HighPeak Energy, Inc. Announces First Quarter 2025 Financial and Operating Results

FORT WORTH, Texas, May 12, 2025 (GLOBE NEWSWIRE) -- HighPeak Energy, Inc. (“HighPeak” or the “Company”) (NASDAQ: HPK) today announced financial and operating results for the quarter ended March 31, 2025, provided an updated 2025 development outlook and increased production guidance. First Quarter 2025 Highlights Sales volumes averaged approximately 53.1 thousand barrels of crude oil equivalent per day (“MBoe/d”), representing a 6% increase from the fourth quarter 2024.Net income was $36.3 million, or $0.26 per diluted share and EBITDAX (a non-GAAP financial measure defined and reconciled below) was $197.3 million, or $1.40 per diluted share. First quarter 2025 adjusted net income (a non-GAAP financial measure defined and reconciled below) was $42.7 million, or $0.31 per diluted share.Lease operating expenses averaged $6.61 per Boe, excluding workover expenses, representing a 3% decrease compared to the fourth quarter 2024.Generated free cash flow (a non-GAAP financial measure defined and reconciled below) of $10.7 million, reduced long-term debt by $30 million and paid $0.04 per share in dividends.Realized increased drilling and completion efficiency gains, which translated to drilling and completing four additional wells during the first quarter. Recent Events Narrowed 2025 production guidance range and increased the midpoint.On May 12, 2025, the Company’s Board of Directors declared a quarterly dividend of $0.04 per common share outstanding payable in June 2025. Statement from Jack Hightower, Chairman and CEO: In March, we discussed our four pillars of success for 2025 which include: 1) improving corporate efficiency, 2) maintaining capital discipline, 3) optimizing our capital structure, and 4) delivering shareholder value. I would like to take this opportunity to update our shareholders on where we stand and the progress we have made to date. Improving Corporate EfficiencyHighPeak delivered another strong quarter of results, beating production guidance and consensus estimates, while also realizing higher levels of operating efficiencies in our development program. We drilled over 25% faster than our previous expectations, which translated to drilling and completing four additional wells during the first quarter. We are running smoother and more efficiently than ever before, while continuing to keep development costs in line with internal expectations. Maintaining Capital DisciplineDue to the global economic uncertainty and its impact on oil prices, we have moderated our development program by laying down one rig for four months, May through August. Despite the pause, we remain on track to drill and complete the same number of wells in our 2025 guidance because of the gains made through operational efficiencies. As detailed on our March conference call, the majority of our 2025 infrastructure capex was first-quarter weighted. Factoring in drilling and completing four additional wells, we accomplished an outsized portion of our planned annual development activity during the first quarter. Going forward, we expect our quarterly capital expenditures to be materially lower and the total for the year to fall within our 2025 guided capex range. Although our operations are running much more efficiently, this is not the proper time to accelerate development activity from our original plan. Additionally, we have complete flexibility from a land and operations perspective to reduce the budget and leave a rig down for longer than the current plan if conditions warrant. Optimizing our Capital StructureWe remain committed to optimizing our capital structure and remain poised to execute our plan once the market has stabilized. We are in a healthy financial position with no near-term debt maturities and are taking proactive steps to keep our balance sheet strong as we navigate this turbulent market. Shareholder ValueGiven the current global macro-economic backdrop, this is a time to remain nimble and prudent, which our high-quality asset base allows. As large owners of the Company, management is fully aligned with shareholders and has a long-term outlook on value creation. While markets may be volatile, it is important to remember the fundamental value of our asset base is still strong. First Quarter 2025 Operational Update HighPeak’s sales volumes during the first quarter of 2025 averaged 53.1 MBoe/d, a six percent increase over the fourth quarter 2024. First quarter sales volumes consisted of approximately 72% crude oil and 86% liquids. The Company averaged two drilling rigs and one frac crew during the first quarter, drilled 16 gross (16.0 net) horizontal wells and turned-in-line 13 gross (12.9 net) producing wells. On March 31, 2025, the Company had 28 gross (28.0 net) horizontal wells in various stages of drilling and completion. The Company updated its 2025 production guidance range to 48,000 – 50,500 Boe/d. HighPeak President, Michael Hollis, commented, “Our strong first quarter production is allowing us to narrow our guided range and increase the midpoint. This speaks to our strong well performance and the high quality of our long lived oily inventory. As seen in the last few commodity price cycles, HighPeak is realizing deflationary cost pressures on both the capex and opex fronts. With our increased operational efficiency, we are doing more with less and at a lower overall cost.” First Quarter 2025 Financial Results HighPeak reported net income of $36.3 million for the first quarter of 2025, or $0.26 per diluted share, and EBITDAX of $197.3 million, or $1.40 per diluted share. HighPeak reported adjusted net income of $42.7 million for the first quarter of 2025, or $0.31 per diluted share. First quarter average realized prices were $71.64 per Bbl of crude oil, $24.21 per Bbl of NGL and $2.34 per Mcf of natural gas, resulting in an overall realized price of $53.84 per Boe, or 75% of the weighted average of NYMEX crude oil prices, excluding the effects of derivatives. HighPeak’s cash costs for the first quarter were $11.94 per Boe, including lease operating expenses of $6.61 per Boe, workover expenses of $0.83 per Boe, production and ad valorem taxes of $3.17 per Boe and G&A expenses of $1.33 per Boe. As a result, the Company’s unhedged EBITDAX per Boe was $41.90 per Boe, or 78% of the overall realized price per Boe for the quarter, excluding the effects of derivatives. HighPeak’s first quarter 2025 capital expenditures to drill, complete, equip, provide facilities and for infrastructure were $179.8 million. Hedging Crude oil. As of March 31, 2025, HighPeak had the following outstanding crude oil derivative instruments and the weighted average crude oil prices and premiums payable per Bbl: Swaps Collars, Enhanced Collars& DeferredPremium Puts SettlementMonth SettlementYear Type ofContract BblsPerDay Index Price perBbl Floor orStrikePrice perBbl CeilingPrice perBbl DeferredPremiumPayableper Bbl Crude Oil: Apr - Jun 2025 Swap 5,500 WTI Cushing $76.37 $— $— $— Apr - Jun 2025 Collar 7,989 WTI Cushing $— $64.38 $88.55 $2.00 Apr - Jun 2025 Put 9,000 WTI Cushing $— $65.78 $— $5.00 Jul - Sep 2025 Swap 3,000 WTI Cushing $75.85 $— $— $— Jul - Sep 2025 Collar 7,000 WTI Cushing $— $65.00 $90.08 $2.28 Jul - Sep 2025 Put 9,000 WTI Cushing $— $65.78 $— $5.00 Oct - Dec 2025 Collar 5,000 WTI Cushing $— $60.00 $72.80 $— Jan - Mar 2026 Collar 5,000 WTI Cushing $— $60.00 $72.80 $— The Company’s crude oil derivative contracts detailed above are based on reported settlement prices on the New York Mercantile Exchange for West Texas Intermediate pricing. Natural gas. As of March 31, 2025, the Company had the following outstanding natural gas derivative instruments and the weighted average natural gas prices payable per MMBtu. Settlement Month SettlementYear Type ofContract MMBtuPer Day Index Price perMMBtu Natural Gas: Apr – Jun 2025 Swap 30,000 HH $4.43 Jul – Sep 2025 Swap 30,000 HH $4.43 Oct – Dec 2025 Swap 30,000 HH $4.43 Jan – Mar 2026 Swap 19,667 HH $4.43 HighPeak added the following natural gas swaps in April 2025. Settlement Month SettlementYear Type ofContract MMBtuPer Day Index Price perMMBtu Natural Gas: Jan - Mar 2026 Swap 10,333 HH $4.30 Apr – Jun 2026 Swap 30,000 HH $4.30 Jul – Sep 2026 Swap 30,000 HH $4.30 Oct – Dec 2026 Swap 30,000 HH $4.30 Jan – Mar 2027 Swap 19,667 HH $4.30 Dividends During the first quarter of 2025, HighPeak’s Board of Directors approved a quarterly dividend of $0.04 per share, or $5.0 million in dividends paid to stockholders during the quarter. In addition, in May 2025, the Company’s Board of Directors declared a quarterly dividend of $0.04 per share, or approximately $5.0 million in dividends, to be paid on June 25, 2025, to stockholders of record on June 2, 2025. Conference Call HighPeak will host a conference call and webcast on Tuesday, May 13, 2025, at 10:00 a.m. Central Time for investors and analysts to discuss its results for the first quarter of 2025. Conference call participants may register for the call here. Access to the live audio-only webcast and replay of the earnings release conference call may be found here. A live broadcast of the earnings conference call will also be available on the HighPeak Energy website at www.highpeakenergy.com under the “Investors” section of the website. A replay will also be available on the website following the call. When available, a copy of the Company’s earnings release, investor presentation and Quarterly Report on Form 10-Q may be found on its website at www.highpeakenergy.com. About HighPeak Energy, Inc. HighPeak Energy, Inc. is a publicly traded independent crude oil and natural gas company, headquartered in Fort Worth, Texas, focused on the acquisition, development, exploration and exploitation of unconventional crude oil and natural gas reserves in the Midland Basin in West Texas. For more information, please visit our website at www.highpeakenergy.com. Cautionary Note Regarding Forward-Looking Statements The information in this press release contains forward-looking statements that involve risks and uncertainties. When used in this document, the words “believes,” “plans,” “expects,” “anticipates,” “forecasts,” “intends,” “continue,” “may,” “will,” “could,” “should,” “future,” “potential,” “estimate” or the negative of such terms and similar expressions as they relate to HighPeak Energy, Inc. (“HighPeak Energy” or the “Company”) are intended to identify forward-looking statements, which are generally not historical in nature. The forward-looking statements are based on the Company's current expectations, assumptions, estimates and projections about the Company and the industry in which the Company operates. Although the Company believes that the expectations and assumptions reflected in the forward-looking statements are reasonable as and when made, they involve risks and uncertainties that are difficult to predict and, in many cases, beyond the Company's control. For example, the Company’s review of strategic alternatives may not result in a sale of the Company, a recommendation that a transaction occur or result in a completed transaction, and any transaction that occurs may not increase shareholder value, in each case as a result of such risks and uncertainties. These risks and uncertainties include, among other things, the results of the strategic review being undertaken by the Company’s Board and the interest of prospective counterparties, the Company’s ability to realize the results contemplated by its 2025 guidance, volatility of commodity prices, political instability or armed conflicts in crude or natural gas producing regions such as the ongoing war between Russia and Ukraine or Israel and Hamas, product supply and demand, the impact of a widespread outbreak of an illness, such as the coronavirus disease pandemic, on global and U.S. economic activity, competition, OPEC+ policy decisions, potential new trade policies, such as tariffs, could adversely affect the Company’s operations, business and profitability, inflationary pressures on costs of oilfield goods, services and personnel, the ability to obtain environmental and other permits and the timing thereof, other government regulation or action, the ability to obtain approvals from third parties and negotiate agreements with third parties on mutually acceptable terms, litigation, the costs and results of drilling and operations, availability of equipment, services, resources and personnel required to perform the Company's drilling and operating activities, access to and availability of transportation, processing, fractionation, refining and storage facilities, HighPeak Energy's ability to replace reserves, implement its business plans or complete its development activities as scheduled, access to and cost of capital, the financial strength of counterparties to any credit facility and derivative contracts entered into by HighPeak Energy, if any, and purchasers of HighPeak Energy's oil, natural gas liquids and natural gas production, uncertainties about estimates of reserves, identification of drilling locations and the ability to add proved reserves in the future, the assumptions underlying forecasts, including forecasts of production, expenses, cash flow from sales of oil and gas and tax rates, quality of technical data, environmental and weather risks, including the possible impacts of climate change, cybersecurity risks and acts of war or terrorism. These and other risks are described in the Company's Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, and Current Reports on Form 8-K and other filings with the SEC. The Company undertakes no duty to publicly update these statements except as required by law. Reserve engineering is a process of estimating underground accumulations of hydrocarbons that cannot be measured in an exact way. The accuracy of any reserve estimate depends on the quality of available data, the interpretation of such data and price and cost assumptions made by reserve engineers. Reserves estimates included herein may not be indicative of the level of reserves or PV-10 value of oil and natural gas production in the future. In addition, the results of drilling, testing and production activities may justify revisions of estimates that were made previously. If significant, such revisions could impact HighPeak’s strategy and change the schedule of any further production and development drilling. Accordingly, reserve estimates may differ significantly from the quantities of oil and natural gas that are ultimately recovered. Use of Projections The financial, operational, industry and market projections, estimates and targets in this press release and in the Company’s guidance (including production, operating expenses and capital expenditures in future periods) are based on assumptions that are inherently subject to significant uncertainties and contingencies, many of which are beyond the Company’s control. The assumptions and estimates underlying the projected, expected or target results are inherently uncertain and are subject to a wide variety of significant business, economic, regulatory and competitive risks and uncertainties that could cause actual results to differ materially from those contained in the financial, operational, industry and market projections, estimates and targets, including assumptions, risks and uncertainties described in “Cautionary Note Regarding Forward-Looking Statements” above. These projections are speculative by their nature and, accordingly, are subject to significant risk of not being actually realized by the Company. Projected results of the Company for 2025 are particularly speculative and subject to change. Actual results may vary materially from the current projections, including for reasons beyond the Company’s control. The projections are based on current expectations and available information as of the date of this release. The Company undertakes no duty to publicly update these projections except as required by law. Drilling Locations The Company has estimated its drilling locations based on well spacing assumptions and upon the evaluation of its drilling results and those of other operators in its area, combined with its interpretation of available geologic and engineering data. The drilling locations actually drilled on the Company’s properties will depend on the availability of capital, regulatory approvals, commodity prices, costs, actual drilling results and other factors. Any drilling activities conducted on these identified locations may not be successful and may not result in additional proved reserves. Further, to the extent the drilling locations are associated with acreage that expires, the Company would lose its right to develop the related locations. HighPeak Energy, Inc.Unaudited Condensed Consolidated Balance Sheet Data(In thousands) March 31,2025 December 31,2024 Current assets: Cash and cash equivalents $51,619 $86,649 Accounts receivable 78,356 85,242 Inventory 8,706 10,952 Prepaid expenses 8,301 4,587 Derivative instruments 5,620 7,582 Total current assets 152,602 195,012 Crude oil and natural gas properties, using the successful efforts method of accounting: Proved properties 4,140,881 3,959,545 Unproved properties 71,359 70,868 Accumulated depletion, depreciation and amortization (1,293,949) (1,184,684) Total crude oil and natural gas properties, net 2,918,291 2,845,729 Other property and equipment, net 3,141 3,201 Other noncurrent assets 19,047 19,346 Total assets $3,093,081 $3,063,288 Current liabilities: Current portion of long-term debt, net $120,000 $120,000 Accounts payable – trade 66,473 74,011 Accrued capital expenditures 53,240 35,170 Revenues and royalties payable 27,993 26,838 Other accrued liabilities 22,065 22,196 Derivative instruments 8,275 5,380 Operating leases 821 719 Advances from joint interest owners — 316 Total current liabilities 298,867 284,630 Noncurrent liabilities: Long-term debt, net 902,844 928,384 Deferred income taxes 242,337 232,398 Asset retirement obligations 15,058 14,750 Operating leases 581 670 Commitments and contingencies Stockholders’ equity Common stock 13 13 Additional paid-in capital 1,166,786 1,166,609 Retained earnings 466,595 435,834 Total stockholders’ equity 1,633,394 1,602,456 Total liabilities and stockholders’ equity $3,093,081 $3,063,288 HighPeak Energy, Inc.Unaudited Condensed Consolidated Statements of Operations(in thousands) Quarter Ended March 31, 2025 2024 Operating revenues: Crude oil sales $246,424 $282,369 NGL and natural gas sales 11,024 5,395 Total operating revenues 257,448 287,764 Operating costs and expenses: Crude oil and natural gas production 35,562 30,271 Production and ad valorem taxes 15,152 14,402 Exploration and abandonments 264 498 Depletion, depreciation and amortization 109,325 130,850 Accretion of discount 244 239 General and administrative 6,345 4,685 Stock-based compensation 177 3,798 Total operating costs and expenses 167,069 184,743 Other expense — 1 Income from operations 90,379 103,020 Interest income 810 2,392 Interest expense (36,988) (43,634) Loss on derivative instruments, net (7,927) (53,043) Income before income taxes 46,274 8,735 Provision for income taxes 9,939 2,297 Net income $36,335 $6,438 Earnings per share: Basic net income $0.26 $0.05 Diluted net income $0.26 $0.05 Weighted average shares outstanding: Basic 123,913 125,696 Diluted 127,213 129,641 Dividends declared per share $0.04 $0.04 HighPeak Energy, Inc.Unaudited Condensed Consolidated Statements of Cash Flows(in thousands) Quarter Ended March 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $36,335 $6,438 Adjustments to reconcile net income to net cash provided by operations: Provision for deferred income taxes 9,939 1,688 Loss on derivative instruments 7,927 53,043 Cash paid on settlement of derivative instruments (3,071) (5,148) Amortization of debt issuance costs 2,034 2,053 Amortization of discounts on long-term debt 2,426 2,453 Stock-based compensation expense 177 3,798 Accretion expense 244 239 Depletion, depreciation and amortization 109,325 130,850 Exploration and abandonment expense 4 274 Changes in operating assets and liabilities: Accounts receivable 6,886 (14,414) Prepaid expenses, inventory and other assets (1,314) (4,722) Accounts payable, accrued liabilities and other current liabilities (13,860) (5,113) Net cash provided by operating activities 157,052 171,439 CASH FLOWS FROM INVESTING ACTIVITIES: Additions to crude oil and natural gas properties (179,819) (147,698) Changes in working capital associated with crude oil and natural gas property additions 25,172 1,705 Acquisitions of crude oil and natural gas properties (2,517) (2,171) Proceeds from sales of properties 570 — Other property additions — (59) Net cash used in investing activities (156,594) (148,223) CASH FLOWS FROM FINANCING ACTIVITIES: Repayments under Term Loan Credit Agreement (120,000) (30,000) Dividends paid (4,957) (5,050) Dividend equivalents paid (531) (530) Repurchased shares under buyback program — (8,764) Debt issuance costs — (7) Net cash used in financing activities (35,488) (44,351) Net decrease in cash and cash equivalents (35,030) (21,135) Cash and cash equivalents, beginning of period 86,649 194,515 Cash and cash equivalents, end of period $51,619 $173,380 HighPeak Energy, Inc.Unaudited Summary Operating Highlights Quarter Ended March 31, 2025 2024 Average Daily Sales Volumes: Crude oil (Bbls) 38,222 39,959 NGLs (Bbls) 7,724 5,147 Natural gas (Mcf) 43,096 27,733 Total (Boe) 53,128 49,729 Average Realized Prices (excluding effects of derivatives): Crude oil per Bbl $71.64 $77.65 NGL per Bbl $24.21 $24.94 Natural gas per Mcf $2.34 $1.33 Total per Boe $53.84 $63.59 Margin Data ($ per Boe): Average price, excluding effects of derivatives $53.84 $63.59 Lease operating expenses (6.61) (6.30) Expense workovers (0.83) (0.39) Production and ad valorem taxes (3.17) (3.18) General and administrative expenses (1.33) (1.04) $41.90 $52.68 HighPeak Energy, Inc.Unaudited Earnings Per Share Details Quarter Ended March 31, 2025 2024 Net income as reported $36,335 $6,438 Participating basic earnings (3,542) (605) Basic earnings attributable to common shareholders 32,793 5,833 Reallocation of participating earnings 47 1 Diluted net income attributable to common shareholders $32,840 $5,834 Basic weighted average shares outstanding 123,913 125,696 Dilutive warrants and unvested stock options 1,146 1,786 Dilutive unvested restricted stock 2,154 2,159 Diluted weighted average shares outstanding 127,213 129,641 Net income per share attributable to common shareholders: Basic $0.26 $0.05 Diluted $0.26 $0.05 HighPeak Energy, Inc.Unaudited Reconciliation of Net Income to EBITDAX, Discretionary Cash Flow and Net Cash Provided by Operations(in thousands) Quarter Ended March 31, 2025 2024 Net income $36,335 $6,438 Interest expense 36,988 43,634 Interest income (810) (2,392) Income tax expense 9,939 2,297 Depletion, depreciation and amortization 109,325 130,850 Accretion of discount 244 239 Exploration and abandonment expense 264 498 Stock based compensation 177 3,798 Derivative related noncash activity 4,856 47,895 Other expense — 1 EBITDAX 197,318 233,258 Cash interest expense (32,528) (39,128) Other (a) 550 1,558 Discretionary cash flow 165,340 195,688 Changes in operating assets and liabilities (8,288) (24,249) Net cash provided by operating activities $157,052 $171,439 (a) Includes interest income net of current tax expense, other expense and operating portion of exploration and abandonment expenses. HighPeak Energy, Inc.Unaudited Reconciliation of Net Cash Provided by Operations and Free Cash Flow(in thousands) Quarter Ended March 31, 2025 2024 Net cash provided by operating activities $157,052 $171,439 Add back: net change in operating assets and liabilities 8,288 24,249 Operating cash flow before working capital changes 165,340 195,688 Additions to crude oil and natural gas properties (179,819) (147,698) Changes in working capital associated with crude oil and natural gas property additions 25,172 1,705 Free cash flow $10,693 $49,695 HighPeak Energy, Inc.Unaudited Reconciliation of Net Income to Adjusted Net Income(in thousands, except per share data) Quarter EndedMarch 31, 2025 Amounts Amounts per Diluted Share Net income $36,335 $0.26 Derivative loss, net 7,927 0.06 Stock-based compensation 177 0.00 Income tax adjustment for above items * (1,741) (0.01) Adjusted net income $42,698 $0.31 * Assuming 21% statutory tax rate Investor Contact: Ryan HightowerVice President, Business Development817.850.9204 rhightower@highpeakenergy.com Source: HighPeak Energy, Inc.

HighPeak Energy, Inc. Announces First Quarter 2025 Financial and Operating Results

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