Granite Ridge Resources : Second Quarter 2025 Earnings Press Release

About this update from Granite Ridge Resources, Inc.

NEWS RELEASE Granite Ridge Resources, Inc. Reports Second Quarter 2025 Results, Declares Quarterly Cash Dividend and Provides Updated Outlook for 2025 2025-08-07 DALLAS--(BUSINESS WIRE)-- Granite Ridge Resources, Inc. ("Granite Ridge" or the "Company") (NYSE: GRNT) today reported nancial and operating results for the second quarter of 2025. Second Quarter 2025 Highlights Grew daily production 37% to 31,576 barrels of oil equivalent ("Boe") per day (51% oil), from 23,106 Boe per day for the second quarter of 2024. Reported net income of $25.1 million, or $0.19 per diluted share, versus $5.1 million, or $0.04 per diluted share, for the prior year period. Adjusted Net Income (non-GAAP) totaled $14.0 million, or $0.11 Adjusted Earnings Per Diluted Share (non-GAAP). Generated $75.4 million of Adjusted EBITDAX (non-GAAP). Invested $77.2 million in development capital expenditures and $10.1 million in acquisition capital to capture high quality drilling opportunities. Placed 4.9 net wells online. Declared dividend of $0.11 per share of common stock. Net Debt to Trailing Twelve Months Adjusted EBITDAX (non-GAAP) of 0.8x Subsequent to quarter end, the Company's Board of Directors declared a regular quarterly dividend of $0.11 per share payable on September 15, 2025 to shareholders of record as of August 29, 2025. Future declarations of dividends are subject to approval by the Board of Directors. See "Supplemental Non-GAAP Financial Measures" below for descriptions of the above non-GAAP measures as well as a reconciliation of these measures to the associated GAAP (as de ned herein) measures. Tyler Farquharson, President and CEO of Granite Ridge, commented, "Our quarterly results continue to validate our business model, with production and cash ow again exceeding expectations. We allocate capital to the highest risk-adjusted returns across a diverse portfolio of oil and natural gas assets, driving consistent and attractive full-cycle returns. This compounding e ect is accelerating our growth momentum. "In the second quarter, we increased production by 37% year-over-year to 31,576 Boe per day, driven by a 46% rise in oil production and a 28% rise in natural gas production. Development capital expenditures of $148.6 million for the six months ended June 30 were in line with expectations, while non-budgeted acquisition capital increased due to heightened transaction activity in our Operated Partnership and Traditional Non-Op investment strategies. We are raising our full-year production guidance by 10% at the midpoint to between 31,000 and 33,000 Boe per day and increasing our capital expenditure guidance to $400-420 million to support the expanded inventory additions." "During the quarter, we announced that Luke Brandenburg stepped down as CEO. I am honored to lead Granite Ridge and am con dent our strategy will maximize shareholder value. We deeply appreciate Luke's signi cant contributions to our success and wish him the very best. Our strategy remains unchanged: underwrite development projects with full-cycle returns exceeding 25%, deliver consistent growth, and return capital to shareholders through a quarterly dividend." Guidance Update The Company's Operated Partnership and Traditional Non-Op investment strategies continued to drive value in the second quarter of 2025. Wells in the Permian came online ahead of schedule and Utica wells exceeded forecasts. As a result, the Company has raised its full-year production guidance by 10% at the midpoint to 31,000-33,000 barrels of oil equivalent per day, achieving 28% year-over-year growth. Capital expenditure guidance has also been increased to $400-$420 million, primarily to fund acquisitions expected to close in 2025. Granite Ridge plans to deploy approximately $120 million in acquisition capital, adding 74 net locations, with a signi cant portion allocated to the Permian Basin through its Operated Partnership strategy and the remaining portion to the high-performing Appalachia leasing strategy. These acquisitions have secured three additional years of inventory at an entry cost of approximately $1.7 million per location. Financial Results Oil and natural gas sales for the second quarter of 2025 were $109.2 million. Net income was $25.1 million, or $0.19 per diluted share. Excluding non-cash and special items, Adjusted Net Income (non-GAAP) was $14.0 million, or $0.11 per diluted share. Adjusted EBITDAX (non-GAAP) for the second quarter of 2025 totaled $75.4 million compared to $68.3 million for the second quarter of 2024. Cash ow from operating activities was $78.0 million, including $8.6 million in working capital changes. Operating Cash Flow Before Working Capital Changes (non-GAAP) was $69.5 million. Production Results Second quarter 2025 oil production volumes totaled 16,009 barrels ("Bbls") per day, a 46% increase from the second quarter of 2024. Natural gas production for the second quarter of 2025 totaled 93,404 thousand cubic feet of natural gas ("Mcf") per day, a 28% increase from the second quarter of 2024. The Company's daily production for the second quarter of 2025 grew 37% from the second quarter of the prior year to 31,576 Boe per day. Oil, Natural Gas and Related Product Sales The Company's average realized price for oil and natural gas for the second quarter of 2025, excluding the e ect of commodity derivatives, was $61.41 per Bbl and $2.32 per Mcf, respectively, compared to $77.84 per Bbl and $1.98 per Mcf realized in the second quarter of 2024. Operating Costs Lease operating expenses were $20.1 million ($7.00 per Boe) for the three months ended June 30, 2025 compared to $13.7 million ($6.50 per Boe) during the same period in 2024. The increase was primarily due to an overall increase in service costs, particularly saltwater disposal costs. Production and ad valorem taxes were $6.4 million for the quarter, or 6% of oil and natural gas sales. During the quarter, general and administrative expenses totaled $8.5 million, or $2.96 per Boe, inclusive of $2.8 million of nonrecurring severance and capital markets expenses and $0.4 million of non-cash stock-based compensation. Capital Expenditures and Operational Activity Capital expenditures for the quarter were $87.3 million comprised of $77.2 million of development capital and $10.1 million of property acquisition costs. The Company closed nine acquisitions in the Permian and Utica Basins, adding an aggregate inventory of 5.5 net undeveloped locations. The table below provides the costs incurred for oil and natural gas producing activities for the periods indicated: Three Months Ended June 30, Six Months Ended June 30, (in thousands) 2025 2024 2025 2024 Property acquisition costs: Proved $ - $ 1,677 $ 13,341 $ 2,824 Unproved 10,069 17,115 31,090 18,596 Development costs 77,185 66,951 148,587 129,590 Total costs incurred for oil and natural gas properties $ 87,254 $ 85,743 $ 193,018 $ 151,010 The Company had 4.9 net wells turned in-line ("TIL") during the second quarter of 2025, compared to 9.1 net wells TIL in the second quarter of 2024. Granite Ridge saw strong well performance across multiple basins, highlighted by robust initial production from recently TIL wells in the Permian Basin. The table below provides a summary of gross and net wells completed and TIL for the three and six months ended June 30, 2025: Three Months Ended June 30, 2025 Six Months Ended June 30, 2025 Gross Net Gross Net Permian 44 4.4 88 17.0 Eagle Ford 1 0.0 2 0.0 Bakken 5 0.1 10 0.2 Haynesville 0 0.0 0 0.0 DJ 5 0.0 66 0.4 Appalachian 9 0.4 30 1.0 Total 64 4.9 196 18.6 At June 30, 2025, the Company had 125 gross (16.0 net) wells in process. Liquidity and Capital Resources As of June 30, 2025, Granite Ridge had $275.0 million of debt outstanding under its Credit Agreement and $103.4 million of liquidity, consisting of $99.7 million of committed borrowing availability and $3.7 million of cash on hand. Commodity Derivatives Update The Company's commodity derivatives strategy is intended to manage its exposure to commodity price uctuations. Please see the table under "Derivatives Information" below for detailed information about Granite Ridge's current derivatives positions. 2025 Updated Guidance The following table summarizes the Company's updated operational and nancial guidance for 2025. Annual production (Boe per day) 31,000 - 33,000 Oil as a % of sales volumes 51% - 53% Acquisitions ($ in millions) $120 - $120 Development capital expenditures ($ in millions) $280 - $300 Total capital expenditures ($ in millions) $400 - $420 Lease operating expenses (per Boe) $6.25 - $7.25 Production and ad valorem taxes (as a % of total sales) 6% - 7% Cash general and administrative expense ($ in millions) Conference Call $25 - $27 Granite Ridge will host a conference call on August 8, 2025, at 10:00 AM CT (11:00 AM ET) to discuss its second quarter 2025 results. A brief Q&A session for security analysts will immediately follow the discussion. The telephone number and passcode to access the conference call are provided below: Dial-in: (888) 660-6093 Intl. dial-in: (929) 203-0844 Participant Passcode: 4127559 To access the live webcast visit Granite Ridge's website at https://www.graniteridge.com . Alternatively, an audio replay will be available through August 22, 2025. To access the audio replay dial (800) 770-2030 and enter con rmation code 4127559. Upcoming Investor Events Granite Ridge management will be participating in the following upcoming investor events: Enercom The Energy Investment Conference (Denver, CO) - August 19, 2025 Three Part Advisors Midwest IDEAS Conference (Chicago, IL) - August 26, 2025 Pickering Energy Conference (Austin, TX) - September 30, 2025 Any investor presentations to be used for such events will be posted prior to the respective event on Granite Ridge's website. Information on Granite Ridge's website does not constitute a portion of, and is not incorporated by reference into this press release. About Granite Ridge Granite Ridge is a scaled energy company which aims to provide shareholders with exposure similar to energy private equity through operated partnerships and traditional non-operated assets. We own assets in six proli c

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