Peyto Reports Fourth Quarter and 2025 Annual Results

Executive Summary

• Peyto reported record Q4 2025 funds from operations of $245 M ($1.19 per diluted share) and full‑year FFO of $860.5 M ($4.24 per diluted share).
• Net earnings rose 61% YoY to $125.9 M ($0.61 per diluted share) for the quarter and $418.6 M ($2.06 per diluted share) for FY 2025; dividends of $264.9 M were paid and net debt was reduced by $171 M.
• Production reached a quarterly record 140,794 boe/d (740 MMcf/d gas, 17,439 bbl/d NGLs), a 6% YoY increase; capital expenditures were $142.1 M in Q4 and $475.2 M for the year, with a revised revolving credit facility of $1.05 B.

Key Details

• Financial Highlights
• Q4 2025 Funds from Operations (FFO): $245.0 M ($1.19/diluted share).
• FY 2025 FFO: $860.5 M ($4.24/diluted share).
• Quarterly earnings: $125.9 M ($0.61/diluted share); FY 2025 earnings: $418.6 M ($2.06/diluted share).
• Dividends paid FY 2025: $264.9 M ($1.32/share).

• Net debt reduced FY 2025 by $171.0 M to $1,177.6 M.

• Production & Operations

• Q4 2025 average production: 140,794 boe/d (740 MMcf/d gas, 17,439 bbl/d NGLs) – up 6% YoY.
• FY 2025 average production: 134,055 boe/d (708 MMcf/d gas, 16,048 bbl/d NGLs) – up 7% YoY.

• Record December 2025 output: 145 Mboe/d (763 MMcf/d gas, 18,270 bbl/d NGLs).

• Cost & Margin Metrics

• Q4 cash costs: $1.23/MMcfe (10% lower YoY).
• Operating margin Q4: 74%; profit margin Q4: 34%.

• Field netback FY 2025: $3.61/MMcfe; recycle ratio: 3.8× (field level).

• Capital Expenditures & Drilling

• Q4 2025 capex: $142.1 M (drilling/completion $110.1 M, tie‑ins $11.9 M, facilities/pipelines $18.9 M).
• FY 2025 total capex: $475.2 M; 82 gross (78.4 net) horizontal wells drilled, 79 gross (75.4 net) brought on production.

• Facility upgrades: $86.2 M (incl. $23.5 M for a 35 MMcf/d compressor in Sundance).

• Reserves

• PDP reserves grew to 3,053 BCFe (+4% YoY); total proved + probable at 8,702 BCFe (+3%).

• PDP FD&A cost: $0.94/MMcfe – lowest in Canadian industry for the year.

• Hedging & Diversification

• Hedged 490 MMcf/d (2026) @ $4.14/Mcf and 248 MMcf/d (2027) @ $3.53/Mcf.

• WTI swaps: 4,545 bbl/d (2026) @ $86.07/bbl; collars: 500 bbl/d @ $81.25‑$94.70.

• Financing

• Amended revolving credit facility to $1.05 B, maturity extended to Oct 2029; term loan repaid/terminated.

• Outlook & Guidance

• Planned FY 2026 capex: $450–$500 M with flexibility for price‑driven adjustments.
• Continued focus on low‑cost natural gas plays, hedging program, and dividend sustainability.

Notable Quotes

“Our disciplined hedging and diversification program protected revenues from continued low natural gas prices, delivering a record operating margin and strong cash flow to support shareholder returns.” – Jean‑Paul Lachance, President & CEO.