DALLAS--(BUSINESS WIRE)--November 06, 2025--
Granite Ridge Resources, Inc. ("Granite Ridge" or the "Company") (NYSE: GRNT) today reported financial and operating results for the third quarter of 2025.
Third Quarter 2025 Highlights
-- Grew daily production 27% to 31,925 barrels of oil equivalent ("Boe") per
day (51% oil), from 25,177 Boe per day for the third quarter of 2024.
-- Reported net income of $14.5 million, or $0.11 per diluted share, versus
$9.1 million, or $0.07 per diluted share, for the prior year period.
Adjusted Net Income (non-GAAP) totaled $11.8 million, or $0.09 Adjusted
Earnings Per Diluted Share (non-GAAP).
-- Generated $78.6 million of Adjusted EBITDAX (non-GAAP).
-- Invested $64.0 million in development capital expenditures and $16.5
million in acquisition capital to capture high quality drilling
opportunities.
-- Placed 9.3 net wells online.
-- Declared dividend of $0.11 per share of common stock.
-- Net Debt to Trailing Twelve Months Adjusted EBITDAX (non-GAAP) of 0.9x.
-- Subsequent to quarter end, the Company's Board of Directors declared a
regular quarterly dividend of $0.11 per share payable on 12/15/2025 to
shareholders of record as of 11/28/2025. Future declarations of dividends
are subject to approval by the Board of Directors.
-- Subsequent to quarter end, the Company issued $350.0 million aggregate
principal amount of 8.875% senior unsecured notes at 96.0% of par with a
stated maturity of November 5, 2029.
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 defined herein) measures.
Tyler Farquharson, President and CEO of Granite Ridge, commented, "Granite Ridge delivered another quarter of strong execution and disciplined growth, demonstrating the consistency of our model and the strength of our diversified portfolio. Our Operated Partnership platform continues to perform well, highlighted by Admiral Permian Resources and other key partners who are driving operational excellence and capital efficiency across our portfolio.
"Subsequent to quarter end, we further strengthened our balance sheet through proactive refinancing that enhanced our liquidity and extended our financial runway heading into 2026. These actions reflect our continued commitment to maintaining a conservative capital structure and ensuring the flexibility to pursue high-return opportunities while delivering consistent cash returns to shareholders.
"As we look ahead to 2026, Granite Ridge is well positioned to build on this momentum. Our Operated Partnerships provide a repeatable path to growth, our non-operated portfolio continues to generate steady cash flow, and our financial strength enables us to create long-term value for shareholders through commodity cycles."
Financial Results
Oil and natural gas sales for the third quarter of 2025 were $112.7 million. Net income was $14.5 million, or $0.11 per diluted share. Excluding non-cash and special items, Adjusted Net Income (non-GAAP) was $11.8 million, or $0.09 per diluted share.
Adjusted EBITDAX (non-GAAP) for the third quarter of 2025 totaled $78.6 million compared to $75.4 million for the third quarter of 2024. Cash flow from operating activities was $77.8 million, including $4.7 million in working capital changes. Operating Cash Flow Before Working Capital Changes (non-GAAP) was $73.1 million.
Production Results
Third quarter 2025 oil production volumes totaled 16,222 barrels ("Bbls") per day, a 28% increase from the third quarter of 2024. Natural gas production for the third quarter of 2025 totaled 94,217 thousand cubic feet of natural gas ("Mcf") per day, a 25% increase from the third quarter of 2024. The Company's daily production for the third quarter of 2025 grew 27% from the third quarter of the prior year to 31,925 Boe per day.
Oil, Natural Gas and Related Product Sales
The Company's average realized price for oil and natural gas for the third quarter of 2025, excluding the effect of commodity derivatives, was $61.62 per Bbl and $2.39 per Mcf, respectively, compared to $73.44 per Bbl and $1.24 per Mcf realized in the third quarter of 2024.
Operating Costs
Lease operating expenses were $23.6 million ($8.03 per Boe) for the three months ended September 30, 2025 compared to $13.0 million ($5.62 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 $6.6 million for the quarter, or 6% of oil and natural gas sales. During the quarter, general and administrative expenses totaled $7.0 million, or $2.38 per Boe, inclusive of $0.4 million of nonrecurring severance and capital markets expenses and $1.3 million of non-cash stock-based compensation.
Capital Expenditures and Operational Activity
Capital expenditures for the quarter were $80.5 million comprised of $64.0 million of development capital and $16.5 million of property acquisition costs. The Company closed 17 acquisitions in the Permian and Utica Basins, adding an aggregate inventory of 13.6 net undeveloped locations.
The table below provides the costs incurred for oil and natural gas producing activities for the periods indicated:
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------------- --------------------------
(in thousands) 2025 2024 2025 2024
--- ------- --------- ------- ---------
Property
acquisition
costs:
Proved $ 807 $ -- $ 14,148 $ 2,824
Unproved 15,704 32,919 46,794 51,515
Development
costs 64,006 77,171 212,593 206,761
--- ------- --------- ------- ---------
Total costs
incurred for
oil and
natural gas
properties $ 80,517 $ 110,090 $ 273,535 $ 261,100
=== ======= ========= ======= =========
The Company had 9.3 net wells turned in-line ("TIL") during the third quarter of 2025, compared to 5.2 net wells TIL in the third 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 nine months ended September 30, 2025:
Three Months Ended September Nine Months Ended September
30, 2025 30, 2025
---------------------------- ----------------------------
Gross Net Gross Net
------------- ------------- ------------- -------------
Permian 25 7.3 113 24.3
Eagle Ford 5 0.5 7 0.5
Bakken 0 0.0 10 0.2
Haynesville 12 1.2 12 1.2
DJ 6 0.2 72 0.6
Appalachian 11 0.1 41 1.1
------------- ------------- ------------- -------------
Total 59 9.3 255 27.9
============= ============= ============= =============
At September 30, 2025, the Company had 108 gross (11.3 net) wells in process.
Liquidity and Capital Resources
As of September 30, 2025, Granite Ridge had $300.0 million of debt outstanding under its existing Credit Agreement and $86.5 million of liquidity, consisting of $74.7 million of committed borrowing availability and $11.8 million of cash on hand.
On November 5, 2025, the Company, as issuer, completed an issuance of $350.0 million aggregate principal amount of 8.875% senior unsecured notes at 96.0% of par with stated maturity on November 5, 2029 (the "2029 Senior Notes") pursuant to a note purchase agreement. The 2029 Senior Notes were purchased by a group of institutional accounts, including funds managed by EOC Partners Advisors L.P. The Company used the net proceeds from issuance of the 2029 Senior Notes to repay certain amounts under the Credit Agreement and to pay related fees and expenses.
On November 5, 2025, the Company and its lenders entered into the Sixth Amendment to Credit Agreement, which amended the Credit Agreement to, among other things:
-- reaffirm the borrowing base and aggregate elected commitment amounts at
$375.0 million,
-- permit the issuance of the 2029 Senior Notes, and
-- extend the maturity date to 2029.
Commodity Derivatives Update
The Company's commodity derivatives strategy is intended to manage its exposure to commodity price fluctuations. Please see the table under "Derivatives Information" below for detailed information about Granite Ridge's current derivatives positions.
2025 Guidance
The following table summarizes the Company's operational and financial guidance for 2025.
Annual production (Boe per day) 31,000 - 33,000 Oil as a % of sales volumes 51% - 53% Acquisitions ($ 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) $25 - $27
Conference Call
Granite Ridge will host a conference call on November 7, 2025, at 10:00 AM CT (11:00 AM ET) to discuss its third 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 www.graniteridge.com. Alternatively, an audio replay will be available through November 21, 2025. To access the audio replay, dial (800) 770-2030 and enter confirmation code 4127559.
Upcoming Investor Events
Granite Ridge management will be participating in the following upcoming investor events:
-- BofA Securities Global Energy Conference (Houston, TX) - November 12,
2025
-- Stephens Annual Investment Conference (Nashville, TN) - November 20, 2025
-- Capital One Securities Energy Conference (New Orleans, LA) - December 9,
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 prolific unconventional basins across the United States. We aim to deliver a diversified portfolio with best-in-class full cycle returns by investing in a large number of high-graded deals developed by proven public and private operators. We focus on success as measured by total shareholder returns, which we seek to balance with a low leverage profile. For more information, visit Granite Ridge's website at www.graniteridge.com.
Forward-Looking Statements and Cautionary Statements
This press release contains forward-looking statements regarding future events and future results that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this release regarding, without limitation, Granite Ridge's 2025 outlook, financial position, operating and financial performance, business strategy, plans and objectives of management for future operations, industry conditions, indebtedness covenant compliance, capital expenditures, production and cash flows are forward-looking statements. When used in this release, forward-looking statements are generally accompanied by terms or phrases such as "estimate," "project," "predict," "believe," "expect," "continue," "anticipate," "target," "could," "plan," "intend," "seek," "goal," "will, " "should," "may" or other words and similar expressions that convey the uncertainty of future events or outcomes. Items contemplating or making assumptions about actual or potential future production and sales, market size, collaborations, and trends or operating results also constitute such forward-looking statements.
Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond Granite Ridge's control) that could cause actual results to differ materially from those set forth in the forward-looking statements, including the following: changes in Granite Ridge's strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans, changes in current or future commodity prices and interest rates, supply chain disruptions, infrastructure constraints and related factors affecting our properties, ability to acquire additional development opportunities and potential or pending acquisition transactions, as well as the effects of such acquisitions on the Company's cash position and levels of indebtedness, changes in reserves estimates or the value thereof, operational risks including, but not limited to, the pace of drilling and completions activity on our properties, changes in the markets in which Granite Ridge competes, geopolitical risk and changes in applicable laws, legislation, or regulations, including those relating to environmental matters, cyber-related risks, the fact that reserve estimates depend on many assumptions that may turn out to be inaccurate and that any material inaccuracies in reserve estimates or underlying assumptions will materially affect the quantities and present value of Granite Ridge's reserves, the outcome of any known and unknown litigation and regulatory proceedings, limited liquidity and trading of Granite Ridge's securities, acts of war, terrorism or uncertainty regarding the effects and duration of global hostilities, including the Israel-Hamas conflict, the Russia-Ukraine war, continued instability in the Middle East, and any associated armed conflicts or related sanctions which may disrupt commodity prices and create instability in the financial markets, and market conditions and global, regulatory, technical, and economic factors beyond Granite Ridge's control, including the potential adverse effects of world health events, affecting capital markets, general economic conditions, global supply chains, uncertainties with respect to trade policies (including the imposition of tariffs) and Granite Ridge's business and operations, increasing regulatory and investor emphasis on, and attention to, environmental, social and governance matters, our ability to establish and maintain effective internal control over financial reporting, and the other risks described under the heading "Item 1A. Risk Factors" in Granite Ridge's Annual Report on Form 10-K for the year ended December 31, 2024 filed with the Securities and Exchange Commission ("SEC"), as updated by any subsequent Quarterly Reports on Form 10-Q that Granite Ridge files with the SEC.
Granite Ridge has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to significant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are difficult to predict and many of which are beyond Granite Ridge's control. If one or more of these risks or uncertainties materialize, or if the underlying assumptions prove incorrect, our actual results may vary materially from those expected or projected. Granite Ridge does not undertake any duty to update or revise any forward-looking statements, except as may be required by the federal securities laws.
Use of Non-GAAP Financial Measures
To supplement the presentation of the Company's financial results prepared in accordance with U.S. Generally Accepted Accounting Principles ("GAAP"), this press release contains certain financial measures that are not prepared in accordance with GAAP, including Adjusted Net Income, Adjusted Earnings Per Share, Adjusted EBITDAX, Trailing Twelve Months Adjusted EBITDAX, Operating Cash Flow Before Working Capital Changes, and Net Debt.
See "Supplemental Non-GAAP Financial Measures" below for a description and reconciliation of each non-GAAP measure presented in this press release to the most directly comparable financial measure calculated in accordance with GAAP.
Granite Ridge Resources, Inc.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands, except par
value and share data) September 30, 2025 December 31, 2024
-------------------- ---------------------
ASSETS
Current assets:
Cash $ 11,832 $ 9,419
Revenue receivable 74,669 69,692
Advances to operators 2,786 19,959
Prepaid and other current
assets 1,131 3,831
Derivative assets -
commodity derivatives 6,809 537
Equity investments 11,574 31,783
--------------- --------------
Total current assets 108,801 135,221
--------------- --------------
Property and equipment:
Oil and gas properties,
successful efforts
method 1,815,027 1,540,021
Accumulated depletion (800,177) (643,051)
--------------- --------------
Total property and
equipment, net 1,014,850 896,970
--------------- --------------
Long-term assets:
Derivative assets -
commodity derivatives 1,373 --
Other long-term assets 3,516 4,288
--------------- --------------
Total long-term assets 4,889 4,288
--------------- --------------
Total assets $ 1,128,540 $ 1,036,479
=============== ==============
LIABILITIES AND STOCKHOLDERS'
EQUITY
Current liabilities:
Accounts payable and
accrued liabilities $ 75,413 $ 99,440
Derivative liabilities -
commodity derivatives 426 1,822
Other liabilities 1,124 546
--------------- --------------
Total current
liabilities 76,963 101,808
--------------- --------------
Long-term liabilities:
Long-term debt 300,000 205,000
Derivative liabilities -
commodity derivatives 1,055 3,679
Asset retirement
obligations 11,511 10,693
Deferred tax liability 95,119 79,946
--------------- --------------
Total long-term
liabilities 407,685 299,318
--------------- --------------
Total liabilities 484,648 401,126
--------------- --------------
Stockholders' Equity:
Common stock, $0.0001 par
value, 431,000,000
shares authorized,
136,937,989 and
136,417,677 issued at
September 30, 2025 and
December 31, 2024,
respectively 14 14
Additional paid-in
capital 657,859 655,472
Retained earnings 22,215 16,047
Treasury stock, at cost,
5,686,711 and 5,683,921
shares at September 30,
2025 and December 31,
2024, respectively (36,196) (36,180)
--------------- --------------
Total stockholders'
equity 643,892 635,353
--------------- --------------
Total liabilities and
stockholders' equity $ 1,128,540 $ 1,036,479
=============== ==============
Granite Ridge Resources, Inc.
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- ----------------------
(in thousands,
except per share
data) 2025 2024 2025 2024
------- ------- ------- -------
Revenues:
Oil and natural
gas sales $112,671 $ 94,075 $344,821 $273,723
------- ------- ------- -------
Operating costs
and expenses:
Lease operating
expenses 23,596 13,026 59,954 42,174
Production and
ad valorem
taxes 6,551 6,345 21,356 18,975
Depletion and
accretion
expense 55,947 44,149 157,804 126,682
Impairments of
unproved
properties -- -- -- 732
General and
administrative 6,988 5,590 22,968 18,705
Other, net -- 283 (120) 283
------- ------- ------- -------
Total
operating
costs and
expenses 93,082 69,393 261,962 207,551
------- ------- ------- -------
Net operating
income 19,589 24,682 82,859 66,172
------- ------- ------- -------
Other income
(expense):
Gain on
derivatives -
commodity
derivatives 5,224 11,841 14,292 7,895
Interest
expense, net (6,069) (4,820) (16,998) (13,797)
Gain (loss) on
equity
investments 548 (18,320) (15,218) (19,315)
Other income
(loss) -- 1 (93) 271
------- ------- ------- -------
Total other
income
(expense) (297) (11,298) (18,017) (24,946)
------- ------- ------- -------
Income before
income taxes 19,292 13,384 64,842 41,226
Income tax
expense 4,769 4,330 15,426 10,845
------- ------- ------- -------
Net income $ 14,523 $ 9,054 $ 49,416 $ 30,381
======= ======= ======= =======
Net income per
share:
Basic $ 0.11 $ 0.07 $ 0.38 $ 0.23
Diluted $ 0.11 $ 0.07 $ 0.38 $ 0.23
Weighted-average
number of shares
outstanding:
Basic 130,472 130,204 130,426 130,182
Diluted 130,506 130,242 130,500 130,219
Granite Ridge Resources, Inc.
Condensed Consolidated Statements of Cash Flows
(Unaudited)
Nine Months Ended September 30,
---------------------------------------
(in thousands) 2025 2024
------------- ------------
Operating activities:
Net income $ 49,416 $ 30,381
Adjustments to reconcile net
income to net cash provided by
operating activities:
Depletion and accretion
expense 157,804 126,682
Impairments of unproved
properties -- 732
Unrealized (gain) loss on
derivatives - commodity
derivatives (11,666) 4,494
Stock-based compensation 2,387 1,683
Amortization of deferred
financing costs 1,222 3,162
Loss on equity investments 15,218 19,415
Deferred income taxes 15,173 10,733
Other (266) (145)
Increase (decrease) in cash
attributable to changes in
operating assets and
liabilities:
Revenue receivable (4,978) 14,429
Other receivable 317 (18)
Accounts payable and accrued
liabilities 5,797 (3,240)
Prepaid and other current
assets 1,497 (859)
Other liabilities (7) 87
------------- ------------
Net cash provided by operating
activities 231,914 207,536
Investing activities:
Capital expenditures for oil
and natural gas properties (233,135) (193,376)
Acquisition of oil and
natural gas properties (57,048) (51,994)
Proceeds from sale of equity
investments 4,991 3,362
Proceeds from sale of oil and
natural gas properties 175 3,064
Refund of advances to
operators 4,230 5,314
------------- ------------
Net cash used in investing
activities (280,787) (233,630)
Financing activities:
Proceeds from borrowing on
credit facilities 135,000 85,000
Repayments of borrowing on
credit facilities (40,000) --
Deferred financing costs (450) (3,004)
Purchase of treasury shares (16) (418)
Payment of dividends (43,248) (43,112)
------------- ------------
Net cash provided by financing
activities 51,286 38,466
Net change in cash and
restricted cash 2,413 12,372
Cash and restricted cash at
beginning of period 9,419 10,730
------------- ------------
Cash and restricted cash at end
of period $ 11,832 $ 23,102
============= ============
Supplemental disclosure of
non-cash investing activities:
Change in accrued capital
expenditures included in
accounts payable and accrued
liabilities $ (13,575) $ 40,003
Advances to operators applied
to development of oil and
natural gas properties $ 115,868 $ 80,320
Granite Ridge Resources, Inc.
Summary Production and Price Data
The following table sets forth summary information concerning production and operating data for the periods indicated:
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------- --------------------------
2025 2024 2025 2024
------- --------- ------- ---------
Net Sales (in
thousands):
Oil sales $ 91,960 $ 85,503 $ 273,269 $ 238,761
Natural gas and
related
product sales 20,711 8,572 71,552 34,962
------- --------- ------- ---------
Total
revenues $112,671 $ 94,075 $ 344,821 $ 273,723
Net Production:
Oil (MBbl) 1,492 1,164 4,277 3,129
Natural gas
(MMcf) 8,668 6,912 24,994 20,758
------- --------- ------- ---------
Total
(MBoe)(1) 2,937 2,316 8,443 6,589
Average Daily
Production:
Oil (Bbl) 16,222 12,655 15,666 11,420
Natural gas
(Mcf) 94,217 75,133 91,554 75,758
------- --------- ------- ---------
Total (Boe)(1) 31,925 25,177 30,925 24,046
Average Sales
Prices:
Oil (per Bbl) $ 61.62 $ 73.44 $ 63.89 $ 76.31
Effect of gain
on settled oil
derivatives on
average price
(per Bbl) 0.02 0.55 0.16 0.11
------- --------- ------- ---------
Oil net of
settled oil
derivatives
(per Bbl)(2) $ 61.64 $ 73.99 $ 64.05 $ 76.42
Natural gas
sales (per
Mcf) $ 2.39 $ 1.24 $ 2.86 $ 1.68
Effect of gain
on settled
natural gas
derivatives on
average price
(per Mcf) 0.20 0.74 0.08 0.58
------- --------- ------- ---------
Natural gas
sales net of
settled
natural gas
derivatives
(per Mcf)(2) $ 2.59 $ 1.98 $ 2.94 $ 2.26
Realized price
on a Boe basis
excluding
settled
commodity
derivatives $ 38.36 $ 40.61 $ 40.84 $ 41.54
Effect of gain
on settled
commodity
derivatives on
average price
(per Boe) 0.60 2.47 0.31 1.88
------- --------- ------- ---------
Realized price
on a Boe basis
including
settled
commodity
derivatives(2) $ 38.96 $ 43.08 $ 41.15 $ 43.42
Operating
Expenses (in
thousands):
Lease operating
expenses $ 23,596 $ 13,026 $ 59,954 $ 42,174
Production and
ad valorem
taxes 6,551 6,345 21,356 18,975
Depletion and
accretion
expense 55,947 44,149 157,804 126,682
General and
administrative 6,988 5,590 22,968 18,705
Costs and
Expenses (per
Boe):
Lease operating
expenses $ 8.03 $ 5.62 $ 7.10 $ 6.40
Production and
ad valorem
taxes $ 2.23 $ 2.74 $ 2.53 $ 2.88
Depletion and
accretion $ 19.05 $ 19.06 $ 18.69 $ 19.23
General and
administrative $ 2.38 $ 2.41 $ 2.72 $ 2.84
Net Producing
Wells at
Period-End: 235.27 195.88 235.27 195.88
------------------ ------- --------- ------- ---------
(1) Natural gas is converted to Boe using the ratio of one barrel of
oil to six Mcf of natural gas. (2) The presentation of realized
prices including settled commodity derivatives is a result of
including the net cash receipts from (payments on) commodity
derivatives to realized pricing. This presentation of average prices
with derivatives is a means by which to reflect the actual cash
performance of our commodity derivatives for the respective periods
and presents oil and natural gas prices with derivatives in a manner
consistent with the presentation generally used by the investment
community.
--------------------------------------------------------------------
Granite Ridge Resources, Inc.
Derivatives Information
The table below provides data associated with the Company's derivatives at November 6, 2025, for the periods indicated:
Q4 2025 2026 2027
---------- ---------- ---------
Collar (oil)
Volume (Bbl) 806,958 2,408,128 902,396
Weighted-average floor
price ($/Bbl) $ 59.32 $ 59.06 $ 52.50
Weighted-average ceiling
price ($/Bbl) $ 75.38 $ 69.88 $ 75.00
Swaps (oil)
Volume (Bbl) 210,180 357,224 452,936
Weighted-average price
($/Bbl) $ 60.92 $ 60.33 $ 60.21
Collar (natural gas)
Volume (Mcf) 4,958,499 12,487,504 3,332,922
Weighted-average floor
price ($/Mcf) $ 3.44 $ 3.50 $ 4.00
Weighted-average ceiling
price ($/Mcf) $ 4.32 $ 4.33 $ 5.15
Swaps (natural gas)
Volume (Mcf) 831,350 7,252,148 6,777,284
Weighted-average price
($/Mcf) $ 3.67 $ 3.73 $ 3.65
Granite Ridge Resources, Inc.
Supplemental Non-GAAP Financial Measures
The Company reports its financial results in accordance with GAAP. However, the Company believes certain non-GAAP performance measures may provide financial statement users with additional meaningful comparisons between current results, the results of its peers and the results of prior periods. In addition, the Company believes these measures are used by analysts and others in the valuation, rating and investment recommendations of companies within the oil and natural gas exploration and production industry. See the reconciliations throughout this release of GAAP financial measures to non-GAAP financial measures for the periods indicated.
Reconciliation of Net Income to Adjusted EBITDAX
Adjusted EBITDAX is presented herein and reconciled from the GAAP measure of net income because of its wide acceptance by the investment community as a financial indicator.
The Company defines Adjusted EBITDAX as net income before depletion and accretion expense, unrealized (gain) loss on derivatives -- commodity derivatives, interest expense, net, non-cash stock-based compensation, income tax expense, impairment of unproved properties, impairment of long-lived assets, (gain) loss on equity investments, and other, net. Adjusted EBITDAX is not a measure of net income or cash flows as determined by GAAP.
The Company's Adjusted EBITDAX measure provides additional information that may be used to better understand the Company's operations. Adjusted EBITDAX is one of several metrics that the Company uses as a supplemental financial measurement in the evaluation of its business and should not be considered in isolation or as an alternative to, or more meaningful than, net income as an indicator of operating performance. Certain items excluded from Adjusted EBITDAX are significant components in understanding and assessing a company's financial performance, such as a company's cost of capital and tax structure, as well as the historic cost of depreciable and depletable assets. Adjusted EBITDAX, as used by the Company, may not be comparable to similarly titled measures reported by other companies. The Company believes that Adjusted EBITDAX is a widely followed measure of operating performance and is one of many metrics used by the Company's management team and by other users of the Company's consolidated financial statements. For example, Adjusted EBITDAX can be used to assess the Company's operating performance and return on capital in comparison to other independent exploration and production companies without regard to financial or capital structure, and to assess the financial performance of the Company's assets and the Company without regard to capital structure or historical cost basis.
The following table provides a reconciliation of the GAAP measure of net income to Adjusted EBITDAX for the periods indicated:
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ---------------------
(in thousands) 2025 2024 2025 2024
------ ------ ------- ---------
Net income $14,523 $ 9,054 $ 49,416 $ 30,381
Interest
expense,
net 6,069 4,820 16,998 13,797
Income tax
expense 4,769 4,330 15,426 10,845
Other, net -- 283 (120) 283
Depletion and
accretion
expense 55,947 44,149 157,804 126,682
Non-cash
stock-based
compensation 1,339 588 2,387 1,683
Impairments
of unproved
properties -- -- -- 732
Unrealized
(gain) loss
on
derivatives
- commodity
derivatives (3,456) (6,112) (11,666) 4,494
(Gain) loss
on equity
investments (548) 18,320 15,218 19,315
------ ------ ------- ---------
Adjusted
EBITDAX $78,643 $75,432 $245,463 $ 208,212
====== ====== ======= =========
The Company defines Trailing Twelve Months Adjusted EBITDAX as the accumulation of the prior twelve months Adjusted EBITDAX. Adjusted EBITDAX for each of the quarters ended December 31, 2024, March 31, 2025, and June 30, 2025 were previously reported in an earnings release relating to the applicable quarter, and the reconciliation of net income to Adjusted EBITDAX for each quarter is included in the applicable earnings release.
The following table provides a reconciliation of the GAAP measure of net income to Trailing Twelve Months Adjusted EBITDAX for the period indicated:
Trailing Twelve Months Ended September 30,
(in thousands) 2025
----- ------------------------------- ----
Net income $ 37,794
Interest expense, net 21,671
Income tax expense 10,788
Other, net (644)
Depletion and accretion
expense 207,651
Non-cash stock-based
compensation 3,002
Impairments of long-lived
assets 35,637
Unrealized loss on derivatives
- commodity derivatives 1,111
Loss on equity investments 11,086
----- ------------------------------- ----
Trailing Twelve Months Adjusted
EBITDAX $ 328,096
===== =============================== ====
Reconciliation of Debt to Net Debt
The Company provides Net Debt, which is a non-GAAP financial measure. The Company defines Net Debt as long-term debt less cash as of the balance sheet date. The Company's Net Debt to Trailing Twelve Months Adjusted EBITDAX provides investors with insight into the Company's leverage as of the measurement date.
The following table provides a reconciliation from the GAAP measure of Debt to Net Debt and Net Debt to Trailing Twelve Months Adjusted EBITDAX ratio:
September 30,
(in thousands except for ratio) 2025
-----------
Long-term debt $ 300,000
Cash 11,832
-----------
Net Debt $ 288,168
===========
Net Debt to Trailing Twelve Months Adjusted EBITDAX Ratio 0.9
Reconciliation of Net Income to Adjusted Net Income and Adjusted Earnings Per Share
The Company provides Adjusted Net Income and Adjusted Earnings Per Share, which are non-GAAP financial measures. Adjusted Net Income and Adjusted Earnings Per Share represent earnings and diluted earnings per share determined under GAAP without regard to certain non-cash and nonrecurring items. The Company defines Adjusted Net Income as net income as determined under GAAP excluding impairments of long lived assets, unrealized (gain) loss on derivatives - commodity derivatives, (gain) loss on equity investments, deferred financing cost amortization acceleration, certain nonrecurring general and administrative expenses and tax impact on above adjustments.
The Company defines Adjusted Earnings Per Share as Adjusted Net Income divided by weighted average number of diluted shares of common stock outstanding.
The Company believes these measures provide useful information to analysts and investors for analysis of its operating results on a recurring, comparable basis from period to period. Adjusted Net Income and Adjusted Earnings Per Share should not be considered in isolation or as a substitute for earnings or diluted earnings per share as determined in accordance with GAAP and may not be comparable to other similarly titled measures of other companies.
The following table provides a reconciliation from the GAAP measure of net income to Adjusted Net Income, both in total and on a per diluted share basis, for the periods indicated:
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ---------------------
(in thousands,
except share
data) 2025 2024 2025 2024
------ ------ ------- ------
Net income $14,523 $ 9,054 $ 49,416 $30,381
Impairments of
unproved
properties -- -- -- 732
Unrealized
(gain) loss on
derivatives -
commodity
derivatives (3,456) (6,112) (11,666) 4,494
(Gain) loss on
equity
investments (548) 18,320 15,218 19,315
Deferred
financing cost
amortization
acceleration -- -- -- 2,167
Nonrecurring
general and
administrative
expenses -
severance
costs 25 -- 1,757 --
Nonrecurring
general and
administrative
expenses -
capital markets
transaction
costs 400 -- 1,512 --
Tax impact on
above
adjustments
(a) 808 (2,808) (1,542) (6,143)
------ ------ ------- ------
Adjusted Net
Income $11,752 $18,454 $ 54,695 $50,946
====== ====== ======= ======
Earnings per
diluted share -
as reported $ 0.11 $ 0.07 $ 0.38 $ 0.23
Impairments of
unproved
properties -- -- -- 0.01
Unrealized
(gain) loss on
derivatives -
commodity
derivatives (0.03) (0.05) (0.09) 0.04
(Gain) loss on
equity
investments -- 0.14 0.12 0.15
Deferred
financing cost
amortization
acceleration -- -- -- 0.02
Nonrecurring
general and
administrative
expenses -
severance
costs -- -- 0.01 --
Nonrecurring
general and
administrative
expenses -
capital markets
transaction
costs -- -- 0.01 --
Tax impact on
above
adjustments
(a) 0.01 (0.02) (0.01) (0.06)
------ ------ ------- ------
Adjusted Earnings
Per Diluted
Share $ 0.09 $ 0.14 $ 0.42 $ 0.39
====== ====== ======= ======
Adjusted earnings
per share:
Basic earnings $ 0.09 $ 0.14 $ 0.42 $ 0.39
Diluted earnings $ 0.09 $ 0.14 $ 0.42 $ 0.39
------------------ ------ ------ ------- ------
(a) Estimated using statutory tax rate in effect for the period.
----------------------------------------------------------------
Reconciliation of Net Cash Provided by Operating Activities to Operating Cash Flow Before Working Capital Changes
The Company provides Operating Cash Flow ("OCF") Before Working Capital Changes, which is a non-GAAP financial measure. The Company defines OCF Before Working Capital Changes as net cash provided by operating activities as determined under GAAP excluding changes in operating assets and liabilities such as: changes in cash due to changes in operating assets and liabilities, revenue receivable, other receivable, accounts payable and accrued liabilities, prepaid and other current assets, and other payables. The Company believes OCF Before Working Capital Changes is an accepted measure of an oil and natural gas company's ability to generate cash used to fund development and acquisition activities and service debt or pay dividends.
This non-GAAP measure should not be considered as an alternative to, or more meaningful than, net cash provided by operating activities as an indicator of operating performance.
The following table provides a reconciliation from the GAAP measure of net cash provided by operating activities to OCF Before Working Capital Changes:
Three Months Ended Nine Months Ended
September 30, September 30,
--------------------- ----------------------
(in thousands) 2025 2024 2025 2024
------ ------ ------- -------
Net cash
provided by
operating
activities $77,780 $74,694 $231,914 $207,536
Changes in
cash due to
changes in
operating
assets and
liabilities:
Revenue
receivable (1,978) (8,744) 4,978 (14,429)
Other
receivable (199) 548 (317) 18
Accounts
payable and
accrued
liabilities (2,595) 842 (5,797) 3,240
Prepaid and
other
current
assets -- (435) (1,497) 859
Other payable 109 3,802 7 (87)
------ ------ ------- -------
Total working
capital
changes (4,663) (3,987) (2,626) (10,399)
------ ------ ------- -------
Operating Cash
Flow Before
Working Capital
Changes $73,117 $70,707 $229,288 $197,137
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View source version on businesswire.com: https://www.businesswire.com/news/home/20251106355453/en/
CONTACT: Investor and Media Contact:
IR@GraniteRidge.com - (214) 396-2850
(END) Dow Jones Newswires
November 06, 2025 18:08 ET (23:08 GMT)
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