HOUSTON, Aug. 12, 2026 (GLOBE NEWSWIRE) — In a release issued under the same headline earlier today by Epsilon Energy Ltd. (NASDAQ: EPSN), please note the following changes to the first table, titled “Q2 2026 Highlights”: The reason for the correction in adjusted net income and adjusted net income per share is the recategorization of sale proceeds from asset sales (in which the company had no basis) during the quarter from Other Income to Gain on Asset Sales, to be consistent with the Company’s definition of adjusted net income. Reported earnings in the Company’s Form 10-Q are unaffected by this correction.
The Adjusted Net Income Q2 2026 should be -815, not 1,578 as previously stated. The p/share Q2 2026 should be -0.03, not 0.05 as previously stated. Both the Adjusted Net Income and the p/share for QoQ% should be -109%, not -82%, as previously stated. The Adjusted Net Income YoY% should be -142%, not -19%, as previously stated. The p/share YoY% should be -130%, not -41%, as previously stated. The corrected release follows:
Epsilon Energy Ltd. (“Epsilon” or the “Company”) (NASDAQ: EPSN) today reported second quarter 2026 financial and operating results.
Q2 2026 Highlights:
| Epsilon – Q2 2026 | ||||||
| Q2 2026 | Q1 2026 | Q2 2025 | QoQ% | YoY% | ||
| NRI Production | ||||||
| Gas | MMcf | 2,082 | 2,482 | 2,752 | -16% | -24% |
| Oil | MBbl | 126 | 136 | 44 | -8% | 184% |
| NGL | MBbl | 42 | 42 | 8 | -1% | 437% |
| Total | MMcfe | 3,088 | 3,554 | 3,064 | -13% | 1% |
| Daily Total | MMcfe/d | 33.9 | 39.5 | 33.7 | ||
| Revenues | $M | |||||
| Gas | 3,767 | 13,403 | 6,910 | -72% | -45% | |
| Oil | 11,771 | 9,462 | 2,725 | 24% | 332% | |
| NGL | 1,387 | 1,073 | 145 | 29% | 856% | |
| Midstream 1 | 1,337 | 1,658 | 1,845 | -19% | -28% | |
| Total | 18,262 | 25,596 | 11,625 | -29% | 57% | |
| Realized Prices 2 | ||||||
| Gas | $/Mcf | 1.81 | 5.40 | 2.51 | -66% | -28% |
| Oil | $/Bbl | 93.73 | 69.39 | 61.73 | 35% | 52% |
| NGL | $/Bbl | 32.94 | 25.32 | 18.51 | 30% | 78% |
| Adj. EBITDA | $M | 5,818 | 13,395 | 7,396 | -57% | -21% |
| Cash + STI 3 | $M | 11,722 | 8,466 | 10,378 | 38% | 13% |
| Capex 4 | $M | 8,484 | 4,885 | 2,698 | 74% | 214% |
| Total Debt | $M | 40,500 | 45,500 | 0 | -11% | |
| Dividend | $M | 1,891 | 1,884 | 1,376 | 0% | 37% |
| Adj Net Income 5 | $M | -815 | 8,683 | 1,954 | -109% | -142% |
| p/share 6 | $ | -0.03 | 0.29 | 0.09 | -109% | -130% |
| 1) Net of elimination entry for fees paid by Epsilon | ||||||
| 2) Excludes impact of hedge realizations | ||||||
| 3) Includes restricted cash balance | ||||||
| 4) Accrual basis, excludes acquisitions | ||||||
| 5) Excludes the impact of transaction costs, impairments, gain / loss on asset sales, and unrealized hedge gain / loss | ||||||
| 6) Calculated on weighted average diluted shares outstanding for the period | ||||||
Jason Stabell, Epsilon’s Chief Executive Officer, commented, “Over the past eight months, Epsilon has undergone a significant transformation. We have expanded from a non-operator into a diversified operator/non-operator hybrid with development activities spanning multiple basins. Importantly, this transition has been executed successfully, with projects progressing ahead of schedule and on budget as our team continues to deliver against our objectives.
The operational momentum we have built gives us the confidence to provide production and capital expenditure guidance for the first time. At the midpoint of our guidance, we expect full-year oil production of approximately 1,800 barrels per day and third-quarter oil production growth of over 25% sequentially, reflecting the impact of recent investments as they begin to contribute meaningfully to production and cash flow.
Based on our planned development activities across our three core operating areas, and the flexibility to allocate capital between oil and gas opportunities, we believe Epsilon has established a foundation for sustained, multi-year production and cash flow growth while maintaining a conservative leverage profile. Supported by a high-quality inventory of development opportunities and disciplined capital allocation, we are well positioned to compound long-term shareholder value.”
Quarter Details:
Epsilon’s capital expenditures were $8.5 million for the quarter ended June 30, 2026.
The Company successfully completed 2 gross (0.7 net) Niobrara DUCs in the Powder River Basin in early July. The wells were put on production in July and are performing above expectations.
The Company participated in the drilling of 5 gross (0.4 net) wells in the Marcellus in April. The wells are expected to be completed in the fourth quarter, with production online in December.
The Company participated in the completion of 1 gross (0.25 net) well in the Permian Basin, the ninth well in the Ector Co. project and the first 3-mile Barnett well. The well was put on production in June and is performing in line with expectations.
Production from Q2 2026 activity will have a larger contribution to results in the second half of the year, starting in the third quarter.
Marcellus production was down 16% quarter over quarter due to a planned suction pressure increase in the Auburn Gas Gathering System in May that caused a temporary drop in production during the quarter (in addition to natural well declines). The suction pressure uplift increases the throughput capacity on the system for future development.
Powder River Basin production was down 11% quarter over quarter, due to field optimization activities and offset completions (in addition to natural well declines).
Permian production was flat quarter over quarter, due to the new well volumes online in June.
The Auburn Gas Gathering System (Epsilon is a 35% owner) gathered and delivered 7.7 Bcf gross of natural gas volumes during the quarter, or 85 MMcf/d.
The quarter included $0.8 million of G&A cost associated with former Peak employees who are on transition services contracts. The full year cost will be approximately $1.5 million, $1.3 million has been incurred in the first half of the year. These costs will not be carried into 2027.
On May 4, 2026, the Company closed the sale of certain overriding royalty interests (ORRIs) in Susquehanna Co, Pennsylvania to an undisclosed private buyer for $3.9 million. The assets covered 940 gross acres and 90 producing Marcellus wells with an average net revenue interest of 0.25% per well. The effective date of the transaction was April 1, 2026, and the consideration represented approximately 6X expected cash flow from the assets over the next twelve months. The assets represented approximately 1.5% of the Company’s trailing twelve months upstream revenue and 2% of the Company’s year-end 2025 Proved Developed Producing (PDP) reserves.
In April, the Company made a $5 million repayment on the outstanding balance on the credit facility, bringing the balance down $10 million from year-end 2025 to $40.5 million.
Q3 2026 Update
In July, the Company sold down a 24% interest in the 3 well Parkman development in the Powder River Basin, that began drilling in June, in exchange for a $1.1 million up front-payment to right-size the third quarter capital program. The Company now holds a 72% interest in the wells.
In July, the Company successfully drilled 3 gross (2.1 net) Parkman wells in the Powder River Basin. The completions are scheduled for the third quarter with production online in the fourth quarter.
Q3 2026 and FY 2026 Production and Capital Guidance Range
Q3 2026 Total Production (MMcfe): 3,270 – 3,510 (mid-point represents 10% QoQ growth)
Q3 2026 Oil Production (MBbl): 155 – 165 (mid-point represents 27% QoQ growth)
Q3 2026 Capital : $24.0 – $28.5 million
FY 2026 Production (MMcfe): 13,740 – 14,280 (mid-point represents 18% YoY growth)
FY 2026 Oil Production (MBbl): 640 – 670 (mid-point represents 194% YoY growth)
FY 2026 Capital: $42.0 – $47.0 million
The primary components of the capital program for the second half of 2026:
- Drilling and completion of 3 gross (2.1 net) Parkman wells in the Powder River Basin (operated)
- Facilities build-out in preparation for 2027 drilling plans in the Powder River Basin (operated)
- Drilling of 2 gross (0.5 net) Barnett wells in the Permian Basin (non-operated), completions are expected in Q127
- Completion of 5 gross (0.4 net) Marcellus wells (non-operated)
Due to the timing of these investments, approximately 35% of 2026 capital spending (2.1 net Parkman wells in the Powder River Basin) is expected to have an impact for ~60 days in Q4 2026. Another 24% of 2026 capital spending is not expected to have an impact on 2026 results (the initial impact will fall into 2027).
Hedge Book (8.11.26):
| Date | Natural Gas | Crude Oil |
||||||||
| Swaps | Costless Collars | Swaps | Costless Collars | |||||||
| Volume (MMcf) |
Price ($/MMBtu) |
Volume (MMcf) |
Bought Put ($/MMBtu) |
Sold Call ($/MMBtu) |
Volume (MBbl) |
Price ($/Bbl) |
Volume (MBbl) |
Bought Put ($/Bbl) |
Sold Call ($/Bbl) |
|
| Q3 2026 | 146 | 3.93 | 176 | 3.35 | 4.94 | 53 | 65.16 | 0 | 60.00 | 70.10 |
| Q4 2026 | 178 | 3.87 | 783 | 3.35 | 5.10 | 41 | 63.24 | 35 | 61.18 | 70.88 |
| FY 2026 | 325 | $3.90 | 959 | $3.35 | $5.07 | 94 | $64.32 | 35 | $61.18 | $70.88 |
| Q1 2027 | 87 | 4.12 | 818 | 3.41 | 5.23 | 29 | 62.13 | 40 | 60.95 | 70.91 |
| Q2 2027 | 91 | 3.49 | 793 | 3.21 | 4.81 | 37 | 64.31 | 27 | 58.21 | 68.04 |
| Q3 2027 | 90 | 3.58 | 773 | 3.11 | 4.31 | 28 | 66.36 | 30 | 58.74 | 68.83 |
| Q4 2027 | 44 | 3.95 | 535 | 3.20 | 4.44 | 14 | 62.32 | 38 | 58.20 | 68.32 |
| FY 2027 | 312 | $3.76 | 2,918 | $3.24 | $4.73 | 108 | $64.00 | 135 | $59.14 | $69.15 |
| Q1 2028 | 28 | 4.46 | 28 | 3.65 | 4.70 | 8 | 62.97 | 11 | 60.29 | 70.25 |
| Q2 2028 | 1 | 70.00 | 78.48 | |||||||
Earning’s Call:
The Company will host a conference call to discuss its results on Thursday, August 13, 2026, at 10:00 a.m. Central Time (11:00 a.m. Eastern Time).
Interested parties in the United States and Canada may participate toll-free by dialing (833) 816-1385. International parties may participate by dialing (412) 317-0478. Participants should ask to be joined to the “Epsilon Energy Second Quarter 2026 Earnings Conference Call.”
A webcast can be viewed at: https://event.choruscall.com/mediaframe/webcast.html?webcastid=6qJpqYfZ. A webcast replay will be available on the Company’s website (www.epsilonenergyltd.com) following the call.
About Epsilon
Epsilon Energy Ltd. is a North American onshore natural gas and oil production and gathering company with assets across the Appalachian, Powder River, Permian, and Western Canadian Sedimentary basins.
Forward-Looking Statements
Certain statements contained in this news release constitute forward looking statements. The use of any of the words “anticipate”, “continue”, “estimate”, “expect”, ‘may”, “will”, “project”, “should”, ‘believe”, and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated. Forward-looking statements are based on reasonable assumptions, but no assurance can be given that these expectations will prove to be correct and the forward-looking statements included in this news release should not be unduly relied upon.
Contact Information:
281-670-0002
Jason Stabell
Chief Executive Officer
Jason.Stabell@EpsilonEnergyLTD.com
Andrew Williamson
Chief Financial Officer
Andrew.Williamson@EpsilonEnergyLTD.com
| EPSILON ENERGY LTD. | |||||||||||||||
| Unaudited Consolidated Statements of Operations | |||||||||||||||
| (All amounts stated in US$) | |||||||||||||||
| Three months ended June 30, |
Six months ended June 30, |
||||||||||||||
| 2026 |
2025 |
2026 |
2025 |
||||||||||||
| Revenues from contracts with customers: | |||||||||||||||
| Gas, oil, NGL, and condensate revenue | $ | 16,924,916 | $ | 9,779,728 | $ | 40,862,926 | $ | 24,050,518 | |||||||
| Gas gathering and compression revenue | 1,336,740 | 1,845,005 | 2,994,517 | 3,737,355 | |||||||||||
| Total revenue | 18,261,656 | 11,624,733 | 43,857,443 | 27,787,873 | |||||||||||
| Operating costs and expenses: | |||||||||||||||
| Lease operating expenses | 6,330,193 | 2,462,785 | 13,525,506 | 5,218,683 | |||||||||||
| Gathering system operating expenses | 508,475 | 613,795 | 1,102,921 | 1,166,446 | |||||||||||
| Depletion, depreciation, amortization, and accretion | 2,804,107 | 3,201,654 | 5,806,446 | 6,677,511 | |||||||||||
| Impairment expense | — | 2,670,000 | — | 2,676,669 | |||||||||||
| Gain on sale of oil and gas properties | (4,174,368 | ) | — | (4,174,368 | ) | — | |||||||||
| Transaction costs | 202,532 | — | 273,952 | — | |||||||||||
| General and administrative expenses: | |||||||||||||||
| Stock based compensation expense | 547,527 | 385,838 | 1,095,054 | 771,676 | |||||||||||
| Other general and administrative expenses | 3,664,814 | 1,461,878 | 7,042,956 | 3,280,296 | |||||||||||
| Total operating costs and expenses | 9,883,280 | 10,795,950 | 24,672,467 | 19,791,281 | |||||||||||
| Operating income | 8,378,376 | 828,783 | 19,184,976 | 7,996,592 | |||||||||||
| Other income (expense): | |||||||||||||||
| Interest income | 24,785 | 17,247 | 70,327 | 32,546 | |||||||||||
| Interest expense | (877,267 | ) | (19,906 | ) | (1,818,848 | ) | (32,117 | ) | |||||||
| Gain (loss) on derivative contracts, net | 2,245,470 | 2,573,863 | (6,684,358 | ) | 1,111,693 | ||||||||||
| Other expense, net | (208,658 | ) | (10,839 | ) | (192,230 | ) | (33,338 | ) | |||||||
| Other income (expense), net | 1,184,330 | 2,560,365 | (8,625,109 | ) | 1,078,784 | ||||||||||
| Net income before income tax expense | 9,562,706 | 3,389,148 | 10,559,867 | 9,075,376 | |||||||||||
| Income tax expense | 2,429,235 | 1,837,687 | 2,696,971 | 3,507,881 | |||||||||||
| NET INCOME | $ | 7,133,471 | $ | 1,551,461 | $ | 7,862,896 | $ | 5,567,495 | |||||||
| Currency translation adjustments | (2,032 | ) | (75,496 | ) | (4,351 | ) | (125,612 | ) | |||||||
| NET COMPREHENSIVE INCOME | $ | 7,131,439 | $ | 1,475,965 | $ | 7,858,545 | $ | 5,441,883 | |||||||
| Net income per share, basic | $ | 0.24 | $ | 0.07 | $ | 0.26 | $ | 0.25 | |||||||
| Net income per share, diluted | $ | 0.23 | $ | 0.07 | $ | 0.26 | $ | 0.25 | |||||||
| Weighted average number of shares outstanding, basic | 30,248,522 | 22,017,310 | 30,244,275 | 22,013,062 | |||||||||||
| Weighted average number of shares outstanding, diluted | 30,414,909 | 22,202,315 | 30,369,810 | 22,155,629 | |||||||||||
| EPSILON ENERGY LTD. | |||||||
| Unaudited Consolidated Balance Sheets | |||||||
| (All amounts stated in US$) | |||||||
| June 30, | December 31, | ||||||
| 2026 | 2025 | ||||||
| ASSETS | |||||||
| Current assets | |||||||
| Cash and cash equivalents | $ | 11,169,421 | $ | 8,959,954 | |||
| Accounts receivable | 17,476,445 | 16,132,501 | |||||
| Fair value of derivatives | 694,977 | 2,694,340 | |||||
| Prepaid income taxes | 2,994,982 | 2,949,311 | |||||
| Other current assets | 1,462,462 | 1,847,672 | |||||
| Total current assets | 33,798,287 | 32,583,778 | |||||
| Non-current assets | |||||||
| Property and equipment: | |||||||
| Oil and gas properties, successful efforts method | |||||||
| Proved properties | 245,787,578 | 233,334,212 | |||||
| Unproved properties | 80,341,257 | 79,307,169 | |||||
| Accumulated depletion, depreciation, amortization and impairment | (136,623,569 | ) | (131,636,141 | ) | |||
| Total oil and gas properties, net | 189,505,266 | 181,005,240 | |||||
| Gathering system | 43,428,789 | 43,540,389 | |||||
| Accumulated depletion, depreciation, amortization and impairment | (37,849,676 | ) | (37,472,139 | ) | |||
| Total gathering system, net | 5,579,113 | 6,068,250 | |||||
| Land | 1,231,965 | 1,231,965 | |||||
| Buildings and other property and equipment, net | 4,036,238 | 4,132,732 | |||||
| Total property and equipment, net | 200,352,582 | 192,438,187 | |||||
| Other assets: | |||||||
| Operating lease right-of-use assets, long term | 371,181 | 488,949 | |||||
| Restricted cash | 553,000 | 553,000 | |||||
| Fair value of derivatives, long term | 33,114 | 1,154,936 | |||||
| Deferred financing costs | 673,754 | 774,347 | |||||
| Prepaid drilling costs | 661,803 | 246,220 | |||||
| Total non-current assets | 202,645,434 | 195,655,639 | |||||
| Total assets | $ | 236,443,721 | $ | 228,239,417 | |||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
| Current liabilities | |||||||
| Accounts payable trade | $ | 19,129,836 | $ | 11,148,050 | |||
| Gathering fees payable | 938,041 | 1,076,143 | |||||
| Royalties payable | 9,902,986 | 8,702,526 | |||||
| Accrued capital expenditures | 486,548 | 24,888 | |||||
| Accrued compensation | 1,081,171 | 1,056,304 | |||||
| Other accrued liabilities | 2,618,815 | 2,682,090 | |||||
| Fair value of derivatives | 686,882 | — | |||||
| Operating lease liabilities | 272,063 | 271,494 | |||||
| Total current liabilities | 35,116,342 | 24,961,495 | |||||
| Non-current liabilities | |||||||
| Credit facility payable | 40,500,000 | 50,500,000 | |||||
| Ad valorem taxes, long term | 7,411,971 | 7,411,971 | |||||
| Asset retirement obligations | 7,676,996 | 7,437,960 | |||||
| Fair value of derivatives, long term | 97,675 | — | |||||
| Deferred income taxes | 15,527,679 | 12,855,585 | |||||
| Operating lease liabilities, long term | 202,015 | 340,052 | |||||
| Total non-current liabilities | 71,416,336 | 78,545,568 | |||||
| Total liabilities | 106,532,678 | 103,507,063 | |||||
| Commitments and contingencies (Note 10) | |||||||
| Shareholders’ equity | |||||||
| Preferred shares, no par value, unlimited shares authorized, none issued or outstanding | — | — | |||||
| Common shares, no par value, unlimited shares authorized and 30,248,617 shares issued and outstanding at June 30, 2026 and 30,239,980 shares issued and outstanding at December 31, 2025 | 154,274,125 | 154,274,125 | |||||
| Additional paid-in capital | 14,958,878 | 13,863,824 | |||||
| Accumulated deficit | (49,214,176 | ) | (53,302,162 | ) | |||
| Accumulated other comprehensive income | 9,892,216 | 9,896,567 | |||||
| Total shareholders’ equity | 129,911,043 | 124,732,354 | |||||
| Total liabilities and shareholders’ equity | $ | 236,443,721 | $ | 228,239,417 | |||
| EPSILON ENERGY LTD. |
|||||||
| Unaudited Consolidated Statements of Cash Flows |
|||||||
| (All amounts stated in US$) |
|||||||
| Six months ended June 30, | |||||||
| 2026 | 2025 | ||||||
| Cash flows from operating activities: | |||||||
| Net income | $ | 7,862,896 | $ | 5,567,495 | |||
| Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
| Depletion, depreciation, amortization, and accretion | 5,806,446 | 6,677,511 | |||||
| Impairment expense | — | 2,676,669 | |||||
| Amortization on deferred financing costs | 100,593 | — | |||||
| Gain on sale of oil and gas properties | (4,174,368 | ) | — | ||||
| Loss (gain) on derivative contracts | 6,684,358 | (1,111,693 | ) | ||||
| Settlement paid on derivative contracts | (2,778,616 | ) | (108,383 | ) | |||
| Settlement of asset retirement obligation | — | (1,600 | ) | ||||
| Stock-based compensation expense | 1,095,054 | 771,676 | |||||
| Deferred income tax expense (benefit) | 2,672,093 | (779,676 | ) | ||||
| Changes in assets and liabilities: | |||||||
| Accounts receivable | (1,343,944 | ) | 346,839 | ||||
| Prepaid income taxes | (45,671 | ) | — | ||||
| Other assets and liabilities | 292,394 | 385,445 | |||||
| Accounts payable, royalties payable, gathering fees payable, and other accrued liabilities | 6,189,202 | (66,454 | ) | ||||
| Income taxes payable | — | 2,572,921 | |||||
| Net cash provided by operating activities | 22,360,437 | 16,930,750 | |||||
| Cash flows from investing activities: | |||||||
| Additions to unproved oil and gas properties | (1,416,572 | ) | (5,132,649 | ) | |||
| Additions to proved oil and gas properties | (8,803,428 | ) | (5,997,993 | ) | |||
| Deductions (additions) to gathering system properties | 100,952 | (228,327 | ) | ||||
| Deductions to land, buildings and property and equipment | (11,446 | ) | (12,102 | ) | |||
| Proceeds from sale of oil and gas properties | 4,174,368 | — | |||||
| Prepaid drilling costs | (415,583 | ) | 705,165 | ||||
| Net cash used in investing activities | (6,371,709 | ) | (10,665,906 | ) | |||
| Cash flows from financing activities: | |||||||
| Payment on credit facility | (10,000,000 | ) | — | ||||
| Dividends paid | (3,774,910 | ) | (2,751,372 | ) | |||
| Net cash used in financing activities | (13,774,910 | ) | (2,751,372 | ) | |||
| Effect of currency rates on cash, cash equivalents, and restricted cash | (4,351 | ) | (125,612 | ) | |||
| Increase in cash, cash equivalents, and restricted cash | 2,209,467 | 3,387,860 | |||||
| Cash, cash equivalents, and restricted cash, beginning of period | 9,512,954 | 6,989,793 | |||||
| Cash, cash equivalents, and restricted cash, end of period | $ | 11,722,421 | $ | 10,377,653 | |||
| Supplemental cash flow disclosures: | |||||||
| Income tax paid – federal | $ | — | $ | 1,325,000 | |||
| Income tax paid – state (PA) | $ | 10,933 | $ | 355,138 | |||
| Income tax paid – state (other) | $ | 50,025 | $ | 1,710 | |||
| Interest paid | $ | 1,722,335 | $ | 9,552 | |||
| Non-cash investing activities: | |||||||
| Change in proved properties accrued in accounts payable | $ | 3,260,493 | $ | (690,866 | ) | ||
| Change in gathering system accrued in accounts payable | $ | (10,648 | ) | $ | 71,366 | ||
| Asset retirement obligation asset additions and adjustments | $ | 6,961 | $ | 18,235 | |||
| Three months ended June 30, | Six months ended June 30, | ||||||||||||||
| 2026 | 2025 | 2026 | 2025 | ||||||||||||
| Net income | $ | 7,133,471 | $ | 1,551,461 | $ | 7,862,896 | $ | 5,567,495 | |||||||
| Add Back: | |||||||||||||||
| Interest expense (income), net | 852,482 | 2,659 | 1,748,521 | (429 | ) | ||||||||||
| Income tax expense | 2,429,235 | 1,837,687 | 2,696,971 | 3,507,881 | |||||||||||
| Depreciation, depletion, amortization, and accretion | 2,804,107 | 3,201,654 | 5,806,446 | 6,677,511 | |||||||||||
| Impairment expense | — | 2,670,000 | — | 2,676,669 | |||||||||||
| Stock based compensation expense | 547,527 | 385,838 | 1,095,054 | 771,676 | |||||||||||
| Gain on sale of oil and gas properties | (4,174,368 | ) | — | (4,174,368 | ) | — | |||||||||
| Transaction costs | 202,532 | — | 273,952 | — | |||||||||||
| (Gain)/loss on derivative contracts net of cash received or paid on settlement | (3,976,251 | ) | (2,267,203 | ) | 3,905,742 | (1,220,076 | ) | ||||||||
| Foreign currency translation (gain) loss | (1,201 | ) | 14,021 | (3,076 | ) | 24,310 | |||||||||
| Adjusted EBITDA | $ | 5,817,534 | $ | 7,396,117 | $ | 19,212,138 | $ | 18,005,037 | |||||||
Epsilon defines Adjusted EBITDA as earnings before (1) net interest expense, (2) taxes, (3) depreciation, depletion, amortization and accretion expense, (4) impairments of natural gas and oil properties, (5) non-cash stock compensation expense, (6) transaction costs, (7) gain or loss on derivative contracts net of cash received or paid on settlement, (8) gain or loss on sale of assets, and (9) gain or loss on foreign currency translations. Adjusted EBITDA is not a measure of financial performance as determined under U.S. GAAP and should not be considered in isolation from or as a substitute for net income or cash flow measures prepared in accordance with U.S. GAAP or as a measure of profitability or liquidity.
Additionally, Adjusted EBITDA may not be comparable to other similarly titled measures of other companies. Epsilon has included Adjusted EBITDA as a supplemental disclosure because its management believes that EBITDA provides useful information regarding its ability to service debt and to fund capital expenditures. It further provides investors with a helpful measure for comparing operating performance on a “normalized” or recurring basis with the performance of other companies, without giving effect to certain non-cash expenses and other items. This provides management, investors and analysts with comparative information for evaluating the Company in relation to other natural gas and oil companies providing corresponding non-U.S. GAAP financial measures or that have different financing and capital structures or tax rates. These non-U.S. GAAP financial measures should be considered in addition to, but not as a substitute for, measures for financial performance prepared in accordance with U.S. GAAP.
| $M | Q225 | Q126 | Q226 | YTD2026 | |||||
| GAAP Net Income (Loss) | 1,551 | 729 | 7,133 | 7,863 | |||||
| Adjustments | |||||||||
| Transaction Cost | 71 | 203 | |||||||
| Impairment | 2,670 | ||||||||
| Asset Sale (Gain) / Loss | -4,174 | ||||||||
| Unrealized Hedge (Gain) / Loss | -2,267 | 7,882 | -3,976 | ||||||
| Adj. Net Income | 1,954 | 8,683 | -815 | 7,868 | |||||
| WA Shares O/S | 22,202 | 30,262 | 30,415 | 30,370 | |||||
| P/Share | $ | 0.09 | $ | 0.29 | $ | (0.03 | ) | $ | 0.26 |
Epsilon defines Adjusted Net Income as reported U.S. GAAP Net Income adjusting for items related to (1) transaction expenses, (2) impairments of natural gas and oil properties, (3) gain or loss on sale of assets, and (4) unrealized gain or loss on hedges. Adjusted Net Income is not a measure of financial performance as determined under U.S. GAAP and should not be considered in isolation from or as a substitute for net income or cash flow measures prepared in accordance with U.S. GAAP or as a measure of profitability or liquidity.
