Alvopetro Energy (ALVOF) Q4 2025 earnings summary

Executive summary

• Achieved a transformational year with 41% year-over-year production growth to 2,523 boepd, Q4 production up 22% sequentially to 2,867–2,900 boepd, and January 2026 reaching close to 3,100 boepd, driven by the 183-D4 well at Murucututu.

• 2P reserves grew 43% to 13.1 MMboe, with a 530% production replacement ratio and a 12.5-year reserve life index.

• Record funds flow from operations of $40.6M for 2025 and $10.6M in Q4, supporting both reinvestment and shareholder returns.

• Maintained a disciplined capital allocation model, splitting funds flow roughly 50/50 between growth and returns, with over $70M in dividends declared since 2021 and a Q1 2026 dividend of $0.12/share (8% yield).

• Expanded operations in Brazil and Canada, including new drilling, facility expansions, and land acquisitions targeting future growth.

Financial highlights

• Q4 2025 operating netback was $49.70/boe, with a realized price of $59.75/boe and an 83% netback margin.

• Net income for 2025 was $23.1M, up 42% from 2024; Q4 net income was $5.6M, up 149% year-over-year.

• Working capital net of debt was $2.5M at year-end, after entering a $20M loan agreement at 7% interest, with repayments starting end of 2026.

• Natural gas, oil, and condensate sales reached $57.95M in 2025, a 27% increase from 2024.

• 1P reserves increased 79% to 8.1 MMboe; 2P NPV10 before tax rose 20% to $393.6M year-over-year.

Outlook and guidance

• 2026 production projected to average over 3,000 boepd, a 22% increase from 2025, with further growth targeted as Murucututu expansion completes.

• CapEx budget for Brazil in 2026 is $21M, focused on facilities expansion and a new well at Murucututu; Canadian drilling plans are commodity price dependent.

• Multi-year development in Murucututu’s Gomo and Caruaçu formations, with additional drilling and facility expansions planned through 2028.

• Medium-term plan to process 100% Murucututu gas with further infrastructure upgrades.

• Dividend for Q1 2026 set at $0.12/share, representing an 8% yield.