Kolibri Global Energy (KEI) Q3 2024 earnings summary

Executive summary

• Achieved strong financial and operational results in Q3 2024, with net income rising 118% year-over-year to $5.1 million ($0.14/share), driven by higher production and unrealized gains on commodity contracts.

• Adjusted EBITDA increased 6% to $10.1 million, reflecting an 11% rise in production, partially offset by a 9% decrease in average prices.

• The three new Alicia Renee 1.5-mile lateral wells are producing over 2,800 BOE/day, exceeding expectations and contributing to overall production growth.

• No additional drilling planned for Q4 2024; focus is on monitoring new wells and preparing locations for 2025.

• Revenue, net of royalties, grew 2% to $13.0 million in Q3 2024, as higher production was mostly offset by lower prices.

Financial highlights

• Q3 2024 average production rose 11% year-over-year to 3,032 BOE/day, driven by new wells; average price per BOE fell 9% to $59.09.

• Netback from operations declined 8% to $40.01/BOE due to lower prices; netback including hedges was $39.95/BOE, down 4%.

• Operating expense per BOE fell 10% to $6.63 in Q3 2024 due to higher production.

• YTD 2024: average production up 13% to 3,154 BOE/day, adjusted EBITDA up 7% to $30.5 million, net revenue up 11% to $41.2 million.

• YTD net income was $12.5 million ($0.35/share), down from $14.5 million ($0.41/share) last year, mainly due to higher income tax, operating, and DD&A expenses.

Outlook and guidance

• Management expects continued growth in Q4 2024 as the company enters a new phase focused on drilling longer laterals.

• Expecting a significant increase in cash flow in Q4 2024 due to strong early performance of new wells.

• 2025 drilling plans and guidance to be determined and presented to the board, with intent to propose additional growth and continued capital returns.