Epsilon Announces Full Year 2024 Results
Epsilon Energy (NASDAQ: EPSN) reported its full-year 2024 results, highlighting challenging market conditions in natural gas. The company returned $7.3 million to shareholders through $5.5 million in quarterly dividends and $1.8 million in share repurchases.
Key operational highlights include:
- Capital expenditures increased 58% YoY to $34.9 million
- Company Proved reserves increased 20% year over year
- Auburn Gas Gathering System delivered 36.9 Bcf gross natural gas volumes (101 MMcf/d)
- Expanded Texas assets to 7 gross producing wells with 14,000 gross undeveloped acres
- Entered new JV in Alberta covering 30,000 gross acres
Production was impacted by low Marcellus wellhead prices (below $2 per Mcf) with 20-25% of production curtailed in 2024. However, Q1 2025 shows 75% increase in Marcellus natural gas production compared to 2024 average daily volumes.
Epsilon Energy (NASDAQ: EPSN) ha riportato i risultati per l'intero anno 2024, evidenziando le difficili condizioni di mercato nel settore del gas naturale. L'azienda ha restituito 7,3 milioni di dollari agli azionisti attraverso 5,5 milioni di dollari in dividendi trimestrali e 1,8 milioni di dollari in riacquisti di azioni.
I principali punti operativi includono:
- Le spese in conto capitale sono aumentate del 58% rispetto all'anno precedente, raggiungendo 34,9 milioni di dollari
- Le riserve provate dell'azienda sono aumentate del 20% anno su anno
- Il sistema di raccolta gas di Auburn ha consegnato volumi lordi di gas naturale pari a 36,9 Bcf (101 MMcf/d)
- Aumentati gli asset in Texas a 7 pozzi produttivi lordi con 14.000 acri lordi non sviluppati
- Entrata in una nuova joint venture in Alberta che copre 30.000 acri lordi
La produzione è stata influenzata dai bassi prezzi del gas alla bocca del pozzo Marcellus (sotto i 2 dollari per Mcf), con una riduzione del 20-25% della produzione nel 2024. Tuttavia, il primo trimestre del 2025 mostra un aumento del 75% nella produzione di gas naturale Marcellus rispetto ai volumi medi giornalieri del 2024.
Epsilon Energy (NASDAQ: EPSN) informó sus resultados del año completo 2024, destacando las difíciles condiciones del mercado en el gas natural. La compañía devolvió 7.3 millones de dólares a los accionistas a través de 5.5 millones de dólares en dividendos trimestrales y 1.8 millones de dólares en recompra de acciones.
Los principales aspectos operativos incluyen:
- Los gastos de capital aumentaron un 58% interanual, alcanzando los 34.9 millones de dólares
- Las reservas probadas de la compañía aumentaron un 20% año tras año
- El sistema de recolección de gas de Auburn entregó volúmenes brutos de gas natural de 36.9 Bcf (101 MMcf/d)
- Se expandieron los activos en Texas a 7 pozos productores brutos con 14,000 acres brutos no desarrollados
- Se ingresó a una nueva empresa conjunta en Alberta que cubre 30,000 acres brutos
La producción se vio afectada por los bajos precios del gas en la boca del pozo Marcellus (por debajo de 2 dólares por Mcf), con una reducción del 20-25% en la producción en 2024. Sin embargo, el primer trimestre de 2025 muestra un aumento del 75% en la producción de gas natural Marcellus en comparación con los volúmenes promedio diarios de 2024.
엡실론 에너지 (NASDAQ: EPSN)는 2024년 전체 연간 실적을 보고하며 천연가스 시장의 어려운 조건을 강조했습니다. 회사는 550만 달러의 분기 배당금과 180만 달러의 자사주 매입을 통해 주주에게 730만 달러를 반환했습니다.
주요 운영 하이라이트는 다음과 같습니다:
- 자본 지출이 전년 대비 58% 증가하여 3,490만 달러에 달했습니다.
- 회사의 검증된 매장량이 전년 대비 20% 증가했습니다.
- 오번 가스 집수 시스템이 총 36.9 Bcf의 천연가스 볼륨(일일 101 MMcf)을 제공했습니다.
- 텍사스 자산을 7개의 총 생산 웰로 확장하고 14,000 에이커의 총 미개발 면적을 확보했습니다.
- 앨버타에서 30,000 에이커를 포함하는 새로운 합작 투자에 진입했습니다.
생산은 마셀루스 우물 가격이 낮아(1Mcf당 2달러 이하) 2024년 생산의 20-25%가 축소되었습니다. 그러나 2025년 1분기는 2024년 평균 일일 볼륨에 비해 마셀루스 천연가스 생산이 75% 증가한 것으로 나타났습니다.
Epsilon Energy (NASDAQ: EPSN) a annoncé ses résultats pour l'année complète 2024, mettant en avant les conditions de marché difficiles dans le secteur du gaz naturel. L'entreprise a restitué 7,3 millions de dollars aux actionnaires grâce à 5,5 millions de dollars de dividendes trimestriels et 1,8 million de dollars de rachats d'actions.
Les principaux points opérationnels incluent:
- Les dépenses d'investissement ont augmenté de 58 % d'une année sur l'autre pour atteindre 34,9 millions de dollars
- Les réserves prouvées de l'entreprise ont augmenté de 20 % d'une année sur l'autre
- Le système de collecte de gaz d'Auburn a livré des volumes bruts de gaz naturel de 36,9 Bcf (101 MMcf/j)
- Les actifs au Texas ont été étendus à 7 puits producteurs bruts avec 14 000 acres bruts non développés
- Entrée dans une nouvelle coentreprise en Alberta couvrant 30 000 acres bruts
La production a été affectée par les faibles prix du gaz au niveau du puits Marcellus (en dessous de 2 dollars par Mcf), avec une réduction de 20 à 25 % de la production en 2024. Cependant, le premier trimestre 2025 montre une augmentation de 75 % de la production de gaz naturel Marcellus par rapport aux volumes moyens quotidiens de 2024.
Epsilon Energy (NASDAQ: EPSN) hat seine Ergebnisse für das gesamte Jahr 2024 veröffentlicht und dabei die herausfordernden Marktbedingungen im Bereich Erdgas hervorgehoben. Das Unternehmen hat 7,3 Millionen Dollar an die Aktionäre zurückgegeben, darunter 5,5 Millionen Dollar in vierteljährlichen Dividenden und 1,8 Millionen Dollar in Aktienrückkäufen.
Wichtige betriebliche Highlights sind:
- Die Investitionsausgaben sind im Jahresvergleich um 58% auf 34,9 Millionen Dollar gestiegen
- Die nachgewiesenen Reserven des Unternehmens sind im Jahresvergleich um 20% gestiegen
- Das Auburn Gas Gathering System lieferte 36,9 Bcf Brutto-Erdgasvolumen (101 MMcf/d)
- Die texanischen Vermögenswerte wurden auf 7 Brutto-Produktionsbohrungen mit 14.000 Brutto-Acres nicht entwickeltem Land erweitert
- Neuer Joint Venture in Alberta, der 30.000 Brutto-Acres abdeckt
Die Produktion wurde durch niedrige Marcellus-Brunnenpreise (unter 2 Dollar pro Mcf) beeinträchtigt, wobei 20-25% der Produktion im Jahr 2024 reduziert wurde. Im ersten Quartal 2025 zeigt sich jedoch ein Anstieg der Marcellus-Erdgasproduktion um 75% im Vergleich zu den durchschnittlichen Tagesvolumina von 2024.
- 20% increase in Proved reserves year over year
- 75% increase in Marcellus natural gas production in Q1 2025 vs 2024 average
- Expanded Texas assets to 7 producing wells with 14,000 acres of undeveloped land
- New Alberta JV acquisition covering 30,000 gross acres
- $50 million in available liquidity for future operations
- 20-25% of production curtailed due to low gas prices
- Marcellus wellhead prices below $2 per Mcf throughout 2024
- Reduced throughput volumes in Auburn Gas Gathering System
- 12% decrease in Probable reserves year over year
Insights
Epsilon Energy's 2024 results highlight a resilient performance in a challenging natural gas price environment that kept prices below $2/Mcf in the Marcellus. Despite these headwinds, the company achieved several strategic milestones worth noting.
Most significantly, Epsilon increased their proved reserves by 20% year-over-year, demonstrating success in both acquisition and development strategies. Their capital expenditures grew 58% to $34.9 million, with 70% allocated to Texas operations that included acquiring 3 gross wells and developing 2 additional wells.
The company's production strategy of voluntarily curtailing 20-25% of their output in 2024 appears well-timed, as they're now ramping volumes into what management describes as a "much improved gas price environment" in Q1 2025. Current Marcellus production is reportedly 75% higher than their 2024 average net daily volumes.
Epsilon's diversification efforts continue to progress with assets now spanning Pennsylvania, Texas, Alberta, New Mexico, and Oklahoma. The new Alberta joint venture adds 30,000 gross acres to their portfolio, potentially establishing another growth vector with attractive economics.
From a shareholder return perspective, the company maintained its dividend program and opportunistically repurchased 373,700 shares at $4.88 per share, returning a total of $7.3 million to shareholders. With over $50 million in available liquidity, Epsilon appears well-positioned to fund both growth initiatives and shareholder returns in 2025.
Epsilon's 2024 performance reflects the broader natural gas industry challenges, but with several company-specific bright spots signaling potential outperformance in 2025.
The Auburn Gas Gathering System's throughput of 36.9 Bcf (101 MMcf/d) demonstrates meaningful midstream infrastructure value despite reduced volumes from curtailments. This asset (35% owned by Epsilon) provides diversified revenue streams beyond wellhead economics.
Their strategic pivot to Texas' Barnett play has already yielded 7 producing wells, all meeting or exceeding performance expectations. The 14,000 gross undeveloped acres with up to 40 gross undeveloped 2-mile locations represents significant inventory life, particularly valuable as this play gains momentum.
The company's reserves picture shows intelligent capital allocation. While producing 11% of reserves, they replaced this through a combination of positive revisions (+14%) and acquisitions/development (+16%). Importantly, most of their Texas inventory remains uncounted in reserves due to lack of offset wells, suggesting material future reserve additions through development.
Their decision to voluntarily curtail production exemplifies disciplined management in a volatile commodity environment. Rather than producing at sub-economic prices, they preserved reserves for the improved pricing environment now materializing. The 75% production increase over 2024 average volumes positions them for significantly enhanced cash flows in 2025.
Their entry into Alberta represents a strategic third leg to their portfolio, with the 30,000-acre position adding substantial drilling inventory with reportedly attractive economics in a favorable royalty regime.
HOUSTON, March 19, 2025 (GLOBE NEWSWIRE) -- Epsilon Energy Ltd. (“Epsilon” or the “Company”) (NASDAQ: EPSN) today reported financial results for the fourth quarter and full-year ended December 31, 2024.
Full Year and Q4 2024 Highlights:
| Epsilon - Full Year 2024 & Q4 2024 | |||||||
| 2024 | 2023 | Q4 2024 | Q3 2024 | YoY% | QoQ% | ||
| NRI Production | |||||||
| Gas | MMcf | 6,142 | 8,340 | 1,765 | 1,304 | - | 35% |
| Oil | Mbbl | 187 | 65 | 52 | 53 | 186% | - |
| NGL | Mbbl | 69 | 39 | 17 | 17 | 78% | - |
| Total | Mmcfe | 7,676 | 8,965 | 2,176 | 1,727 | - | 26% |
| Revenues | $M | ||||||
| Gas | 10,786 | 14,864 | 3,958 | 1,904 | - | 108% | |
| Oil | 13,731 | 5,091 | 3,537 | 3,965 | 170% | - | |
| NGL | 1,482 | 984 | 385 | 335 | 51% | 15% | |
| Midstream1 | 5,524 | 9,791 | 1,060 | 1,084 | - | - | |
| Total | 31,523 | 30,730 | 8,940 | 7,288 | 3% | 23% | |
| Realized Prices2 | |||||||
| Gas | $/Mcf | 1.76 | 1.78 | 2.24 | 1.46 | - | 54% |
| Oil | $/Bbl | 73.61 | 77.96 | 68.38 | 74.27 | - | - |
| NGL | $/Bbl | 21.41 | 25.29 | 22.98 | 19.56 | - | 17% |
| Adj. EBITDA | $M | 17,578 | 18,828 | 5,335 | 3,744 | - | 43% |
| Cash + STI3 | $M | 6,990 | 32,649 | 6,990 | 8,775 | - | - |
| Capex4 | $M | 34,887 | 22,038 | 3,804 | 3,908 | 58% | - |
| 1) Net of elimination entry for fees paid by Epsilon | |||||||
| 2) Excludes impact of hedge realizations | |||||||
| 3) Includes restricted cash balance | |||||||
| 4) Includes acquisitions | |||||||
The Company returned
$5.5 million through the quarterly dividends$1.8 million through the repurchase of 373,700 shares at an average price of$4.88 per share
Jason Stabell, Epsilon’s Chief Executive Officer, commented, “As we expected, the challenging natural gas environment continued in 2024, Marcellus net wellhead prices were below
We continued to invest in our Texas assets during the year, where we now have 7 gross producing wells, all performing better than or as expected, and approximately 14,000 gross undeveloped acres holding up to 40 gross undeveloped 2-mile locations, in the heart of the ascendant Barnett play. We expect development activity to resume there in the second half of 2025. As mentioned last year, this project successfully diversified our commodity mix and provides optionality for multi-year capital allocation.
In the fourth quarter, we entered into a JV in Alberta with a reputable US sponsor-backed operator. This met our criteria of low entry cost, drill-bit focused, large inventory runway, capable operator and attractive well economics. We are excited about the opportunity as it covers over 30,000 gross acres where the well returns screen attractive on productivity, drilling and completion cost structure, and royalty regime. We have drilled and completed the first two wells and expect to discuss those initial results soon.
During the year we continued our track record of shareholder returns with the fixed quarterly dividend and opportunistic share repurchases.
With growing cash flows and over
We are setup for a strong year in 2025, and we expect material growth in production and cash flows.”
2024 Operations:
Epsilon’s capital expenditures were
The Auburn Gas Gathering System (Epsilon is a
Reserves:
The Company has received the year-end 2024 third party reserves report completed by the engineering firm DeGolyer & MacNaughton. The table below summarizes the report.
| Epsilon Net Year End Reserves | |||||||||||||||||||||||||||||
| 12/31/2023 | 12/31/2024 | YoY Change | |||||||||||||||||||||||||||
| Oil | NGL | Gas | Total | Oil | NGL | Gas | Total | Oil | NGL | Gas | Total | Total | |||||||||||||||||
| Mbbl | Mbbl | MMcf | Mmcfe | Mbbl | Mbbl | MMcf | Mmcfe | Mbbl | Mbbl | MMcf | Mmcfe | % | |||||||||||||||||
| Proved Developed | 272 | 249 | 47,555 | 50,681 | 847 | 490 | 56,851 | 64,872 | 575 | 241 | 9,296 | 14,191 | 28 | % | |||||||||||||||
| Proved Undeveloped | 69 | 134 | 18,361 | 19,581 | 725 | 387 | 12,550 | 19,225 | 656 | 253 | (5,811 | ) | (356 | ) | -2 | % | |||||||||||||
| Total Proved | 341 | 383 | 65,916 | 70,262 | 1,572 | 877 | 69,401 | 84,097 | 1,231 | 494 | 3,485 | 13,835 | 20 | % | |||||||||||||||
| Total Probable | 354 | 437 | 156,730 | 161,474 | 380 | 384 | 137,906 | 142,487 | 26 | (53 | ) | (18,824 | ) | (18,987 | ) | -12 | % | ||||||||||||
| Total Proved + Probable | 695 | 820 | 222,646 | 231,736 | 1,952 | 1,261 | 207,307 | 226,584 | 1,257 | 441 | (15,339 | ) | (5,152 | ) | -2 | % | |||||||||||||
As shown in the table above, Company Proved reserves increased
The primary drivers for the positive revisions were (1) changes to the development plan in PA (as provided by the operator), moving Probable reserves to Proved, (2) Proved reserves acquisitions in Texas, and (3) development activity in Texas adding Proved undeveloped reserves.
The majority of the Company’s inventory in Texas is not included in the reserve report, due to no offset producing wells. The Company believes the unaccounted-for inventory is comparable to the existing wells in the project and expects to add meaningful reserves in Texas with incremental development.
Current Hedge Book:
| Hedge Book | ||||||||||||
| Trade Date | Product | Structure | Ref | Contract Start | Contract End | Price / Strike | Outstanding | Metric | ||||
| 01/14/2025 | Crude Oil | Swap | NYMEX WTI CMA | 04/01/2025 | 09/30/2025 | (14,900.00 | ) | BBL | ||||
| 01/07/2025 | Crude Oil | Swap | NYMEX WTI CMA | 04/01/2025 | 12/31/2025 | (24,600.00 | ) | BBL | ||||
| 12/30/2024 | Natural Gas | Swap | NYMEX Henry Hub (LD) | 04/01/2025 | 10/31/2025 | (214,000.00 | ) | MMBTU | ||||
| 12/30/2024 | Natural Gas | Swap | Tenn Z4 300L Basis | 04/01/2025 | 10/31/2025 | - | (214,000.00 | ) | MMBTU | |||
| 11/21/2024 | Natural Gas | Swap | NYMEX Henry Hub (LD) | 04/01/2025 | 10/31/2025 | (321,000.00 | ) | MMBTU | ||||
| 11/21/2024 | Natural Gas | Swap | Tenn Z4 300L Basis | 04/01/2025 | 10/31/2025 | - | (321,000.00 | ) | MMBTU | |||
| 11/20/2024 | Natural Gas | Swap | NYMEX Henry Hub (LD) | 04/01/2025 | 10/31/2025 | (214,000.00 | ) | MMBTU | ||||
| 11/20/2024 | Natural Gas | Swap | Tenn Z4 300L Basis | 04/01/2025 | 10/31/2025 | - | (214,000.00 | ) | MMBTU | |||
| 11/13/2024 | Natural Gas | Swap | NYMEX Henry Hub (LD) | 04/01/2025 | 10/31/2025 | (535,000.00 | ) | MMBTU | ||||
| 11/13/2024 | Natural Gas | Swap | Tenn Z4 300L Basis | 04/01/2025 | 10/31/2025 | - | (535,000.00 | ) | MMBTU | |||
| 10/07/2024 | Crude Oil | Swap | NYMEX WTI CMA | 04/01/2025 | 06/30/2025 | (7,500.00 | ) | BBL | ||||
| 10/02/2024 | Natural Gas | Swap | NYMEX Henry Hub (LD) | 04/01/2025 | 10/31/2025 | (535,000.00 | ) | MMBTU | ||||
| 10/02/2024 | Natural Gas | Swap | Tenn Z4 300L Basis | 04/01/2025 | 10/31/2025 | - | (535,000.00 | ) | MMBTU | |||
| 02/26/2024 | Crude Oil | Swap | NYMEX WTI CMA | 03/01/2025 | 03/01/2025 | (4,389.00 | ) | BBL | ||||
Earning’s Call:
The Company will host a conference call to discuss its results on Thursday, March 20, 2025, at 10:30 a.m. Central Time (11:30 a.m. Eastern Time).
Interested parties in the United States and Canada may participate toll-free by dialing (833) 816-1385. International parties may participate by dialing (412) 317-0478. Participants should ask to be joined to the “Epsilon Energy 2024 Year End Earnings Conference Call.”
A webcast can be viewed at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=lEJXH1I5. A webcast replay will be available on the Company’s website (www.epsilonenergyltd.com) following the call.
About Epsilon
Epsilon Energy Ltd. is a North American onshore natural gas and oil production and gathering company with assets in Pennsylvania, Texas, Alberta CA, New Mexico, and Oklahoma.
Forward-Looking Statements
Certain statements contained in this news release constitute forward looking statements. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, ‘may”, “will”, “project”, “should”, ‘believe”, and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated. Forward-looking statements are based on reasonable assumptions, but no assurance can be given that these expectations will prove to be correct and the forward-looking statements included in this news release should not be unduly relied upon.
Contact Information:
281-670-0002
Jason Stabell
Chief Executive Officer
Jason.Stabell@EpsilonEnergyLTD.com
Andrew Williamson
Chief Financial Officer
Andrew.Williamson@EpsilonEnergyLTD.com
| EPSILON ENERGY LTD. Unaudited Consolidated Statements of Operations (All amounts stated in US$) | ||||||||
| Year ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Revenues from contracts with customers: | ||||||||
| Gas, oil, NGL, and condensate revenue | $ | 25,998,712 | $ | 20,939,221 | ||||
| Gas gathering and compression revenue | 5,524,063 | 9,790,531 | ||||||
| Total revenue | 31,522,775 | 30,729,752 | ||||||
| Operating costs and expenses: | ||||||||
| Lease operating expenses | 7,264,824 | 6,405,281 | ||||||
| Gathering system operating expenses | 2,265,190 | 2,459,694 | ||||||
| Depletion, depreciation, amortization, and accretion | 10,185,119 | 7,685,084 | ||||||
| Impairment expense | 1,450,076 | — | ||||||
| Loss on sale of oil and gas properties | — | 1,449,871 | ||||||
| General and administrative expenses: | ||||||||
| Stock based compensation expense | 1,244,416 | 1,018,262 | ||||||
| Other general and administrative expenses | 5,688,714 | 6,293,234 | ||||||
| Total operating costs and expenses | 28,098,339 | 25,311,426 | ||||||
| Operating income | 3,424,436 | 5,418,326 | ||||||
| Other income (expense): | ||||||||
| Interest income | 493,277 | 1,673,241 | ||||||
| Interest expense | (46,400 | ) | (80,379 | ) | ||||
| (Loss) gain on derivative contracts | (391,147 | ) | 3,130,055 | |||||
| Other income | 76,727 | 4,357 | ||||||
| Other income, net | 132,457 | 4,727,274 | ||||||
| Net income before income tax expense | 3,556,893 | 10,145,600 | ||||||
| Income tax expense | 1,629,093 | 3,200,447 | ||||||
| NET INCOME | $ | 1,927,800 | $ | 6,945,153 | ||||
| Currency translation adjustments | 262,588 | (3,872 | ) | |||||
| Unrealized (loss) gain on securities | (1,598 | ) | 1,598 | |||||
| NET COMPREHENSIVE INCOME | $ | 2,188,790 | $ | 6,942,879 | ||||
| Net income per share, basic | $ | 0.09 | $ | 0.31 | ||||
| Net income per share, diluted | $ | 0.09 | $ | 0.31 | ||||
| Weighted average number of shares outstanding, basic | 21,930,277 | 22,496,772 | ||||||
| Weighted average number of shares outstanding, diluted | 21,930,277 | 22,511,647 | ||||||
| EPSILON ENERGY LTD. Unaudited Consolidated Balance Sheets (All amounts stated in US$) | ||||||||
| December 31, | December 31, | |||||||
| 2024 | 2023 | |||||||
| ASSETS | ||||||||
| Current assets | ||||||||
| Cash and cash equivalents | $ | 6,519,793 | $ | 13,403,628 | ||||
| Accounts receivable | 5,843,722 | 6,015,448 | ||||||
| Short term investments | — | 18,775,106 | ||||||
| Fair value of derivatives | — | 1,219,025 | ||||||
| Prepaid income taxes | 975,963 | 952,301 | ||||||
| Other current assets | 792,041 | 763,288 | ||||||
| Total current assets | 14,131,519 | 41,128,796 | ||||||
| Non-current assets | ||||||||
| Property and equipment: | ||||||||
| Oil and gas properties, successful efforts method | ||||||||
| Proved properties | 191,349,210 | 160,263,511 | ||||||
| Unproved properties | 28,364,186 | 25,504,873 | ||||||
| Accumulated depletion, depreciation, amortization and impairment | (122,751,395 | ) | (113,708,210 | ) | ||||
| Total oil and gas properties, net | 96,962,001 | 72,060,174 | ||||||
| Gathering system | 43,116,371 | 42,738,273 | ||||||
| Accumulated depletion, depreciation, amortization and impairment | (36,449,511 | ) | (35,539,996 | ) | ||||
| Total gathering system, net | 6,666,860 | 7,198,277 | ||||||
| Land | 637,764 | 637,764 | ||||||
| Buildings and other property and equipment, net | 259,335 | 291,807 | ||||||
| Total property and equipment, net | 104,525,960 | 80,188,022 | ||||||
| Other assets: | ||||||||
| Operating lease right-of-use assets, long term | 344,589 | 441,987 | ||||||
| Restricted cash | 470,000 | 470,000 | ||||||
| Prepaid drilling costs | 982,717 | 1,813,808 | ||||||
| Total non-current assets | 106,323,266 | 82,913,817 | ||||||
| Total assets | $ | 120,454,785 | $ | 124,042,613 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current liabilities | ||||||||
| Accounts payable trade | $ | 2,334,732 | $ | 3,149,371 | ||||
| Gathering fees payable | 997,016 | 1,136,237 | ||||||
| Royalties payable | 1,400,976 | 1,422,898 | ||||||
| Accrued capital expenditures | 572,079 | 696,761 | ||||||
| Accrued compensation | 695,018 | 636,295 | ||||||
| Other accrued liabilities | 371,503 | 649,037 | ||||||
| Fair value of derivatives | 487,548 | 118,770 | ||||||
| Operating lease liabilities | 121,135 | 86,473 | ||||||
| Total current liabilities | 6,980,007 | 7,895,842 | ||||||
| Non-current liabilities | ||||||||
| Asset retirement obligations | 3,652,296 | 3,502,952 | ||||||
| Deferred income taxes | 12,738,577 | 11,553,943 | ||||||
| Operating lease liabilities, long term | 355,776 | 476,911 | ||||||
| Total non-current liabilities | 16,746,649 | 15,533,806 | ||||||
| Total liabilities | 23,726,656 | 23,429,648 | ||||||
| Commitments and contingencies (Note 11) | ||||||||
| Shareholders' equity | ||||||||
| Preferred shares, no par value, unlimited shares authorized, none issued or outstanding | — | — | ||||||
| Common shares, no par value, unlimited shares authorized and 22,008,766 shares issued and outstanding at December 31, 2024 and 22,222,722 issued and 22,151,848 shares outstanding at December 31, 2023 | 116,081,031 | 118,272,565 | ||||||
| Treasury shares, at cost, 0 at December 31, 2024 and 70,874 at December 31, 2023 | — | (360,326 | ) | |||||
| Additional paid-in capital | 12,118,907 | 10,874,491 | ||||||
| Accumulated deficit | (41,505,076 | ) | (37,946,042 | ) | ||||
| Accumulated other comprehensive income | 10,033,267 | 9,772,277 | ||||||
| Total shareholders' equity | 96,728,129 | 100,612,965 | ||||||
| Total liabilities and shareholders' equity | $ | 120,454,785 | $ | 124,042,613 | ||||
| EPSILON ENERGY LTD. Unaudited Consolidated Statements of Cash Flows (All amounts stated in US$) | ||||||||
| Year ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Cash flows from operating activities: | ||||||||
| Net income | $ | 1,927,800 | $ | 6,945,153 | ||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||
| Depletion, depreciation, amortization, and accretion | 10,185,119 | 7,685,084 | ||||||
| Impairment expense | 1,450,076 | — | ||||||
| Accretion of discount on available for sale securities | (297,637 | ) | (836,528 | ) | ||||
| Loss on sale of oil and gas properties | — | 1,449,871 | ||||||
| Gain (loss) on derivative contracts | 391,147 | (3,130,055 | ) | |||||
| Settlement received on derivative contracts | 1,196,656 | 3,251,890 | ||||||
| Settlement of asset retirement obligation | (88,992 | ) | (509,802 | ) | ||||
| Stock-based compensation expense | 1,244,416 | 1,018,262 | ||||||
| Deferred income tax expense | 1,184,634 | 936,549 | ||||||
| Changes in assets and liabilities: | ||||||||
| Accounts receivable | 171,726 | 1,185,938 | ||||||
| Prepaid income taxes | (23,662 | ) | 187,793 | |||||
| Other assets and liabilities | (17,828 | ) | 126,347 | |||||
| Accounts payable, royalties payable and other accrued liabilities | (493,176 | ) | (122,203 | ) | ||||
| Net cash provided by operating activities | 16,830,279 | 18,188,299 | ||||||
| Cash flows from investing activities: | ||||||||
| Additions to unproved oil and gas properties | (4,507,280 | ) | (8,136,442 | ) | ||||
| Additions to proved oil and gas properties | (31,695,651 | ) | (10,377,642 | ) | ||||
| Additions to gathering system properties | (341,452 | ) | (82,302 | ) | ||||
| Additions to land, buildings and property and equipment | (16,513 | ) | (49,689 | ) | ||||
| Purchases of short term investments - held to maturity | — | (32,812,974 | ) | |||||
| Purchases of short term investments - available for sale | (4,045,785 | ) | (11,988,982 | ) | ||||
| Proceeds from short term investments - held to maturity | 6,743,178 | 26,864,976 | ||||||
| Proceeds from short term investments - available for sale | 16,373,752 | — | ||||||
| Proceeds from sale of oil and gas properties | — | 12,498 | ||||||
| Prepaid drilling costs | 831,091 | (1,813,808 | ) | |||||
| Net cash used in investing activities | (16,658,660 | ) | (38,384,365 | ) | ||||
| Cash flows from financing activities: | ||||||||
| Buyback of common shares | (1,831,208 | ) | (6,055,601 | ) | ||||
| Exercise of stock options | — | 62,875 | ||||||
| Dividends paid | (5,486,834 | ) | (5,600,655 | ) | ||||
| Debt issuance costs | — | (140,000 | ) | |||||
| Net cash used in financing activities | (7,318,042 | ) | (11,733,381 | ) | ||||
| Effect of currency rates on cash, cash equivalents, and restricted cash | 262,588 | (3,872 | ) | |||||
| Decrease in cash, cash equivalents, and restricted cash | (6,883,835 | ) | (31,933,319 | ) | ||||
| Cash, cash equivalents, and restricted cash, beginning of period | 13,873,628 | 45,806,947 | ||||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 6,989,793 | $ | 13,873,628 | ||||
| Supplemental cash flow disclosures: | ||||||||
| Income tax paid - federal | $ | 414,250 | $ | 1,250,000 | ||||
| Income tax paid - state (PA) | $ | — | $ | 182,000 | ||||
| Income tax (refund) paid - state (other) | $ | (2,071 | ) | $ | 7,583 | |||
| Interest paid | $ | 16,832 | $ | 97,595 | ||||
| Non-cash investing activities: | ||||||||
| Change in proved properties accrued in accounts payable and accrued liabilities | $ | (862,744 | ) | $ | 1,611,724 | |||
| Change in gathering system accrued in accounts payable and accrued liabilities | $ | 36,645 | $ | 16,969 | ||||
| Asset retirement obligation asset additions and adjustments | $ | 54,902 | $ | 1,190,579 | ||||
| Year ended December 31, | ||||||||
| 2024 | 2023 | |||||||
| Net income | $ | 1,927,800 | $ | 6,945,153 | ||||
| Add Back: | ||||||||
| Interest income, net | (446,877 | ) | (1,592,862 | ) | ||||
| Income tax expense | 1,629,093 | 3,200,447 | ||||||
| Depreciation, depletion, amortization, and accretion | 10,185,119 | 7,685,084 | ||||||
| Impairment expense | 1,450,076 | — | ||||||
| Stock based compensation expense | 1,244,416 | 1,018,262 | ||||||
| Loss on sale of assets | — | 1,449,871 | ||||||
| Loss on derivative contracts net of cash received or paid on settlement | 1,587,803 | 121,835 | ||||||
| Foreign currency translation loss | 570 | (278 | ) | |||||
| Adjusted EBITDA | $ | 17,578,000 | $ | 18,827,512 | ||||
Epsilon defines Adjusted EBITDA as earnings before (1) net interest expense, (2) taxes, (3) depreciation, depletion, amortization and accretion expense, (4) impairments of natural gas and oil properties, (5) non-cash stock compensation expense, (6) gain or loss on derivative contracts net of cash received or paid on settlement, (7) gain or loss on derivative contracts net of cash received or paid on settlement, and (8) other income. Adjusted EBITDA is not a measure of financial performance as determined under U.S. GAAP and should not be considered in isolation from or as a substitute for net income or cash flow measures prepared in accordance with U.S. GAAP or as a measure of profitability or liquidity.
Additionally, Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. Epsilon has included Adjusted EBITDA as a supplemental disclosure because its management believes that EBITDA provides useful information regarding its ability to service debt and to fund capital expenditures. It further provides investors a helpful measure for comparing operating performance on a "normalized" or recurring basis with the performance of other companies, without giving effect to certain non-cash expenses and other items. This provides management, investors and analysts with comparative information for evaluating the Company in relation to other natural gas and oil companies providing corresponding non-U.S. GAAP financial measures or that have different financing and capital structures or tax rates. These non-U.S. GAAP financial measures should be considered in addition to, but not as a substitute for, measures for financial performance prepared in accordance with U.S. GAAP.
FAQ
How much did Epsilon Energy (EPSN) return to shareholders in 2024?
What was EPSN's capital expenditure in 2024 and how was it allocated?
How did EPSN's proved reserves change in 2024?
What was the impact of low gas prices on EPSN's Marcellus production in 2024?
