HIGHWOOD ASSET MANAGEMENT LTD. ANNOUNCES THIRD QUARTER 2025 RESULTS AND OPERATIONAL UPDATE

Executive Summary

• Highwood reported Q3 2025 Adjusted EBITDA of $13.6 M ($0.89/share) and adjusted funds flow of $11.9 M ($0.79/share), with average production of 5,253 boe/d (≈6% YoY decline).
• Net debt rose to $114.8 M, while the company reduced its 2025 capital program by one well and completed two Wilson Creek wells slated for first‑quarter 2026 start‑up.
• The firm reiterated FY 2025 production guidance of 5,200–5,400 boe/d and highlighted a hedging program covering ~2,067 bbl/d oil (2025) and ~6,300 GJ/d natural gas (2025).

Key Details

• Production:
• Q3 average corporate production: 5,253 boe/d (down 6% QoQ).
• Crude oil: 2,787 bbl/d (‑23%).
• NGLs: 841 boe/d (+20%).

• Natural gas: 9,749 mcf/d (+19%).

• Financial Highlights (Q3 2025 vs Q3 2024):

• Petroleum & natural gas sales: $23.8 M (‑31%).
• Total net revenues: $18.3 M (‑52%).
• Adjusted EBITDA: $13.6 M (‑33%).
• Capital expenditures: $7.46 M (‑64%).

• Net debt: $114.8 M (↑12%).

• Adjusted Funds Flow: $11.9 M; Adjusted EBITDA per share $0.89, adjusted funds flow per share $0.79.

• Hedging Program (remainder of 2025):

• Oil: ~2,067 bbl/d hedged at CAD $95.75/bbl (WTI‑NYMEX).
• Natural gas: ~6,300 GJ/d hedged at $3.18/GJ (AECO).

• Realized gain on commodity contracts in Q3: $2.4 M; market value of contracts ≈$8 M.

• Capital Program & Drilling Update:

• Reduced 2025 program by ~1 gross well (0.7 net).
• Completed 2 gross (1.8 net) wells in Wilson Creek (Belly River) in Q4 2025; expected first‑quarter 2026 production.

• New completion method on “13‑15” well (Basal sand, Brazeau) cut clean‑up time by ~6 weeks.

• Guidance & Outlook:

• FY 2025 production guidance reaffirmed at 5,200–5,400 boe/d (≈70% oil & liquids).

• Focus on reducing leverage, growing free cash flow per share, and maintaining flexibility for organic growth or strategic M&A.

• Shareholder Compensation:

• Granted ~136 k Performance Share Units to officers (vest in 3 years).
• Granted 20 k Deferred Share Units to non‑management directors (vest in 1 year).

Notable Quotes

(No direct quotes were provided in the release.)