PHX Energy Announces a Special Dividend and Record Fourth Quarter and Annual Revenue Supported by Strong RSS Activity

Executive Summary

• PHX Energy reported record fourth‑quarter and full‑year 2025 consolidated revenue of $183.9 M (Q4) and $709.6 M (FY), up 3% and 8% year‑over‑year respectively.
• Adjusted EBITDA rose to $36.9 M in Q4 (up 24%) and $132.8 M for the year (up 7%), with earnings of $17.6 M ($0.35/share) in Q4 and $54.7 M ($1.13/share) FY‑2025.
• The Board declared a special cash dividend of $0.20 per share payable April 1, 2026 (record date March 16, 2026), adding to the regular quarterly dividend.

Key Details

• Quarterly Financial Highlights (Q4 2025):
• Consolidated revenue: $183.9 M (+3% YoY).
• Adjusted EBITDA: $36.9 M (+24% YoY), representing 20% of revenue.
• Net earnings: $17.6 M, or $0.35/share diluted (+25% YoY).

• Excess cash flow after capex: $29.8 M.

• Full‑Year Financial Highlights (FY 2025):

• Consolidated revenue: $709.6 M (+8% YoY), highest ever for PHX.
• Adjusted EBITDA: $132.8 M, 19% of revenue (second‑highest in company history).
• Net earnings: $54.7 M, $1.13/share diluted (flat YoY).

• Excess cash flow: $69 M; remaining ROCS balance: $8.7 M.

• Segment Performance:

• U.S. division revenue Q4: $131.8 M (flat YoY); FY: $516.2 M (+8%). RSS activity rose to 22% of US operating days.

• Canadian division revenue Q4: $52.1 M (+12% YoY); FY: $193.4 M (+7%). RSS activity increased to 12% of operating days (Q4) and 8% FY‑average.

• Operating Metrics:

• Consolidated operating days Q4: 7,826, up 0.1% YoY.
• U.S. rig count declined 7% quarter‑over‑quarter; Canadian drilling days down 10% YoY.

• Motor rental revenue grew 19% Q4 and 26% FY, reaching $48.3 M for the year.

• Capital Expenditures & Investments:

• Total capex FY 2025: $72.3 M (growth $27.4 M RSS, $23 M MWD, $17.6 M drilling motors).
• Net capital expenditures after equipment disposals: $30 M.

• Equipment commitments for 2026: $41.4 M, with ~40% earmarked for growth projects (RSS, motors, Velocity systems).

• Financing Activity:

• Dividends paid FY 2025: $36.3 M.
• NCIB repurchases FY 2025: 379k shares for $3.3 M.

• Net cash used in financing FY 2025: $23.4 M (including $19 M drawdown on credit facility).

• Liquidity & Debt:

• Cash on hand Dec‑31‑2025: $29.1 M; CAD $35.5 M drawn on Canadian facilities, USD $0 on U.S. facility.
• Available borrowing capacity: CAD $74 M, USD $25 M (facility maturity Dec 2028).

• Net debt (net cash) at year‑end: $6.4 M; Debt/EBITDA covenant well below 3.0× (0.28×).

• Dividend & ROCS Update:

• Special dividend of $0.20/share, payable April 1, 2026 (record date March 16, 2026).
• Regular quarterly dividend unchanged at $0.20/share.

• ROCS target (70% of excess cash flow) remains a core capital‑allocation policy; balance after FY 2025: $8.7 M.

• Outlook & Guidance:

• Anticipated 2026 capex ~$60 M, with ~40% growth spend on RSS, motors, and Velocity technologies.
• Management expects continued record revenue growth despite a softer industry backdrop, leveraging premium technology fleet and expanding motor‑rental business.

Notable Quotes

• Michael Buker, President & CEO: “We are proud of our 2025 operational and financial performance… The special dividend reflects our strong results and confidence in the 2026 outlook while reinforcing our Return of Capital Strategy.”