Battalion Oil Corporation Announces Second Quarter 2026 Financial and Operating Results
Rhea-AI Summary
Battalion Oil (NYSE American: BATL) reported second quarter 2026 production of 12,407 Boe/d (45% oil) and total operating revenues of $48.1 million, up from $42.8 million a year earlier, driven mainly by a $6.48/Boe increase in realized prices excluding hedges.
The company generated net income available to common stockholders of $9.1 million, or $0.34 per diluted share, but reported an adjusted diluted net loss of $4.9 million. Adjusted EBITDA was $12.3 million versus $18.1 million in second quarter 2025. Lease operating and workover expense declined to $8.69/Boe from $10.98/Boe.
During the quarter, Battalion issued 17.4 million ATM shares for $30.3 million and another 14.9 million shares for $25.6 million after quarter end, reducing net debt to $74.2 million and leverage to 1.36x. A new senior secured credit agreement extended debt maturity to December 31, 2029 and added up to $175 million of discretionary delayed draw capacity. Stockholders’ equity turned positive at $203.1 million as of June 30, 2026.
Positive
- Total operating revenues rose to $48.1 million from $42.8 million year over year
- Net income to common $9.1 million, or $0.34 per diluted share
- Adjusted diluted net loss narrowed to $4.9 million from $10.6 million
- Adjusted EBITDA of $12.3 million, with lower lease operating costs per Boe
- LOE and workover expense fell to $8.69/Boe from $10.98/Boe
- Net debt reduced to $74.2 million; leverage ratio improved to 1.36x
- ATM equity proceeds of $55.9 million before and after quarter end
- New credit facility maturity extended to December 31, 2029 with $175 million delayed draw capacity
- Interest margin reduced to SOFR plus 6.50% from 7.75–8.50% grid
- Stockholders’ equity improved to positive $203.1 million from a deficit
Negative
- Average production declined to 12,407 Boe/d from 12,989 Boe/d year over year
- Adjusted EBITDA decreased to $12.3 million from $18.1 million
- Realized hedge losses totaled approximately $7.8 million in second quarter 2026
- Gathering and other expenses increased to $10.87/Boe from $9.27/Boe
- G&A expense rose to $3.60/Boe from $2.17/Boe, even excluding non-recurring items
- Common shares outstanding increased to 38.9 million from 16.5 million, indicating dilution
News Explained
The refinancing is closed, but its headline $175 million expansion is only lender-discretionary capacity, not committed funding.
Battalion Oil sold
The refinancing closed on
The joint exploration and development program has completed preparations, but drilling is still expected to commence before the end of August 2026, so that operating expansion has not yet reached the drilling stage.
Key Figures
Previous Earnings Reports
| Date | Event | Sentiment | 24h Move | Catalyst |
|---|---|---|---|---|
| May 13 | 1Q26 earnings report | Negative | -16.7% | Reported net loss alongside lower revenue despite improved balance sheet metrics. |
| Mar 23 | 4Q25 earnings report | Negative | -17.5% | Reported quarterly net loss despite asset sale, debt repayment, and development activity. |
| Nov 13 | 3Q25 earnings report | Negative | -0.9% | Reported net loss amid acid gas injection outage and production disruption. |
| Aug 14 | 2Q25 earnings report | Negative | -3.5% | Reported net loss and subsequent production disruption from acid gas facility outage. |
| May 14 | 1Q25 earnings report | Negative | -3.0% | Reported lower production, revenue, and net loss with term loan debt outstanding. |
24h Move is the share-price change in the day after each event; other market factors may also have contributed.
All five tag-matched earnings events were followed by negative 24-hour reactions, with an average move of -8.31%.
Key Terms
boe/d technical
atm offering financial
sofr financial
delayed draw facility financial
redeemable convertible preferred stock financial
AI-generated analysis. How Rhea-AI works. Not financial advice.
HOUSTON, Aug. 12, 2026 (GLOBE NEWSWIRE) -- Battalion Oil Corporation (NYSE American: BATL, “Battalion” or the “Company”) today announced financial and operating results for the second quarter of 2026.
Key Highlights
- The Company ended the quarter with positive equity of
$203.1 million . - Generated second quarter 2026 sales volumes of 12,407 barrels of oil equivalent per day (“Boe/d”) (~
45% oil,70% liquids) - Lease operating and workover expense per BOE reduced by ~
12% vs Q1 2026 - Placed 17.4 million shares of common stock under its ATM program for net proceeds of
$30.3 million during Q2 2026 and an additional 14.9 million shares for net proceeds of$25.6 million subsequent to quarter end. The proceeds have allowed the Company to:- Reduce net debt (gross debt less cash and reinvestment proceeds) to
$74.2 million vs$108.3 million in Q1 2026 and leverage ratio to 1.36x in Q2 2026 vs 1.79x in Q1 2026 - Complete a refinancing of its term loan yielding interest payment savings and reduced amortization
- Redeem and convert a portion of its outstanding preferred equity subsequent to quarter end - preferred liquidation value of
$42 million was extinguished for$19 million in cash and 3.5 million common shares
- Reduce net debt (gross debt less cash and reinvestment proceeds) to
- Completed preparations for drilling under new joint exploration and development agreement with drilling expected to commence prior to end of August 2026
Management Comments
The Company continued to execute across all facets of its business during the second quarter of 2026, advancing its Monument Draw development program while further strengthening its balance sheet. In April 2026, the Company completed midstream expansion projects at Monument Draw ahead of schedule and approximately
“The second quarter of 2026 was extremely active. We exhibited significant progress across every part of our business,” said Matt Steele, Chief Executive Officer of Battalion. “Our midstream investments at Monument Draw came in ahead of schedule and under budget, and we are already seeing the benefit in record well productivity and increased throughput capacity. Additional compression secured during the quarter will further improve reliability starting in mid-Q3 and support production growth from our active drilling program. Establishing our ATM program gave us an efficient tool to continue strengthening the balance sheet. The ATM proceeds, asset sales, and free cash flow from the underlying business have allowed us to significantly reduce net debt. We are now under 1.5x levered – something the Company has never previously achieved. Given the improved balance sheet, we plan to judiciously utilize the limited shares available in our ATM going forward. Executing our joint exploration and development agreement in Monument Draw is the culmination of months of work and allows us to transition to multi-bench development while prudently deploying capital within cash on hand. Closing our refinancing at quarter end meaningfully lowers our cost of capital and enhances our financial flexibility as we move into this next phase of development at Monument Draw. The Company has never been in a stronger financial and operational position. In fact, we were recently able to utilize cash on hand to opportunistically buy back a portion of our preferred stock at a substantial discount to its par value from a holder seeking liquidity. Going forward, we will continue to focus on disciplined execution and creation of value for our shareholders.”
Results of Operations
Average daily net production and total operating revenue during the second quarter of 2026 were 12,407 Boe/d (
Lease operating and workover expense was
For the second quarter of 2026, the Company reported net income available to common stockholders of
Liquidity and Balance Sheet
As of June 30, 2026, the Company had
On June 30, 2026, the Company entered into the Third Amended and Restated Senior Secured Credit Agreement (the “New Credit Agreement”) which amended and restated in its entirety the Second Amended and Restated Senior Secured Credit Agreement dated December 26, 2024, as amended (the "Existing Credit Agreement"). Outstanding term loans under the Existing Credit Agreement continued under the New Credit Agreement as closing date term loans, against a maximum closing date term loan commitment of
Key terms of the New Credit Agreement include:
Interest Rate: SOFR plus a fixed applicable margin of
Maturity: December 31, 2029.
Delayed Draw Facility: Up to
Amortization: Scheduled quarterly principal amortization commences with the fiscal quarter ending June 30, 2027.
Financial Covenants: Includes maintenance covenants relating to Total Net Leverage Ratio, Current Ratio, Asset Coverage Ratio and minimum Liquidity, each commencing with the fiscal quarter ending September 30, 2026.
For additional details on liquidity, financial position, and recent developments, please refer to Management’s Discussion and Analysis included in Battalion’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2026.
Forward Looking Statements
This release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Statements that are not strictly historical statements constitute forward-looking statements. Forward-looking statements include, among others, statements about anticipated production, liquidity, capital spending, drilling and completion plans, and forward guidance. Forward-looking statements may often, but not always, be identified by the use of such words such as "expects", "believes", "intends", "anticipates", "plans", "estimates", “projects,” "potential", "possible", or "probable" or statements that certain actions, events or results "may", "will", "should", or "could" be taken, occur or be achieved. Forward-looking statements are based on current beliefs and expectations and involve certain assumptions or estimates that involve various risks and uncertainties that could cause actual results to differ materially from those reflected in the statements. These risks include, but are not limited to, those set forth in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025, and other filings submitted by the Company to the SEC, copies of which may be obtained from the SEC's website at www.sec.gov or through the Company's website at www.battalionoil.com. Readers should not place undue reliance on any such forward-looking statements, which are made only as of the date hereof. The Company has no duty, and assumes no obligation, to update forward-looking statements as a result of new information, future events or changes in the Company's expectations.
About Battalion
Battalion Oil Corporation is an independent energy company engaged in the acquisition, production, exploration and development of onshore oil and natural gas properties in the United States.
Contact
Matthew B. Steele
Chief Executive Officer & Principal Financial Officer
832-538-0300
| BATTALION OIL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In thousands, except per share amounts) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating revenues: | ||||||||||||||||
| Oil, natural gas and natural gas liquids sales: | ||||||||||||||||
| Oil | $ | 49,152 | $ | 36,291 | $ | 85,434 | $ | 75,991 | ||||||||
| Natural gas | (6,904 | ) | 935 | (8,397 | ) | 3,758 | ||||||||||
| Natural gas liquids | 5,730 | 5,350 | 10,003 | 10,212 | ||||||||||||
| Total oil, natural gas and natural gas liquids sales | 47,978 | 42,576 | 87,040 | 89,961 | ||||||||||||
| Other | 151 | 236 | 263 | 326 | ||||||||||||
| Total operating revenues | 48,129 | 42,812 | 87,303 | 90,287 | ||||||||||||
| Operating expenses: | ||||||||||||||||
| Production: | ||||||||||||||||
| Lease operating | 9,189 | 10,670 | 19,283 | 21,028 | ||||||||||||
| Workover and other | 622 | 2,309 | 1,640 | 3,742 | ||||||||||||
| Taxes other than income | 2,981 | 2,522 | 5,305 | 5,322 | ||||||||||||
| Gathering and other | 12,268 | 10,958 | 23,518 | 22,958 | ||||||||||||
| General and administrative | 4,066 | 2,567 | 8,326 | 6,980 | ||||||||||||
| Depletion, depreciation and accretion | 12,222 | 13,939 | 24,584 | 27,019 | ||||||||||||
| Total operating expenses | 41,348 | 42,965 | 82,656 | 87,049 | ||||||||||||
| Income (loss) from operations | 6,781 | (153 | ) | 4,647 | 3,238 | |||||||||||
| Other income (expenses): | ||||||||||||||||
| Net gain (loss) on derivative contracts | 13,051 | 11,548 | (34,913 | ) | 20,850 | |||||||||||
| Interest expense and other | (4,324 | ) | (6,599 | ) | (9,841 | ) | (13,269 | ) | ||||||||
| Loss on extinguishment of debt | — | — | (862 | ) | — | |||||||||||
| Total other income (expenses) | 8,727 | 4,949 | (45,616 | ) | 7,581 | |||||||||||
| Income (loss) before income taxes | 15,508 | 4,796 | (40,969 | ) | 10,819 | |||||||||||
| Income tax benefit (provision) | — | — | — | — | ||||||||||||
| Net income (loss) | $ | 15,508 | $ | 4,796 | $ | (40,969 | ) | $ | 10,819 | |||||||
| Preferred dividends | — | (8,270 | ) | (8,331 | ) | (20,090 | ) | |||||||||
| Undistributed earnings allocable to preferred stockholders | (6,434 | ) | — | — | — | |||||||||||
| Net income (loss) available to common stockholders | $ | 9,074 | $ | (3,474 | ) | $ | (49,300 | ) | $ | (9,271 | ) | |||||
| Net income (loss) per share of common stock available to common stockholders: | ||||||||||||||||
| Basic | $ | 0.34 | $ | (0.21 | ) | $ | (2.25 | ) | $ | (0.56 | ) | |||||
| Diluted | $ | 0.34 | $ | (0.21 | ) | $ | (2.25 | ) | $ | (0.56 | ) | |||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 26,430 | 16,457 | 21,947 | 16,457 | ||||||||||||
| Diluted | 45,172 | 16,457 | 21,947 | 16,457 | ||||||||||||
| BATTALION OIL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share and per share amounts) | ||||||||
| June 30, 2026 | December 31, 2025 | |||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 83,097 | $ | 27,965 | ||||
| Accounts receivable, net | 14,406 | 12,071 | ||||||
| Assets from derivative contracts | 4,229 | 16,145 | ||||||
| Restricted cash | 5,294 | 91 | ||||||
| Prepaids and other | 462 | 892 | ||||||
| Total current assets | 107,488 | 57,164 | ||||||
| Oil and natural gas properties (full cost method): | ||||||||
| Evaluated | 833,063 | 890,050 | ||||||
| Unevaluated | 54,334 | 48,025 | ||||||
| Gross oil and natural gas properties | 887,397 | 938,075 | ||||||
| Less: accumulated depletion | (572,058 | ) | (547,982 | ) | ||||
| Net oil and natural gas properties | 315,339 | 390,093 | ||||||
| Other operating property and equipment: | ||||||||
| Other operating property and equipment | 4,682 | 4,678 | ||||||
| Less: accumulated depreciation | (2,843 | ) | (2,807 | ) | ||||
| Net other operating property and equipment | 1,839 | 1,871 | ||||||
| Other noncurrent assets: | ||||||||
| Assets from derivative contracts | 3,729 | 7,350 | ||||||
| Operating lease right of use assets | 666 | 840 | ||||||
| Other assets | 3,524 | 3,360 | ||||||
| Total assets | $ | 432,585 | $ | 460,678 | ||||
| Current liabilities: | ||||||||
| Accounts payable and accrued liabilities | $ | 39,898 | $ | 39,734 | ||||
| Liabilities from derivative contracts | 6,667 | 633 | ||||||
| Current portion of long-term debt | 2,031 | 22,510 | ||||||
| Operating lease liabilities | 484 | 764 | ||||||
| Total current liabilities | 49,080 | 63,641 | ||||||
| Long-term debt, net | 156,208 | 180,955 | ||||||
| Other noncurrent liabilities: | ||||||||
| Liabilities from derivative contracts | 6,194 | 1,692 | ||||||
| Asset retirement obligations | 17,749 | 20,837 | ||||||
| Operating lease liabilities | 216 | 104 | ||||||
| Commitments and contingencies | ||||||||
| Temporary equity: | ||||||||
| Redeemable convertible preferred stock: 138,000 shares of | — | 226,241 | ||||||
| Stockholders' equity (deficit): | ||||||||
| Redeemable convertible preferred stock: 130,197 shares of | 221,185 | — | ||||||
| Common stock: 100,000,000 shares of | 4 | 2 | ||||||
| Additional paid-in capital | 295,914 | 240,202 | ||||||
| Accumulated deficit | (313,965 | ) | (272,996 | ) | ||||
| Total stockholders' equity (deficit) | 203,138 | (32,792 | ) | |||||
| Total liabilities, temporary equity and stockholders' equity | $ | 432,585 | $ | 460,678 | ||||
| BATTALION OIL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (In thousands) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||||
| Net income (loss) | $ | 15,508 | $ | 4,796 | $ | (40,969 | ) | $ | 10,819 | |||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities: | ||||||||||||||||
| Depletion, depreciation and accretion | 12,222 | 13,939 | 24,584 | 27,019 | ||||||||||||
| Stock-based compensation, net | 421 | — | 421 | (109 | ) | |||||||||||
| Unrealized gain on derivative contracts | (20,865 | ) | (7,248 | ) | 26,072 | (19,076 | ) | |||||||||
| Amortization of deferred financing costs | 264 | 397 | 612 | 792 | ||||||||||||
| Loss on extinguishment of debt | — | — | 862 | — | ||||||||||||
| Accrued settlements on derivative contracts | (30 | ) | 23 | 2,395 | (537 | ) | ||||||||||
| Other | 5 | 56 | 7 | 109 | ||||||||||||
| Cash flows from operations before changes in working capital | 7,525 | 11,963 | 13,984 | 19,017 | ||||||||||||
| Changes in working capital | 1,253 | (1,758 | ) | (3,101 | ) | 3,919 | ||||||||||
| Net cash provided by operating activities | 8,778 | 10,205 | 10,883 | 22,936 | ||||||||||||
| Cash flows from investing activities: | ||||||||||||||||
| Oil and natural gas capital expenditures | (4,205 | ) | (33,290 | ) | (7,818 | ) | (53,090 | ) | ||||||||
| Proceeds received from sale of oil and natural gas assets | — | — | 60,055 | — | ||||||||||||
| Other operating property and equipment capital expenditures | — | (8 | ) | — | (14 | ) | ||||||||||
| Other | (9 | ) | (64 | ) | (14 | ) | (370 | ) | ||||||||
| Net cash (used in) provided by investing activities | (4,214 | ) | (33,362 | ) | 52,223 | (53,474 | ) | |||||||||
| Cash flows from financing activities: | ||||||||||||||||
| Proceeds from borrowings | — | — | — | 63,000 | ||||||||||||
| Repayments of borrowings | — | (5,652 | ) | (45,635 | ) | (5,678 | ) | |||||||||
| Debt issuance costs | (407 | ) | (138 | ) | (1,064 | ) | (1,875 | ) | ||||||||
| Proceeds from issuance of common stock | 29,903 | — | 43,928 | — | ||||||||||||
| Net cash provided by (used in) financing activities | 29,496 | (5,790 | ) | (2,771 | ) | 55,447 | ||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 34,060 | (28,947 | ) | 60,335 | 24,909 | |||||||||||
| Cash, cash equivalents and restricted cash at beginning of period | 54,331 | 73,659 | 28,056 | 19,803 | ||||||||||||
| Cash, cash equivalents and restricted cash at end of period | $ | 88,391 | $ | 44,712 | $ | 88,391 | $ | 44,712 | ||||||||
| BATTALION OIL CORPORATION SELECTED OPERATING DATA (Unaudited) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Production volumes: | ||||||||||||||||
| Crude oil (MBbls) | 510 | 584 | 1,038 | 1,153 | ||||||||||||
| Natural gas (MMcf) | 2,012 | 2,136 | 4,066 | 3,935 | ||||||||||||
| Natural gas liquids (MBbls) | 283 | 242 | 546 | 444 | ||||||||||||
| Total (MBoe) | 1,129 | 1,182 | 2,262 | 2,253 | ||||||||||||
| Average daily production (Boe/d) | 12,407 | 12,989 | 12,497 | 12,448 | ||||||||||||
| Average prices: | ||||||||||||||||
| Crude oil (per Bbl) | $ | 96.38 | $ | 62.14 | $ | 82.31 | $ | 65.91 | ||||||||
| Natural gas (per Mcf) | (3.43 | ) | 0.44 | (2.07 | ) | 0.96 | ||||||||||
| Natural gas liquids (per Bbl) | 20.25 | 22.11 | 18.32 | 23.00 | ||||||||||||
| Total per Boe | 42.50 | 36.02 | 38.48 | 39.93 | ||||||||||||
| Cash effect of derivative contracts: | ||||||||||||||||
| Crude oil (per Bbl) | $ | (24.63 | ) | $ | 1.04 | $ | (15.70 | ) | $ | (2.93 | ) | |||||
| Natural gas (per Mcf) | 2.36 | 1.73 | 1.83 | 1.31 | ||||||||||||
| Natural gas liquids (per Bbl) | — | — | — | — | ||||||||||||
| Total per Boe | (6.92 | ) | 3.64 | (3.91 | ) | 0.79 | ||||||||||
| Average prices computed after cash effect of settlement of derivative contracts: | ||||||||||||||||
| Crude oil (per Bbl) | $ | 71.75 | $ | 63.18 | $ | 66.61 | $ | 62.98 | ||||||||
| Natural gas (per Mcf) | (1.07 | ) | 2.17 | (0.24 | ) | 2.27 | ||||||||||
| Natural gas liquids (per Bbl) | 20.25 | 22.11 | 18.32 | 23.00 | ||||||||||||
| Total per Boe | 35.58 | 39.66 | 34.57 | 40.72 | ||||||||||||
| Average cost per Boe: | ||||||||||||||||
| Production: | ||||||||||||||||
| Lease operating | $ | 8.14 | $ | 9.03 | $ | 8.52 | $ | 9.33 | ||||||||
| Workover and other | 0.55 | 1.95 | 0.73 | 1.66 | ||||||||||||
| Taxes other than income | 2.64 | 2.13 | 2.35 | 2.36 | ||||||||||||
| Gathering and other | 10.87 | 9.27 | 10.40 | 10.19 | ||||||||||||
| General and administrative, as adjusted (1) | 2.83 | 2.11 | 2.92 | 2.54 | ||||||||||||
| Depletion | 10.62 | 11.47 | 10.64 | 11.64 | ||||||||||||
| (1) Represents general and administrative costs per Boe, adjusted for items noted in the reconciliation below: | ||||||||||||||||
| General and administrative: | ||||||||||||||||
| General and administrative, as reported | $ | 3.60 | $ | 2.17 | $ | 3.68 | $ | 3.10 | ||||||||
| Stock-based compensation: | ||||||||||||||||
| Non-cash | (0.37 | ) | - | (0.19 | ) | (0.02 | ) | |||||||||
| Non-recurring charges and other: | ||||||||||||||||
| Cash | (0.40 | ) | (0.06 | ) | (0.57 | ) | (0.54 | ) | ||||||||
| General and administrative, as adjusted(2) | $ | 2.83 | $ | 2.11 | $ | 2.92 | $ | 2.54 | ||||||||
| Total operating costs, as reported | $ | 25.80 | $ | 24.55 | $ | 25.68 | $ | 26.64 | ||||||||
| Total adjusting items | (0.77 | ) | (0.06 | ) | (0.76 | ) | (0.56 | ) | ||||||||
| Total operating costs, as adjusted(3) | $ | 25.03 | $ | 24.49 | $ | 24.92 | $ | 26.08 | ||||||||
| _______________ | ||||||||||||||||
| (2) General and administrative, as adjusted, is a non-GAAP measure that excludes non-cash stock-based compensation charges relating to equity awards under our incentive stock plan, as well as other cash charges associated with non-recurring charges and other. The Company believes that it is useful to understand the effects that these charges have on general and administrative expenses and total operating costs and that exclusion of such charges is useful for comparison to prior periods. (3) Represents lease operating expense, workover and other expense, taxes other than income, gathering and other expense and general and administrative costs per Boe, adjusted for items noted in the reconciliation above. | ||||||||||||||||
| BATTALION OIL CORPORATION RECONCILIATION (Unaudited) (In thousands, except per share amounts) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| As Reported: | ||||||||||||||||
| Net income (loss) available to common stockholders - diluted(1) | $ | 15,508 | $ | (3,474 | ) | $ | (49,300 | ) | $ | (9,271 | ) | |||||
| Impact of Selected Items: | ||||||||||||||||
| Unrealized (gain) loss on derivatives contracts: | ||||||||||||||||
| Crude oil | $ | (22,813 | ) | $ | (16,782 | ) | $ | 26,995 | $ | (22,326 | ) | |||||
| Natural gas | 1,948 | 9,534 | (923 | ) | 3,250 | |||||||||||
| Total mark-to-market non-cash charge | (20,865 | ) | (7,248 | ) | 26,072 | (19,076 | ) | |||||||||
| Loss on extinguishment of debt | — | — | 862 | — | ||||||||||||
| Non-recurring charges | 454 | 73 | 1,289 | 1,222 | ||||||||||||
| Selected items, before income taxes | (20,411 | ) | (7,175 | ) | 28,223 | (17,854 | ) | |||||||||
| Income tax effect of selected items | — | — | — | — | ||||||||||||
| Selected items, net of tax | (20,411 | ) | (7,175 | ) | 28,223 | (17,854 | ) | |||||||||
| Net loss available to common stockholders, as adjusted(2) | $ | (4,903 | ) | $ | (10,649 | ) | $ | (21,077 | ) | $ | (27,125 | ) | ||||
| Diluted net income (loss) per common share, as reported | $ | 0.34 | $ | (0.21 | ) | $ | (2.25 | ) | $ | (0.56 | ) | |||||
| Impact of selected items | (0.45 | ) | (0.44 | ) | 1.29 | (1.09 | ) | |||||||||
| Diluted net loss per common share, excluding selected items(2)(3) | $ | (0.11 | ) | $ | (0.65 | ) | $ | (0.96 | ) | $ | (1.65 | ) | ||||
| Net cash provided by operating activities | $ | 8,778 | $ | 10,205 | $ | 10,883 | $ | 22,936 | ||||||||
| Changes in working capital | (1,253 | ) | 1,758 | 3,101 | (3,919 | ) | ||||||||||
| Cash flows from operations before changes in working capital | 7,525 | 11,963 | 13,984 | 19,017 | ||||||||||||
| Cash components of selected items | 484 | 50 | (1,106 | ) | 1,759 | |||||||||||
| Income tax effect of selected items | — | — | — | — | ||||||||||||
| Cash flows from operations before changes in working capital, adjusted for selected items(1) | $ | 8,009 | $ | 12,013 | $ | 12,878 | $ | 20,776 | ||||||||
| _______________ | ||||||||||||||||
| (1) Amount reflects net (loss) income available to common stockholders on a diluted basis for earnings per share purposes as calculated using the two-class method of computing earnings per share which is further described in Note 14, Earnings Per Share in our Form 10-K for the year ended December 31, 2025. (2) Net (loss) income per share excluding selected items and cash flows from operations before changes in working capital adjusted for selected items are non-GAAP measures presented based on management's belief that they will enable a user of the financial information to understand the impact of these items on reported results. These financial measures are not measures of financial performance under GAAP and should not be considered as an alternative to net income, earnings per share and cash flows from operations, as defined by GAAP. These financial measures may not be comparable to similarly named non-GAAP financial measures that other companies may use and may not be useful in comparing the performance of those companies to Battalion's performance. (3) The impact of selected items for the three and six months ended June 30, 2026 were calculated based upon weighted average diluted shares of 45.2 and 21.9 million, respectively, due to the net income (loss) available to common stockholders, excluding selected items. The impact of selected items for the three and six months ended June 30, 2025 were calculated based upon weighted average diluted shares of 16.5 million due to the net loss available to common stockholders, excluding selected items | ||||||||||||||||
| BATTALION OIL CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30, | June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Net income (loss), as reported | $ | 15,508 | $ | 4,796 | $ | (40,969 | ) | $ | 10,819 | |||||||
| Impact of adjusting items: | ||||||||||||||||
| Interest expense | 5,124 | 7,341 | 10,965 | 14,530 | ||||||||||||
| Depletion, depreciation and accretion | 12,222 | 13,939 | 24,584 | 27,019 | ||||||||||||
| Stock-based compensation | 421 | - | 421 | 48 | ||||||||||||
| Interest income | (612 | ) | (764 | ) | (936 | ) | (1,343 | ) | ||||||||
| Loss on extinguishment of debt | — | — | 862 | — | ||||||||||||
| Unrealized gain on derivatives contracts | (20,865 | ) | (7,248 | ) | 26,072 | (19,076 | ) | |||||||||
| Non-recurring charges and other | 454 | 73 | 1,289 | 1,222 | ||||||||||||
| Adjusted EBITDA(1) | $ | 12,252 | $ | 18,137 | $ | 22,288 | $ | 33,219 | ||||||||
| _______________ | ||||||||||||||||
| (1) Adjusted EBITDA is a non-GAAP measure, which is presented based on management's belief that it will enable a user of the financial information to understand the impact of these items on reported results. This financial measure is not a measure of financial performance under GAAP and should not be considered as an alternative to GAAP measures, including net (loss) income. This financial measure may not be comparable to similarly named non-GAAP financial measures that other companies may use and may not be useful in comparing the performance of those companies to Battalion's performance. | ||||||||||||||||
| BATTALION OIL CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands) | ||||||||||||||||
| Three Months | Three Months | Three Months | Three Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| June 30, 2026 | March 31, 2026 | December 31, 2025 | September 30, 2025 | |||||||||||||
| Net income (loss), as reported | $ | 15,508 | $ | (56,477 | ) | $ | 1,795 | $ | (735 | ) | ||||||
| Impact of adjusting items: | ||||||||||||||||
| Interest expense | 5,124 | 5,841 | 6,987 | 7,318 | ||||||||||||
| Depletion, depreciation and accretion | 12,222 | 12,362 | 11,603 | 13,522 | ||||||||||||
| Asset impairment | — | — | 1,072 | — | ||||||||||||
| Stock-based compensation | 421 | — | — | — | ||||||||||||
| Interest income | (612 | ) | (324 | ) | (414 | ) | (503 | ) | ||||||||
| Loss on extinguishment of debt | — | 862 | — | — | ||||||||||||
| Unrealized (gain) loss on derivatives contracts | (20,865 | ) | 46,937 | (9,313 | ) | (1,044 | ) | |||||||||
| Non-recurring charges and other | 454 | 835 | 1,631 | 324 | ||||||||||||
| Adjusted EBITDA(1) | $ | 12,252 | $ | 10,036 | $ | 13,361 | $ | 18,882 | ||||||||
| Adjusted LTM EBITDA(1) | $ | 54,531 | ||||||||||||||
| _______________ | ||||||||||||||||
| (1) Adjusted EBITDA is a non-GAAP measure, which is presented based on management's belief that it will enable a user of the financial information to understand the impact of these items on reported results. This financial measure is not a measure of financial performance under GAAP and should not be considered as an alternative to GAAP measures, including net (loss) income. This financial measure may not be comparable to similarly named non-GAAP financial measures that other companies may use and may not be useful in comparing the performance of those companies to Battalion's performance. | ||||||||||||||||
| BATTALION OIL CORPORATION ADJUSTED EBITDA RECONCILIATION (Unaudited) (In thousands) | ||||||||||||||||
| Three Months | Three Months | Three Months | Three Months | |||||||||||||
| Ended | Ended | Ended | Ended | |||||||||||||
| June 30, 2025 | March 31, 2025 | December 31, 2024 | September 30, 2024 | |||||||||||||
| Net income (loss), as reported | $ | 4,796 | $ | 6,023 | $ | (22,202 | ) | $ | 21,628 | |||||||
| Impact of adjusting items: | ||||||||||||||||
| Interest expense | 7,341 | 7,189 | 6,135 | 6,873 | ||||||||||||
| Depletion, depreciation and accretion | 13,939 | 13,080 | 14,155 | 12,533 | ||||||||||||
| Asset impairment | — | — | 18,511 | — | ||||||||||||
| Stock-based compensation | - | 48 | 12 | 5 | ||||||||||||
| Interest income | (764 | ) | (579 | ) | (278 | ) | (509 | ) | ||||||||
| Loss on extinguishment of debt | — | — | 7,489 | — | ||||||||||||
| Unrealized (gain) loss on derivatives contracts | (7,248 | ) | (11,828 | ) | 1,648 | (28,091 | ) | |||||||||
| Change in fair value of embedded derivative liability | — | — | (761 | ) | 41 | |||||||||||
| Merger Termination Payment | — | — | (10,000 | ) | — | |||||||||||
| Non-recurring charges and other | 73 | 1,149 | 3,310 | 978 | ||||||||||||
| Adjusted EBITDA(1) | $ | 18,137 | $ | 15,082 | $ | 18,019 | $ | 13,458 | ||||||||
| Adjusted LTM EBITDA(1) | $ | 64,696 | ||||||||||||||
| _______________ | ||||||||||||||||
| (1) Adjusted EBITDA is a non-GAAP measure, which is presented based on management's belief that it will enable a user of the financial information to understand the impact of these items on reported results. This financial measure is not a measure of financial performance under GAAP and should not be considered as an alternative to GAAP measures, including net income (loss). This financial measure may not be comparable to similarly named non-GAAP financial measures that other companies may use and may not be useful in comparing the performance of those companies to Battalion's performance. | ||||||||||||||||
