EagleRock Land (NYSE: EROK) posts strong Q2 growth and $78.2M Intrepid Ranch deal
Rhea-AI Filing Summary
EagleRock Land, LLC reported a strong second quarter for 2026, highlighting rapid growth and its first major post-IPO acquisition. For the quarter ended June 30, 2026, the company generated normalized revenue of $46.8 million, up 32.3% from the first quarter, driven by commercialization of its Permian Basin land position. Normalized Adjusted EBITDA was $36.2 million, an increase of 31.7%, with a high 77.5% margin.
Free Cash Flow was $22.2 million versus $4.4 million in the prior quarter; excluding $6.4 million of cash interest tied to a predecessor credit facility repaid on June 3, 2026, Free Cash Flow would have been $28.6 million, a 96% conversion. The company completed an IPO on May 15, 2026, issuing 19.9 million Class A shares at $18.50 for approximately $368 million in gross proceeds, and ended the quarter with $261.8 million of liquidity. Full-year 2026 Normalized EBITDA guidance is $129–$133 million, above its original internal forecast.
EagleRock also acquired the Intrepid Ranch, approximately 50,000 surface acres in Lea County, New Mexico, from Hydrosource Logistics LLC for $78.2 million, funded with cash and revolver borrowings. The package includes about 22,000 fee acres, expanding New Mexico fee acreage by roughly 60%, along with existing commercial water rights, storage, disposal wells, caliche pits and permitted sand mines, positioning the company for additional royalty, water and non-oil-and-gas revenue opportunities.
Positive
- Normalized revenue rose 32.3% quarter-over-quarter to $46.8 million, with Normalized Adjusted EBITDA up 31.7% to $36.2 million, demonstrating strong early growth as a public company.
- Free Cash Flow grew to $22.2 million from $4.4 million in Q1 2026; excluding $6.4 million of legacy interest, Free Cash Flow would have been $28.6 million with 96% conversion.
- The company completed an IPO raising approximately $368 million and ended Q2 with $261.8 million of liquidity, supporting balance sheet strength and funding capacity.
- Full-year 2026 Normalized EBITDA guidance of $129–$133 million is stated to exceed the original internal forecast, indicating higher expected profitability.
- The $78.2 million Intrepid Ranch acquisition adds about 50,000 surface acres, including 22,000 fee acres, expanding New Mexico fee acreage by roughly 60% with multiple embedded revenue opportunities.
Negative
- Despite operational growth, EagleRock reported a Q2 2026 GAAP net loss of $37.5 million, driven in part by $75.7 million of general and administrative expense including significant IPO-related and share-based compensation costs.
Insights
Analyzing...
8-K Event Classification
Key Figures
Key Terms
Normalized Adjusted EBITDA financial
Free Cash Flow Conversion financial
sales-type lease financial
surface use royalties financial
noncontrolling interest financial
Earnings Snapshot
For full-year 2026, Normalized EBITDA is expected to range from $129 million to $133 million, which the company states exceeds its original internal forecast.
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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):
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(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 2.02 | Results of Operations and Financial Condition. |
On August 10, 2026, EagleRock Land, LLC (the “Company”) issued a press release providing information regarding its financial results for the quarter ended June 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 August 10, 2026, the Company posted an investor presentation on its website. The presentation, titled “Second 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 August 10, 2026, the Company issued a press release announcing its acquisition of the Intrepid Ranch from Hydrosource Logistics, LLC. 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.
| Exhibit Number |
Description | |
| 99.1 | Press Release of EagleRock Land, LLC, dated August 10, 2026 (financial results). | |
| 99.2 | Press Release of EagleRock Land, LLC, dated August 10, 2026 (acquisition of the Intrepid Ranch). | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document). | |
2
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: August 10, 2026
3
Exhibit 99.1
EagleRock Announces Second Quarter 2026 Results
August 10, 2026
Delivers strong second quarter results surpassing company expectations
Initiates full-year 2026 financial guidance above company forecast
HOUSTON—(BUSINESS WIRE)—EagleRock Land, LLC (“EagleRock” or the “Company”) (NYSE: EROK) today announced its financial and operating results for the second quarter ended June 30, 2026.
Second Quarter and Recent Financial and Business Highlights
| • | Successfully completed an initial public offering on the NYSE and NYSE Texas on May 15, 2026, issuing 19.9 million Class A shares, including the full exercise of the underwriters’ over-allotment option, at a price of $18.50 per share and raising approximately $368 million in gross proceeds. |
| • | Reported revenue of $41.5 million |
| • | Reported net loss of $(37.5) million |
| • | Normalized revenue(1)(2) of $46.8MM, representing an increase of 32.3% versus the first quarter of 2026 |
| • | Normalized Adjusted EBITDA(1)(2) of $36.2 million, representing an increase of 31.7% versus the first quarter of 2026 |
| • | Normalized Adjusted EBITDA margin(1)(2) of 77.5% compared to 77.9% in first quarter of 2026 |
| • | Liquidity of $261.8 million as of June 30, 2026 |
| • | On August 10, 2026, acquired Intrepid Ranch, an approximately 50,000-acre, 22,000-fee-acre position in Lea County, New Mexico directly adjacent to EagleRock’s existing surface footprint, for a total purchase price of $78.2 million, expanding the Company’s contiguous Delaware Basin position. |
Management Commentary
“EagleRock holds a stronghold position in two of the most important sub-basins in the Permian, co-located with some of the deepest, most economic drilling inventory in the country,” said Greg Pipkin, Chief Executive Officer of EagleRock. “The pieces of this platform are worth more together than they’d be apart, reinforced by our strategic partners. Together, they deliver durable, royalty and fee driven cash flow that moves largely independent of commodity price swings, a broader base to keep growing organically and through acquisition, and meaningful upside as the Permian evolves into a full-scale energy ecosystem.”
“We’re already delivering on that growth potential. In the second quarter, we delivered more than 30% revenue and Normalized Adjusted EBITDA growth on a quarter-over-quarter basis, consistent with the expectations we set when we went public. That same growth strategy is now showing up in our acquisition activity, and we’re pleased to announce the purchase of Intrepid Ranch, a contiguous, adjacent asset in Lea County, New Mexico. With this asset, we intend to apply the same active management playbook that’s driving our results today, renegotiating and modernizing surface use agreements, expanding our water infrastructure and water rights, and unlocking additional royalty opportunities including sand development, consistent with the disciplined M&A approach we described at our IPO.”
| 1 | EagleRock’s reorganization and IPO closed May 15, 2026; results for the period prior reflect the predecessor structure. Normalized figures recast January 1 – May 14, 2026 as if EagleRock had operated in its current, post-IPO form for the entire six-month period, for comparability across the full six months; see reconciliation included |
| 2 | Normalized Revenue, Normalized Adjusted EBITDA and Normalized Adjusted EBITDA Margin are non-GAAP financial measures. See Comparison of Non-GAAP Financial Measures for a discussion of these measures and a reconciliation of these measures to our most directly comparable financial measures calculated and presented in accordance with GAAP. |
Second Quarter Results
EagleRock generated normalized revenue of $46.8 million in the second quarter of 2026, an increase of 32.3% versus the first quarter of 2026. The strong growth in revenue was underpinned by the continued success of the commercialization of our land and our active land management strategy.
Normalized Adjusted EBITDA was $36.2 million, an increase of 31.7% versus the first quarter of 2026, representing a Normalized Adjusted EBITDA margin of 77.5%, compared to 77.9% in the first quarter.
Diversified Revenue Streams
Resource Sales revenues were $28.2 million in the second quarter of 2026, or 68% of total revenue, and an increase of 48% versus the first quarter of 2026. On a normalized basis, resources sales revenues were $24.2 million in the second quarter of 2026, or 52% of Normalized Revenue, and an increase of 53.1% versus the first quarter of 2026. The increase in resource sales was driven primarily by an additional 7.0 MMBbls of brackish water sold from our ranches, together with higher caliche sales.
Surface Use Revenues were $5.9 million in the second quarter of 2026, or 14% of total revenue, and an increase of 84% versus the first quarter of 2026. On a normalized basis, surface use revenues were $7.1 million in the second quarter of 2026, or 15% of Normalized Revenue, and an increase of 74.3% versus the first quarter of 2026. The increase was driven primarily by heightened commercial activity across our lands, which generated additional surface damage and easement fees.
Surface Use Royalties revenues were $7.4 million in the second quarter of 2026, or 18% of total revenue, and an increase of 837% versus the first quarter of 2026. On a normalized basis, surface use royalties revenues were $15.5 million in the second quarter of 2026, or 33% of Normalized Revenue, and flat with the first quarter of 2026. The majority of surface use royalties continued to be driven by produced water takeaway and recycled water sales.
Free Cash Flow Generation
Free Cash Flow3 for the second quarter of 2026 was $22.2 million compared to $4.4 million in the first quarter of 2026. Free Cash Flow during the quarter was negatively impacted by $6.4 million of cash interest expense associated with the carrying cost of the Predecessor Company’s credit facility, which was repaid in full and terminated on June 3, 2026. Excluding the $6.4 million impact, second-quarter Free Cash Flow would have been $28.6 million, representing Free Cash Flow conversion of 96%.
IPO and Liquidity
The Company successfully completed an initial public offering on the NYSE and NYSE Texas on May 15, 2026, issuing 19.9 million Class A shares, including the full exercise of the underwriters’ over-allotment option, at a price of $18.50 per share and raising approximately $368 million in gross proceeds.
As of June 30, 2026, the Company had total liquidity of $261.8 million, comprised of $61.8 million of cash and cash equivalents and $200 million of available borrowing capacity under its revolving credit facility.
2026 Outlook
For the full year 2026, the Company now expects Normalized EBITDA to exceed its original internal forecast and is expected to range from $129 million to $133 million.
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.
| 3 | Free Cash Flow is a non-GAAP financial measure. See Comparison of Non-GAAP Financial Measures for a discussion of this measure and a reconciliation of this measure to our most directly comparable financial measure calculated and presented in accordance with GAAP. |
Conference Call and Webcast Information
The Company will hold a conference call on August 11, 2026 at 10:00 am ET / 9:00 am CT to discuss second 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/events-and-presentations/default.aspx.
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 516 046 936 as the meeting ID.
About EagleRock
EagleRock (NYSE: EROK) is a land management company that owns or controls approximately 286,000 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 70,000 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 SEC on May 14, 2026 (the “Prospectus”) and the other reports and materials it files with the SEC. These factors include, but are not limited to: any statements regarding the Acquisition, including our ability to actively manage the new assets, the ability to renegotiate and modernize surface use agreements, creating new revenue opportunities and the expected benefits of the Acquisition, 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 press 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 press 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.
SECOND QUARTER 2026 RESULTS
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands) (unaudited)
| Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| REVENUES |
||||||||||||||||
| Resource sales |
$ | 28,202 | $ | 19,215 | $ | 47,155 | $ | 24,154 | ||||||||
| Resource sales - related party |
25 | 509 | 151 | 509 | ||||||||||||
| Surface use related revenues |
5,851 | 3,181 | 9,033 | 5,166 | ||||||||||||
| Surface use royalties |
1,440 | 958 | 2,234 | 1,102 | ||||||||||||
| Surface use royalties - related party |
6,008 | — | 6,008 | — | ||||||||||||
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| Total revenues |
41,526 | 23,863 | 64,581 | 30,931 | ||||||||||||
| COSTS AND EXPENSES |
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| Cost of sales (exclusive of depreciation and amortization) |
6,103 | 7,722 | 10,960 | 9,608 | ||||||||||||
| Related party cost of sales |
2,564 | 2,504 | 5,425 | 3,627 | ||||||||||||
| General and administrative expense |
75,731 | 3,709 | 80,319 | 4,720 | ||||||||||||
| Related party general and administrative expense |
— | 212 | 6 | 231 | ||||||||||||
| Depreciation and amortization expense |
10,275 | 4,445 | 14,866 | 5,838 | ||||||||||||
| Loss (gain) on sale of property, plant and equipment, net |
9 | — | 9 | 30 | ||||||||||||
| Gain on investment in sales-type lease |
— | — | (3,275 | ) | — | |||||||||||
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| Total operating expenses |
94,682 | 18,592 | 108,310 | 24,054 | ||||||||||||
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| INCOME (LOSS) FROM OPERATIONS |
(53,156 | ) | 5,271 | (43,729 | ) | 6,877 | ||||||||||
| OTHER EXPENSE (INCOME) |
||||||||||||||||
| Interest expense, net |
4,812 | 6,068 | 10,646 | 8,783 | ||||||||||||
| Loss (gain) on extinguishment of debt |
(20,352 | ) | 70,001 | (20,352 | ) | 70,001 | ||||||||||
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| Total other expense (income) |
(15,540 | ) | 76,069 | (9,706 | ) | 78,784 | ||||||||||
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| INCOME (LOSS) BEFORE INCOME TAXES |
(37,616 | ) | (70,798 | ) | (34,023 | ) | (71,907 | ) | ||||||||
| Income tax expense (benefit) |
(80 | ) | — | 150 | — | |||||||||||
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| NET INCOME (LOSS) |
$ | (37,536 | ) | $ | (70,798 | ) | $ | (34,173 | ) | $ | (71,907 | ) | ||||
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| NET INCOME (LOSS) ATTRIBUTABLE TO PREDECESSOR |
$ | 2,261 | $ | 5,624 | ||||||||||||
| NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST |
$ | (32,235 | ) | $ | (32,235 | ) | ||||||||||
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| NET INCOME (LOSS) ATTRIBUTABLE TO EAGLEROCK LAND, LLC |
$ | (7,562 | ) | $ | (7,562 | ) | ||||||||||
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| Basic and dilutive net income (loss) per Class A share |
$ | (0.29 | ) | |||||||||||||
| Basic and dilutive weighted average Class A shares outstanding |
26,374,967 | |||||||||||||||
CONSOLIDATED BALANCE SHEETS
(in thousands) (unaudited)
| June 30, 2026 |
December 31, 2025 |
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| ASSETS |
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| Current assets: |
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| Cash and cash equivalents |
$ | 61,770 | $ | 9,042 | ||||
| Accounts receivable, net |
12,668 | 13,096 | ||||||
| Accounts receivable - related party |
13,032 | — | ||||||
| Inventory |
308 | 310 | ||||||
| Prepaid expenses and other current assets |
2,323 | 8,765 | ||||||
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| Total current assets |
90,101 | 31,213 | ||||||
| Property, plant and equipment, net |
377,897 | 55,586 | ||||||
| Right of use assets, net |
1,541 | 1,565 | ||||||
| Intangible assets, net |
674,174 | 191,240 | ||||||
| Goodwill |
643,270 | |||||||
| Net investment in sales-type lease |
3,215 | — | ||||||
| Deferred offering costs |
— | 1,459 | ||||||
| Other noncurrent assets |
5,985 | 947 | ||||||
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| TOTAL ASSETS |
$ | 1,796,183 | $ | 282,010 | ||||
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| LIABILITIES AND SHAREHOLDERS’ AND MEMBERS’ EQUITY |
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| Current liabilities: |
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| Accounts payable |
$ | 4,547 | $ | 4,433 | ||||
| Accounts payable - related party |
35,418 | 2,684 | ||||||
| Accrued liabilities |
3,173 | 2,909 | ||||||
| Current income taxes payable |
224 | 42 | ||||||
| Current deferred revenue |
202 | 533 | ||||||
| Current operating lease liability |
122 | 492 | ||||||
| Current debt - related party |
— | 6,038 | ||||||
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| Total current liabilities |
43,686 | 17,131 | ||||||
| Non-current liabilities |
||||||||
| Operating lease liability, less current portion |
1,364 | 1,019 | ||||||
| Deferred tax liability, net |
10,680 | 10,852 | ||||||
| Deferred revenue, less current portion |
— | 94 | ||||||
| Long-term debt - related party, less current portion |
— | 294,629 | ||||||
| Other noncurrent liabilities |
2,677 | — | ||||||
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| Total non-current liabilities |
14,721 | 306,594 | ||||||
| SHAREHOLDERS’ AND MEMBERS’ EQUITY |
||||||||
| Members’ deficit |
— | (41,715 | ) | |||||
| Class A shares, unlimited shares authorized and 24,455,688 shares issued and outstanding as of June 30, 2026. None authorized, issued or outstanding as of December 31, 2025 |
335,374 | — | ||||||
| Class B shares, unlimited shares authorized and 105,164,311 shares issued and outstanding as of June 30, 2026. None authorized, issued or outstanding as of December 31, 2025 |
20 | — | ||||||
| Retained earnings |
(7,562 | ) | — | |||||
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| Total shareholders’ equity attributable to EagleRock Land, LLC |
327,832 | — | ||||||
| Noncontrolling interest |
1,409,944 | — | ||||||
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| Total shareholders’ equity and members’ equity |
$ | 1,737,776 | $ | (41,715 | ) | |||
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| TOTAL LIABILITIES AND EQUITY |
$ | 1,796,183 | $ | 282,010 | ||||
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Comparison of Non-GAAP Financial Measures
Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow and Free Cash Flow 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) minus interest, taxes, depreciation, amortization, depletion and accretion, which we refer to as “EBITDA” and from which we further deduct share-based compensation, 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 Adjusted EBITDA, Adjusted EBITDA Margin, Free Cash Flow, and Free Cash Flow Margin for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||
| 2026 | 2026 | 2026 | ||||||||||
| Net income (loss) |
$ | 3,363 | $ | (37,536 | ) | $ | (34,173 | ) | ||||
| Adjustments: |
— | — | — | |||||||||
| Depreciation and amortization |
4,591 | 10,275 | 14,866 | |||||||||
| Non Cash Interest |
(2,454 | ) | (1,564 | ) | (4,018 | ) | ||||||
| Non Cash Taxes |
(18 | ) | (154 | ) | (172 | ) | ||||||
| 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 | |||||||||
| Capital Expenditures |
(835 | ) | (1,169 | ) | (2,004 | ) | ||||||
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| Free Cash Flow |
$ | 4,451 | $ | 22,214 | $ | 26,665 | ||||||
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|
|
|
|
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| Free Cash Flow Margin |
19.3 | % | 53.5 | % | 41.3 | % | ||||||
| Free cash Flow Conversion |
16.2 | % | 74.5 | % | 61.1 | % | ||||||
| (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 net income (loss) as determined in accordance with GAAP to Adjusted EBITDA and Normalized Adjusted EBITDA in for the periods indicated.
| Three Months Ended March 31, |
Three Months Ended June 30, |
Six Months Ended June 30, |
||||||||||
| (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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|
|
|
|
|
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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: |
||||||||||||
| 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 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, |
||||||||||
| (in thousands) | 2026 | 2026 | 2026 | |||||||||
| Reported revenue |
$ | 23,056 | $ | 41,526 | $ | 64,581 | ||||||
| Normalizing adjustments: |
||||||||||||
| 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
Source: EagleRock Land, LLC
Exhibit 99.2
EagleRock Acquires Intrepid Ranch
Acquisition materially expands EagleRock’s contiguous Delaware Basin position, with significant upside expected to be achieved through active management of the asset
August 10, 2026
HOUSTON, Texas — EagleRock Land, LLC (“EagleRock”), a surface land management company that controls surface acreage in the core of the Permian Basin, acquired the Intrepid Ranch, which is comprised of approximately 50,000 surface acres, from Hydrosource Logistics LLC (the “Acquisition”) for a total purchase price of $78.2 million. The Acquisition was funded through a combination of cash on hand and borrowings under EagleRock’s existing revolving credit facility, reflecting EagleRock’s strong liquidity position and financial flexibility.
The acreage is directly adjacent to EagleRock’s existing surface position in Lea County, New Mexico, and includes approximately 22,000 fee acres, representing an increase of approximately 60% to EagleRock’s existing fee acreage in New Mexico. EagleRock intends to apply the active management approach it has used successfully elsewhere in its portfolio, including renegotiating and modernizing mutually beneficial surface use agreements, optimizing and expanding water infrastructure and water rights, and unlocking additional royalty opportunities including sand development.
The acreage includes several million barrels per year of currently producing commercial water rights, several million barrels of above-ground storage capacity, multiple saltwater disposal wells, as well as active caliche pits and permitted sand mines. The position sits within a corridor of the Delaware Basin developed by several of the industry’s most active, blue-chip operators, underscoring the strategic quality and demand fundamentals of the surrounding acreage. The ranch’s proximity to expanding urban development in the region also positions EagleRock to pursue non-oil and gas commercial opportunities, such as power generation and transmission, further diversifying the revenue potential of the acquired acreage.
“We look for assets that are worth more inside the EagleRock platform than individually, and the Intrepid Ranch clearly fits that standard,” said Greg Pipkin, Chief Executive Officer of EagleRock. “It creates a contiguous corridor from the state line through the heart of Lea County and our existing New Mexico acreage. We expect to continue to execute our strategy to grow the portfolio, organically and through disciplined, accretive M&A that strengthens the business for our shareholders.”
“The Intrepid Ranch is EagleRock’s first major acquisition since completing its initial public offering in May and reflects the accretive, adjacent acquisition strategy that EagleRock outlined to investors at that time,” commented Neal Shah, President and CFO of EagleRock. “We believe the Acquisition represents an attractive entry valuation with significant upside and multiple avenues to grow asset-level revenue and EBITDA, further enhancing the economics of the acquisition.”
The Acquisition was unanimously approved by a committee of independent members of EagleRock’s board of directors (the “Committee”). Raymond James served as financial advisor and Gibson, Dunn & Crutcher LLP acted as legal advisor to the Committee. Vinson & Elkins L.L.P. acted as legal advisor to EagleRock. Jackson Walker LLP acted as legal advisor to Hydrosource Logistics LLC.
About EagleRock
EagleRock (NYSE: EROK) is a land management company that owns or controls approximately 286,000 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 70,000 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.
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Cautionary Statement Concerning Forward-Looking Statements
This press release may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, that are based on EagleRock’s beliefs, as well as assumptions made by, and information currently available to, EagleRock, and therefore involve risks and uncertainties that are difficult to predict, including that the anticipated benefits of the Acquisition will not be realized in a timely manner, or at all. 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. Forward-looking statements include any statements regarding the Acquisition, including our ability to actively manage the new assets, the ability to renegotiate and modernize surface use agreements, creating new revenue opportunities and the expected benefits of the Acquisition, including expected accretion, integration plans, synergies, opportunities and anticipated future performance. 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.
All statements other than historical facts are forward-looking statements, and include statements regarding EagleRock’s future financial position, business strategy, projected revenues, earnings, costs, capital expenditures and plans and objectives and intentions of management for the future. Although EagleRock 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, including those risks more fully discussed in in its final prospectus filed with the SEC on May 14, 2026 and the other reports and materials it files with the SEC. You can access EagleRock’s filings with the SEC through the SEC’s website at http://www.sec.gov. 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. EagleRock cautions you not to place undue reliance on forward-looking statements contained in this presentation, which speak only as of the date hereof, and EagleRock 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.
Neal Shah
President and Chief Financial Officer
EagleRock Land, LLC
info@erok.com; (713) 280-7002
Source: EagleRock Land, LLC
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