Hemisphere Energy Declares Quarterly Dividend, Announces 2026 Guidance, and Provides Corporate Update

Executive Summary

• Hemisphere Energy declares a quarterly cash dividend of $0.025 per common share payable on February 26, 2026.
• The Board approves a 2026 capital program of approximately C$12 million, fully funded by an estimated adjusted funds flow (AFF) of C$40 million.
• Guidance projects 2026 free funds flow (FFF) of C$28 million, with ~35% allocated to quarterly base dividends and the remainder available for discretionary uses such as accelerated development, acquisitions, or additional shareholder returns.

Key Details

• Quarterly Dividend: $0.025 per common share; record date February 12, 2026; payment date February 26, 2026; designated eligible dividend.
• 2026 Capital Program: Approx. C$12 million (includes C$0.4 million ARO).
• Estimated 2026 AFF: C$40 million (based on $60/bbl WTI price).
• Projected 2026 FFF: C$28 million after capital expenditures; ~35% earmarked for quarterly base dividends.
• Dividend Allocation (2026): Base dividend per basic share projected at $0.10 (consistent across $50‑$70 WTI scenarios).
• Production Guidance: Average annual production 3,900 boe/d (99 % heavy oil).
• Pricing Assumptions: WTI price $60/bbl (sensitivity shown for $50 and $70); WCS differential $12.50/bbl; quality adjustment $4.00/bbl.
• Cost Assumptions: Operating & transportation $15.00/boe; royalties 16 % at $60 WTI; G&A $3.47/boe; tax costs $5.54/boe (at $60 WTI).
• Financial Metrics (per basic share, 94.6 M shares):
• AFF per share: $0.42 (base case)
• FFF per share: $0.29 (base case)
• Base dividend per share: $0.10 (all scenarios)
• 2025 Shareholder Returns: Total of C$21.8 million ($0.23/share) comprising base dividends, special dividends, and NCIB purchases.
• Balance Sheet Position: Debt‑free entering 2026 with >C$7 million working capital.

Notable Quotes

• Don Simmons, President & CEO: “Our disciplined $12 million capital budget, fully funded by strong cash flow, positions Hemisphere to continue delivering shareholder value while maintaining flexibility to accelerate growth initiatives.”