ARC Resources (ARX) Q4 2025 earnings summary

Executive summary

• Achieved record Q4 production of 408,382 BOE/d in 2025, up 10% per share year-over-year, driven by Kakwa acquisition and Attachie ramp-up, with premium Montney asset exposure and a $14B market cap.

• Maintained exceptional safety performance in 2025, outperforming all key safety metrics despite high activity and complexity.

• Advanced strategic priorities by growing production and reserves per share by ~10% and doubling free cash flow per share to CAD 2.20, enabling a fifth consecutive annual dividend increase.

• Executed two strategic opportunities: consolidating Montney resources at Kakwa and expanding Attachie land through a unique agreement.

• Strategy centers on free funds flow per share growth, disciplined capital allocation, and sustainable dividends.

Financial highlights

• Q4 funds from operations reached CAD 874 million ($1.52/share), 11% above forecast; free cash flow was CAD 415 million, up 47% sequentially and 40% above analyst expectations.

• Full-year 2025 free funds flow totaled CAD 1.3 billion ($2.20/share), nearly double 2024 levels.

• Returned 75% of free funds flow to shareholders via buybacks (CAD 514 million) and dividends (CAD 452 million); repurchased 19.7 million shares in 2025.

• Ended 2025 with net debt of CAD 2.9 billion, or 0.9x cash flow, a reduction of CAD 200 million from the prior quarter.

• Capital expenditures for 2025 totaled CAD 1.9 billion, within guidance.

Outlook and guidance

• 2026 production guidance: 405,000–420,000 BOE/d (61% natural gas, 39% crude oil/liquids); capital budget remains CAD 1.8–1.9 billion.

• Expect to generate approximately CAD 1.2 billion in free funds flow in 2026, with plans to return nearly all to shareholders.

• Attachie development plan under review due to inconsistent well performance; asset-level production guidance for Attachie removed for 2026.

• First international LNG shipments expected in about a year, enhancing natural gas price exposure.

• Long-term plan targets >500 Mboe/d sustainable production for over 10 years.