Riley Exploration Permian, Inc.

The company did not report consolidated revenue or EPS in the prepared remarks, but it did report several operating and cash metrics. Operating cash flow rose 35% quarter-over-quarter to $64 million. Cash CapEx and other investments increased 153% quarter-over-quarter to $73 million, while free cash flow fell to $6 million; year-to-date free cash flow is approximately $30 million. Q2 accrual capital spend was $87 million, including $70 million of drilling and completion capital and approximately $17 million of infrastructure and other spend. Oil production was near the high end of guidance and June exit rate was 24,400 barrels per day; Q3 midpoint oil production guidance is 25,600 barrels per day. Full-year accrual CapEx guidance was raised 12% to $236 million, and full-year oil production guidance was increased to imply approximately 30% year-over-year oil production growth, with the midpoint corresponding to 23,000 barrels per day. Quarter-end principal debt increased 11%, or $26 million, to $273 million after $9.5 million was used for dividends and buybacks.

Bobby Riley framed the quarter as a validation of the company’s accelerated 2026 growth plan, emphasizing that activity was the most robust in Riley Permian’s history and that the June exit rate better reflects underlying momentum than the Q2 average. He said the company expects production growth to continue into the second half of 2026 and into 2027, with a steady pace of development and a focus on growing production, spending within cash flow, reducing debt and paying dividends. He also stressed that the Targa pipeline and expanded New Mexico infrastructure should unlock more inventory and support a broader development platform.

Philip Riley highlighted the financial impact of higher oil prices and heavier investment, noting operating cash flow of $64 million, cash CapEx and other investments of $73 million, and free cash flow of $6 million for the quarter. He said the company increased Q3 accrual CapEx guidance to $59 million and raised full-year accrual CapEx guidance to $236 million, with the increase split roughly one-third upstream and two-thirds infrastructure; 60% of the infrastructure increase is for saltwater disposal and most of the rest for oil gathering, mainly in Champions. He also said the company expects higher free cash flow in the second half of the year than in the first, while maintaining flexibility between dividends, buybacks and debt reduction.

Analysts focused on the 2027 trajectory, capital allocation, gas takeaway, Silverback optimization potential and New Mexico spacing. Management said it expects a “steady as she goes” development pace into next year, with one rig running continuously and a continued emphasis on growth, dividends and debt reduction. On gas takeaway, management said the Targa line is expected in early Q4 and that current New Mexico exposure should be manageable until then; they also said they recently added Waha hedges and expect market conditions to remain volatile. On Silverback, management said only some of the obvious workovers have been executed so far and that there may be “a couple of years of inventory” across the asset base.