Peyto Exploration & Development Corp

Latest Results (10.10.2025):

Peyto Exploration & Development Corp. reported strong financial performance for the second quarter of 2025, demonstrating significant growth in funds from operations and earnings. The company maintained its industry-leading low cash costs and effectively managed its hedging strategy, resulting in substantial free funds flow and a reduction in net debt.

Robust Funds from Operations

Peyto achieved $191.3 million in funds from operations (FFO) for Q2 2025, translating to $0.95 per diluted share. This strong FFO was driven by the company's low cash costs and a realized natural gas price after hedging of $3.53/Mcf, which is 57% higher than the AECO 7A monthly benchmark.

Increased Earnings and Dividends

Earnings for the quarter reached $87.8 million, or $0.43 per diluted share. The company returned $66.0 million in dividends to shareholders, underscoring its commitment to shareholder value.

Debt Reduction

Net debt was reduced by $39.9 million during the quarter, bringing the total net debt down to $1.24 billion by the end of Q2 2025. This marks a significant decrease of $105.6 million since December 31, 2024.

Growth in Production Volumes

Production volumes averaged 131,754 barrels of oil equivalent per day (boe/d) in Q2 2025, an 8% year-over-year increase. This growth was driven by the company's active capital program, reflecting a 5% increase on a per-share basis.

Effective Hedging Strategy

Peyto recorded $52.6 million in realized hedging gains and maintained a hedge position that protects approximately 479 MMcf/d and 410 MMcf/d of natural gas production for the second half of 2025 and 2026, respectively, at around $4/Mcf. This strategy has secured approximately $655 million in revenue for 2026.

Lowest Cash Costs in Industry

The company's cash costs totaled $1.31/Mcfe for the quarter, including various expenses, highlighting Peyto's position as the lowest-cost producer among Canadian oil and natural gas companies.

Capital Expenditures and Operational Efficiency

Total capital expenditures amounted to $104.6 million in Q2 2025. Peyto drilled 19 wells, completed 19 wells, and brought 21 wells on production, demonstrating efficient capital deployment and operational effectiveness.