Cavvy Energy (CVVY) Q3 2025 earnings summary

Executive summary

• Achieved solid Q3 2025 performance with net operating income of $30.6 million, driven by strategic execution, cost improvements, and record third-party processing and hedging gains.

• Transitioned to phase 2 of the strategic plan, focusing on deleveraging, asset growth, and per-share value enhancement.

• Executed a forward pricing agreement for 2026 sulphur sales, providing downside protection and upside market participation, materially reducing revenue risk and supporting debt reduction.

Financial highlights

• Net operating income (NOI) of nearly $31 million, supported by $28 million in commodity hedging gains.

• Q3 production averaged 23,956 boe/d (80% natural gas), up 4% year-over-year, with significant growth in third-party raw gas processing volumes.

• Third-party gas processing revenue exceeded $10 million, now over 15% of total revenue, with volumes up 105% year-over-year to 136.1 MMcf/d.

• Operating expense at a record low of $36.7 million ($16.64/boe); adjusted OpEx at $10.31/boe.

• Q3 2025 net income was a loss of $10.1 million, or ($0.03) per share.

Outlook and guidance

• Increased 2025 NOI guidance to $100–110 million and netback to $11.50–12.50/boe.

• Production and capital program expected to remain within prior guidance ranges (23,000–25,000 boe/d; $25–30 million capex).

• 2026 guidance to be announced in early December after budget approval.

• Anticipates accelerated deleveraging in 2026, leveraging new sulphur contract.

• No resumption of development drilling planned for 2025 due to weak natural gas prices; selective participation in non-operated wells.