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BARNWELL INDUSTRIES INC (BRN)·Q4 2024 Earnings Summary

Executive Summary

  • Q4 results reflected continued optimization and new Twining production, but softer pricing and another non-cash impairment drove a net loss: revenue $4.268M; net loss ($1.883M); EPS ($0.19). The company ended FY24 debt-free with $4.505M cash and $1.071M working capital .
  • The Twining development well commenced production mid-September and averaged ~107 bbl/d in its first two months; management emphasized Twining as the core growth engine .
  • Management will move forward with strategic alternatives for Water Resources (contract drilling), including potential sale or orderly wind-down to reduce corporate complexity and costs .
  • Q4 revenue declined versus Q3 and Q4 2023; results were affected by a $609k quarter impairment and low realized Texas gas prices despite increased gas/NGL production year over year .
  • No earnings call transcript was found for Q4; Wall Street consensus estimates (S&P Global) were unavailable at time of analysis.

What Went Well and What Went Wrong

What Went Well

  • Twining well online and performing as expected: “Twining continues to be the engine for our future growth… our new development well is online and producing as expected.” ~107 bbl/d average in first two months .
  • Cost discipline: production operating costs declined $585k (6%) in FY24; G&A down $1.358M (20%) year over year, driven by lower proxy/professional fees .
  • Liquidity and simplification: company remains debt-free with $4.505M cash; progressing to simplify non-core businesses to free cash for Twining and acquisitions .

What Went Wrong

  • Pricing headwinds: low realized Texas gas prices pressured cash flows, partially offset by expected improvement following Matterhorn Express commissioning .
  • Non-cash impairments persisted: $609k in Q4 and $2.885M for FY24 due to lower 12‑month average pricing; Q3 impairment was $599k and Q2 impairment $1.677M .
  • Revenue and EPS weaker vs prior periods: Q4 revenue $4.268M vs $6.844M in Q4 2023 and $5.527M in Q3 2024; EPS ($0.19) vs ($0.01) in Q4 2023 and ($0.12) in Q3 2024 .

Financial Results

Quarterly Financials vs Prior Periods

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD)$5,774,000 $5,527,000 $4,268,000
Net Loss ($USD)($1,772,000) ($1,246,000) ($1,883,000)
EPS ($USD)($0.18) ($0.12) ($0.19)
Non‑cash Impairment ($USD)$1,677,000 $599,000 $609,000

Year-over-Year (Q4 2024 vs Q4 2023)

MetricQ4 2023Q4 2024
Revenue ($USD)$6,844,000 $4,268,000
Net Loss ($USD)($96,000) ($1,883,000)
EPS ($USD)($0.01) ($0.19)

Liquidity Snapshot (Quarterly)

MetricQ2 2024Q3 2024Q4 2024 (FY End)
Cash & Equivalents ($USD)N/A$4,393,000 $4,505,000
Working Capital ($USD)$3,332,000 $3,292,000 $1,071,000
DebtDebt‑free Debt‑free Debt‑free

Margins vs Estimates

MetricQ2 2024Q3 2024Q4 2024Consensus (Q4 2024)
EBIT Margin %UnavailableUnavailableUnavailableUnavailable
EBITDA Margin %UnavailableUnavailableUnavailableUnavailable

Note: Margin metrics were not disclosed in cited press releases; retrieval from S&P Global fundamentals was unavailable at the time of analysis.

KPIs and Operating Metrics

KPIPeriodValue
Twining new well average oil rateFirst two months post‑startup (mid‑Sep start)~107 bbl/d
Production operating cost changeFY24 vs FY23Down $585,000 (6%)
G&A changeFY24 vs FY23Down $1,358,000 (20%)
Q3 production operating costsQ3 2024 vs Q3 2023Down $772,000 (26%)
Q2 production increases vs prior year quarterQ2 2024 vs Q2 2023Oil +16%, Gas +47%, NGL +100%
Land segment cash proceedsQ2 2024$500,000 percentage of sales payments; $953,000 net cash distributions

Guidance Changes

Metric/TopicPeriodPrevious Guidance/CommentaryCurrent Guidance/UpdateChange
Twining drilling programFY24Plan to drill at least one 100%‑owned well during remainder of FY24 Well completed; commenced production mid‑Sep and performing as expected (~107 bbl/d) Executed (from plan to production)
Water Resources (contract drilling)Q3–Q4 2024Investigating strategic alternatives including sale, wind‑down, equipment liquidation Will move forward with strategic/business/financial alternatives (sale or orderly wind‑down) Advanced (from evaluation to action)
Quantitative financial guidance (revenue/margins, etc.)Q4 2024Not providedNot providedMaintained (no guidance)

Earnings Call Themes & Trends

Note: No Q4 2024 earnings call transcript was found.

TopicQ-2 (Q2 2024)Q-1 (Q3 2024)Current Period (Q4 2024)Trend
Twining developmentPlanned at least one well; strong Twining performance Well drilled in July; cased pending completion Well online; ~107 bbl/d; core growth engine Positive execution; production ramp
Cost optimizationG&A down 33% YoY for Q2; focus on cost reduction Operating cost down $772k; continued optimization FY operating costs down $585k; G&A down $1.358M Sustained cost discipline
Impairments/pricing$1.677M impairment; rolling average price ceiling test $599k impairment; backward‑looking pricing $609k impairment; 12‑month average pricing decline Persistent pricing headwind
Texas gas pricingNew production increased operating costs; low realized gas prices Texas cash flows affected by low gas prices Expect pricing improvement from Matterhorn pipeline egress Early signs of relief expected
Portfolio simplificationConsidering alternatives for Water Resources Continuing to investigate alternatives Moving forward with sale/wind‑down options Accelerating simplification

Management Commentary

  • “Twining continues to be the engine for our future growth… our new development well is online and producing as expected.” – Craig D. Hopkins, CEO .
  • “We continue to work to simplify Barnwell’s other businesses and reduce the corresponding administrative costs to improve our returns and increase our cash available for investment.” – Craig D. Hopkins, CEO .
  • “The Texas cash flows have been adversely affected by the low realized gas prices in the area in 2024, but the commissioning of the Matterhorn Express Pipeline increases egress from the area and is expected to improve pricing.” .

Q&A Highlights

No Q4 2024 earnings call transcript was found; therefore, no formal Q&A themes or clarifications were available from a call setting.

Estimates Context

  • Wall Street consensus (S&P Global) for Q4 2024 EPS and revenue was unavailable at time of analysis. As a result, we cannot quantify beats/misses vs consensus and expect sell-side models to reflect the reported revenue $4.268M and EPS ($0.19) and incorporate impairment/pricing factors going forward .

Key Takeaways for Investors

  • Twining execution and well performance are tangible positives; near‑term production uplift is underway and supports the oil‑weighted growth narrative .
  • Continued cost reductions (operating and G&A) are material and likely to improve cash generation as pricing normalizes; debt‑free balance sheet provides flexibility .
  • Pricing remains the key external swing factor; the Matterhorn Express pipeline should enhance Texas gas realizations, potentially easing cash flow pressure in coming quarters .
  • Ongoing non‑cash impairments highlight backward‑looking price methodologies; investors should focus on forward pricing trajectories and Twining well performance to gauge near‑term margin recovery .
  • Strategic actions on Water Resources may unlock value and reduce overhead; monitor timing and proceeds from sale/wind‑down as a catalyst .
  • Land segment cash inflows in Q2 (Kukio payments/distributions) underscore optionality from non‑E&P assets; assess sustainability of such proceeds in FY25 .
  • With consensus unavailable, trading may focus on fundamental datapoints (Twining volumes, pricing trends, cost trajectory) and corporate actions; the narrative is constructive on operations but awaits pricing normalization and segment simplification to translate into sustained profitability .