PEDEVCO — Q3 2026 Earnings Summary

Financial Performance:

• Revenue increased 411% year-over-year to $35.5 million in Q3 2026, compared to $7.0 million in Q3 2025, driven by a 298% increase in production volumes and a 31% rise in average realized oil price.
• Average daily production reached 5,850 Boe/d in Q3 2026, up 298% from 1,471 Boe/d in Q3 2025, though this represented a 14% sequential decline from Q2 2026.
• Net loss for Q3 2026 was $9.2 million ($0.70 per share), compared to a net loss of $0.3 million ($0.07 per share) in Q3 2025.
• Adjusted EBITDA increased 239% year-over-year to $14.7 million in Q3 2026, compared to $4.3 million in Q3 2025.
• Net loss on derivative contracts totaled $16.6 million for the quarter, including $4.6 million in realized settlement losses and $12.0 million in non-cash unrealized losses.
• Lease operating expenses were $14.3 million for the quarter, compared to $2.1 million in the prior year period.
• General and administrative expenses were $4.9 million, including $2.1 million in severance costs related to leadership transition.
• Depreciation, depletion, amortization, and accretion (DD&A) was $9.7 million, compared to $4.0 million in the prior year period.
• Interest expense was $1.7 million, compared to $0.1 million in the prior year period.
• Cash and restricted cash totaled $5.8 million as of September 30, 2026 ($4.7 million cash and $1.1 million restricted).
• Revolver borrowings declined to $80.0 million as of September 30, 2026, from $85.0 million at June 30, 2026, leaving $45.0 million in availability.

Guidance and Future Outlook:

• Full-year 2026 net capital expenditure guidance was updated to a range of $37 million to $42 million, revised upward from previous guidance of up to $20 million.
• Full-year 2026 Adjusted EBITDA guidance remains reiterated at $60 million to $70 million.
• Management expects sequentially stronger production results in Q4 2026 following the return of temporarily shut-in wells.
• The Company anticipates meaningful production growth in 2027 driven by its extensive Rockies inventory.
• Future budgets will focus capital allocation on the Rocky Mountain region to maximize growth and returns.

Business Segments and Product Lines:

• Production volumes increased 300% for crude oil, 266% for natural gas, and 324% for NGLs year-over-year.
• Average realized oil price increased 31% to $83.81 per barrel; natural gas price decreased 34% to $1.94 per Mcf; NGL price increased 23% to $29.44 per barrel.
• In the D-J Basin, the Company completed a previously drilled uncompleted (DUC) well and sold interests in Weld County, Colorado properties for $2.5 million.
• In the Powder River Basin, the Company drilled a new operated well and acquired approximately 5,678 net acres for $5.9 million via a BLM lease sale, doubling its Mowry position in that prospect area to approximately 12,000 net acres.
• The Company holds approximately 85,898 net acres in the D-J Basin, 183,829 net acres in the Powder River Basin, and 14,505 net acres in the Permian Basin.
• A $4.7 million net gain was recognized on the sale of oil and gas properties during the quarter.

Market and Competitive Landscape:

• The Company operates a consolidated Rockies-focused platform with over 284,000 net acres following the October 2025 merger with Juniper Capital Advisors-controlled portfolio companies.
• The Mowry Shale position in the Powder River Basin is identified as one of the highest-growth areas in the portfolio.
• The Company is actively searching for a permanent Chief Executive Officer to lead the organization.

Risks and Challenges:

• Net income is subject to significant volatility due to unrealized gains and losses on derivative contracts, which depend on future commodity prices.
• Temporary offset shut-ins associated with drilling and completion activity in the D-J and Powder River Basins, along with accelerated rod conversions, curtailed over 200 barrels of oil per day during the quarter.
• The Company faces risks related to the integration of acquired operations, servicing credit facility obligations, and commodity price volatility.

Management Commentary and Tone:

• Interim President and CEO R.T. Dukes stated the Company is entering a new phase of translating inventory into production growth after substantial progress in asset integration.
• Management emphasized a commitment to concentrating capital in the Rocky Mountain region to create long-term shareholder value.
• The tone reflects confidence in the expanded asset base and the expectation that optimizations will drive higher growth in 2027.

Other Key Points:

• The borrowing base and elected commitments under the revolving credit facility were reaffirmed at $125 million in October 2026.
• The Company converted Series A preferred stock into common stock, resulting in 13,292,013 shares issued and outstanding as of September 30, 2026.
• Adjusted EBITDA calculations for Q3 2026 exclude $2.1 million in severance costs, a change in definition from prior periods.
• The Company recognized a $16.6 million net loss on derivatives, with $12.0 million being non-cash and unrealized.
• Subsequent to quarter-end, the Company entered into fixed-price crude oil swaps covering 400,330 Bbl for January 2027 through December 2028.