) -- Epsilon Energy Ltd. (“Epsilon” or the “Company”) (NASDAQ: EPSN) today reported third quarter 2025 financial and operating results.

Third Quarter 2025 Highlights:

Epsilon - Q3 2025
		Q3 2025	Q2 2025	Q3 2024	QoQ%		YoY%		YTD 2025
NRI Production
Gas	MMcf	2,136	2,752	1,304	-22	%	64	%	7,628
Oil	Mbbl	39	44	53	-11	%	-26	%	129
NGL	Mbbl	14	8	17	78	%	-18	%	38
Total	Mmcfe	2,456	3,064	1,727	-20	%	42	%	8,629
Daily	Mmcfe/d	26.7	33.7	18.8					31.6

Revenues	$M
Gas		4,758	6,910	1,904	-31	%	150	%	22,282
Oil		2,511	2,725	3,965	-8	%	-37	%	8,505
NGL		267	145	335	84	%	-20	%	799
Midstream¹		1,445	1,845	1,084	-22	%	33	%	5,183
Total		8,981	11,625	7,288	-23	%	23	%	36,769

Realized Prices²
Gas	$/Mcf	2.23	2.51	1.46	-11	%	53	%	2.92
Oil	$/Bbl	63.73	61.72	74.27	3	%	-14	%	65.87
NGL	$/Bbl	19.12	18.51	19.56	3	%	-2	%	21.26

Adj. EBITDA	$M	4,365	7,396	3,744	-41	%	17	%	22,370

Cash + STI³	$M	13,236	10,378	8,775	28	%	51	%

Capex⁴	$M	2,885	2,698	3,908	7	%	-26	%	13,618

Dividend	$M	1,379	1,376	1,374	0	%	0	%	4,130

Share Buybacks	$M	0	0	628	0	%	-100	%	0

Adj Net Income⁵	$M	1,904	4,146	406					10,023
p/share	$	0.09	0.19	0.02					0.45

1) Net of elimination entry for fees paid by Epsilon
2) Excludes impact of hedge realizations
3) Includes restricted cash balance
4) Includes acquisitions
5) Excludes one-time expenses for transaction costs and impairment

Operations Update:

Epsilon’s capital expenditures were $2.9 million for the quarter ended September 30, 2025. These were primarily related to the completion of 1 gross (0.25 net) well in Texas. The well in Texas is the eighth Barnett well developed in the project and is performing in-line with pre-drill expectations with a 30-day gross IP rate of over 870 Boe/d (82% oil). Offset wells were shut-in for approximately 20 days during the quarter during the completion, with a net impact of approximately 3,000 net barrels.

In the Marcellus, operator elected shut-ins occurred in the second half of the quarter in response to lower gas prices during the shoulder season, with a net impact of approximately 110 MMcf.

Jason Stabell, Epsilon’s Chief Executive Officer, commented, “Over the last several weeks, net wellhead pricing in the Marcellus has moved up strongly as we exit the shoulder season, providing a strong setup for enhanced cash flows in the coming quarters. In the Permian, we continue to deliver good results. The eighth well in the project was brought online in September and performance is consistent with other wells developed in the project area. The next well in Texas is planned for development in the first quarter next year.

The big news during the quarter was our announcement of the acquisition of the operated business in the Powder River Basin. This transaction represents a major milestone in our strategic objectives to add scale, capital control and highly economic inventory at an attractive valuation. The transaction complements our non-operated portfolio and delivers on all these objectives. Integration planning and due diligence have progressed on schedule. We are excited to welcome a capable operating team from Peak and a premier long term focused energy investor in Yorktown as an anchor shareholder. The transaction is expected to close in November.”

Current Hedge Book:

Date	Natural Gas											Crude Oil
	Swaps			Basis Swaps			Costless Collars					Swaps
	Volume (MMcf)	Price ($/MMBtu)		Volume (MMcf)	Basis ($/MMBtu)		Volume (MMcf)	Bought Put ($/MMBtu)		Sold Call ($/MMBtu)		Volume (MBbl)	Price ($/Bbl)

4Q 2025	597		3.69	414	(0.96	)	286		3.46		5.60	22		67.66
FY 2025	597	$3.69		414	($0.96	)	286	$3.46		$5.60		22	$67.66
1Q 2026	270		4.66	-	-		567		3.36		5.49	6		65.00
2Q 2026	273		4.10	-	-		459		3.35		5.00	3		64.00
3Q 2026	276		4.10	-	-		439		3.35		5.01	-		-
4Q 2026	93		4.10	-	-		590		3.33		5.26	-		-
FY 2026	912	$4.27		-	-		2,055	$3.35		$5.21		9	$64.67
1Q 2027	-		-	-	-		619		3.43		5.41	-		-
2Q 2027	-		-	-	-		553		3.25		5.04	-		-
3Q 2027	-		-	-	-		229		3.16		4.46	-		-
4Q 2027	-		-	-	-		75		3.16		4.46	-		-
FY 2027	-		-	-	-		1,477	$3.31		$5.07		-		-

Earning’s Call:

The Company will host a conference call to discuss its results on Thursday, November 6, 2025, at 10:00 a.m. Central Time (11:00 a.m. Eastern Time).

Interested parties in the United States and Canada may participate toll-free by dialing (833) 816-1385. International parties may participate by dialing (412) 317-0478. Participants should ask to be joined to the “Epsilon Energy Third Quarter 2025 Earnings Conference Call.”

A webcast can be viewed at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=Z4tohzO8. A webcast replay will be available on the Company’s website (www.epsilonenergyltd.com) following the call.

About Epsilon

Epsilon Energy Ltd. is a North American onshore natural gas and oil production and gathering company with assets in Pennsylvania, Texas, Alberta CA, New Mexico, and Oklahoma.

Forward-Looking Statements

Certain statements contained in this news release constitute forward looking statements. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, ‘may”, “will”, “project”, “should”, ‘believe”, and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated. Forward-looking statements are based on reasonable assumptions, but no assurance can be given that these expectations will prove to be correct and the forward-looking statements included in this news release should not be unduly relied upon.

Contact Information:

281-670-0002

Jason Stabell
Chief Executive Officer
Jason.Stabell@EpsilonEnergyLTD.com

Andrew Williamson
Chief Financial Officer
Andrew.Williamson@EpsilonEnergyLTD.com

EPSILON ENERGY LTD. Unaudited Consolidated Statements of Operations *(All amounts stated in US$)*

	Three months ended September 30,						Nine months ended September 30,
	2025			2024			2025			2024
Revenues from contracts with customers:
Gas, oil, NGL, and condensate revenue	$	7,536,248		$	6,203,953		$	31,586,766		$	18,118,368
Gas gathering and compression revenue		1,445,211			1,083,988			5,182,566			4,464,134
Total revenue		8,981,459			7,287,941			36,769,332			22,582,502

Operating costs and expenses:
Lease operating expenses		2,397,052			2,099,501			7,615,735			5,517,830
Gathering system operating expenses		563,542			490,325			1,729,988			1,692,862
Depletion, depreciation, amortization, and accretion		2,570,462			2,698,812			9,247,973			7,127,641
Impairment expense		—			—			2,676,669			—
General and administrative expenses:
Stock based compensation expense		376,613			309,109			1,148,289			944,267
Other general and administrative expenses		2,467,785			1,449,576			5,748,081			4,486,814
Total operating costs and expenses		8,375,454			7,047,323			28,166,735			19,769,414
Operating income		606,005			240,618			8,602,597			2,813,088

Other income (expense):
Interest income		84,894			60,693			117,440			435,908
Interest expense		(11,666	)		(17,598	)		(43,783	)		(35,117	)
Gain on derivative contracts, net		964,307			440,712			2,076,000			245,095
Other income (expense), net		5,252			9,994			(28,086	)		111,067
Other income, net		1,042,787			493,801			2,121,571			756,953

Net income before income tax expense		1,648,792			734,419			10,724,168			3,570,041
Income tax expense		576,497			368,398			4,084,378			881,464
NET INCOME	$	1,072,295		$	366,021		$	6,639,790		$	2,688,577
Currency translation adjustments		(42,676	)		39,845			(168,288	)		62,438
Unrealized loss on securities		—			—			—			(1,598	)
NET COMPREHENSIVE INCOME	$	1,029,619		$	405,866		$	6,471,502		$	2,749,417

Net income per share, basic	$	0.05		$	0.02		$	0.30		$	0.12
Net income per share, diluted	$	0.05		$	0.02		$	0.30		$	0.12
Weighted average number of shares outstanding, basic		22,017,310			21,948,519			22,028,248			21,954,803
Weighted average number of shares outstanding, diluted		22,159,532			22,155,292			22,170,223			22,000,881

EPSILON ENERGY LTD. Unaudited Consolidated Statements of Cash Flows *(All amounts stated in US$)*

	September 30			December 31,
	2025			2024
ASSETS
Current assets
Cash and cash equivalents	$	12,766,167		$	6,519,793
Accounts receivable		4,515,199			5,843,722
Fair value of derivatives		889,187			—
Prepaid income taxes		—			975,963
Other current assets		965,970			792,041
Total current assets		19,136,523			14,131,519
Non-current assets
Property and equipment:
Oil and gas properties, successful efforts method
Proved properties		200,066,005			191,879,210
Unproved properties		33,396,744			28,364,186
Accumulated depletion, depreciation, amortization and impairment		(134,181,378	)		(123,281,395	)
Total oil and gas properties, net		99,281,371			96,962,001
Gathering system		43,540,301			43,116,371
Accumulated depletion, depreciation, amortization and impairment		(37,271,826	)		(36,449,511	)
Total gathering system, net		6,268,475			6,666,860
Land		637,764			637,764
Buildings and other property and equipment, net		221,901			259,335
Total property and equipment, net		106,409,511			104,525,960
Other assets:
Operating lease right-of-use assets, long term		272,298			344,589
Restricted cash		470,000			470,000
Prepaid drilling costs		4,673			982,717
Total non-current assets		107,156,482			106,323,266
Total assets	$	126,293,005		$	120,454,785

LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable trade	$	2,963,805		$	2,334,732
Gathering fees payable		978,890			997,016
Royalties payable		1,481,520			1,400,976
Income taxes payable		1,556,724			—
Accrued capital expenditures		1,605,705			572,079
Accrued compensation		726,213			695,018
Other accrued liabilities		490,970			371,503
Fair value of derivatives					487,548
Operating lease liabilities		120,799			121,135
Total current liabilities		9,924,626			6,980,007
Non-current liabilities
Asset retirement obligations		3,822,030			3,652,296
Deferred income taxes		12,062,053			12,738,577
Operating lease liabilities, long term		266,263			355,776
Total non-current liabilities		16,150,346			16,746,649
Total liabilities		26,074,972			23,726,656
Commitments and contingencies (Note 11)
Shareholders' equity
Preferred shares, no par value, unlimited shares authorized, none issued or outstanding		—			—
Common shares, no par value, unlimited shares authorized and 22,058,574 shares issued and outstanding at September 30, 2025 and 22,008,766 issued and outstanding at December 31, 2024		116,081,031			116,081,031
Additional paid-in capital		13,267,196			12,118,907
Accumulated deficit		(38,995,173	)		(41,505,076	)
Accumulated other comprehensive income		9,864,979			10,033,267
Total shareholders' equity		100,218,033			96,728,129
Total liabilities and shareholders' equity	$	126,293,005		$	120,454,785

EPSILON ENERGY LTD. Unaudited Consolidated Statements of Cash Flows *(All amounts stated in US$)*

	Nine months ended September 30,
	2025			2024
Cash flows from operating activities:
Net income	$	6,639,790		$	2,688,577
Adjustments to reconcile net income to net cash provided by operating activities:
Depletion, depreciation, amortization, and accretion		9,247,973			7,127,641
Impairment expense		2,676,669			—
Accretion of discount on available for sale securities		—			(297,637	)
Gain on derivative contracts		(2,076,000	)		(245,095	)
Settlement received on derivative contracts		699,265			1,245,931
Settlement of asset retirement obligation		(1,600	)		(88,992	)
Stock-based compensation expense		1,148,289			944,267
Deferred income tax (benefit) expense		(676,523	)		584,088
Changes in assets and liabilities:
Accounts receivable		1,328,523			1,545,431
Prepaid income taxes		—			(67,878	)
Other assets and liabilities		(191,487	)		(94,360	)
Accounts payable, royalties payable, gathering fees payable, and other accrued liabilities		(430,885	)		(1,520,707	)
Income taxes payable		2,532,686			—
Net cash provided by operating activities		20,896,700			11,821,266
Cash flows from investing activities:
Additions to unproved oil and gas properties		(5,032,558	)		(3,100,294	)
Additions to proved oil and gas properties		(5,901,411	)		(28,728,498	)
Additions to gathering system properties		(384,124	)		(76,625	)
Additions to land, buildings and property and equipment		(12,102	)		(13,912	)
Purchases of short term investments - available for sale		—			(4,045,785	)
Proceeds from short term investments - held to maturity		—			23,116,930
Prepaid drilling costs		978,044			1,813,808
Net cash used in investing activities		(10,352,151	)		(11,034,376	)
Cash flows from financing activities:
Buyback of common shares		—			(1,831,208	)
Dividends paid		(4,129,887	)		(4,116,777	)
Net cash used in financing activities		(4,129,887	)		(5,947,985	)
Effect of currency rates on cash, cash equivalents, and restricted cash		(168,288	)		62,438
Increase (decrease) in cash, cash equivalents, and restricted cash		6,246,374			(5,098,657	)
Cash, cash equivalents, and restricted cash, beginning of period		6,989,793			13,873,628
Cash, cash equivalents, and restricted cash, end of period	$	13,236,167		$	8,774,971

Supplemental cash flow disclosures:
Income tax paid - federal	$	1,417,860		$	—
Income tax paid - state (PA)	$	755,138		$	—
Income tax paid - state (other)	$	26,710		$	4,000
Interest paid	$	9,935		$	16,832

Non-cash investing activities:
Change in proved properties accrued in accounts payable	$	2,266,859		$	818,504
Change in gathering system accrued in accounts payable	$	39,805		$	173,193
Asset retirement obligation asset additions and adjustments	$	25,196		$	39,597

	Three months ended September 30,						Nine months ended September 30,
	2025			2024			2025			2024
Net income	$	1,072,295		$	366,021		$	6,639,790		$	2,688,577
Add Back:
Interest income, net		(73,228	)		(43,095	)		(73,657	)		(400,791	)
Income tax expense		576,497			368,398			4,084,378			881,464
Depreciation, depletion, amortization, and accretion		2,570,462			2,698,812			9,247,973			7,127,641
Impairment expense		—			—			2,676,669			—
Stock based compensation expense		376,613			309,109			1,148,289			944,267
(Gain) loss on derivative contracts net of cash received or paid on settlement		(156,659	)		44,677			(1,376,735	)		1,000,836
Foreign currency translation loss		(710	)		—			23,601			570
Adjusted EBITDA	$	4,365,270		$	3,743,922		$	22,370,308		$	12,242,564

Epsilon defines Adjusted EBITDA as earnings before (1) net interest expense, (2) taxes, (3) depreciation, depletion, amortization and accretion expense, (4) impairments of natural gas and oil properties, (5) non-cash stock compensation expense, (6) gain or loss on derivative contracts net of cash received or paid on settlement, and (7) other income. Adjusted EBITDA is not a measure of financial performance as determined under U.S. GAAP and should not be considered in isolation from or as a substitute for net income or cash flow measures prepared in accordance with U.S. GAAP or as a measure of profitability or liquidity.

Additionally, Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. Epsilon has included Adjusted EBITDA as a supplemental disclosure because its management believes that EBITDA provides useful information regarding its ability to service debt and to fund capital expenditures. It further provides investors with a helpful measure for comparing operating performance on a "normalized" or recurring basis with the performance of other companies, without giving effect to certain non-cash expenses and other items. This provides management, investors and analysts with comparative information for evaluating the Company in relation to other natural gas and oil companies providing corresponding non-U.S. GAAP financial measures or that have different financing and capital structures or tax rates. These non-U.S. GAAP financial measures should be considered in addition to, but not as a substitute for, measures for financial performance prepared in accordance with U.S. GAAP.

	Q125		Q225		Q325		YTD 2025
Net Income		3,965,918		1,475,965		1,029,619		6,471,502

Adjustments
Transaction Costs		0		0		874,541		874,541
Impairment - Canada		6,669		2,670,000				2,676,669

Adjusted Net Income		3,972,587		4,145,965		1,904,160		10,022,712
WA Shares O/S - Diluted		22,109,819		22,202,315		22,159,532		22,170,223
P/Share	$	0.18	$	0.19	$	0.09	$	0.45

Epsilon defines Adjusted Net Income Per Share as reported U.S. GAAP Net Income Per Share adding back expenses related to (1) transaction expenses related to the Peak acquisitions and (2) impairments of natural gas and oil properties. Adjusted Net Income Per Share is not a measure of financial performance as determined under U.S. GAAP and should not be considered in isolation from or as a substitute for net income or cash flow measures prepared in accordance with U.S. GAAP or as a measure of profitability or liquidity.