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BARNWELL INDUSTRIES INC (BRN)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 revenue from continuing operations was $3.569M, down 23.7% year over year, with a net loss from continuing operations of $(1.538)M and diluted loss per share of $(0.15); net loss attributable to Barnwell was $(1.207)M .
  • Costs tied to a shareholder consent solicitation and proxy contest increased G&A by $906K (72% YoY), and management disclosed substantial doubt about going concern due to uncertainty in oil and gas cash inflows and ongoing proxy-related expenses .
  • The Company completed the sale of its Water Resources International subsidiary for $1.05M, reclassified the Contract Drilling segment to discontinued operations, and recorded $331K of net earnings from discontinued ops in the quarter .
  • Liquidity tightened: quarter-end working capital deficit was $57K with cash and equivalents of $1.432M, versus $642K working capital and $1.957M cash in Q1; management is evaluating debt financing, asset sales, and potential sales of Kukio land interests .

What Went Well and What Went Wrong

What Went Well

  • Strategic focus sharpened via the divestiture of Water Resources for $1.05M; management reiterated intent to reduce fixed costs and reinvest proceeds into oil and gas operations .
  • Non-cash impairment was minimal at $52K in Q2 versus $1.677M in the prior year period, reducing non-operating drag .
  • Depletion expense decreased by $589K YoY due to lower depletion rates after prior write-downs and reduced production, aiding cost of sales dynamics .

What Went Wrong

  • Proxy contest expenses drove a $906K (72%) YoY increase in G&A, directly impacting the P&L and prompting a going concern disclosure given uncertain operating cash inflows .
  • Land investment segment operating results declined $500K QoQ as no Kukio lots were sold in Q2 versus two lots sold in Q1, reducing diversified income contributions .
  • Hydrocarbon output fell: oil (-14%), natural gas (-24%), and NGLs (-13%) YoY in Q2, pressuring revenue despite lower depletion and smaller impairments .

Financial Results

Quarterly Performance vs Prior Periods and Consensus

MetricQ4 2024Q1 2025Q2 2025Consensus (Q2 2025)
Revenue ($USD)$4.268M $4.477M $3.569M N/A (no coverage)
Net Loss from Continuing Ops ($USD)N/A$(1.917)M $(1.538)M N/A (no coverage)
Diluted EPS – Continuing Ops ($USD)N/A$(0.19) $(0.15) N/A (no coverage)
Net Loss Attributable ($USD)$(1.883)M $(1.917)M $(1.207)M N/A (no coverage)

Notes: S&P Global consensus estimates were unavailable for Q2 2025 EPS and revenue; coverage appears limited.

Q2 2025 vs Q2 2024 (Year over Year)

MetricQ2 2024Q2 2025
Revenue ($USD)$4.678M $3.569M
Net Loss from Continuing Ops ($USD)$(1.306)M $(1.538)M
Diluted EPS – Continuing Ops ($USD)$(0.13) $(0.15)

Margins

MetricQ4 2024Q1 2025Q2 2025
EBITDA Margin %-4.90%*3.93%*-11.43%*
EBIT Margin %-31.00%*-21.17%*-37.35%*
Net Income Margin %-44.12%*-42.82%*-33.82%*

*Values retrieved from S&P Global.

KPIs

KPIQ4 2024Q1 2025Q2 2025
Working Capital ($USD)$1.071M $0.642M $(0.057)M (deficit)
Cash & Equivalents ($USD)$4.505M $1.957M $1.432M
Ceiling Test Impairment ($USD)$0.609M $0.613M $0.052M
Oil Production YoY (%)N/A-17% -14%
Natural Gas Production YoY (%)N/A-21% -24%
NGL Production YoY (%)N/A-17% -13%

Segment and Operations Highlights (Q2 2025)

Segment/ItemQ2 Detail
Land InvestmentOperating results decreased by $0.5M QoQ due to no Kukio lot sales in Q2 vs two in prior quarter .
Contract DrillingSold Water Resources for $1.05M; segment reclassified to discontinued operations; TTM revenue $3.162M pre-sale .
Oil & GasQ2 production declines: oil -14%, gas -24%, NGL -13%; impairment $52K .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY/Q2 2025 onwardNone providedNone providedMaintained (no formal guidance)
MarginsFY/Q2 2025 onwardNone providedNone providedMaintained (no formal guidance)
OpEx/G&AFY/Q2 2025 onwardN/AExpect elevated G&A due to ongoing proxy contest; cannot estimate amount Raised (qualitative)
Liquidity/FundingFY/Q2 2025 onwardN/AExploring debt financing, non-core property sales, potential sale of Kukio interests; timing/amounts not secured New disclosure
Going ConcernFY/Q2 2025 onwardNo prior disclosureSubstantial doubt raised due to proxy costs, tariff impacts, and cash inflow uncertainty New disclosure

Earnings Call Themes & Trends

Note: No Q2 earnings call transcript was found.

TopicPrevious Mentions (Q4 2024)Previous Mentions (Q1 2025)Current Period (Q2 2025)Trend
Governance/Proxy ContestFocus on cost reductions and simplification; no proxy conflict highlighted Warned a potential proxy contest could harm liquidity and growth Proxy contest ongoing; costs elevating G&A; going concern disclosed Deteriorating
Cost Reduction/StreamliningFY G&A down 20%; simplification and optimization emphasized G&A down 9% YoY; plan to wind down/sell contract drilling Sold Water Resources; intent to further reduce fixed costs Executing despite headwinds
Twining/O&G OperationsNew Twining well online; ~107 bpd initial rate New well produced ~107 boe/d; ~10,000 boe in Q1 Production declines across commodities; lower depletion and small impairment Mixed (asset quality vs decline)
Macro/Tariffs & PricingCommentary on Matterhorn pipeline improving gas egress/pricing Hydrocarbon prices down (oil -2%, gas -40%, NGL -8%) YoY Tariffs cited as reducing oil prices; macro impact on U.S. economy Negative
Liquidity & FundingFY-end cash $4.505M and WC $1.071M Cash $1.957M; WC $0.642M Cash $1.432M; WC deficit $57K; evaluating financing and asset sales Tightening

Management Commentary

  • “Our current proxy contest has negatively impacted the Company’s liquidity and hindered its investment and growth opportunities… The completed sale of our contract drilling business will help refocus our efforts and reduce fixed costs” — Craig D. Hopkins, CEO .
  • “We are also seeking ways to further reduce costs and enhance profitability… The Company ended the quarter with a working capital deficit of $57,000, including $1,432,000 in cash and cash equivalents.” — Craig D. Hopkins, CEO .
  • “A potential proxy contest in the near term could harm the company’s liquidity and hinder investment and growth opportunities… Our new well is performing as anticipated” — Craig D. Hopkins, CEO (Q1) .
  • “The sale of Water Resources… streamline our business, reduce fixed cost, and focus on higher return opportunities.” — Craig D. Hopkins, CEO .

Q&A Highlights

  • No Q2 2025 earnings call transcript was available; no analyst Q&A recorded in the source documents reviewed (press releases and 8-Ks) .

Estimates Context

  • Wall Street consensus (S&P Global) for Q2 2025 EPS and revenue was unavailable; S&P Global shows actual revenue but no consensus values or estimate counts for the quarter. Investors should assume limited sell-side coverage and rely on reported figures and internal modeling [Q2 2025 revenue actual via S&P Global; no consensus].*
MetricPeriodConsensus# of EstimatesActual
EPSQ2 2025N/A*N/A*$(0.15)
Revenue ($USD)Q2 2025N/A*N/A*$3.569M

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • Elevated proxy contest expenses are the primary earnings headwind and drove a going concern disclosure; until resolved, expect continued G&A pressure and liquidity constraints .
  • Strategic simplification is progressing: the Water Resources sale removes a lower-return segment, refocusing capital on oil and gas; look for incremental fixed-cost reductions and potential non-core asset sales .
  • Operating quality is mixed: smaller Q2 impairment and lower depletion rates are positives, but multi-commodity production declines and tariff-linked pricing pressure weigh on revenue trajectories .
  • Liquidity has tightened materially (cash down and working capital turned negative); management is evaluating debt financing and asset monetization—execution and terms will be crucial to near-term solvency and drilling cadence .
  • Land investment contribution is lumpy; absence of Kukio lot sales in Q2 removed a $0.5M QoQ benefit seen in the prior period, reinforcing the need for core O&G growth or diversified cash inflows .
  • With limited sell-side coverage and no formal guidance, investors should model scenarios around cost reduction pace, resolution of the proxy contest, and timing of funding to unlock Twining/legacy asset development .
  • Near term: headline risk from governance disputes and going concern language likely keeps volatility high; medium term: if funding is secured and proxy overhang resolves, simplified operations could support improved margins and reinvestment .