Mach Natural Resources (MNR) Q1 2026 earnings summary

Executive summary

• Q1 2026 net production averaged 158 Mboe/d, with a mix of 16% oil, 70% natural gas, and 14% NGLs, supported by major acquisitions and a diversified asset base across the Mid-Continent, Permian, and San Juan Basins totaling 2.8 million net acres.

• Focused on disciplined reinvestment below 50% of operating cash flow, maximizing cash distributions, and maintaining financial strength, with $1.4 billion in cash distributions paid since inception and a realized MOIC of 2.0x.

• Shifted drilling focus toward oil-weighted projects in response to commodity price changes, pausing Deep Anadarko activity and restarting Oswego drilling for higher returns.

• Leverage increased to 1.3x–1.4x after recent acquisitions, with a target to return to 1x before further debt-funded acquisitions.

• Production nearly doubled year-over-year, driven by the IKAV and Sabinal acquisitions completed in September 2025.

Financial highlights

• Q1 2026 total revenues were $286 million, with oil and gas revenues at $366 million before derivative losses; adjusted EBITDA was $195 million, and cash available for distribution was $107.4 million.

• Net loss for Q1 2026 was $35 million, primarily due to $96.9–$103.8 million in unrealized derivative losses.

• Lease operating expense was $7.12/Boe; gathering and processing expense was $4.18/Boe; G&A was $0.37/Boe.

• Distributed $0.64 per unit for Q1 2026, payable June 4, 2026.

• Cash balance at quarter-end was $53 million, with $695 million drawn on a $1.0 billion credit facility, leaving $358 million in liquidity.

Outlook and guidance

• 2026 capital expenditure budget set between $315 million and $360 million, focused on drilling and development in core formations, with a nimble capital allocation strategy prioritizing high-return oil projects.

• CapEx guidance expected to remain stable despite the shift to oil; management maintains flexibility to adjust drilling based on commodity prices and service cost inflation.

• Systematic hedging program in place, with ~50% of 2026 gas volumes unhedged, providing cash flow insulation and upside exposure.