Executive Summary

Q3 2025 was operationally solid but optically messy: production landed above midpoint (20,789 Boe/d) with LOE at $10.73/Boe (below guidance), yet a $72.9M non‑cash ceiling test impairment drove a GAAP net loss of $(0.25) per diluted share; on an adjusted basis EPS was $0.06 and Adjusted EBITDA was $47.7M .
Versus S&P Global consensus, Ring delivered an adjusted/primary EPS beat (0.06 vs 0.04*), a revenue beat ($78.6M vs $76.9M*), and an in‑line/slight beat on Adjusted EBITDA ($47.7M vs $47.1M*) despite softer realized pricing ($41.10/Boe) . Values with asterisks retrieved from S&P Global.
Cash discipline remained the anchor: Adjusted FCF was $13.9M; debt was reduced by $20M to $428M outstanding with total liquidity at $157.3M; leverage ticked to 2.10x LTM under the RBL covenant framework .
Guidance largely reaffirmed with a lower LOE outlook: FY25 capex midpoint maintained at $97M (range narrowed), and FY25 LOE midpoint lowered to $11.10/Boe; Q4 guidance implies stable volumes (19.1–20.7k Boe/d; 66% oil) and capex of $18–$28M .
Near‑term stock catalysts: discipline-led deleveraging and cost control (positive); GAAP loss from non‑cash impairment and higher G&A (q/q) could weigh; September CFO departure introduces modest leadership transition risk until a permanent CFO is named .

What Went Well and What Went Wrong

What Went Well
- Cost execution: LOE at $10.73/Boe beat even the recently lowered range; all‑in cash operating costs were $22.35/Boe; “ongoing efforts to reduce costs” cited by management .
- Balance sheet progress: Paid down $20M on the revolver to $428M; liquidity improved to $157.3M; 24th consecutive quarter of positive cash generation (AFCF $13.9M) .
- Operational delivery: Sales volumes of 20,789 Boe/d (64% oil) landed above guidance midpoint; five wells (4 Hz, 1 vertical) brought on in CBP at 100% WI .
What Went Wrong
- Optics of a GAAP loss: $72.9M non‑cash full‑cost ceiling impairment flipped GAAP EPS to $(0.25), overshadowing otherwise steady operations .
- Pricing headwinds: Realized $/Boe declined 4% q/q and 15% y/y to $41.10/Boe; NGL and gas realizations remained weak .
- Higher overhead q/q: G&A rose to $8.1M ($4.26/Boe), up 14–16% from Q2 2025; management is targeting further G&A reductions over time .

Financial Results

Metric	Q3 2024	Q2 2025	Q3 2025
Revenue ($MM)	$89.2	$82.6	$78.6
GAAP Diluted EPS ($)	$0.17	$0.10	$(0.25)
Adjusted EPS ($)	$0.07	$0.05	$0.06
Adjusted EBITDA ($MM)	$54.0	$51.5	$47.7
Average Sales (Boe/d)	20,108	21,295	20,789
Oil Mix (%)	66%	68%	64%
Realized $/Boe	$48.24	$42.63	$41.10
LOE $/Boe	$10.98	$10.45	$10.73
Adjusted Free Cash Flow ($MM)	$1.9	$24.8	$13.9
Capex ($MM)	$42.7	$16.8	$24.6

Estimate comparison (Q3 2025):

Revenue: $76.9M consensus* vs $78.6M actual → Beat .
Primary/Adjusted EPS: $0.04 consensus* vs $0.06 actual → Beat .
Adjusted EBITDA: $47.1M consensus* vs $47.7M actual → Slight beat .
Values with asterisks retrieved from S&P Global.

KPIs and balance sheet:

Liquidity: $157.3M (primarily revolver availability) .
Revolver borrowings: $428M (down $20M q/q) .
Leverage Ratio (LTM RBL definition): 2.10x vs 2.05x in Q2 2025 and 1.59x in Q3 2024 .

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Capital spending ($MM)	FY 2025	$97 midpoint; $87–$107 range	$97 midpoint; $92–$102 range	Maintained midpoint; narrowed range
LOE ($/Boe)	FY 2025	$12.00 midpoint (from earlier FY outlook)	$10.95–$11.25; $11.10 midpoint	Lowered
Total sales (Boe/d)	FY 2025	—	19,800–20,400; 20,100 midpoint	New FY range provided
Oil sales (Bo/d)	FY 2025	—	13,100–13,500; 13,300 midpoint	New FY range provided
LOE ($/Boe)	Q4 2025	—	$10.75–$11.75; $11.25 midpoint	New
Capital spending ($MM)	Q4 2025	—	$18–$28; $23 midpoint	New
Total sales (Boe/d)	Q4 2025	—	19,100–20,700; 19,900 midpoint	New
Oil sales (Bo/d)	Q4 2025	—	12,700–13,600; 13,150 midpoint	New

Note: Q2 2025 provided 2H’25 guidance; Q3 2025 introduced FY’25 and Q4’25 detail .

Earnings Call Themes & Trends

Topic	Previous Mentions (Q-2 and Q-1)	Current Period (Q3 2025)	Trend
Capital discipline & deleveraging	Cut capex by ~36–47% for 2H/FY; record AFCF in Q2; paid down debt ($12M in Q2) .	AFCF $13.9M; additional $20M debt reduction; liquidity $157.3M .	Strengthening
LOE/cost control	LOE $11.89/Boe in Q1; $10.45/Boe in Q2, below guidance; lowered LOE guidance for 2H .	LOE $10.73/Boe; below the low end of the recently lowered range .	Improving
Lime Rock (LRR) integration	Closed 3/31; first full quarter in Q2; assets outperforming, low decline .	Drilled/completed 5 CBP wells; continued operational integration .	On track
Commodity prices/hedging	Hedged ~1.3MM bbl 2H25; ~2.3MM bbl 2026 floors; protected gas .	~0.6MM bbl hedged for Q4’25 at ~$62 floors; gas hedges in place .	Risk‑managed
Impairment/ceiling test	No impairments in Q1/Q2 .	$72.9M non‑cash impairment due to lower 12‑mo avg pricing .	New headwind
Leadership	Stable through Q2 .	CFO resigned; Interim CFO appointed (Rocky Kwon) .	Transition

Management Commentary

“Ring Energy again maintained strong cash generation and superior capital and operational discipline despite the significant headwinds of volatile commodity prices… We applied these savings to debt reduction, paying down $20 million of debt… liquidity… $157.3 million” — Paul D. McKinney, CEO .
“Our focus remains centered on maximizing free cash flow generation through continued capital discipline and improvements in capital efficiency, reducing operating costs and G&A, and applying these benefits to further debt reduction.” — Paul D. McKinney .
Q2 perspective for context: “Reduced capital expenditures by 48% over the previous quarter… generated a record of $24.8 million in Adjusted Free Cash Flow for the quarter” — Paul D. McKinney .

Q&A Highlights

A transcript was not available in the document set. The company hosted its Q3 call on Nov 7, 2025; guidance clarifications and operational updates are reflected in the press release and 8‑K exhibits .

Estimates Context

Consensus (S&P Global) coverage remains thin (EPS: 1 estimate; revenue: 2): Q3 2025 Primary EPS 0.04* vs 0.06 actual (Adjusted EPS) → Beat; revenue $76.9M* vs $78.6M (8‑K) → Beat; Adjusted EBITDA $47.1M* vs $47.7M → Slight beat . Values with asterisks retrieved from S&P Global.
With realized pricing down q/q and volumes slightly below Q2 record levels, the beat hinged on cost control (LOE) and disciplined capex .

Key Takeaways for Investors

Cash discipline and cost execution continue to offset pricing pressure; LOE beat and narrowed FY25 capex range support FCF durability through Q4 .
Adjusted results topped consensus despite a GAAP loss from a non‑cash impairment; investors should focus on normalized earnings/FCF versus GAAP optics in a volatile price tape .
Deleveraging pace improved ($20M q/q); liquidity at $157.3M offers flexibility heading into Q4 and 2026 plan framing .
LRR integration remains accretive; continued CBP development at 100% WI underscores operational control and inventory depth .
Watch items: elevated G&A vs Q2, realized price softness, and leadership transition (Interim CFO) until a permanent appointment is made .
Hedges provide downside protection into Q4 and 2026, moderating cash flow volatility .
Near‑term setup: stable Q4 volumes, lower LOE, and tight capex should keep FCF positive; further debt reduction is a likely management priority and potential stock catalyst .

Supporting Detail: Estimates vs Actuals (Q3 2025)

Metric	Consensus	# of Est.	Actual	Result
Revenue ($MM)	76.9*	2*	$78.6	Beat
Primary/Adj. EPS ($)	0.04*	1*	0.06 (Adj. EPS)	Beat
Adjusted EBITDA ($MM)	47.1*	—	$47.7	Slight beat

Values with asterisks retrieved from S&P Global.

Additional Data Points

Select expenses (Q3 2025): G&A $8.1M ($4.26/Boe); interest expense $10.1M; realized derivative gain $2.5M; unrealized derivative loss $(2.1)M .
Hedge summary (as of 9/30/25): ~0.6MM bbl oil hedged for Q4 at avg downside $62.08; ~0.6 Bcf gas hedged at $3.27; 2026 oil swaps/collars provide additional floors .

Citations: All company figures are from Ring Energy’s Q3 2025 8‑K and press release exhibits unless noted. S&P Global consensus values are marked with an asterisk and were retrieved via S&P Global.

RING ENERGY, INC. (REI)·Q3 2025 Earnings Summary