Cardinal Energy (CJ) Q2 2025 earnings summary

Executive summary

• Q2 2025 production averaged 21,184 boe/d, 3% above budget, despite drilling only one conventional oil well as focus shifted to the Reford SAGD project.

• Adjusted funds flow for Q2 2025 was $49.4 million, primarily allocated to the Reford project and dividends.

• Net operating expenses per boe decreased 5% sequentially, reflecting operational efficiencies.

• Net debt rose to $227.1 million, with 39% of the $240 million credit facility drawn.

• $28.9 million in dividends were paid in Q2, resulting in an 84% total payout ratio.

Financial highlights

• Petroleum and natural gas revenue was $127.4 million, down 25% year-over-year.

• Adjusted funds flow fell 40% year-over-year to $49.4 million ($0.31 per share basic/diluted).

• Net income dropped 62% year-over-year to $15.5 million ($0.10 per share basic).

• Development capital expenditures decreased 32% year-over-year to $12.7 million.

• Free cash flow for Q2 was $36.7 million, down from $63.1 million a year ago.

Outlook and guidance

• First steam at the Reford SAGD project is expected in late Q3 2025, with production ramping up in early Q1 2026 to 6,000 bbl/d.

• Four additional conventional wells are planned for H2 2025; development intensity to increase in 2026.

• Debt reduction is anticipated to begin in Q4 2025 as Reford capital spending winds down.

• Five stratigraphic test wells and further seismic work are planned in 2025 to delineate future thermal projects.