/C O R R E C T I O N -- Highwood Asset Management Ltd./

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In the news release, HIGHWOOD ASSET MANAGEMENT LTD. ANNOUNCES FIRST QUARTER 2025 RESULTS AND OPERATIONAL UPDATE, issued 15-May-2025 by Highwood Asset Management Ltd. over CNW, we are advised by the company that the fifth bullet should read "$3.15/GJ" instead of "$3.15/JG," and the table header for the Summary of Financial & Operating Results should read "2025" instead of "2023." The complete, corrected release follows:

HIGHWOOD ASSET MANAGEMENT LTD. ANNOUNCES FIRST QUARTER 2025 RESULTS AND OPERATIONAL UPDATE

/NOT FOR DISSEMINATION IN THE U.S. OR THROUGH U.S. NEWSWIRES/

CALGARY, AB, May 15, 2025 /CNW/ - Highwood Asset Management Ltd. ("Highwood" or the "Company") (TSXV: HAM) is pleased to announce financial and operating results for the three months ended March 31, 2025. The Company also announces that its unaudited financial statements and associated Management's Discussion and Analysis ("MD&A") for the period ended March 31, 2025, are available on Highwood's website at www.highwoodmgmt.com and on SEDAR+ at www.sedarplus.ca.

Highwood Asset Management Ltd. Logo (CNW Group/Highwood Asset Management Ltd.)
Highwood Asset Management Ltd. Logo (CNW Group/Highwood Asset Management Ltd.)

Highlights

  • Achieved average corporate production of 5,264 boe/d in Q1 2025, representing an increase of approximately 5% from the comparative period last year (average of 5,023boe/d). During this period, the Company's oil production was impacted by long periods of severe cold weather, third party outages and delays in bringing new drills online. However, corporate production is currently exceeding 6,300 boe/d with multiple wells continuing to clean up from the first quarter drilling program.

  • For the first quarter of 2025, Highwood delivered Adjusted EBITDA of $13.7 million ($0.90 per share) and adjusted funds flow of $11.98 million ($0.79 per share). Highwood also delivered income of $2.4MM ($0.16/share), an increase of $2.9MM from the comparative period in 2024.(1)

  • The Company incurred capital expenditures of approximately $33.2 million in the first quarter of 2025, with the majority of costs related to six gross (4.2 net) wells drilled — three booked wells in Brazeau and three booked wells in Wilson Creek, along with the completion and equipping of the 102/08-19-047-13W5 (the "8-19 well" that was drilled in December 2024). The 8-19 well was brought onstream during the second half of the first quarter and the remaining six wells drilled were brought onstream in the second quarter of 2025.

  • As a result of the first quarter drilling program, the validated inventory of the Brazeau Basal Belly River play is now approximately 30 net locations (9 booked, 21 unbooked), with a payout of approximately 12 months. The 30 net locations represents approximately 30% of the prospective Brazeau Basal Belly River lands.(1)(2)

  • The recent announcements of U.S. tariffs, OPEC+ production increases and economic uncertainty has resulted in significant volatility in commodity prices. Highwood's hedging program mitigates this volatility with approximately 2,200 bbls/day of oil hedged through the remainder of 2025 and 1,550 bbls/day of oil hedged in 2026 at an average contract price of approximately $95.00CAD/bbl (WTI-NYMEX). Further, the Company also has approximately 5,500GJ/day of natural gas hedged at an average contract price of approximately $3.15/GJ (AECO). The market value of Highwood's commodity contracts is approximately $15 million in the money.

  • Highwood reiterates its initial 2025 guidance issued in November 2024 of capital plan of $60-65 million and to deliver average production of 6,200-6,400 boe/d (+10% increase YoY at midpoint). The guidance was issued based on a 2025 average WTI oil price of US$70/bbl WTI which would yield Adjusted EBITDA of $88-92 million and a 2025 Net Debt / 2025 Exit EBITDA ratio of approximately 0.8x. Each +/- US$5/bbl move in 2025 average WTI prices results in approximately a +/- $2.5 million move in EBITDA, which impacts the 2025 Net Debt / 2025 Exit EBITDA ratio by approximately 0.05x. (1)(2)