Executive Summary

PVL’s Q3 2025 distributable income fell sharply year over year on lower oil volumes and prices, but improved sequentially as Haynesville gas volumes/prices and normalized costs supported positive net profits; Q3 distributable income was $0.528M ($0.0160/unit) vs $1.518M ($0.0460/unit) in Q3 2024 and $0.282M ($0.008548/unit, largely escrow release) in Q2 2025 .
YoY, oil sales declined 55% on 44% lower oil volumes and 20% lower realized oil prices; gas sales rose 69% on stronger realized gas pricing, but could not offset the oil headwinds; net profits fell 79% YoY to $1.645M .
The Sponsor revised 2025 capex outlook higher to $12.0–$17.0M gross ($9.6–$13.6M net to NPI), and established/expanded a development reserve ($0.3M in September → $0.7M in October → $1.3M in November) tied to three additional Haynesville wells planned by an operator .
Monthly distributions re-accelerated post shortfall/advance repayments: $0.0230 (paid Oct 15), $0.0300 (Nov 14), $0.0290 (Dec 15), aided by Haynesville contributions and a $0.4M Permian non‑producing acreage sale flowing into November’s NPI calculation; potential catalysts are continued Haynesville performance and reserve releases if capex slips .

What Went Well and What Went Wrong

What Went Well
- Haynesville gas drove sequential improvement; three new wells “are currently performing above the Sponsor’s original expectations,” and the operator “intends to drill three additional wells” in the region .
- Operating cost trajectory improved; management cites “continued decline in lease operating expenditures per barrel of oil equivalent” vs prior periods on an aggregate basis .
- Administrative shortfalls/advances eliminated; “no Net Profits Interest shortfall as of September 30, 2025,” enabling resumed monthly distributions .
What Went Wrong
- Oil volumes/prices drove the YoY miss: oil sales −55% YoY on 44% lower oil volumes (103,237 Bbl vs 182,758) and 20% lower realized oil prices ($63.71/Bbl vs $79.76/Bbl), cutting gross profits materially .
- Net profits down 79% YoY to $1.645M despite gas tailwinds; development expenses rose 28% YoY, and compression/gathering/transport costs rose 43% with the gas mix .
- Sequentially, oil prices moderated from Q2 ($73.21/Bbl to $63.71/Bbl) and oil volumes slipped (108,972 Bbl to 103,237 Bbl), tempering the quarter’s rebound potential .

Financial Results

Quarterly comparables (oldest → newest):

Metric	Q3 2024	Q2 2025	Q3 2025
Oil Sales ($)	$14,577,415	$7,978,067	$6,577,515
Natural Gas Sales ($)	$2,950,780	$3,240,447	$4,995,710
Total Gross Profits ($)	$17,528,195	$11,218,514	$11,573,225
Lease Operating Expenses ($)	$5,717,000	$4,787,000	$5,483,000
Compression/Gathering/Transportation ($)	$958,000	$968,000	$1,368,000
Production/Ad Valorem/Other Taxes ($)	$1,123,000	$720,000	$720,000
Development Expenses ($)	$1,840,000	$2,798,000	$2,357,000
Total Costs ($)	$9,638,000	$9,273,000	$9,928,000
Net Profits ($)	$7,890,195	$1,945,514	$1,645,225
Income from Net Profits Interest ($)	$2,406,499	$419,589	$1,316,179
Distributable Income ($)	$1,518,000	$282,084	$528,000
Distributable Income per Unit ($)	$0.046000	$0.008548	$0.016000

Volumes and realized prices:

KPI	Q3 2024	Q2 2025	Q3 2025
Oil Volumes (Bbls)	182,758	108,972	103,237
Gas Volumes (Mcf)	1,954,972	1,308,205	1,678,635
Oil Realized Price ($/Bbl)	$79.76	$73.21	$63.71
Gas Realized Price ($/Mcf)	$1.51	$2.48	$2.98

Distributions during/after Q3:

Declaration Date	Record Date	Payment Date	Distribution per Unit
Sep 18, 2025	Sep 30, 2025	Oct 15, 2025	$0.023000
Oct 17, 2025	Oct 31, 2025	Nov 14, 2025	$0.030000
Nov 17, 2025	Nov 28, 2025	Dec 15, 2025	$0.029000

Notes: November calculation included $0.4M proceeds from a non‑producing Permian acreage sale attributable to the NPI .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Capital Expenditures (Gross)	FY 2025	$10.0–$15.0M	$12.0–$17.0M	Raised
Capital Expenditures (Net to NPI)	FY 2025	$8.0–$12.0M	$9.6–$13.6M	Raised
Sponsor Development Reserve for Near‑Term Capex	As of Sep 2025	N/A	$0.3M balance	Established
Sponsor Development Reserve for Near‑Term Capex	Oct 2025	$0.3M	$0.7M (added $0.4M)	Raised
Sponsor Development Reserve for Near‑Term Capex	Nov 2025	$0.7M	$1.3M (added $0.6M)	Raised
Trustee Admin Cash Reserve (for Trust expenses)	Ongoing	Withholds $50k/month; cumulative $1.241M at 6/30/25	$1.393M withheld as of 9/30/25	Increased
Distributions	Oct–Dec 2025	—	$0.0230; $0.0300; $0.0290 per unit	Resumed/increased

Earnings Call Themes & Trends

PVL did not hold an earnings call; themes below reflect MD&A and monthly distribution releases.

Topic	Previous Mentions (Q1–Q2 2025)	Current Period (Q3 2025)	Trend
Haynesville development/performance	Three Haynesville wells completed; initial revenues to flow; operator proposed three more for 2026	“These wells are currently performing above … expectations,” and operator intends three additional wells; majority of 2025 capex focused on Haynesville	Positive execution; increasing gas weighting
Oil macro/pricing	OPEC signaling increased supply weighing on prices; volatility $57–$80/Bbl	“OPEC recently guided to a pause in further production increases in 2026,” stabilizing forward oil prices	Slightly constructive
Operating costs	Declining LOE/BOE vs prior periods	Continued decline in LOE/BOE vs 2024; new operator lower-cost reputation	Improving
Capital intensity	2025 capex guided to high end of $10–$15M	Guidance raised to $12–$17M; development reserve established/raised	Higher spend near term
Asset portfolio actions	Potential divestitures/leasing opportunities	Sold non‑producing Permian acreage for $0.4M ($20k/acre); proceeds included in Nov NPI calc	Active portfolio mgmt
Distributions/shortfalls	No regular distributions in H1 due to advances/shortfall; special $0.008548 from escrow	Monthly distributions resumed/increased; no NPI shortfall at 9/30/25	Improving cash returns

Management Commentary

“Those three [Haynesville] wells were turned to revenue collection during the third quarter of 2025… These wells are currently performing above the Sponsor’s original expectations; meanwhile, the same super major operator has indicated that it intends to drill three additional wells in the Haynesville region.”
“Over the first nine months of 2025, the Sponsor continued to see a reduction in operating costs… continued decline in lease operating expenditures per barrel of oil equivalent… driven by a new operator… with a reputation for prudent operating at a lower cost.”
“OPEC recently guided to a pause in further production increases in 2026, somewhat stabilizing forward oil prices.”
“The Sponsor has notified the Trustee that it is withholding an additional $0.6 million… To date, the Sponsor has established a total reserve of $1.3 million for approved, future development expenses.”
On the three new Haynesville wells: “The operator reported initial production rates of approximately 60 million cubic feet per day for each of these wells.”

Q&A Highlights

No earnings call or public Q&A session was filed for Q3 2025; clarifications on distributions, reserves, and development cadence were provided through 10‑Q MD&A and Item 2.02 distribution press releases .

Estimates Context

There is no active Wall Street consensus for PVL’s EPS/EBITDA/target price; S&P Global did not return consensus values for these metrics. The only S&P data returned were realized “Revenue” actuals (likely mapping to Income from Net Profits Interest/cash receipts for a royalty trust), shown below. Where applicable, estimates are unavailable and should not be inferred.

Metric	Q1 2025	Q2 2025	Q3 2025
Revenue ($)	$23,000*	$442,686*	$1,339,445*

*Values retrieved from S&P Global.

Implications: With no EPS/EBITDA coverage, estimate revisions are unlikely to be a near‑term catalyst; distributions and monthly NPI updates drive the narrative.

Key Takeaways for Investors

Distribution momentum returned: $0.0230 (Oct 15), $0.0300 (Nov 14), $0.0290 (Dec 15), with potential upside if development reserves are released or Haynesville outperformance persists .
Gas mix tailwinds: Haynesville wells outperformed expectations and should remain the primary 2025–2026 driver as oil volumes/prices remain softer; watch compression/gathering costs versus realized gas pricing .
Capex path raised: FY25 capex guiding up to $12–$17M gross ($9.6–$13.6M net to NPI) with near‑term development reserves set aside ($1.3M to date); this can dampen near‑term distributable income but seed future volumes .
Cost curve improving: Continued decline in LOE/BOE and operating discipline by a new operator should support margins into 2026, partially offsetting oil price/volume headwinds .
Portfolio activity is additive: $0.4M non‑producing Permian acreage sale aided November NPI; management also cites potential future divestiture/leasing opportunities .
Risk checks: Distribution sensitivity to commodity volatility (especially oil), development timing, and elevated midstream costs with higher gas throughput; absence of Street coverage increases reliance on monthly trust updates .
Trading frame: Focus on monthly updates (Item 2.02 8‑Ks) for near‑term catalysts: development reserve changes, Haynesville volume ramps, and any additional asset proceeds flowing through NPI calculations .

Permianville Royalty Trust (PVL)·Q3 2025 Earnings Summary