Saturn Oil & Gas (SOIL) investor relations material

Executive summary

• Q1 2026 production averaged over 43,100 BOE/d, surpassing analyst expectations for the seventh consecutive quarter and exceeding guidance by 1,600 BOE/d, with volumes reaching 43,116 BOE/d, 3% above the high end of guidance.

• Adjusted funds flow and free funds flow both beat analyst consensus, with adjusted funds flow at $107.2 million ($0.59/share diluted) and free funds flow at $62.5 million ($0.34/share diluted), despite only one month of higher oil prices in March.

• Net debt declined 5% from year-end 2025, exiting Q1 at approximately $725 million, reflecting ongoing debt repayment efforts.

• Share buybacks continued, nearing the NCIB maximum, with equity-based compensation settled via open market purchases to minimize dilution.

• Realized oil prices surged to nearly $115/bbl in March due to geopolitical events, significantly boosting financial results.

Financial highlights

• Adjusted funds flow was CAD 107 million (CAD 0.59 per basic share), 5% above consensus; free funds flow was CAD 52 million, 13% above consensus.

• Petroleum and natural gas sales were $270.2 million, up from $233.6 million in Q4 2025 but down from $278.1 million in Q1 2025.

• Net income was a loss of $97.3 million, compared to a profit of $31.2 million in Q4 2025 and $37.8 million in Q1 2025.

• Operating costs were CAD 24.9/BOE, at midpoint of guidance but higher sequentially due to seasonality.

• Realized hedging loss of CAD 21 million (CAD 5.45/BOE) due to March oil price spike; large non-cash unrealized hedging loss impacted net income.

Outlook and guidance

• Capital acceleration planned: ~CAD 20 million of H2 capital moved into Q2, targeting higher near-term production.

• Q2 2026 capital spending expected at CAD 35–40 million, with volumes averaging 40–41 thousand BOE/d.

• Full-year 2026 capital budget may be increased if oil prices remain elevated; up to 50% expansion possible if prices stabilize in the high CAD 70s–80s.

• Plans to add a fifth rig in West Central Saskatchewan to target high-impact, short cycle-time wells.

• No cash taxes expected until 2028 or later due to CAD 1.6 billion in tax pools.