Earnings release
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NuVista Energy Ltd. Announces Second Quarter Results Highlighting Solid Financial and Operating Progress CALGARY, Alberta, Aug. 06, 2025 -- NuVista Energy Ltd. ("NuVista" or the "Company") (TSX: NVA) is pleased to announce financial and operating results for the three and six months ended June 30, 2025, and to provide an update on our operational performance. We have continued to advance our business with the goal of creating top-tier returns for our shareholders. Our predictable and repeatable development plan continues to produce improved capital efficiencies, allowing us to reduce our capital expenditures guidance both this year and next and deliver average annual per share production growth of at least 15%. In the third quarter, we will be ramping up production toward 100,000 Boe/d and our 5-year outlook of growing production to 125,000 Boe/d remains fully in-tact and will be achieved with less capital than originally expected. With respect to returns to shareholders, we have directed over $100 million toward share repurchases in the first half of the year and continue to believe a balanced approach to absolute growth and share repurchases will drive superior total returns. Operational and Financial Highlights During the second quarter ended June 30, 2025, NuVista: • Produced 73,595 Boe/d, just above our revised guidance of 73,500 Boe/d for the quarter. Production volumes in the second quarter were impacted by planned third-party gas plant turnaround activity in the greater Wapiti area (“Wapiti Turnaround”) in addition to delays in the commissioning of the Pipestone Gas Plant (“Pipestone Plant”). The production composition for the second quarter aligned with guidance at 29% condensate(1), 9% natural gas liquids (“NGLs”) and 62% natural gas; • Executed a successful net capital expenditure(2) program of $81.7 million, resulting in the drilling and completion of 12 and 4 wells, respectively; • Generated adjusted funds flow(3) of $134.3 million ($0.67/share, basic(4)), and realized $50.9 million of free adjusted funds flow(2) ($0.25/share, basic(4)); • Delivered a strong operating netback(5) at $24.27/Boe and a corporate netback(5) at $20.05/Boe, reflecting increases of 12% and 8%, respectively, compared to the second quarter of 2024; • Exited the quarter with $105.7 million drawn on our $550 million credit facility, maintaining a favorable net debt to annualized second quarter adjusted funds flow(3) ratio of 0.6x; • Achieved net earnings of $80.5 million ($0.40/share, basic), and • Announced the renewal of our NCIB program on June 18, 2025, allowing for the repurchase of up to 16,398,617 common shares, prior to June 22, 2026. Year-to-date, we have repurchased and subsequently cancelled 7.9 million common shares under our NCIB program for a total cost of $104 million, resulting in a 3.3% reduction in the number of shares outstanding since the beginning of the year. Notes: (1) NGLs are defined by National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities to include ethane, butane, propane, pentanes plus and condensate. Unless explicitly stated in this press release, references to “NGL” refers only to ethane, butane and propane and references to "condensate" refers to only to condensate and pentanes plus. NuVista has disclosed condensate and pentanes plus values separately from ethane, butane and propane values as NuVista believes it provides a more accurate description of NuVista’s operations and results therefrom. (2) Each of “free adjusted funds flow” and “net capital expenditures” are non-GAAP financial measures that do not have any standardized meanings under IFRS Accounting Standards and therefore may not be comparable to similar measures presented by other companies where similar terminology is used. Reference should be made to the section entitled “Specified Financial Measures” in this press release. (3) Each of “adjusted funds flow”, “net debt” and “net debt to annualized second quarter adjusted funds flow” are capital management measures. Reference should be made to the section entitled “Specified Financial Measures” in this press release. (4) Each of “adjusted funds flow per share” and “free adjusted funds flow per share” are supplementary financial measures. Reference should be made to the section entitled “Specified Financial Measures” in this press release. (5) Each of "operating netback" and "corporate netback" are non-GAAP ratios that do not have any standardized meanings under IFRS Accounting Standards and therefore may not be comparable to similar measures presented by other companies where similar terminology is used. Reference should be made to the section entitled “Specified Financial Measures” in this press release. Operations Update We have had a tremendous start to the year operationally. We have achieved record production milestones, built significant
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production volumes behind pipe, delivered meaningful cost savings through the disciplined execution of our development plan, and maintained efficiency with our dedicated two-drilling rigs and established completions crews. Notable operational achievements in the first half of 2025, included: • Sustaining production above 90,000 Boe/d for March and April, and with all 43 wells from our 2025 development program available for production by the end of September, we anticipate reaching a new production milestone of 100,000 Boe/d in the fourth quarter of 2025; • Drilling and completion execution exhibiting steady improvement. We continue to successfully deploy our monobore well design across our assets and have seen average meters per day drilling rates increase by 10% year-over-year. Completions execution has set several new pacesetter milestones for daily pumping hours with over 21 hours pumped per day; this combined with reductions in our water usage has resulted in record daily sand placement. Our execution to-date has translated into an average capital cost reduction of 7% per well compared to our budget; • Our recent 5-well pad in Elmworth clearly highlighted this performance by setting new benchmarks for the area and driving costs 17% below (approximately $1 million per well) the offsetting pad, which was executed in 2024. Importantly, production from this pad has shown robust gas and condensate deliverability, achieving an IP30 of 2,200 Boe/d per well, including 33% condensate; and impressively the pad delivered 65% more cumulative condensate per well over its IP30 compared to the offsetting pad; and • Execution and well deliverability at Pipestone tracked ahead of budget. Our recent 14-well pad while flowing at restricted rates, has achieved an IP90 of 1,450 Boe/d per well, including 35% condensate. We are finishing completion operations on an additional 8-well pad, which is slated to underpin our growth into the newly expanded Pipestone infrastructure. Return of Capital to Shareholders and Balance Sheet Strength NuVista’s capital allocation strategy remains disciplined and unchanged, emphasizing the compounding benefits of absolute growth and share repurchases to deliver industry-leading total returns. We have met our annual commitment to return a minimum of $100 million through share buybacks in the first half of the year. We plan to build on this momentum in the second half of the year by allocating the majority of free adjusted funds flow to additional repurchases. Based on current commodity prices, we expect to generate approximately $150 million in free adjusted funds flow in the second half of the year. Our strategy remains focused on disciplined growth and significant shareholder returns, with share repurchases continuing to be our preferred means of returning capital back to our shareholders. To support our ongoing position of financial strength and flexibility, we amended and renewed our existing covenant-based credit facility on May 8, 2025, followed by an amendment and renewal of our unsecured letter of credit facility with Export Development Canada (“EDC”) on June 30, 2025. The covenant-based credit facility was increased from $450 million to $550 million, and its maturity extended by one year to May 7, 2028. Similarly, the maturity of the letter of credit facility was extended by one year to June 30, 2026, and increased from CDN$30 million to US$50 million. We ended the quarter with net debt of $303 million and a net debt to adjusted funds flow ratio of 0.6x, well below our long-term target of less than 1.0x, even under a stress-test price environment of US$45.00/Bbl WTI and US$2.00/MMBtu NYMEX. We remain committed to maintaining low leverage and preserving flexibility in our capital plans, allowing us to adjust if commodity prices weaken, while continuing to prioritize shareholder returns through our NCIB program. Guidance Update NuVista’s well results continue to outperform, however as previously communicated, average annual production has been impacted by infrastructure curtailments throughout the summer months. We are pleased to report that the Wapiti Turnaround has progressed inline with the revised schedule and is nearing completion and the Pipestone Plant has commenced final commissioning operations. As a result, we reaffirm our expectations that both third-party gas plants will be fully operational prior to September. Our third quarter production is forecast to average 68,000 - 70,000 Boe/d and with the fourth quarter expected to average approximately 100,000 Boe/d, we reiterate our 2025 full-year guidance of approximately 83,000 Boe/d. Given the drilling and completion execution outperformance noted above, we have reduced our annual 2025 net capital expenditure guidance to $425 - $450 million, from $450 million. Looking ahead to 2026, continued well outperformance, additional production behind pipe (due to the infrastructure curtailments in 2025), and improved capital efficiencies, have resulted in a more robust 2026 outlook for NuVista. We have reduced our capital expenditures to $500 - $525 million, from $575 million while maintaining our production outlook at approximately 100,000 Boe/d. This will ultimately deliver production growth of more than 20% year-over-year. We anticipate our improved capital efficiencies to translate throughout our 5-year outlook and forecast a 5% reduction in annual capital expenditures beyond 2026. Improved cycle time has allowed us to stick with a steady two-drilling rig outlook, as opposed to adding a third-drilling rig as we grow beyond 100,000 Boe/d. Consistent, steady operations and improved capital efficiencies have allowed us to reduce combined 2025 and 2026 net capital expenditures by up to $100 million and to allocate a greater proportion of adjusted funds flow to shareholder returns, further compounding per share value growth. Based on current commodity prices we forecast generating nearly an aggregate of $500 million of free adjusted funds flow in 2025 and 2026, of which a minimum of 75% will be allocated to shareholder returns.
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Our top-tier economics underpin our resilient business, however we continue to monitor the macro environment with a focus on prioritizing economics and returns, as such, if commodity prices weaken and persist, we have the flexibility to adjust our net capital program to maximize shareholder returns and preserve our growth economics for a more robust price environment. We would like to thank our staff, contractors, and suppliers for their continued dedication and delivery, and we thank our Board of Directors and our shareholders for their continued guidance and support. Please note that our updated corporate presentation will be available at www.nuvistaenergy.com on August 6, 2025. NuVista's management's discussion and analysis, condensed consolidated interim financial statements for the three and six months ended June 30, 2025 and notes thereto, will be filed on SEDAR+ (www.sedarplus.ca) on August 6, 2025 and can also be obtained at www.nuvistaenergy.com. FINANCIAL AND OPERATING HIGHLIGHTS Three months ended June 30Six months ended June 30 ($ thousands, except otherwise stated) 2025 2024 % Change 2025 2024 % Change FINANCIAL Petroleum and natural gas revenues 267,317 323,350 (17) 638,722 632,374 1 Cash provided by operating activities 71,041 166,280 (57) 303,704 314,173 (3) Adjusted funds flow(3) 134,272 140,246 (4) 326,158 275,659 18 Per share, basic(6) 0.67 0.68 (1) 1.62 1.33 22 Per share, diluted(6) 0.67 0.67 — 1.61 1.31 23 Net earnings 80,454 110,974 (28) 192,606 146,743 31 Per share, basic 0.40 0.54 (26) 0.96 0.71 35 Per share, diluted 0.40 0.53 (25) 0.95 0.70 36 Total assets 3,613,647 3,302,604 9 Net capital expenditures(1) 81,736 121,497 (33) 235,147 309,353 (24) Net debt(3) 303,236 267,949 13 OPERATING Daily Production Natural gas (MMcf/d) 273.8 299.8 (9) 304.1 296.3 3 Condensate (Bbls/d) 21,318 25,761 (17) 23,238 24,991 (7) NGLs (Bbls/d) 6,648 7,424 (10) 7,590 7,223 5 Total (Boe/d) 73,595 83,152 (11) 81,512 81,597 — Condensate & NGLs weighting 38% 40% 38% 39% Condensate weighting 29% 31% 29% 31% Average realized selling prices(5) Natural gas ($/Mcf) 3.44 2.25 53 3.70 2.66 39 Condensate ($/Bbl) 81.50 103.89 (22) 90.48 99.63 (9) NGLs ($/Bbl)(4) 38.87 27.44 42 39.80 27.34 46 Netbacks ($/Boe) Petroleum and natural gas revenues 39.92 42.73 (7) 43.29 42.58 2 Realized gain on financial derivatives 4.01 0.26 1,442 3.01 0.05 5,920 Other income 0.01 0.02 (50) 0.01 0.04 (75) Royalties (1.70) (5.01) (66) (2.90) (4.75) (39) Transportation expense (5.69) (4.94) 15 (5.17) (4.71) 10 Net operating expense(2) (12.28) (11.47) 7 (11.71) (11.49) 2 Operating netback(2) 24.27 21.59 12 26.53 21.72 22 Corporate netback(2) 20.05 18.52 8 22.11 18.56 19 SHARE TRADING STATISTICS High ($/share) 16.11 14.38 12 16.11 14.38 12 Low ($/share) 10.44 11.73 (11) 10.44 9.59 9 Close ($/share) 14.98 14.22 5 14.98 14.22 5 Common shares outstanding (thousands of shares) 197,066 206,073 (4) Notes: (1) Non-GAAP financial measure that does not have any standardized meaning under IFRS Accounting Standards and therefore may not be comparable to similar measures presented by other companies where similar terminology is used. Reference should be made to the section entitled “Specified Financial Measures”. (2) Non-GAAP ratio that does not have any standardized meaning under IFRS Accounting Standards and therefore may not be comparable to similar measures presented by other companies where similar terminology is used. Reference should be made to the section entitled “Specified Financial Measures”. (3) Capital management measure. Reference should be made to the section entitled “Specified Financial Measures”.
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(4) Includes butane, propane and ethane revenue and sales volumes, and sulphur revenue. (5) Product prices exclude realized gains/losses on financial derivatives. (6) Supplementary financial measure. Reference should be made to the section entitled “Specified Financial Measures”. Advisories Regarding Oil and Gas Information BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 Bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. As the value ratio between natural gas and crude oil based on the current prices of natural gas and crude oil is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value. Any references in this press release to initial production rates are useful in confirming the presence of hydrocarbons, however, such rates are not determinative of the rates at which such wells will continue production and decline thereafter. While encouraging, readers are cautioned not to place reliance on such rates in calculating the aggregate production for NuVista. This press release contains certain oil and gas metrics, which do not have standardized meanings or standard methods of calculation and therefore such measures may not be comparable to similar measures used by other companies and should not be used to make comparisons. Such metrics have been included herein to provide readers with additional measures to evaluate NuVista's performance; however, such measures are not reliable indicators of NuVista's future performance and future performance may not compare to NuVista's performance in previous periods and therefore such metrics should not be unduly relied upon. Management uses these oil and gas metrics for its own performance measurements and to provide security holders with measures to compare NuVista's operations over time. Readers are cautioned that the information provided by these metrics, or that can be derived from the metrics presented in this presentation, should not be relied upon for investment or other purposes. In this press release reference is made to 2025 and 2026 price outlook in the forecast of annual free adjusted funds flow. The forecast is based on 2025 price assumptions of: US$68/Bbl WTI, US$3.50/MMBtu NYMEX, C$1.65/GJ AECO and 1.39:1 CAD:USD FX, and 2026 price assumptions of: US$65/Bbl WTI, US$4.00/MMBtu NYMEX, C$2.85/GJ AECO and 1.36:1 CAD:USD FX. Basis of presentation Unless otherwise noted, the financial data presented in this press release has been prepared in accordance with Canadian generally accepted accounting principles (“GAAP”) also known as International Financial Reporting Standards (“IFRS”). Natural gas liquids are defined by National Instrument 51-101 – Standards of Disclosure for Oil and Gas Activities” to include ethane, butane, propane, pentanes plus and condensate. Unless explicitly stated in this press release, references to “NGL” refers only to ethane, butane and propane and references to "condensate" refers to only to condensate and pentanes plus. NuVista has disclosed condensate and pentanes plus values separately from ethane, butane and propane values as NuVista believes it provides a more accurate description of NuVista’s operations and results therefrom. Production split for Boe/d amounts referenced in the press release are as follows: Reference Total Boe/dNatural GasCondensateNGLs Q2 2025 production - actual 73,595 62% 29% 9% Q2 2025 production - guidance 73,500 62% 29% 9% Q3 2025 production - guidance 68,000 - 70,000 62% 29% 9% Q4 2025 production - guidance ~100,000 61% 30% 9% 2025 annual production - guidance ~83,000 61% 30% 9% 2026 annual production - guidance ~100,000 62% 29% 9% Q2 2025 production - guidance (original)(1) 75,000 - 77,000 62% 29% 9% 2025 annual production - guidance (original)(1) ~90,000 61% 30% 9% Note: (1) As of May 8, 2025 Advisory regarding forward-looking information and statements This press release contains forward-looking statements and forward-looking information (collectively, “forward-looking statements”) within the meaning of applicable securities laws. The use of any of the words “will”, “expects”, “believe”, “plans”, “potential” and similar expressions are intended to identify forward-looking statements. More particularly and without limitation, this press release contains forward looking statements, including but not limited to: • our belief that a balanced approach to absolute growth and share repurchases will drive superior total returns; • our expectation that our development plan will continue to produce improved capital efficiencies and enable us to deliver at least 15% production growth on average over the next two years; • our expectation that third-quarter production will average 68,000 – 70,000 Boe/day;
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• our 5-year plateau production outlook of approximately 125,000 Boe/d; • our plan to continue to prioritize reducing our outstanding common shares in the second half of the year, by directing the majority of our free adjusted funds flow towards share repurchases under our NCIB program; • that all 43 new wells from our 2025 development program will be available to be brought online by the end of September and our resulting productive capability in the fourth quarter; • that we will reach a new production milestone of 100,000 Boe/d in the fourth quarter of 2025; • that the results from our recent drilling and completions activities will translate into go-forward capital cost reductions per well; • our expectations that our anticipated improved capital efficiencies will translate throughout our 5-year outlook and result in a 5% reduction in annual net capital expenditures beyond 2026; • that we will finish the completion activities on an additional 8-well pad in Pipestone that will underpin the newly expanded infrastructure in this area; • that the amendment and renewal of our three-year covenant-based credit facility and EDC letter of credit facility will strengthen our financial position; • our expectation that we will generate approximately $150 million of free adjusted funds flow in the second half of 2025, the majority of which will be allocated to the repurchase of our common shares pursuant to our NCIB; • that our soft ceiling net debt will allow our current production levels to be sustainable and maintain an adjusted funds flow ratio below 1.0x in a stress test price environment of US$45/Bbl WTI and US$2.00/MMBtu NYMEX; • NuVista’s ability to continue directing free adjusted funds flow towards a prudent balance of return of capital to shareholders, while investing in high return growth projects; • the anticipated allocation of free adjusted funds flow; • guidance with respect to third quarter 2025 production and production mix; • the expected timing for completion of the Wapiti Turnaround; • the anticipated timing of Pipestone Plant becoming fully operational and the anticipated benefits thereof; • our expectations that following the Wapiti Turnaround and commissioning of the Pipestone Plant, the infrastructure will be in place to support production of approximately 100,000 Boe/d in the fourth quarter of 2025; • our 2025 full year production, full year production mix and net capital expenditures guidance ranges; • our plan to continue to maintain an efficient drilling program by employing 2-drill-rig execution; • our anticipated net capital expenditures and free adjusted funds flow outlook for both 2025 and 2026; • our ability to maintain flexibility in our capital program should commodity prices weaken; • our future focus, strategy, plans, opportunities and operations; and • other such similar statements. The future acquisition of our common shares pursuant to a share buyback (including through our normal course issuer bid), if any, and the level thereof is uncertain. Any decision to acquire common shares pursuant to a share buyback will be subject to the discretion of the Board of Directors and may depend on a variety of factors, including, without limitation, the Company’s business performance, financial condition, financial requirements, growth plans, expected capital requirements and other conditions existing at such future time including, without limitation, contractual restrictions and satisfaction of the solvency tests imposed on the Company under applicable corporate law. There can be no assurance of the number of common shares that the Company will acquire pursuant to a share buyback, if any, in the future. By their nature, forward-looking statements are based upon certain assumptions and are subject to numerous risks and uncertainties, some of which are beyond NuVista’s control, including the impact of general economic conditions, industry conditions, current and future commodity prices and inflation rates; that (i) the tariffs that are currently in effect on goods exported from or imported into Canada continue in effect for an extended period of time, the tariffs that have been threatened are implemented, that tariffs that are currently suspended are reactivated, the rate or scope of tariffs are increased, or new tariffs are imposed, including on oil and natural gas, (ii) the U.S. and/or Canada imposes any other form of tax, restriction or prohibition on the import or export of products from one country to the other, including on oil and natural gas, and (iii) the tariffs imposed or threatened to be imposed by the U.S. on other countries and retaliatory tariffs imposed or threatened to be imposed by other countries on the U.S., will trigger a broader global trade war which could have a material adverse effect on the Canadian, U.S. and global economies, and by extension the Canadian oil and natural gas industry and the Company, including by decreasing demand for (and the price of) oil and natural gas, disrupting supply chains, increasing costs, causing volatility in global financial markets, and limiting access to financing; the impact of ongoing global events, including Middle East and European tensions, with respect to commodity prices, currency and interest rates, anticipated production rates, borrowing, operating and other costs and adjusted funds flow; the timing, allocation and amount of net capital expenditures and the results therefrom; anticipated reserves and the imprecision of reserve estimates; the performance of existing wells; the success obtained in drilling new wells; the sufficiency of budgeted net capital expenditures in carrying out planned activities; access to infrastructure and markets; competition from other industry participants; availability of qualified personnel or services and drilling and related equipment; stock market volatility; effects of regulation by governmental agencies including changes in environmental regulations, tax laws and royalties; the ability to access sufficient capital from internal sources and bank and equity markets; that we will be able to execute our 2025 drilling plans as expected; our ability to carry out our 2025 production and capital guidance as expected, and by extension the oil and gas industry; and including, without limitation, those risks considered under “Risk Factors” in our Annual Information Form. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at
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the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. NuVista’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these forward-looking statements, or if any of them do so, what benefits NuVista will derive therefrom. NuVista has included the forward-looking statements in this press release in order to provide readers with a more complete perspective on NuVista’s future operations and such information may not be appropriate for other purposes. NuVista disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. This press release also contains financial outlook and future oriented financial information (together, “FOFI”) relating to NuVista including, without limitation, net capital expenditures and free adjusted funds flow in each of the second half of 2025, and 2025 and 2026 on an annual basis, production for the third and fourth quarter of 2025, annual 2025 production and annual 2026 production, which are based on, among other things, the various assumptions disclosed in this press release including under "Advisory regarding forward-looking information and statements" and including assumptions regarding benchmark pricing as it relates to the 2025 capital allocation framework. The financial outlooks disclosed herein do not include the potential impact of any tariff or other trade related regulations enacted by the U.S., Canada or other countries, other than those in effect as of August 6, 2025. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and the impact of the tariffs on NuVista’s business operations and financial condition, while currently unknown, may be material and adverse and, as such, undue reliance should not be placed on FOFI. NuVista’s actual results, performance or achievement could differ materially from those expressed in, or implied by, these FOFI, or if any of them do so, what benefits NuVista will derive therefrom. NuVista has included the FOFI in order to provide readers with a more complete perspective on NuVista’s future operations and such information may not be appropriate for other purposes. These forward-looking statements and FOFI are made as of the date of this press release and NuVista disclaims any intent or obligation to update any forward-looking statements and FOFI, whether as a result of new information, future events or results or otherwise, other than as required by applicable securities law. Specified Financial Measures This press release uses various specified financial measures (as such terms are defined in National Instrument 52-112 – Non- GAAP Disclosure and Other Financial Measures Disclosure (“NI 52-112”)) including “non-GAAP financial measures”, “non- GAAP ratios”, “capital management measures” and “supplementary financial measures” (as such terms are defined in NI 52- 112), which are described in further detail below. Management believes that the presentation of these non-GAAP measures provides useful information to investors and shareholders as the measures provide increased transparency and the ability to better analyze performance against prior periods on a comparable basis. (1) Non-GAAP financial measures NI 52-112 defines a non-GAAP financial measure as a financial measure that: (i) depicts the historical or expected future financial performance, financial position or cash flow of an entity; (ii) with respect to its composition, excludes an amount that is included in, or includes an amount that is excluded from, the composition of the most directly comparable financial measure disclosed in the primary financial statements of the entity; (iii) is not disclosed in the financial statements of the entity; and (iv) is not a ratio, fraction, percentage or similar representation. These non-GAAP financial measures are not standardized financial measures under IFRS Accounting Standards and might not be comparable to similar measures presented by other companies where similar terminology is used. Investors are cautioned that these measures should not be construed as alternatives to or more meaningful than the most directly comparable GAAP measures as indicators of NuVista’s performance. Set forth below are descriptions of the non-GAAP financial measures used in this press release. • Free adjusted funds flow Free adjusted funds flow is adjusted funds flow less net capital expenditures, power generation expenditures, and asset retirement expenditures. Each of the components of free adjusted funds flow are non-GAAP financial measures. Please refer to disclosures under the headings “Capital management measures” and “Net capital expenditures” for a description of each component of free adjusted funds flow. Management uses free adjusted funds flow as a measure of the efficiency and liquidity of its business, measuring its funds available for additional capital allocation to manage debt levels and return capital to shareholders through its NCIB program and/or dividend payments. By removing the impact of current period net capital and asset retirement expenditures, management believes this measure provides an indication of the funds NuVista has available for future capital allocation decisions. Free adjusted funds flow guidance is a forward-looking non-GAAP financial measure. NuVista does not provide a reconciliation of such forward-looking measure to the most directly comparable financial measure calculated and presented in accordance with GAAP due to unknown variables and the uncertainty related to future results. Guidance for free adjusted funds flow is calculated in the same manner as described above for historical free adjusted funds flow, as applicable. The following table sets out our free adjusted funds flow compared to the most directly comparable GAAP measure of cash provided by operating activities less cash used in investing activities for the applicable periods: Three months ended June 30 Six months ended June 30 ($ thousands) 2025 2024 2025 2024
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Cash provided by operating activities 71,041 166,280 303,704 314,173 Cash used in investing activities (120,461) (138,110) (298,489) (304,137) Excess cash provided by operating activities over cash used in investing activities (49,420) 28,170 5,215 10,036 Adjusted funds flow 134,272 140,246 326,158 275,659 Net capital expenditures (81,736) (121,497) (235,147) (309,353) Power generation expenditures — — — (1,680) Asset retirement expenditures (1,649) (392) (5,129) (6,842) Free adjusted funds flow 50,887 18,357 85,882 (42,216) • Net Capital expenditures Net capital expenditures are equal to cash used in investing activities, excluding changes in non-cash working capital, other asset expenditures, and power generation expenditures. The Company includes funds used for property acquisitions or proceeds from property dispositions within net capital expenditures as these transactions are part of its development plans. NuVista considers net capital expenditures to represent its organic capital program inclusive of capital spending for acquisition and disposition proposes and a useful measure of cash flow used for capital reinvestment. There were no differences between capital expenditures and net capital expenditures for the three and six months ended June 30, 2025, and June 30, 2024, as NuVista did not complete any property acquisitions or dispositions during these periods. Net capital expenditure guidance is a forward-looking non-GAAP financial measure. NuVista does not provide a reconciliation of such forward-looking measure to the most directly comparable financial measure calculated and presented in accordance with GAAP due to unknown variables and the uncertainty related to future results. Guidance for net capital expenditures is calculated in the same manner as described above for historical net capital expenditures, as applicable. The following table provides a reconciliation between the non-GAAP measure of net capital expenditures to the most directly comparable GAAP measure of cash used in investing activities for the applicable periods: Three months ended June 30Six months ended June 30 ($ thousands) 2025 2024 2025 2024 Cash used in investing activities (120,461) (138,110) (298,489) (304,137) Changes in non-cash working capital 10,806 16,613 10,408 (6,896) Other asset expenditures (27,919) — 52,934 — Power generation expenditures — — — 1,680 Net capital expenditures (81,736) (121,497) (235,147) (309,353) The following table provides a breakdown of net capital expenditures and power generation expenditures by category for the applicable periods: Three months ended June 30Six months ended June 30 ($ thousands, except % amounts) 2025 % of total 2024 % of total 2025 % of total 2024 % of total Land and retention costs — — 6,004 6 — — 6,968 2 Geological and geophysical 334 — 429 — 697 — 614 — Drilling and completion 67,294 82 85,473 70 198,788 85 214,438 70 Facilities and equipment 12,645 15 27,976 23 32,365 14 84,078 27 Corporate and other 1,463 3 1,615 1 3,297 1 3,255 1 Net capital expenditures 81,736 121,497 235,147 309,353 Power generation expenditures — — — 1,680 (2) Non-GAAP ratios NI 52-112 defines a non-GAAP ratio as a financial measure that: (i) is in the form of a ratio, fraction, percentage or similar representation; (ii) has a non-GAAP financial measure as one or more of its components; and (iii) is not disclosed in the financial statements of the entity. Set forth below is a description of the non-GAAP ratios used in this MD&A. These non-GAAP ratios are not standardized financial measures under IFRS Accounting Standards and might not be comparable to similar measures presented by other companies where similar terminology is used. Investors are cautioned that these ratios should not be construed as alternatives to or more meaningful than the most directly comparable IFRS Accounting Standards measures as indicators of NuVista's performance. Per Boe disclosures for petroleum and natural gas revenues, realized gains/losses on financial derivatives, royalties, transportation expense, G&A expense, financing costs, and DD&A expense are non-GAAP ratios that are calculated by dividing each of these respective GAAP measures by NuVista’s total production volumes for the period. Non-GAAP ratios presented on a “per Boe” basis may also be considered to be supplementary financial measures (as such term is defined in NI 52-112).
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• Operating netback and corporate netback ("netbacks"), per Boe NuVista calculated netbacks per Boe by dividing the netbacks by total production volumes sold in the period. Each of operating netback and corporate netback are non-GAAP financial measures. Operating netback is calculated as petroleum and natural gas revenues, realized financial derivative gains/losses and other income, less royalties, transportation expense and net operating expense. Corporate netback is operating netback less general and administrative expense, cash share-based compensation expense (recovery), financing costs excluding accretion expense, and current income tax expense (recovery). Management believes both operating and corporate netbacks are key industry benchmarks and measures of operating performance for NuVista that assists management and investors in assessing NuVista’s profitability, and are commonly used by other petroleum and natural gas producers. The measurement on a Boe basis assists management and investors with evaluating NuVista’s operating performance on a comparable basis. • Net operating expense, per Boe NuVista calculated net operating expense per Boe by dividing net operating expense by NuVista’s production volumes for the period. Management believes that net operating expense, calculated as gross operating expense less processing income and other recoveries, which are included in NuVista’s statements of earnings, is a meaningful measure for investors to understand the net impact of the Company’s operating activities. The measurement on a Boe basis assists management and investors with evaluating NuVista's operating performance on a comparable basis. (3) Capital management measures NI 52-112 defines a capital management measure as a financial measure that: (i) is intended to enable an individual to evaluate an entity’s objectives, policies and processes for managing the entity’s capital; (ii) is not a component of a line item disclosed in the primary financial statements of the entity; (iii) is disclosed in the notes to the financial statements of the entity; and (iv) is not disclosed in the primary financial statements of the entity. NuVista has defined net debt, adjusted funds flow, and net debt to annualized current quarter adjusted funds flow ratio as capital management measures used by the Company in this press release. • Adjusted funds flow NuVista considers adjusted funds flow to be a key measure that provides a more comprehensive view of the company’s ability to generate cash flow necessary for financing capital expenditures, meeting asset retirement obligations, and fulfilling its financial commitments. Adjusted funds flow is calculated by adjusting cash flow from operating activities to exclude changes in non-cash working capital and asset retirement expenditures. Management believes these elements are subject to timing variations in collection, payment, and occurrence. By excluding them, management is able to provide a more meaningful performance measure of NuVista’s ongoing operations. Specifically, expenditures on asset retirement obligations may fluctuate depending on the company’s capital programs and the maturity of its operating areas, while environmental remediation recovery is tied to an infrequent incident that management does not expect to recur regularly. The settlement of asset retirement obligations is managed through NuVista’s capital budgeting process, which incorporates the available adjusted funds flow. A reconciliation of adjusted funds flow is presented in the following table: Three months ended June 30Six months ended June 30 ($ thousands) 2025 2024 2025 2024 Cash provided by operating activities 71,041 166,280 303,704 314,173 Asset retirement expenditures 1,649 392 5,129 6,842 Change in non-cash working capital 61,582 (26,426) 17,325 (45,356) Adjusted funds flow 134,272 140,246 326,158 275,659 • Net debt Net debt is used by management to provide a more comprehensive understanding of NuVista’s capital structure and to assess the company’s liquidity. NuVista calculates net debt by considering accounts receivable, prepaid expenses, accounts payable and accrued liabilities, long-term debt (the credit facility), senior unsecured notes, and other liabilities. Management uses total market capitalization and the ratio of net debt to annualized adjusted funds flow for the current quarter to analyze balance sheet strength and liquidity. The following is a summary of total market capitalization, net debt and net debt to annualized current quarter adjusted funds flow: ($ thousands) June 30, 2025 December 31, 2024 Basic common shares outstanding (thousands of shares) 197,066 203,701 Share price(1) 14.98 13.82
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Total market capitalization 2,952,049 2,815,148 Accounts receivable and other (86,712) (132,538) Prepaid expenses (54,072) (45,584) Accounts payable and accrued liabilities 139,953 206,862 Current portion of other liabilities 18,343 18,351 Long-term debt 105,720 5,353 Senior unsecured notes 163,887 163,258 Other liabilities 16,117 16,801 Net debt 303,236 232,503 Annualized current quarter adjusted funds flow 537,088 548,236 Net debt to annualized current quarter adjusted funds flow 0.6 0.4 (1) Represents the closing share price on the TSX on the last trading day of the period. (4) Supplementary financial measures This press release may contain certain supplementary financial measures. NI 52-112 defines a supplementary financial measure as a financial measure that: (i) is intended to be disclosed on a periodic basis to depict the historical or expected future financial performance, financial position or cash flow of an entity; (ii) is not disclosed in the financial statements of the entity; (iii) is not a non-GAAP financial measure; and (iv) is not a non-GAAP ratio. NuVista calculates “adjusted funds flow per share” by dividing adjusted funds flow for a period by the number of weighted average common shares of NuVista for the specified period by dividing operating netback for a period by the number of weighted average common shares of NuVista for the specified period. FOR FURTHER INFORMATION CONTACT: Mike J. Lawford President and CEO (403) 538-1936 Ivan J. Condic VP, Finance and CFO (403) 538-1945