Harbour Energy (HBR) Q4 2025 TU earnings summary

Executive summary

• Achieved 2025 production of 474 kboepd, up 84% year-over-year and at the top end of guidance, driven by operational excellence, asset integration, and robust free cash flow despite softer commodity prices.

• Strategic acquisitions (LLOG, Waldorf) and divestments (Indonesia, Vietnam) announced in December 2025 to enhance portfolio, increase free cash flow, and drive growth.

• Successfully integrated new assets, improved cost structure, and advanced key development projects in Mexico and Argentina.

• Maintained investment grade credit ratings and confirmed intention to move to a payout ratio-based distribution policy, with a new policy to be announced with full year results.

Financial highlights

• 2025 free cash flow reached $1.1bn, a $0.5bn upgrade from initial outlook, with revenue at $10.3bn and EBITDAX at $7.1bn.

• Unit operating costs reduced by 20% to $13/boe, supported by cost controls, asset sales, and integration of lower-cost portfolios.

• Distributions to shareholders totaled $545m in 2025, up from $200m in 2024.

• Net debt reduced to $4.4bn with leverage at 0.6x, well below the 1.0x target.

• Total capital expenditure (including decommissioning) was $2.3bn in 2025.

Outlook and guidance

• 2026 production guidance set at 435–455 kboepd, with unit opex around $13.5/boe and capex of $1.7–1.9bn.

• Free cash flow for 2026 expected at approximately $0.63bn, assuming $65/bbl Brent and $11/mscf European gas.

• If announced transactions complete, production could approach 500 kboepd by year-end 2026.

• Portfolio expected to sustain material production beyond 2030, with new projects in Norway, Argentina, and Mexico offsetting UK declines.

• New distribution policy to be announced with full year results.