0001437749-25-025923
SEC filingNet income declined to $26.2M due to 27% lower realized prices, partially offset by derivative gains and lower DD&A.
For the three months ended June 30, 2025, HighPeak Energy reported total operating revenues of $200.4 million, a 27% decrease from $275.3 million in the same period of 2024. This decline was primarily driven by a 27% drop in average realized price per Boe to $45.27, reflecting weaker crude oil prices (down 22% to $63.74/Bbl) and a modest increase in NGL and natural gas prices. Daily sales volumes were essentially flat at 48,649 Boepd (up less than 1%), as lower crude oil volumes (down 9%) were offset by higher NGL (up 24%) and natural gas (up 34%) volumes from midstream expansions.
Net income decreased to $26.2 million ($0.19 per diluted share) from $29.7 million ($0.22 per diluted share) in the prior year. Key offsets to the revenue decline included a $29.1 million improvement in derivative gains (from a $2.7 million loss to a $26.4 million gain), a $26.5 million decrease in DD&A expense due to a lower DD&A rate ($22.86 per Boe vs $28.91), and lower interest expense ($36.4 million vs $43.0 million). Higher production costs (up 3%), exploration and abandonment expenses (up $0.9 million), and G&A (up $0.9 million) partially offset these gains.
HighPeak operates two core areas—Flat Top and Signal Peak—both in the Midland Basin. The company does not provide separate financial results by area, but operational highlights indicate Flat Top remains the primary focus, with 27 gross horizontal wells drilled and 27 completed during the first half of 2025. Signal Peak had 2 wells drilled but none completed. Production mix shifted toward NGL and natural gas, which now account for 14% of total Boe volumes (up from 12% in the prior year), driven by third-party midstream expansions. Crude oil volumes declined due to reduced activity and natural decline.
HighPeak Energy’s 2025 capital budget is expected to range between $375 million and $405 million for drilling, completion, and facilities, plus $40 million to $50 million for field infrastructure and $33 million to $35 million for one-time infrastructure expenditures. The company plans to average one to two drilling rigs and one frac crew for the remainder of 2025, maintaining flexibility in response to commodity price volatility and macroeconomic uncertainties. Key risks include OPEC+ production increases, U.S. tariffs on energy imports, and ongoing geopolitical conflicts. The company continues to evaluate strategic alternatives to maximize shareholder value, including a potential sale, but has not set a definitive timetable. Liquidity was enhanced by debt amendments in August 2025, extending maturities to September 2028 and providing additional borrowing capacity.
As of June 30, 2025, HighPeak Energy reported cash and cash equivalents of $21.9 million, down from $86.6 million at year-end 2024, reflecting heavy investing and debt repayments. Total debt (including current maturities) stood at $1,027.4 million, slightly down from $1,048.4 million at December 31, 2024. Shareholders' equity increased to $1,654.1 million from $1,602.5 million, driven by net income partially offset by dividends. Inventory was $6.8 million.
The company has $136.7 million in purchase commitments as of June 30, 2025. The largest is a crude oil delivery contract with Delek: a minimum volume commitment with a remaining monetary obligation of $123.9 million. Additionally, a natural gas gathering and treating agreement requires $12.8 million in remaining aid-in-construction costs. No other material commitments were disclosed; the sand supply agreement has been fulfilled.
HighPeak Energy operates as a single reporting segment focused on crude oil and natural gas exploration and production in the Permian Basin (Midland Basin, Howard and Borden Counties). The chief operating decision makers use net income to assess performance. For H1 2025, total operating revenues were $457.8 million, lease operating expenses $60.6 million, production taxes $27.5 million, and net income $62.5 million. Total assets as of June 30, 2025 were $3.09 billion.