ROK Resources Files Financial Results and Management Discussion & Analysis for Second Quarter of 2026
Rhea-AI Summary
ROK Resources (OTCQB:ROKRF) reported Q2 2026 results and an update on its 2026 capital program for the period ended June 30, 2026. According to ROK, Adjusted Net Surplus rose to $9.9 million from $4.5 million at December 31, 2025, supported by cash flow and proceeds from a non-core asset sale that closed in Q3 2026 for $8.0 million and reduced asset retirement obligations by about 16%.
Q2 2026 average production was 3,037 boepd (67% liquids) versus 3,729 boepd in Q2 2025, while oil and natural gas sales increased to $20.998 million from $16.641 million. Operating Income was $8.221 million with an operating netback of $29.75/boe. Net income was $0.652 million, down from $3.278 million, and Funds from Operations were $8.955 million versus $10.824 million. Funds Flow was $6.653 million compared to $8.977 million. The company is drilling its seventh 2026 well, with three new wells adding about 400 boepd (80% liquids) in August and holding only ~10% of oil production hedged through September 2026.
Positive
- Adjusted Net Surplus increased to $9.9 million at June 30, 2026 from $4.5 million at December 31, 2025
- Oil and natural gas sales grew to $20.998 million in Q2 2026 from $16.641 million in Q2 2025
- Operating Income rose to $8.221 million in Q2 2026 versus $3.540 million in Q2 2025
- Operating netback improved to $29.75/boe in Q2 2026 from $10.42/boe in Q2 2025
- Non-core asset sale in Q3 2026 generated $8.0 million cash and reduced asset retirement obligations by approximately 16%
- New wells contributed about 400 boepd (80% liquids) in August, more than offsetting production sold in the asset disposition
- Low oil hedging with only ~10% of oil production hedged through September 2026 preserves upside exposure to commodity prices
Negative
- Average production declined to 3,037 boepd in Q2 2026 from 3,729 boepd in Q2 2025
- Net income decreased to $0.652 million in Q2 2026 from $3.278 million in Q2 2025
- Funds from Operations fell to $8.955 million in Q2 2026 versus $10.824 million in Q2 2025
- Funds Flow declined to $6.653 million in Q2 2026 from $8.977 million in Q2 2025
- Operating expenses per boe increased to $34.71/boe in Q2 2026 from $31.07/boe in Q2 2025
- Capital expenditures on property, plant and equipment rose to $5.031 million in Q2 2026 from $1.034 million in Q2 2025
News Explained
ROK reports financial flexibility, but drilling, acquisitions, share purchases and shareholder returns remain options rather than committed allocations.
ROK Resources has filed its second-quarter 2026 financial results, completing the reporting event for the periods ended
ROK defines adjusted net surplus through specified working-capital, debt, lease-obligation and risk-management-contract adjustments; it is not presented as a simple cash balance.
The filing lists 218,418,315 common shares outstanding at
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NOT FOR DISTRIBUTION TO THE U.S. NEWSWIRE OR FOR DISSEMINATION IN THE UNITED STATES
REGINA, SK / ACCESS Newswire / August 20, 2026 / ROK Resources Inc. ("ROK" or the "Company") (TSXV:ROK)(OTCQB:ROKRF) announces that the Company has filed its Financial Results and Management Discussion & Analysis ("MD&A") for the three and six month periods ended June 30, 2026, and provides an update on its financial and operating performance, including continued execution of its 2026 capital program and positive early results from its Southeast Saskatchewan drilling program.
ROK enters the second half of 2026 from a position of financial strength, with a fully funded capital program, positive liquidity and early drilling results that are exceeding the Company's type-curve expectations. This financial position provides ROK with the flexibility to advance its organic development strategy while continuing to evaluate additional opportunities to enhance shareholder value.
With an Adjusted Net Surplus of
ROK continues to advance its 2026 capital program, currently drilling its seventh well, with three wells on production and the remaining drilled wells expected to be brought on production in the coming weeks. For the month of August, the three new wells have added approximately 400 boepd (
Q2 2026 Highlights
Significantly Strengthened Financial Position: Adjusted Net Surplus increased to
$9.9 million as at June 30, 2026, compared to$4.5 million at December 31, 2025, representing an increase of approximately120% ;Strong Initial Production Rates on Drill Program: Encouraging initial daily production volumes, adding high netback oil to the Company's corporate production base and increasing ROK's Southeast Saskatchewan light oil drilling inventory;
Production In-Line with Forecast: Average Q2 2026 production of 3,037 boepd (
67% liquids);Significant Commodity Price Upside Exposure: With only ~
10% of ROK's oil production currently hedged through September 2026, the Company retains significant exposure to commodity price upside;Strategic Non-Core Asset Disposition and ARO Reduction: Closed the previously announced sale of non-core assets in Q3 2026 for
$8.0 million in cash proceeds, subject to customary closing adjustments, while also reducing the Company's associated asset retirement obligations ("ARO") by approximately16% ; andMultiple Avenues for Value Creation: ROK's financial position and internally funded capital program provide the Company with flexibility to pursue the highest-return opportunities available, including incremental organic development, NCIB, accretive acquisitions and potential returns of capital to shareholders.
Operating (expressed in | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 | ||||||||||||
Oil and Natural Gas Sales | 20,998 | 16,641 | 36,872 | 37,621 | ||||||||||||
Royalties | (3,185 | ) | (2,558 | ) | (5,782 | ) | (6,036 | ) | ||||||||
Operating Expenses | (9,592 | ) | (10,543 | ) | (18,259 | ) | (19,574 | ) | ||||||||
Operating Income | 8,221 | 3,540 | 12,831 | 12,011 | ||||||||||||
Processing and other income (1) | 616 | 415 | 994 | 914 | ||||||||||||
Realized gain on commodity contracts | 118 | 6,869 | 395 | 6,535 | ||||||||||||
Funds from Operations | 8,955 | 10,824 | 14,220 | 19,460 | ||||||||||||
Average daily production | ||||||||||||||||
Crude oil (bbl/d) | 1,662 | 2,030 | 1,703 | 2,098 | ||||||||||||
NGLs (boe/d) | 364 | 376 | 351 | 396 | ||||||||||||
Natural gas (mcf/d) | 6,065 | 7,940 | 5,870 | 8,041 | ||||||||||||
Total (boe/d) | 3,037 | 3,729 | 3,032 | 3,834 | ||||||||||||
Operating Netback per boe | ||||||||||||||||
Oil and Natural Gas Sales | 75.98 | 49.03 | 67.19 | 54.21 | ||||||||||||
Royalties | (11.52 | ) | (7.54 | ) | (10.53 | ) | (8.70 | ) | ||||||||
Operating Expenses | (34.71 | ) | (31.07 | ) | (33.27 | ) | (28.20 | ) | ||||||||
Operating Netbacks ($/boe) | 29.75 | 10.42 | 23.39 | 17.31 | ||||||||||||
Funds from Operations ($/boe) | 32.40 | 31.90 | 25.91 | 28.04 | ||||||||||||
Operating Income Profit Margin | 39.2 | % | 21.3 | % | 34.8 | % | 31.9 | % | ||||||||
Funds from Operations Profit Margin | 42.6 | % | 65.1 | % | 38.6 | % | 51.7 | % | ||||||||
0.42642801 | 0.65062207 | 0.38562286 | 0.51724774 | |||||||||||||
Share information | ||||||||||||||||
Common shares outstanding, end of period | 218,418,315 | 212,613,817 | 218,418,315 | 212,613,817 | ||||||||||||
Weighted average basic shares outstanding | 218,418,348 | 211,916,317 | 218,418,348 | 211,916,317 | ||||||||||||
Weighted average diluted shares outstanding | 218,418,348 | 265,105,802 | 218,418,348 | 265,105,802 | ||||||||||||
Financial (expressed in | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 | ||||||||||||
Net income | 652 | 3,278 | 3,033 | 1,733 | ||||||||||||
Basic ($/share) | 0.00 | 0.01 | 0.01 | 0.01 | ||||||||||||
Diluted ($/share) | 0.00 | 0.01 | 0.01 | 0.01 | ||||||||||||
Funds flow | 6,653 | 8,977 | 10,477 | 16,126 | ||||||||||||
Basic ($/share) | 0.03 | 0.04 | 0.05 | 0.07 | ||||||||||||
Diluted ($/share) | 0.03 | 0.04 | 0.05 | 0.07 | ||||||||||||
Expenditures on property, plant and equipment | 5,031 | 1,034 | 5,536 | 1,703 | ||||||||||||
Refer to "Non-IFRS Measures" section below for details regarding adjustments to processing and other income for purposes of calculating "Funds from Operations".
Complete reports and statements are available on SEDAR+ at www.sedarplus.ca and on the Company website www.rokresources.ca.
About ROK
ROK is primarily engaged in petroleum and natural gas exploration and development activities in Alberta and Saskatchewan. It has offices located in both Regina, Saskatchewan, Canada and Calgary, Alberta, Canada. ROK's common shares are traded on the TSX Venture Exchange under the trading symbol "ROK".
For further information, please contact:
Bryden Wright, President and Chief Executive Officer
Jared Lukomski, Senior Vice President, Land & Business Development
Phone: (306) 522-0011
Email: investor@rokresources.ca
Website: www.rokresources.ca
Non-IFRS Measures
The non-IFRS measures referred to above do not have any standardized meaning prescribed by IFRS Accounting Standards ("IFRS") and, therefore, may not be comparable to similar measures used by other companies. Management uses this non-IFRS measurement to provide its shareholders and investors with a measurement of the Company's financial performance and are not intended to represent operating profits nor should they be viewed as an alternative to cash provided by operating activities, net income or other measures of financial performance calculated in accordance with IFRS. The reader is cautioned that these amounts may not be directly comparable to measures for other companies where similar terminology is used.
"Operating Income" is calculated by deducting royalties and operating expense from total sales revenue. Total sales revenue is comprised of oil and gas sales. The Company refers to Operating Income expressed per unit of production as an "Operating Netback". "Operating Income Profit Margin" is calculated by the Company as Operating Income as a percentage of oil and natural gas sales. "Funds from Operations" is calculated by adding other income and realized gains/losses on commodity contracts ("hedging") to Operating Income. "Funds from Operations Profit Margin" is calculated by the Company as Funds from Operations as a percentage of oil and natural gas sales.
The following table reconciles the aforementioned non-IFRS measures:
( | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 | ||||||||||||
Oil and natural gas sales | 20,998 | 16,641 | 36,872 | 37,621 | ||||||||||||
Royalties | (3,185 | ) | (2,558 | ) | (5,782 | ) | (6,036 | ) | ||||||||
Operating expenses | (9,592 | ) | (10,543 | ) | (18,259 | ) | (19,574 | ) | ||||||||
Operating Income | 8,221 | 3,540 | 12,831 | 12,011 | ||||||||||||
Processing and other income (1) | 616 | 415 | 994 | 914 | ||||||||||||
Realized gain on commodity contracts | 118 | 6,869 | 395 | 6,535 | ||||||||||||
Funds from Operations | 8,955 | 10,824 | 14,220 | 19,460 | ||||||||||||
Sales volume (boe) | 276,353 | 339,366 | 548,800 | 694,023 | ||||||||||||
Per boe | ||||||||||||||||
Oil and Natural Gas Sales | 75.98 | 49.03 | 67.19 | 54.21 | ||||||||||||
Royalties | (11.52 | ) | (7.54 | ) | (10.53 | ) | (8.70 | ) | ||||||||
Operating Expenses | (34.71 | ) | (31.07 | ) | (33.27 | ) | (28.20 | ) | ||||||||
Operating Netback | 29.75 | 10.42 | 23.39 | 17.31 | ||||||||||||
Funds from Operations | 32.40 | 31.90 | 25.91 | 28.04 | ||||||||||||
Operating Income Profit Margin | 39.2 | % | 21.3 | % | 34.8 | % | 31.9 | % | ||||||||
Funds from Operations Profit Margin | 42.6 | % | 65.1 | % | 38.6 | % | 51.7 | % | ||||||||
Non-cash revenue derived from management fees that are recognized over time from deferred revenue in the 2025 comparative period is excluded from processing and other income for the calculation of Funds from Operations.
"Net Surplus (Debt)" includes the undiscounted face value of all indebtedness of the Company, such as the credit facility and lease obligations (each as defined within the Company's interim condensed consolidated financial statements for the six months ended June 30, 2026), net of Adjusted Working Capital. "Adjusted Working Capital" is calculated as current assets less current liabilities, excluding current portion of debt, lease liabilities, decommissioning obligations, RSU liabilities, and assets and liabilities held for sale as defined on the Company's statement of financial position within the Company's interim condensed consolidated financial statements for the six months ended June 30, 2026. "Adjusted Net Surplus (Debt)" is calculated by removing the mark-to-market fair value of the current portion of risk management contracts and lease obligations (each as defined within the interim condensed consolidated financial statements for the six months ended June 30, 2026) from Net Surplus (Debt).
The following table reconciles the aforementioned non-IFRS measures:
( | June 30, 2026 | December 31, 2025 | ||||||
Cash and cash equivalents | 13,786 | 5,744 | ||||||
Accounts receivable | 8,323 | 6,675 | ||||||
Prepaids and deposits | 215 | 220 | ||||||
Risk management contracts | - | 141 | ||||||
Accounts payable | (12,411 | ) | (8,154 | ) | ||||
Adjusted working capital | 9,913 | 4,626 | ||||||
Less: lease obligations | (404 | ) | (324 | ) | ||||
Net surplus | 9,509 | 4,302 | ||||||
Remove: current portion of risk management contracts | - | (141 | ) | |||||
Remove: lease obligations | 404 | 324 | ||||||
Adjusted net surplus | 9,913 | 4,485 | ||||||
"Funds Flow" includes all cash from (used in) operating activities and is calculated before the change in non-cash working capital. "Funds Flow Basic ($/share)" and "Funds Flow Diluted ($/share)" are calculated by dividing Funds Flow by the weighted average number of basic shares and weighted average number of diluted shares outstanding, respectively, for the relevant period, as presented within the Company's interim condensed consolidated financial statements for the six months ended June 30, 2026. These are considered key measures of operating performance and capital management as they demonstrate the Company's ability to generate the cash necessary to repay debt and fund capital investments. Management believes that by excluding the temporary impact of changes in non-cash operating working capital, each of these provide useful measures of ROK's ability to generate cash that are not subject to short-term movements in non-cash operating working capital.
The following table reconciles cash flow from operating activities to Funds Flow:
( | Q2 2026 | Q2 2025 | YTD 2026 | YTD 2025 | ||||||||||||
Cash provided by operating activities | 10,927 | 9,496 | 12,737 | 12,533 | ||||||||||||
Change in non-cash working capital | (4,274 | ) | (519 | ) | (2,260 | ) | 3,593 | |||||||||
Funds Flow | 6,653 | 8,977 | 10,477 | 16,126 | ||||||||||||
Conversion Measures
Production volumes and reserves are commonly expressed on a barrel of oil equivalent ("boe") basis whereby natural gas volumes are converted at the ratio of 6 thousand cubic feet ("Mcf") to 1 barrel of oil ("bbl"). Although the intention is to sum oil and natural gas measurement units into one basis for improved analysis of results and comparisons with other industry participants, boe's may be misleading, particularly if used in isolation. A boe conversion ratio of 6 Mcf to 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. In recent years, the value ratio based on the price of crude oil as compared to natural gas has been significantly higher than the energy equivalency of 6:1 and utilizing a conversion of natural gas volumes on a 6:1 basis may be misleading as an indication of value.
Abbreviations
bbls/d | barrels per day | |
boepd | barrels oil equivalent per day | |
IP | Initial Production | |
NGLs | Natural Gas Liquids | |
Mboe | Thousands of barrels of oil equivalent | |
MMboe | Millions of barrels of oil equivalent | |
PDP | Proved Developed Producing | |
TP | Total Proved Reserves | |
TPP | Total Proved and Probable Reserves | |
WTI | West Texas Intermediate, the reference price paid in U.S. dollars at Cushing, Oklahoma for the crude oil standard grade |
Cautionary Statement Regarding Forward-Looking Information
This news release includes certain "forward-looking statements" under applicable Canadian securities legislation that are not historical facts. Forward-looking statements involve risks, uncertainties, and other factors that could cause actual results, performance, prospects, and opportunities to differ materially from those expressed or implied by such forward-looking statements. Forward-looking statements in this news release include, but are not limited to, statements with respect to the Company's objectives, goals, or future plans and the expected results thereof. Forward-looking statements are necessarily based on several estimates and assumptions that, while considered reasonable, are subject to known and unknown risks, uncertainties and other factors which may cause actual results and future events to differ materially from those expressed or implied by such forward-looking statements. Such factors include but are not limited to general business, economic and social uncertainties; litigation, legislative, environmental, and other judicial, regulatory, political and competitive developments; delay or failure to receive board, shareholder or regulatory approvals; those additional risks set out in ROK's public documents filed on SEDAR+ at www.sedarplus.ca; and other matters discussed in this news release. Although the Company believes that the assumptions and factors used in preparing the forward-looking statements are reasonable, undue reliance should not be placed on these statements, which only apply as of the date of this news release, and no assurance can be given that such events will occur in the disclosed time frames or at all. Except where required by law, the Company disclaims any intention or obligation to update or revise any forward-looking statement, whether because of new information, future events, or otherwise.
Neither the Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Exchange) accepts responsibility of the adequacy or accuracy of this release.
SOURCE: ROK Resources Inc.
View the original press release on ACCESS Newswire