Sable Offshore (SOC) Q2 2025 earnings summary

Executive summary

• Production at SYU restarted on May 15, 2025, after being shut in since 2015, with oil now flowing to onshore storage but not yet sold pending regulatory approvals.

• Completed major anomaly repair and hydrotests on the Las Flores Pipeline System, meeting Consent Decree requirements.

• Flowed 130,000 barrels of oil into storage during Q2 2025, with an additional 220,000 barrels stored by August 8, 2025.

• Raised $295 million in a May 2025 public offering, with proceeds for capital expenditures and working capital.

• The Senior Secured Term Loan maturity accelerated to January 10, 2026, requiring refinancing or repayment within 240 days of production restart.

Financial highlights

• Net loss of $128.1 million for Q2 2025, compared to a net loss of $165.4 million in Q2 2024.

• Operating expenses rose 107% year-over-year to $128.9 million in Q2 2025, driven by higher maintenance, headcount, and incentive compensation.

• Interest expense for Q2 2025 was $21.0 million, up 9.6% from Q2 2024.

• Cash and cash equivalents at June 30, 2025, were $247.1 million, with restricted cash of $35.6 million.

• No revenue recognized in Q2 2025 as oil produced remains in storage pending sales approval.

Outlook and guidance

• Management expects sales of production to commence in Q3 or September 2025, contingent on regulatory and legal approvals.

• Operating cash flows are projected to increase rapidly after sales begin, supporting further capital expenditures.

• Remaining start-up expenses to reach first sales are estimated at $66.6 million.

• Substantial doubt exists about the ability to continue as a going concern due to regulatory uncertainties and the need to refinance the Senior Secured Term Loan.