EagleRock Land swings to $11.3M profit in Q3 2026
The 35,000-acre dedication brings Double Eagle’s Midland Basin acreage dedication to approximately 105,000 acres, with royalties based on water-system net proceeds.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
EagleRock Land, LLC (EROK) reported third-quarter 2026 revenue of $43.348 million and net income of $11.272 million, compared with $17.530 million of revenue and a $4.888 million net loss in third-quarter 2025. Adjusted EBITDA was $34.012 million and free cash flow was $31.758 million. It raised 2026 Adjusted EBITDA guidance to $133 million–$137 million, with a $135 million midpoint versus $131 million previously.
DE Flow, an EROK subsidiary, entered a water system management agreement with DEF Operating, an affiliate of Double Eagle IV Midco, a beneficial owner of more than 5% of EROK’s common shares. DEF Operating will develop and operate a system associated with a separate dedication by DE West Texas of approximately 35,000 acres, bringing Double Eagle’s Midland Basin dedication to approximately 105,000 acres. DE Flow will receive monthly royalties on 50% of net proceeds. The agreement’s initial term ends December 31, 2035, with one automatic three-year renewal unless terminated before renewal; EROK expects revenue contribution from the dedication beginning in 2027. Two Midland Basin acquisitions totaling approximately 2,000 acres closed for $15.4 million, funded with cash and revolving-credit borrowings.
As of September 30, 2026, EROK reported $70 million of debt, $12 million of cash and $58 million of net debt, with total liquidity of $142 million.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointThird-quarter revenue was $43.348 million, versus $17.530 million in 2025.
- Moderate pointThird-quarter net income was $11.272 million, versus a $4.888 million loss in 2025.
Negative
- Moderate pointNine-month operating results were a $31.268 million loss, versus $8.380 million income in 2025.
8-K Event Classification
Key Figures
Key Terms
Adjusted EBITDA financial
Free Cash Flow Conversion financial
Normalized Revenue financial
revolving credit facility financial
Earnings Snapshot
Raised full-year 2026 Adjusted EBITDA guidance to $133 million–$137 million; the $135 million midpoint compares with a prior midpoint of $131 million.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
How did EROK perform in the third quarter of 2026?
What is EROK’s 2026 Adjusted EBITDA guidance?
What are the terms of EROK’s new water system agreement?
How much did EROK pay for its two Midland Basin acquisitions?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
(Address of principal executive offices and zip code)
Registrant’s telephone number, including area code:
Not Applicable
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934:
| Title of each class |
Trading |
Name of each exchange | ||
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| Item 1.01 | Entry into a Material Definitive Agreement. |
On November 3, 2026, DE IV Flow, LLC, a Delaware limited liability company (“DE Flow”) and a wholly owned subsidiary of EagleRock Land, LLC (the “Company”), entered into a water system management agreement (the “Double Eagle V WSMA”) with DEF Operating, LLC, a Delaware limited liability company (“DEF Operating”) and an affiliate of Double Eagle IV Midco, LLC, a Delaware limited liability company and a beneficial owner of more than 5% of the Company’s common shares, pursuant to which DEF Operating is obligated to develop, construct, operate, maintain and repair a new water infrastructure system to be owned by DE Flow and to be constructed in Glasscock and Midland Counties, Texas (the “DE V Water System”). DEF Operating also operates the Company’s integrated water infrastructure system in Reagan County, Texas. The Double Eagle V WSMA has an initial term expiring on December 31, 2035, and renews automatically for one additional three-year term, unless terminated by a party prior to the renewal. Under the Double Eagle V WSMA, DEF Operating will develop, construct, operate, maintain and repair the DE V Water System, and will utilize it to store, transport, treat, process, dispose of, purchase and sell produced water, fresh water, blended water, treated water and recycled water from the dedicated acreage described below. DE Flow will receive monthly royalties on 50% of the net proceeds realized by DEF Operating from the DE V Water System. The Double Eagle V WSMA also provides for mutual termination rights in the event of payment or performance defaults and contains standard confidentiality, indemnification, insurance and change of control provisions.
The Double Eagle V WSMA was entered into in connection with the dedication by DE West Texas, LLC, a Delaware limited liability company (“DE West Texas”), of approximately 35,000 acres in Glasscock and Midland Counties, Texas, to DE Flow and DEF Operating pursuant to a Supply Water Purchase and Produced Water Gathering and Disposal Agreement, dated as of November 3, 2026, by and among DEF Operating, DE Flow and DE West Texas (the “Double Eagle V Gathering Agreement”). The Double Eagle V WSMA governs DEF Operating’s use of the DE V Water System to provide the produced water gathering and disposal services and supply water sales required under the Double Eagle V Gathering Agreement.
| Item 2.02 | Results of Operations and Financial Condition. |
On November 3, 2026, the Company issued a press release providing information regarding its financial results for the quarter ended September 30, 2026. A copy of the press release is furnished as Exhibit 99.1 and incorporated by reference herein.
The information in this Item 2.02, including Exhibit 99.1 incorporated by reference herein, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.
| Item 7.01 | Regulation FD Disclosure. |
On November 3, 2026, the Company posted an investor presentation on its website. The presentation, titled “Third Quarter 2026 Earnings Presentation,” may be found at https://ir.erok.com in the “Events and Presentations” section on the Company’s “Investor Relations” webpage. Investors should note that the Company announces financial information in filings with the U.S. Securities and Exchange Commission, press releases and public conference calls as well as on its website. The Company may use the “Investor Relations” webpage and other sections of its website to communicate with investors, and it is possible that the financial and other information posted there could be deemed to be material information.
On November 3, 2026, the Company issued a press release announcing its execution of an agreement with DE West Texas for an additional acreage dedication in the Midland Basin and its completion of two bolt-on acquisitions in the Midland Basin. A copy of the press release is furnished as Exhibit 99.2 and incorporated by reference herein.
The information contained or referred to in this Item 7.01, including Exhibit 99.2 incorporated by reference herein, shall not be deemed to be “filed” for purposes of the Exchange Act, or otherwise subject to the liabilities of that section, and is not incorporated by reference into any filing under the Securities Act or the Exchange Act.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
2
| Exhibit |
Description | |
| 99.1 | Press Release of EagleRock Land, LLC, dated November 3, 2026 (financial results). | |
| 99.2 | Press Release of EagleRock Land, LLC, dated November 3, 2026 (Double Eagle V acreage dedication and Midland Basin acquisitions). | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| EAGLEROCK LAND, LLC | ||
| By: |
/s/ Greg Pipkin Jr. | |
| Name: |
Greg Pipkin Jr. | |
| Title: |
Chief Executive Officer | |
Date: November 3, 2026
4
Exhibit 99.1
EagleRock Announces Third Quarter 2026 Results
Raises full-year 2026 Adjusted EBITDA guidance to a range between $133 million and $137 million
November 3, 2026
Houston, TX – EagleRock Land, LLC (“EagleRock” or the “Company”) (NYSE: EROK) today announced its financial and operating results for the third quarter ended September 30, 2026.
Third Quarter Financial Highlights
| • | Reported revenue of $43.3 million and net income of $11.3 million |
| • | Delivered robust Adjusted EBITDA of $34.0 million, with an Adjusted EBITDA Margin of 78.5%, |
| • | Generated strong Free Cash Flow of $31.8 million, representing Free Cash Flow Conversion of 93% |
| • | Raised full-year 2026 Adjusted EBITDA guidance to a range of $133 million to $137 million, reflecting both additional organic growth and the contribution from Intrepid Ranch. |
Recent Business Highlights
| • | Announced a new agreement with Double Eagle V for an additional dedication of approximately 35,000 acres in the Midland Basin (the “Double Eagle V Dedication”) |
| • | Closed two strategic Midland Basin bolt-on acquisitions totaling approximately 2,000 acres for approximately $15.4 million (the “Acquisitions”) |
| • | Executed a lease with a sand operator to develop a sand mine on Intrepid Ranch and in late stage negotiations for multiple AGI projects in New Mexico, each creating an additional royalty stream for EagleRock |
Management Commentary
“EagleRock’s position across the Midland and Delaware Basins reflects the strength of our integrated model, with complementary assets, deep relationships, and durable royalty and fee-driven cash flow across commodity cycles,” said Greg Pipkin, Chief Executive Officer of EagleRock. “Our third-quarter results reflect our continued focus on disciplined execution and creating long-term value for shareholders.”
“Our cash flow generation provides the flexibility to pursue attractive opportunities while maintaining a disciplined balance sheet. To that end, we’re pleased to announce a new, substantial acreage dedication from Double Eagle, alongside additional bolt-on acquisitions that further densify our footprint in the Midland Basin. Together, these transactions deepen our water infrastructure, expand our royalty base, and tie our own organic growth directly into the strength of our relationship with Double Eagle. This is the same disciplined, accretive approach to growth we have spoken to in the past, and we remain confident in our ability to continue building on it.”
Third Quarter Results
EagleRock generated revenue of $43.3 million in the third quarter of 2026, compared to Normalized Revenue of $46.8 million in the second quarter of 2026. The third quarter is the first quarter presented entirely on an as-reported basis.
Adjusted EBITDA was $34.0 million, representing an Adjusted EBITDA Margin of 78.5%, compared to Normalized Adjusted EBITDA of $36.2 million and a Normalized Adjusted EBITDA Margin of 77.5% in the second quarter.
Diversified Revenue Streams
Resource Sales revenues were $12.7 million in the third quarter of 2026, or 29% of total revenue. Resource Sales results reflected brackish water volumes in New Mexico, consistent with the pace of completions activity on our acreage. In Texas, Resource Sales volumes increased as our Shallow Valley system continued to benefit from the accelerated synergy realization through its connection into the DE Flow water management system.
Surface Use Revenues were $11.3 million in the third quarter of 2026, or 26% of total revenue. Surface Use Revenues primarily reflects heightened commercial activity across our ranches, which resulted in robust surface disruption fees and easement payments.
Surface Use Royalties revenues were $19.4 million in the third quarter of 2026, or 45% of total revenue. The results were driven by meaningful recycled water royalties and continued strength in produced water takeaway volumes.
Free Cash Flow Generation
Free Cash Flow for the third quarter of 2026 was $31.8 million, compared to $22.4 million in the second quarter of 2026, representing Free Cash Flow Conversion of 93%. Capital expenditures for the quarter continued to trend low and were $1.1 million, reflecting the capital-light nature of the Company’s business model.
Balance Sheet and Liquidity
As of September 30, 2026, the Company had total debt of $70 million, cash and cash equivalents of $12 million and net debt of $58 million. Net leverage, calculated as net debt divided by the midpoint of the Company’s full-year 2026 Adjusted EBITDA guidance, was 0.4x. Total liquidity was $142 million, comprised of $12 million of cash and cash equivalents and $130 million of available borrowing capacity under the Company’s revolving credit facility, which includes $200 million of initial capacity and the ability to request up to an additional $100 million.
EagleRock funded the Intrepid Ranch acquisition, which was completed for a total purchase price of $78.3 million, primarily through its revolving credit facility. Following the initial draw in August, the Company repaid $10 million in each of September and October, partially offset by approximately $16 million of borrowings in October to fund the Acquisitions. The Company expects to continue allocating approximately $10 million per month toward debt reduction.
2026 Outlook
For the full year 2026, the Company is raising its Adjusted EBITDA guidance to a range of $133 million to $137 million, inclusive of the Intrepid Ranch acquisition. The $135 million midpoint compares to a $131 million midpoint in the Company’s prior guidance, with the $4 million increase reflecting approximately $2 million from Intrepid Ranch and approximately $2 million of additional organic growth.
Reconciliations of forward-looking non-GAAP financial measures to comparable GAAP measures are not available due to the challenges and impracticability of estimating certain items, particularly non-recurring gains or losses, unusual or non-recurring items, income tax benefit or expense, or one-time transaction costs and cost of revenue. We are unable to reasonably predict these because they are uncertain and depend on various factors not yet known, which could have a material impact on GAAP results for the guidance period. Because of those challenges, a reconciliation of forward-looking non-GAAP financial measures is not available without unreasonable effort.
Conference Call and Webcast Information
The Company will hold a conference call on November 4, 2026 at 10:00 am ET / 9:00 am CT to discuss third quarter results. A live webcast of the conference call will be available on the “Events & Presentations” section of the EagleRock Investor Relations website at https://ir.erok.com/.
Additionally, a replay will be available shortly after the call’s conclusion. Analysts and investors looking to participate in the Q&A can access the call by dialing (833) 461-5787 or (585) 542-9983 and entering 721 302 913 as the meeting ID.
About EagleRock
EagleRock (NYSE: EROK) is a land management company that owns or controls approximately 288,000 acres in the heart of the Delaware and Midland sub-basins within the prolific Permian Basin. In addition, EagleRock has an interest in up to approximately 105,000 acres pursuant to an acreage dedication related to its Midland Basin water infrastructure assets. Its acreage is vital to the efficient development of oil and natural gas resources in the Permian Basin and is strategically located to support the growing surface, resource, infrastructure, and related commercial development needs of the power and other emerging industries in the Permian Basin.
Cautionary Statement Concerning Forward-Looking Statements
The information in this press release relates to EagleRock Land, LLC (the “Company,” “EROK,” “we,” “us” or “our”) and contains information that includes or is based upon “forward-looking statements.” All statements other than historical facts are forward-looking statements, and include statements regarding EROK’s future financial position, business strategy, projected revenues, earnings, costs, capital expenditures and plans and objectives and intentions of management for the future. Words such as “expect,” “could,” “may,” “anticipate,” “intend,” “plan,” “ability,” “believe,” “seek,” “see,” “will,” “would,” “estimate,” “forecast,” “target,” “guidance,” “outlook,” “opportunity” or “strategy” or similar expressions are generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of our management and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, projected in, or implied by, such statements.
Although EROK believes the expectations and forecasts reflected in its forward-looking statements are reasonable, they are inherently subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond its control. No assurance can be given that such forward-looking statements will be correct or achieved or that the assumptions are accurate or will not change over time. Particular uncertainties that could cause EROK’s actual results to be materially different from those expressed in its forward-looking statements are described under the heading “Risk Factors” in its final prospectus filed with the Securities and Exchange Commission (the “SEC”) on May 14, 2026 and the other reports and materials it files with the SEC. These factors include, but are not limited to: any statements regarding the Double Eagle V Dedication and the Acquisitions, including our ability to actively manage the new dedicated acreage and assets, the ability to renegotiate and modernize surface use agreements, creating new revenue opportunities and the expected benefits of the Double Eagle V Dedication and the Acquisitions, including expected accretion, integration plans, synergies, opportunities and anticipated future performance, customer demand for and use of EROK’s surface, resource, and water infrastructure assets; enforceability of its surface use agreements and other customer agreements; its operating partners’ success in executing their strategies; customers’ ability or decisions to develop EROK’s land or acquired acreage; global supply of and demand for energy, including OPEC+ production actions; customer and geographic concentration of its revenues; EROK’s ability to enter into favorable surface use, access, and fee contracts; EROK’s ability to maintain and renew leases and permits on state and federal land; changes in state and federal land use policies affecting its leased land; execution of EROK’s business strategies, including attracting customers; commodity price volatility; competition, including alternative resources; changes in the price and availability of services EROK’s customers need; planned or future expansion projects; advances or changes in energy technologies or practices; execution of EROK’s growth plans, including acquisitions and new revenue streams; deterioration of customers’ financial condition and access to capital; effects of customer consolidation on U.S. drilling and completions spending; customers’ ability to obtain necessary supplies and raw materials; EROK’s and its customers’ ability to obtain permits and government approvals; operational disruptions and related liability affecting EROK’s customers; EROK’s liquidity and access to capital markets; uncertainty of resource and reserve estimates; general economic, business, and industry conditions and market volatility; political instability or armed conflict in oil and gas producing regions; EROK’s level of indebtedness and ability to service it; title defects in acquired acreage; conditions in the markets for surface acreage; integration of acquired acreage and management of related growth; recruitment and retention of key personnel and service providers; changes in laws and regulations, including environmental and water-related rules; changes in tax rates and adverse tax outcomes; general political and regulatory conditions, including new legislation and trade and tax policies; severity and duration of health events, natural disasters, and severe weather; and evolving cybersecurity risks.
EROK cautions you not to place undue reliance on forward-looking statements contained in this release, which speak only as of the date hereof, and EROK is under no obligation, and expressly disclaims any obligation to update, alter or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise. This release may also contain information from third-party sources. This data may involve a number of assumptions and limitations, and EROK has not independently verified them and does not warrant the accuracy or completeness of such third-party information.
THIRD QUARTER 2026 RESULTS
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands) (unaudited)
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| REVENUES |
||||||||||||||||
| Resource sales |
$ | 9,588 | $ | 11,928 | $ | 56,244 | $ | 36,082 | ||||||||
| Resource sales - related party |
3,102 | — | 3,752 | 509 | ||||||||||||
| Surface use related revenues |
11,032 | 4,547 | 20,066 | 9,713 | ||||||||||||
| Surface use related revenues - related party |
244 | — | 244 | — | ||||||||||||
| Surface use royalties |
2,193 | 1,055 | 4,428 | 2,156 | ||||||||||||
| Surface use royalties - related party |
17,189 | — | 23,197 | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total revenues |
43,348 | 17,530 | 107,931 | 48,460 | ||||||||||||
| COSTS AND EXPENSES |
||||||||||||||||
| Cost of sales (exclusive of depreciation and amortization) |
3,849 | 5,281 | 14,809 | 14,889 | ||||||||||||
| Related party cost of sales |
465 | 3,837 | 5,891 | 7,464 | ||||||||||||
| General and administrative expense |
10,492 | 2,346 | 90,812 | 7,065 | ||||||||||||
| Related party general and administrative expense |
192 | 4 | 198 | 235 | ||||||||||||
| Depreciation and amortization expense |
15,889 | 4,559 | 30,755 | 10,397 | ||||||||||||
| Loss (gain) on sale of property, plant and equipment, net |
— | — | 9 | 30 | ||||||||||||
| Gain on investment in sales-type lease |
— | — | (3,275 | ) | — | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total operating expenses |
30,887 | 16,027 | 139,199 | 40,080 | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| INCOME (LOSS) FROM OPERATIONS |
12,461 | 1,503 | (31,268 | ) | 8,380 | |||||||||||
| OTHER EXPENSE (INCOME) |
||||||||||||||||
| Interest expense, net |
903 | 6,391 | 11,549 | 15,174 | ||||||||||||
| Loss (gain) on extinguishment of debt |
— | — | (20,352 | ) | 70,001 | |||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| Total other expense (income) |
903 | 6,391 | (8,803 | ) | 85,175 | |||||||||||
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|
|
|
|
|
|
|
|
|||||||||
| INCOME (LOSS) BEFORE INCOME TAXES |
11,558 | (4,888 | ) | (22,465 | ) | (76,795 | ) | |||||||||
| Income tax expense (benefit) |
286 | — | 436 | — | ||||||||||||
|
|
|
|
|
|
|
|
|
|||||||||
| NET INCOME (LOSS) |
$ | 11,272 | $ | (4,888 | ) | $ | (22,901 | ) | $ | (76,795 | ) | |||||
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| NET INCOME (LOSS) ATTRIBUTABLE TO PREDECESSOR |
$ | — | $ | 5,624 | ||||||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST |
$ | 9,165 | $ | (23,070 | ) | |||||||||||
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| NET INCOME (LOSS) ATTRIBUTABLE TO EAGLEROCK LAND, LLC |
$ | 2,107 | $ | (5,455 | ) | |||||||||||
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| Basic and diluted net income (loss) per Class A share |
$ | 0.08 | $ | (0.21 | ) | |||||||||||
| Basic and diluted weighted average Class A shares outstanding |
26,490,396 | 26,450,820 | ||||||||||||||
CONSOLIDATED BALANCE SHEETS
(in thousands) (unaudited)
| September 30, 2026 |
December 31, 2025 |
|||||||
| ASSETS |
||||||||
| Current assets: |
||||||||
| Cash and cash equivalents |
$ | 12,294 | $ | 9,042 | ||||
| Accounts receivable, net |
17,608 | 13,096 | ||||||
| Accounts receivable - related party |
16,127 | — | ||||||
| Inventory |
308 | 310 | ||||||
| Prepaid expenses and other current assets |
1,887 | 8,765 | ||||||
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|
|||||
| Total current assets |
48,224 | 31,213 | ||||||
| Property, plant and equipment, net |
404,370 | 55,586 | ||||||
| Right of use assets, net |
1,471 | 1,565 | ||||||
| Intangible assets, net |
711,360 | 191,240 | ||||||
| Goodwill |
643,270 | — | ||||||
| Net investment in sales-type lease |
3,209 | — | ||||||
| Deferred offering costs |
— | 1,459 | ||||||
| Other noncurrent assets |
5,612 | 947 | ||||||
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|
|
|||||
| TOTAL ASSETS |
$ | 1,817,516 | $ | 282,010 | ||||
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| LIABILITIES AND SHAREHOLDERS’ AND MEMBERS’ EQUITY |
||||||||
| Current liabilities: |
||||||||
| Accounts payable |
$ | 1,130 | $ | 4,433 | ||||
| Accounts payable - related party |
325 | 2,684 | ||||||
| Accrued liabilities |
3,981 | 2,909 | ||||||
| Current income taxes payable |
675 | 42 | ||||||
| Current deferred revenue |
149 | 533 | ||||||
| Current operating lease liability |
124 | 492 | ||||||
| Current debt - related party |
— | 6,038 | ||||||
|
|
|
|
|
|||||
| Total current liabilities |
6,384 | 17,131 | ||||||
| Non-current liabilities |
||||||||
| Operating lease liability, less current portion |
1,350 | 1,019 | ||||||
| Deferred tax liability, net |
10,515 | 10,852 | ||||||
| Deferred revenue, less current portion |
— | 94 | ||||||
| Long-term debt |
70,000 | — | ||||||
| Long-term debt - related party, less current portion |
— | 294,629 | ||||||
| Other noncurrent liabilities |
2,729 | — | ||||||
|
|
|
|
|
|||||
| Total non-current liabilities |
84,594 | 306,594 | ||||||
| SHAREHOLDERS’ AND MEMBERS’ EQUITY |
||||||||
| Members’ deficit |
— | (41,715 | ) | |||||
| Class A shares, unlimited shares authorized and 26,355,259 shares issued and outstanding as of September 30, 2026. None authorized, issued or outstanding as of December 31, 2025 |
351,296 | — | ||||||
| Class B shares, unlimited shares authorized and 105,164,311 shares issued and outstanding as of September 30, 2026. None authorized, issued or outstanding as of December 31, 2025 |
20 | — | ||||||
| Accumulated deficit |
(5,455 | ) | — | |||||
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|
|
|||||
| Total shareholders’ equity attributable to EagleRock Land, LLC |
345,861 | — | ||||||
| Noncontrolling interest |
1,380,677 | — | ||||||
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|
|||||
| Total shareholders’ equity and members’ equity |
$ | 1,726,538 | $ | (41,715 | ) | |||
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|
|
|
|
|||||
| TOTAL LIABILITIES AND EQUITY |
$ | 1,817,516 | $ | 282,010 | ||||
|
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|
|
|
|||||
Comparison of Non-GAAP Financial Measures
Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, Free Cash Flow Margin, Free Cash Flow Conversion, Normalized Revenue, Normalized Adjusted EBITDA and Normalized Adjusted EBITDA Margin are supplemental non-GAAP financial measures that we use to evaluate current, past and expected future performance. Although these non-GAAP financial measures are important factors in assessing our operating results and cash flows, they should not be considered in isolation or as a substitute for net income or gross margin or any other measures of financial performance presented in accordance with GAAP.
Adjusted EBITDA and Adjusted EBITDA Margin are used by our management and by external users of our Financial Statements, such as investors, research analysts and others, to assess the financial performance of our assets over the long term to generate sufficient cash to return capital to equity holders or service indebtedness. We define Adjusted EBITDA as net income (loss) plus interest, taxes, depreciation, amortization, depletion and accretion, which we refer to as “EBITDA” and to which we further add back share-based compensation and related employer payroll taxes, non-recurring transaction-related expenses and other non-cash or non-recurring expenses. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue.
Management believes Adjusted EBITDA and Adjusted EBITDA Margin are useful because they allow us and external users of our Financial Statements to more effectively evaluate our operating performance and compare the results of our operations from period to period, and against our peers, without regard to our financing methods or capital structure. We exclude the items listed above from net income (loss) in arriving at Adjusted EBITDA and Adjusted EBITDA Margin because these amounts can vary substantially from company to company within our industry, depending upon accounting methods, book values of assets, capital structures and the method by which the assets were acquired. Our computations of these measures may differ from the computations of similarly titled measures of other companies.
Free Cash Flow, Free Cash Flow Margin and Free Cash Flow Conversion are performance measures used by our management and by external users of our Financial Statements, such as investors, research analysts and others, to assess our ability to generate cash from operations to repay our indebtedness, return capital to our shareholders and fund potential acquisitions without access to external sources of financing for such purposes. To calculate Free Cash Flow, net income is adjusted by the same items discussed above for EBITDA and Adjusted EBITDA (other than interest expense and income tax expense / benefit) and then further adjusted for incurred capital expenditures, changes in accounts payable related to capital expenditures, non-cash interest expense, and non-cash tax expense. Free Cash Flow Margin is calculated as Free Cash Flow divided by total revenue. Free Cash Flow Conversion is calculated as Free Cash Flow divided by Adjusted EBITDA.
Management believes Free Cash Flow, Free Cash Flow Margin and Free Cash Flow Conversion are useful because they allow for an effective evaluation of both our operating and financial performance, as well as the capital intensity of our business, and subsequently the ability of our operations to generate cash flow that is available to distribute to our shareholders, reduce leverage or support acquisition activities. Our computations of these measures may differ from the computations of similarly titled measures of other companies.
Normalized Revenue is used by our management and is useful to investors, research analysts and other external users of our Financial Statements to assess our operating performance on a basis that reflects our expected go-forward business following our initial public offering. Because our results for the three and six months ended June 30, 2026 include only a partial period of operations as a public company and do not reflect the full effect of certain items that we expect to characterize our operations on a go-forward basis, we present Normalized Revenue to illustrate what our Revenue would approximate had these items been in effect for the full periods presented. We define Normalized Revenue as Revenue adjusted for normalizing adjustments, which consist of the addition of revenue from assets contributed in the corporate reorganization in connection with our initial public offering and the exclusion of revenue attributable to our predecessor that are not expected to recur on a go-forward basis.
Normalized Adjusted EBITDA and Normalized Adjusted EBITDA Margin are used by our management and are useful to investors, research analysts and other external users of our Financial Statements to assess our operating performance on a basis that reflects our expected go-forward business following our initial public offering. Because our results for the three and six months ended June 30, 2026 include only a partial period of operations as a public
company and do not reflect the full effect of certain items that we expect to characterize our operations on a go-forward basis, we present Normalized Adjusted EBITDA to illustrate what our Adjusted EBITDA would approximate had these items been in effect for the full periods presented. We define Normalized Adjusted EBITDA as Adjusted EBITDA further adjusted for normalizing adjustments, which consist of the addition of revenue from assets contributed in the corporate reorganization in connection with our initial public offering; the exclusion of revenue attributable to our predecessor that are not expected to recur on a go-forward basis; operating costs associated with newly acquired surface acreage and assets from the Shallow Valley Contribution; amortization of RSU expense on a normalized basis; and other general and administrative expenses associated with operating as a public company. We define Normalized Adjusted EBITDA Margin as Normalized Adjusted EBITDA divided by Normalized Revenue.
Management believes Normalized Adjusted EBITDA and Normalized Adjusted EBITDA Margin are useful because they allow us and external users of our Financial Statements to evaluate the earnings profile we expect to result from operating as a public company over the whole period for which the measures are given, giving effect to items listed above. The normalizing adjustments reflect management’s estimates of the annualized or go-forward effect of these items and are based on assumptions that management believes to be reasonable. These are not prepared in accordance with Article 11 of Regulation S-X or otherwise intended to represent pro forma financial information. The following table sets forth a reconciliation of net income (loss) as determined in accordance with GAAP to Free Cash Flow, Free Cash Flow Margin and Free Cash Flow Conversion for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in thousands) | 2026 | 2026 | 2026 | 2026 | ||||||||||||
| Net income (loss) |
$ | 3,363 | $ | (37,536 | ) | $ | 11,272 | $ | (22,901 | ) | ||||||
| Adjustments: |
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| Depreciation and amortization |
4,591 | 10,275 | 15,889 | 30,755 | ||||||||||||
| Non Cash Interest |
(2,454 | ) | (1,564 | ) | 187 | (3,831 | ) | |||||||||
| Non Cash Taxes |
(18 | ) | (155 | ) | (165 | ) | (338 | ) | ||||||||
| Gain on investment in sales-type lease |
(3,275 | ) | — | — | (3,275 | ) | ||||||||||
| Gain on extinguishment of debt |
— | (20,352 | ) | — | (20,352 | ) | ||||||||||
| Share-based compensation - IPO share-based compensation expense |
— | 57,350 | 1,023 | 58,373 | ||||||||||||
| Share-based compensation - RSU share-based compensation expense |
— | 4,088 | 4,370 | 8,458 | ||||||||||||
| Share-based compensation - PSU share-based compensation expense |
— | — | 239 | 239 | ||||||||||||
| Transaction-related expenses(1) |
3,079 | 11,267 | 30 | 14,376 | ||||||||||||
| Other(2) |
— | 9 | — | 9 | ||||||||||||
| Capital Expenditures |
(835 | ) | (949 | ) | (1,087 | ) | (2,871 | ) | ||||||||
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| Free Cash Flow |
$ | 4,451 | $ | 22,433 | $ | 31,758 | $ | 58,642 | ||||||||
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| Free Cash Flow Margin |
19.3 | % | 54.0 | % | 73.3 | % | 54.3 | % | ||||||||
| Free Cash Flow Conversion |
32.2 | % | 75.2 | % | 93.4 | % | 75.5 | % | ||||||||
| (1) | Transaction-related expenses consist of non-recurring professional services expenses, including banker fees, legal and professional fees and integration costs directly attributable to completed or contemplated transactions, including the IPO. We do not adjust for ongoing integration or optimization costs unless they are incremental, and directly attributable to the transaction. |
| (2) | Other consists of (gain) loss on sale of assets. |
The following table sets forth a reconciliation of net income (loss) as determined in accordance with GAAP to Adjusted EBITDA and Adjusted EBITDA Margin for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Three Months Ended September 30, |
Nine Months Ended September 30, |
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| (in thousands) | 2026 | 2026 | 2026 | 2026 | ||||||||||||
| Net income (loss) |
$ | 3,363 | $ | (37,536 | ) | $ | 11,272 | $ | (22,901 | ) | ||||||
| Adjustments: |
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| Depreciation and amortization |
4,591 | 10,275 | 15,889 | 30,755 | ||||||||||||
| Interest expense |
5,834 | 4,812 | 903 | 11,549 | ||||||||||||
| Income tax expense (benefit) |
230 | (80 | ) | 286 | 436 | |||||||||||
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| EBITDA |
$ | 14,018 | $ | (22,529 | ) | $ | 28,350 | $ | 19,839 | |||||||
| Gain on investment in sales-type lease |
(3,275 | ) | — | — | (3,275 | ) | ||||||||||
| Gain on extinguishment of debt |
— | (20,352 | ) | — | (20,352 | ) | ||||||||||
| Share-based compensation - IPO share-based compensation expense |
— | 57,350 | 1,023 | 58,373 | ||||||||||||
| Share-based compensation - RSU share-based compensation expense |
— | 4,088 | 4,370 | 8,458 | ||||||||||||
| Share-based compensation - PSU share-based compensation expense |
— | — | 239 | 239 | ||||||||||||
| Transaction-related expenses(1) |
3,079 | 11,267 | 30 | 14,376 | ||||||||||||
| Other(2) |
— | 9 | — | 9 | ||||||||||||
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| Adjusted EBITDA |
$ | 13,822 | $ | 29,833 | $ | 34,012 | $ | 77,667 | ||||||||
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| Adjusted EBITDA Margin |
59.9 | % | 71.8 | % | 78.5 | % | 72.0 | % | ||||||||
| (1) | Transaction-related expenses consist of non-recurring professional services expenses, including banker fees, legal and professional fees and integration costs directly attributable to completed or contemplated transactions, including the IPO. We do not adjust for ongoing integration or optimization costs unless they are incremental, and directly attributable to the transaction. |
| (2) | Other consists of (gain) loss on sale of assets for the three and nine months ended September 30, 2026. |
The following table sets forth a reconciliation of net income (loss) as determined in accordance with GAAP to Adjusted EBITDA and Normalized Adjusted EBITDA for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Six Months Ended June 30, |
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| (in thousands) | 2026 | 2026 | 2026 | |||||||||
| Net income (loss) |
$ | 3,363 | $ | (37,536 | ) | $ | (34,173 | ) | ||||
| Adjustments: |
— | |||||||||||
| Depreciation and amortization |
4,591 | 10,275 | 14,866 | |||||||||
| Interest expense |
5,834 | 4,812 | 10,646 | |||||||||
| Income tax expense (benefit) |
230 | (80 | ) | 150 | ||||||||
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| EBITDA |
$ | 14,018 | $ | (22,529 | ) | $ | (8,511 | ) | ||||
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| Gain on investment in sales-type lease |
(3,275 | ) | — | (3,275 | ) | |||||||
| Gain on extinguishment of debt |
— | (20,352 | ) | (20,352 | ) | |||||||
| Share-based compensation - IPO share-based compensation expense |
— | 57,350 | 57,350 | |||||||||
| Share-based compensation - RSU share-based compensation expense |
— | 4,088 | 4,088 | |||||||||
| Transaction-related expenses(1) |
3,079 | 11,267 | 14,346 | |||||||||
| Other(2) |
— | 9 | 9 | |||||||||
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| Adjusted EBITDA |
$ | 13,822 | $ | 29,833 | $ | 43,655 | ||||||
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| Normalizing adjustments: |
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| Double Eagle Royalty |
11,718 | 6,186 | 17,904 | |||||||||
| Shallow Valley Revenue |
5,166 | 2,485 | 7,651 | |||||||||
| Convert Hydrosource Revenue to Royalty |
(4,574 | ) | (3,407 | ) | (7,981 | ) | ||||||
| Add Shallow Valley Costs |
(943 | ) | (352 | ) | (1,295 | ) | ||||||
| Carve Out Hydrosource Costs |
3,766 | 2,111 | 5,877 | |||||||||
| Public Company G&A |
(1,410 | ) | (611 | ) | (2,021 | ) | ||||||
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| Normalized Adjusted EBITDA |
$ | 27,545 | $ | 36,245 | $ | 63,790 | ||||||
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| Net income (loss) margin |
14.6 | % | (90.4 | )% | (52.9 | )% | ||||||
| Adjusted EBITDA Margin |
59.9 | % | 71.8 | % | 67.6 | % | ||||||
| Normalized Adjusted EBITDA Margin |
77.9 | % | 77.5 | % | 77.6 | % | ||||||
| (1) | Transaction-related expenses consist of non-recurring professional services expenses, including banker fees, legal and professional fees and integration costs directly attributable to completed or contemplated transactions, including the IPO. We do not adjust for ongoing integration or optimization costs unless they are incremental, and directly attributable to the transaction. |
| (2) | Other consists of (gain) loss on sale of assets for the three and six months ended June 30, 2026. |
The following table sets forth a reconciliation of Revenue as determined in accordance with GAAP to Normalized Revenue for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Six Months Ended June 30, |
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| (in thousands) | 2026 | 2026 | 2026 | |||||||||
| Reported revenue |
$ | 23,056 | $ | 41,526 | $ | 64,581 | ||||||
| Normalizing adjustments: |
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| Double Eagle Royalty |
11,718 | 6,186 | 17,904 | |||||||||
| Shallow Valley Revenue |
5,166 | 2,485 | 7,651 | |||||||||
| Convert Hydrosource Revenue to Royalty |
(4,574 | ) | (3,407 | ) | (7,981 | ) | ||||||
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| Normalized Revenue |
$ | 35,366 | $ | 46,790 | $ | 82,155 | ||||||
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Investor Contact:
Neal Shah
President and Chief Financial Officer
EagleRock Land, LLC
info@erok.com; (713) 280-7002
Exhibit 99.2
EagleRock Announces Double Eagle V Acreage Dedication and Two Midland Basin Acquisitions
Approximately 35,000-acre dedication brings total Double Eagle acreage dedication in the Midland Basin to approximately 105,000 acres
Bolt-on acquisitions add water supply, storage and disposal capacity
November 3, 2026
HOUSTON, Texas — EagleRock Land, LLC (“EagleRock”) (NYSE: EROK), a surface land management company that controls surface acreage in the core of the Permian Basin, today announced that it has executed an agreement with Double Eagle V for an additional acreage dedication of approximately 35,000 acres in the Midland Basin (the “Double Eagle V Dedication”) and has closed two bolt-on acquisitions in the Midland Basin totaling approximately 2,000 acres for $15.4 million in aggregate (the “Acquisitions”). EagleRock funded the acquisitions through a combination of cash on hand and borrowings under its existing revolving credit facility.
The Double Eagle V Dedication covers approximately 35,000 acres in Midland and Glasscock Counties and increases the total acreage dedicated to EagleRock by Double Eagle in the Midland Basin by approximately 50%, to approximately 105,000 acres. This agreement further strengthens our longstanding relationship with Double Eagle, one of the most active private operators in the Midland Basin and EagleRock’s largest shareholder. Importantly, the dedication underscores the strength of our capital-light business model, generating additional royalty revenue without requiring any capital investment by EagleRock. While it is early to provide specific financial guidance, we expect robust revenue contribution from this dedication beginning in 2027, with further meaningful growth in subsequent years consistent with Double Eagle’s drilling and completions cadence.
The two Midland Basin acquisitions were acquired at a valuation of less than 10x EBITDA, with one acquisition directly adjacent to our existing Shallow Valley footprint and the other directly adjacent to the newly announced Double Eagle V acreage dedication. These strategically located assets expand EagleRock’s water supply, storage, disposal capabilities, and include sand development optionality, creating opportunities to capture incremental operating synergies and unlock additional revenue across the entire Double Eagle dedicated footprint and the broader Midland Basin. Pro forma for the transactions, EagleRock’s Midland Basin footprint is approximately 44,000 acres plus approximately 105,000 dedicated acres. The acquisitions closed concurrent with signing.
“The Double Eagle V Dedication builds on a relationship that already anchors our Midland Basin position, and it requires no upfront capital from EagleRock,” said Greg Pipkin, Chief Executive Officer of EagleRock. “The two acquisitions follow the same approach. They sit next to assets we already have, expand our water supply and storage, and are accretive. Together, these transactions expand our Midland Basin footprint and enhance our ability to serve customers across the region.”
“Our approach to acquisitions remains disciplined, focused on the remaining development potential of each asset, its strategic fit within our portfolio and its ability to drive financial accretion and create shareholder value. We believe these recent transactions demonstrate our ability to move quickly and decisively when opportunities align with our strategy,” added Neal Shah, President and CFO of EagleRock.
The Double Eagle V Dedication was unanimously approved by a committee of independent members of EagleRock’s board of directors.
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About EagleRock
EagleRock (NYSE: EROK) is a land management company that owns or controls approximately 288,000 acres in the heart of the Delaware and Midland sub-basins within the prolific Permian Basin. In addition, EagleRock has an interest in up to approximately 105,000 acres pursuant to an acreage dedication related to its Midland Basin water infrastructure assets. Its acreage is vital to the efficient development of oil and natural gas resources in the Permian Basin and is strategically located to support the growing surface, resource, infrastructure, and related commercial development needs of the power and other emerging industries in the Permian Basin.
Cautionary Statement Concerning Forward-Looking Statements
The information in this press release relates to EagleRock Land, LLC (the “Company,” “EROK,” “we,” “us” or “our”) and contains information that includes or is based upon “forward-looking statements.” All statements other than historical facts are forward-looking statements, and include statements regarding EROK’s future financial position, business strategy, projected revenues, earnings, costs, capital expenditures and plans and objectives and intentions of management for the future. Words such as “expect,” “could,” “may,” “anticipate,” “intend,” “plan,” “ability,” “believe,” “seek,” “see,” “will,” “would,” “estimate,” “forecast,” “target,” “guidance,” “outlook,” “opportunity” or “strategy” or similar expressions are generally intended to identify forward-looking statements. These forward-looking statements are based upon the current beliefs and expectations of our management and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in, projected in, or implied by, such statements. Although EROK believes the expectations and forecasts reflected in its forward-looking statements are reasonable, they are inherently subject to numerous risks and uncertainties, most of which are difficult to predict and many of which are beyond its control. No assurance can be given that such forward-looking statements will be correct or achieved or that the assumptions are accurate or will not change over time. Particular uncertainties that could cause EROK’s actual results to be materially different from those expressed in its forward-looking statements are described under the heading “Risk Factors” in its final prospectus filed with the Securities and Exchange Commission (the “SEC”) on May 14, 2026 and the other reports and materials it files with the SEC. These factors include, but are not limited to: any statements regarding the Double Eagle V Dedication and the Acquisitions, including our ability to actively manage the new dedicated acreage and assets, the ability to renegotiate and modernize surface use agreements, creating new revenue opportunities and the expected benefits of the Double Eagle V Dedication and the Acquisitions, including expected accretion, integration plans, synergies, opportunities and anticipated future performance, customer demand for and use of EROK’s surface, resource, and water infrastructure assets; enforceability of its surface use agreements and other customer agreements; its operating partners’ success in executing their strategies; customers’ ability or decisions to develop EROK’s land or acquired acreage; global supply of and demand for energy, including OPEC+ production actions; customer and geographic concentration of its revenues; EROK’s ability to enter into favorable surface use, access, and fee contracts; EROK’s ability to maintain and renew leases and permits on state and federal land; changes in state and federal land use policies affecting its leased land; execution of EROK’s business strategies, including attracting customers; commodity price volatility; competition, including alternative resources; changes in the price and availability of services EROK’s customers need; planned or future expansion projects; advances or changes in energy technologies or practices; execution of EROK’s growth plans, including acquisitions and new revenue streams; deterioration of customers’ financial condition and access to capital; effects of customer consolidation on U.S. drilling and completions spending; customers’ ability to obtain necessary supplies and raw materials; EROK’s and its customers’ ability to obtain permits and government approvals; operational disruptions and related liability affecting EROK’s customers; EROK’s liquidity and access to capital markets; uncertainty of resource and reserve estimates; general economic, business, and industry conditions and market volatility; political instability or armed conflict in oil and gas producing regions; EROK’s level of indebtedness and ability to service it; title defects in acquired acreage; conditions in the markets for surface acreage; integration of acquired acreage and management of related growth; recruitment and retention of key personnel and service providers; changes in laws and regulations, including environmental and water-related rules; changes in tax rates and adverse tax outcomes; general political and regulatory conditions, including new legislation and trade and tax policies; severity and duration of health events, natural disasters, and severe weather; and evolving cybersecurity risks.
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EROK cautions you not to place undue reliance on forward-looking statements contained in this release, which speak only as of the date hereof, and EROK is under no obligation, and expressly disclaims any obligation to update, alter or otherwise revise any forward-looking statements, whether as a result of new information, future events or otherwise. This release may also contain information from third-party sources. This data may involve a number of assumptions and limitations, and EROK has not independently verified them and does not warrant the accuracy or completeness of such third-party information.
Neal Shah
President and Chief Financial Officer
EagleRock Land, LLC
info@erok.com; (713) 280-7002
Source: EagleRock Land, LLC
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