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W&T OFFSHORE INC (WTI)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 revenue rose to $127.5M, up 4% QoQ and 5% YoY; production increased 6% QoQ to 35.6 MBoe/d, near the high end of guidance . Versus consensus, revenue modestly beat and EPS was better than expected; revenue consensus $126.4M*, EPS consensus $(0.07)* vs actual Adjusted EPS $(0.05) (beat) .
  • Adjusted EBITDA increased 11% QoQ to $39.0M; GAAP net loss of $(71.5)M was driven by a non-cash $59.9M deferred tax valuation allowance .
  • Guidance refined: full-year gathering/transportation/production taxes lowered to $24–$26M and DD&A per Boe reduced to $11.50–$12.50; Q4 production guided to 34.2–37.9 MBoe/d .
  • Balance sheet/liquidity remained solid: $124.8M cash, $50M undrawn revolver; net debt down ~$59M YTD to $225.6M; dividend of $0.01 declared for Q4 .
  • Management highlighted cost reductions (LOE per Boe down 8% QoQ to $23.27) and accretive pipeline investments expected to lower midstream costs and enhance production in 2026 .

What Went Well and What Went Wrong

What Went Well

  • Production and EBITDA growth: “We increased production by 6%… and grew Adjusted EBITDA by 11%” .
  • Integration and high-return workovers/recompletions: “Three recompletions on former Cox assets… three workovers in Mobile Bay” supporting production without drilling .
  • Liquidity/capital structure: “~$125M in unrestricted cash… undrawn $50M revolver… lowered net debt by ~$60M” .

What Went Wrong

  • GAAP loss driven by tax valuation allowance: Net loss $(71.5)M, impacted by $59.9M non-cash deferred tax valuation allowance .
  • G&A stepped up QoQ on non-cash comp grants: $21.5M total G&A; cash G&A $18.0M; unit G&A rose to $6.57/Boe .
  • Realized prices softened: Boe price fell to $38.33 from $39.16 QoQ and $41.92 YoY; NGL realizations dropped to $14.29/Bbl QoQ .

Financial Results

MetricQ3 2024Q2 2025Q3 2025
Revenue ($USD Millions)$121.372 $122.367 $127.515
GAAP Net Loss ($USD Millions)$(36.921) $(20.884) $(71.474)
GAAP EPS (basic & diluted) ($)$(0.25) $(0.14) $(0.48)
Adjusted Net Loss ($USD Millions)$(23.811) $(10.021) $(7.266)
Adjusted EPS ($)$(0.16) $(0.07) $(0.05)
Adjusted EBITDA ($USD Millions)$26.689 $35.240 $39.048
Avg Daily Production (MBoe/d)31.0 33.5 35.6
LOE ($/Boe)$25.37 $25.20 $23.27

Estimate comparison (S&P Global):

  • Revenue consensus Q3 2025: $126.4M*; actual $127.5M (beat) .
  • EPS consensus Q3 2025: $(0.071)*; Adjusted EPS $(0.05) (beat) .
  • EBITDA consensus Q3 2025: $33.1M*, actual EBITDA (SPGI basis) $24.0M*; note definitional differences vs company Adjusted EBITDA .
    Values retrieved from S&P Global.*

Segment/commodity revenue mix:

Revenue Component ($USD Thousands)Q3 2024Q2 2025Q3 2025
Oil$90,862 $80,014 $84,131
NGLs$5,636 $4,715 $4,000
Natural Gas$23,148 $34,802 $37,400
Other$1,726 $2,836 $1,984

KPIs:

KPIQ3 2024Q2 2025Q3 2025
Avg realized price ($/Boe)$41.92 $39.16 $38.33
Oil price ($/Bbl)$75.09 $63.55 $64.62
NGL price ($/Bbl)$21.51 $19.24 $14.29
Gas price ($/Mcf)$2.79 $3.75 $3.68
G&A ($/Boe)$6.91 $5.79 $6.57
DD&A ($/Boe)$11.99 $8.67 $8.73

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Total equivalents (MBoe)Q4 2025—3,145–3,483 New
Avg daily equivalents (MBoe/d)Q4 2025—34.2–37.9 New
LOE ($MM)Q4 2025—71.0–79.0 New
Gathering, transportation & production taxes ($MM)Q4 2025—7.5–8.4 New
Cash G&A ($MM)Q4 2025—16.0–17.7 New
DD&A + accretion ($/Boe)Full-year 202513.40–14.90 11.50–12.50 Lowered
Gathering, transportation & production taxes ($MM)Full-year 202527.1–30.1 24.0–26.0 Lowered
LOE ($MM)Full-year 2025280–310 280–310 Maintained
Cash G&A ($MM)Full-year 202562–69 62–69 Maintained
Total equivalents (MBoe)Full-year 202511,983–13,257 11,983–13,257 Maintained

Rationale: Lower GT&PT and DD&A reflect pipeline investments reducing third-party midstream reliance and asset base revaluation from the mid-year reserve report, respectively .

Earnings Call Themes & Trends

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q3 2025)Trend
Production uplift from Cox assets & Mobile Bay workoversQ2: nine workovers (five at Mobile Bay); Cox fields ramp; Q3 guidance to ~35 MBoe/d Three recompletions on Cox assets; three Mobile Bay workovers; Oct average >36 MBoe/d Improving throughput without drilling
Pipeline/midstream investmentsNoted CapEx ~$34–$42M (Q1), limited spend; Q2 plan evolving FID to lay new pipelines; accretive to cash flow, earnings, reserves; lowers GT&PT Accretive cost-reduction implementation
Liquidity/capital structureQ1: $350M new notes, $50M revolver, insurance settlement; net debt down ~$125M cash; $50M undrawn; net debt ~ $226M; ATM $83M Strengthening balance sheet
Regulatory/surety environmentQ1: Trump EO, DOI easing supplemental assurance; Q2: favorable surety settlement and injunction denial No impact from government shutdown on permitting; regulators maintaining status Reduced external friction
Hedging/derivativesQ2: costless collars added; $12.0M net derivative gain Q3: $4.1M net derivative gain; monetized natural gas collar ($7.6M proceeds) Opportunistic monetization

Management Commentary

  • “We increased production by 6%… and grew Adjusted EBITDA by 11% quarter-over-quarter… we continue to grow our cash position and reduce our Net Debt” — Tracy W. Krohn, CEO .
  • “Investments in pipeline infrastructure are accretive to earnings, cash flow and reserves… we workovers and recompletions and facility upgrades to enhance production and reduce costs” — Tracy W. Krohn .
  • “Our GAAP reported net loss this quarter primarily reflects a non-cash increase to our valuation allowance on deferred tax assets… we expect substantially all income taxes in 2025 to be deferred” — Tracy W. Krohn .
  • “Production has continued this positive trajectory and averaged above 36,000 Boe/d in October… we’re feeling very good about opportunities moving into 2026–2027” — Tracy Krohn and William Williford (COO) .
  • “With nearly $125M in cash… over a quarter of a billion in liquidity including revolver and ATM… the Gulf of America is open for business again” — Tracy W. Krohn .

Q&A Highlights

  • Operating cost outlook post-pipeline projects: Management expects accretive impact to earnings/cash flow/reserves and further per-Boe cost reductions as production rises and pipeline benefits are realized .
  • Capital allocation/M&A: With ~$125M cash, $50M revolver, and $83M ATM, W&T is positioned for accretive, low-risk producing asset acquisitions; organic workovers remain the focus near term .
  • Regulatory backdrop: No permitting/regulatory impact from recent government shutdown; regulators maintained status quo, aiding operational continuity .
  • 2026+ projects: Budgeting underway; strong pipeline of recompletions/workovers expected to support base production without new drilling .

Estimates Context

  • Revenue: Q3 2025 consensus $126.4M* vs actual $127.5M — modest beat .
  • EPS: Q3 2025 consensus $(0.071)* vs Adjusted EPS $(0.05) — beat .
  • EBITDA: Consensus $33.1M* vs SPGI actual $24.0M*; company-reported Adjusted EBITDA $39.0M — definitional differences (SPGI standardized vs company Non-GAAP) .
    Where estimates may adjust: Upward on revenue and EPS given beats; caution on EBITDA dispersion due to measurement basis.
    Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Operational momentum continues: sequential production growth (+6% QoQ) and improved unit costs (LOE $/Boe down 8% QoQ) support near-term cash generation .
  • Quality beat vs consensus: modest top-line and Adjusted EPS beats; underlying performance solid despite non-cash tax allowance impacting GAAP results .
  • Cost structure tailwinds: pipeline FIDs and reduced reliance on third-party midstream drove full-year GT&PT guidance lower; DD&A reset reduces per-Boe charges next quarters .
  • Balance sheet optionality: ~$175M liquidity (cash + revolver) and improving net debt provide capacity for accretive acquisitions; dividend maintained .
  • 2026 setup: robust workover/recompletion slate and integration gains from Cox assets should sustain base production without new drilling, lowering capital intensity .
  • Watch items: NGL pricing weakness and G&A non-cash comp elevation; monitor per-Boe cost trajectory vs Q4 guidance and realized pricing mix .
  • Trading implications: Stock could react positively to visible unit cost declines and production stability; any M&A announcement using ample liquidity may be a catalyst given management’s accretive track record .
Note: Non-GAAP metrics (Adjusted EBITDA, Adjusted EPS) follow company definitions; reconciliations provided in releases **[1288403_0001104659-25-107091_wti-20251105xex99d1.htm:12]** **[1288403_0001104659-25-107091_wti-20251105xex99d1.htm:14]** **[1288403_f708360850094057aed534badabe3d9b_17]** **[1288403_f708360850094057aed534badabe3d9b_20]**.