Earnings release
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2025-07-31 NOG Announces Second Quarter 2025 Results and Updates 2025 Guidance SECOND QUARTER HIGHLIGHTS Total quarterly production of 134,094 Boe per day (57% oil), up 9% from the second quarter of 2024 Oil volumes of 76,944 Bbl per day, up 10.5% from the second quarter of 2024 Record Appalachian volumes of 123.5 MMcf per day Uinta volumes up over 18.5% sequentially, marking the second consecutive quarter of double digit growth GAAP net income of $99.6 million, Adjusted Net Income of $136.3 million and record Adjusted EBITDA of $440.4 million. See “Non-GAAP Financial Measures” below Cash ow from operations of $362.1 million. Excluding changes in net working capital, cash ow from operations was $387.0 million, an increase of 3% from the second quarter of 2024 Generated $126.2 million of Free Cash Flow. See “Non-GAAP Financial Measures” below Capital expenditures of $210.0 million, excluding non-budgeted acquisitions and other items, down 12% from the second quarter of 2024 Completed twenty-two ground game transactions adding approximately 2,600 net acres and 4.8 net wells for $31.2 million, inclusive of associated development costs In April 2025, closed on previously announced Upton County, Texas acquisition adding 2,275 net acres for total cash consideration of $61.7 million, net of closing adjustments. Raised $211.2 million in a re-opening of 2029 Convertible Notes and repurchased over 1.1 million shares of common stock at an average price of $31.15 per share in conjunction with the o ering Expect to receive a $48.6 million legal settlement, net of legal expenses Updates guidance on operating costs, production levels and capital expenditures MINNEAPOLIS--(BUSINESS WIRE)-- Northern Oil and Gas, Inc. (NYSE: NOG) (“NOG” or “Company”) today announced the Company’s second quarter results. MANAGEMENT COMMENTS “NOG’s diverse and scaled platform delivered solid results, with strong free cash ow generation and continued growth from our Appalachian and Uinta Basin properties. The Ground Game continues to gain momentum, providing accretive opportunities that should bene t the Company through cycle, featuring both near term development and longer dated inventory rich opportunities. With a focus on creating shareholder value for the long-term, we anticipate incremental growth being focused on the strong backlog of inorganic opportunities 1
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available to us in the marketplace today,” commented Nick O’Grady, NOG’s Chief Executive O cer. SECOND QUARTER FINANCIAL RESULTS Oil and natural gas sales for the second quarter were $574.4 million. Second quarter GAAP net income was $99.6 million or $1.00 per diluted share. Second quarter Adjusted Net Income was $136.3 million or $1.37 per adjusted diluted share. Adjusted EBITDA in the second quarter was $440.4 million, a 7% increase from the second quarter of 2024. See “Non-GAAP Financial Measures” below. PRODUCTION Second quarter production was 134,094 Boe per day, inline with the rst quarter of 2025 and a 9% increase from the prior year. Oil represented 57% of total production in the second quarter with 76,944 Bbls per day, down 2% from the rst quarter of 2025 and an increase of 10.5% from the second quarter of 2024. NOG had 20.8 net wells added to production during the second quarter, compared to 27.3 net wells added to production in the rst quarter of 2025. Despite modest commodity price related shut ins, the Company saw strong well performance across multiple basins. Uinta volumes were again exceptional, growing over 18.5% sequentially, and Appalachian volumes set a new record for the second straight quarter during a period of strong natural gas pricing. PRICING During the second quarter, NOG’s unhedged net realized oil price was $58.37. The Company’s average di erential to WTI prices was $5.31, an 8% improvement from the rst quarter of 2025, driven primarily by lower di erentials in the Uinta Basin. NOG’s unhedged net realized gas price in the second quarter was $2.89 per Mcf, representing a 82% realization compared with Henry Hub pricing. Natural gas realizations declined from the rst quarter of 2025 primarily driven by continued widening in Waha pricing in the Permian. OPERATING COSTS Lease operating costs were $121.4 million in the second quarter of 2025, or $9.95 per Boe, 6% higher on a per unit basis compared to the rst quarter of 2025. LOE costs increased primarily due to higher processing and salt water disposal costs. Production taxes were $35.6 million in the second quarter of 2025, compared to $36.1 million in the rst quarter of 2025, a decrease primarily due to lower realized oil prices. Second quarter general and administrative (“G&A”) costs totaled $15.6 million or $1.28 per Boe, as compared to $1.19 per Boe in the rst quarter of 2025. NOG’s adjusted cash G&A costs, which excludes non-cash share-based compensation and acquisition cost amounts of $3.7 million and $1.0 million, respectively, totaled $10.9 million or $0.89 per Boe in the second quarter, up $0.02 per Boe compared to the rst quarter of 2025. CAPITAL EXPENDITURES AND ACQUISITIONS Capital expenditures for the second quarter were $210.0 million (excluding non-budgeted acquisitions and other). 2
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This was comprised of $178.8 million of total drilling and completion (“D&C”) capital on organic assets, and $31.2 million of Ground Game activity inclusive of associated development costs. Notably, capital expenditures were down 16.0% quarter over quarter and 11.5% year over year while production volumes remained robust. D&C spending was largely as expected during the quarter, with signi cant spud activity and steady AFE activity. Normalized well costs on the Company’s D&C list declined sequentially, now averaging approximately $800 per lateral foot. NOG’s Permian Basin spending was 34% of the capital expenditures for the second quarter, the Williston was 25%, the Uinta was 15% and the Appalachian was 26%. On the Ground Game acquisition front, NOG closed on twenty two transactions across the Company’s four operating areas and featuring various structures totaling over 2,600 net acres and separately 4.8 net current and future development wells. On April 1, 2025, NOG closed on its previously announced Upton County, Texas acquisition from a private operator. The assets add 2,275 net acres and were acquired for total cash consideration of $61.7 million, net of closing adjustments. LIQUIDITY AND CAPITAL RESOURCES NOG had total liquidity in excess of $1.1 billion as of June 30, 2025, consisting of $1.1 billion of committed borrowing availability under its Revolving Credit Facility and $25.9 million cash on hand. OTHER MATTERS NOG accounts for its assets under the Full Cost method, as opposed to the Successful E orts method, which does not perform historical price-based asset tests. Driven by lower average oil prices, the Company recorded a non- cash impairment charge of $115.6 million in the second quarter of 2025 under the “ceiling test” of its full cost pool of oil and gas assets. This non-cash charge will have no impact on cash ows of the Company. In June 2025, the Company entered into a settlement and mutual release agreement (the “Settlement Agreement”) with an operator in North Dakota (the “Operator”). Pursuant to the Settlement Agreement, the Operator and the Company have settled and permanently released certain claims of the Company relating to certain post-production costs previously deducted from revenues. Pursuant to the settlement, the Company will receive approximately $81.7 million, recorded within Oil and Gas Sales in the accompanying condensed statements of operations. The Company expects to receive a net cash settlement of $48.6 million after deducting approximately $33.1 million in legal settlement expenses. The cash proceeds are expected to be received in the third quarter of 2025. SHAREHOLDER RETURNS In the second quarter of 2025, the Company repurchased 1.1 million shares of common stock at an average price of $31.15 per share in connection with the re-opening of the Company’s 2029 Convertible Notes. In the second quarter of 2025, the Company paid a cash dividend of $0.45 per share to NOG’s stockholders of 3
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record as of March 28, 2025. This represented an increase of 7% over the dividend per share paid in the previous quarter. In July 2025, the Company paid a cash dividend of $0.45 per share to NOG’s stockholders of record as of June 27, 2025. 2025 ANNUAL GUIDANCE Given the recent volatility in commodity markets, the reduction of activity in the Williston Basin and a reduction in discretionary spending, the Company is reducing overall capital spending for 2025 by $125 - $150 million from the prior range. In accordance with the reduced capital spending, oil volume guidance is reduced, at the midpoint, to the low end of the prior range of guidance. Additionally, total production guidance was reduced by approximately 1,000 Boe per day at the midpoint. NOG continues to be highly exible with its capital spending, and should commodity prices and thus, returns, increase, the Company could accelerate capital spending to prior levels if warranted. NOG currently expects total capital spending in the range of $925 - $1,050 million for 2025, with approximately 57% of its 2025 budget to be spent on the Permian, 17% on the Williston, 16% on the Appalachian and 11% on the Uinta Basin. In addition to revisions to capital spending and oil volumes, the Company has made modest additional guidance changes to production expenses, NYMEX WTI di erentials and production taxes, which are detailed in the table below. Prior GuidanceRevised Guidance Annual Production (Boe per day) 130,000 - 135,000130,000 - 133,000Annual Oil Production (Bbls per day) 75,000 - 79,00074,000 - 76,000Total Capital Expenditures ($ in millions) $1,050 - $1,200$925 - $1,050Net Oil Wells Turned-in-Line (TIL) 87.0 - 91.0 73.0 - 76.0Net Total Wells Turned-in-Line (TIL)97.0 - 99.0 83.0 - 85.0Net Wells Spud 106.0 - 110.0 75.0 - 85.0 Operating Expenses and Di erentials Production Expenses (per Boe) $9.15 - $9.40 $9.25 - $9.60Production Taxes (as a percentage of Oil & Gas Sales)8.5% - 9.0% 7.5% - 8.5%Average Di erential to NYMEX WTI (per Bbl) ($4.75) - ($5.50)($5.25) - ($5.75)Average Realization as a Percentage of NYMEX Henry Hub (per Mcf) 85% - 90% 85% - 90%DD&A (per Boe) $16.50 - $17.50$16.00 - $17.00 General and Administrative Expense (per Boe): Non-Cash $0.25 - $0.30 $0.25 - $0.30Cash (excluding transaction costs on non-budgeted acquisitions)$0.85 - $0.90 $0.85 - $0.90 4
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SECOND QUARTER 2025 RESULTS The following tables set forth selected operating and nancial data for the periods indicated. Three Months Ended June 30, 20252024% ChangeNet Production: Oil (MBbl) 7,002 6,338 10% Natural Gas (MMcf) 31,20429,319 6% Total (MBoe) 12,20311,224 9% Average Daily Production: Oil (Bbl) 76,94469,645 10% Natural Gas (Mcf) 342,900322,183 6% Total (Boe) 134,094123,342 9% Average Sales Prices: Oil (per Bbl) $ 58.37$ 77.11 (24)% E ect of Gain (Loss) on Settled Oil Derivatives on Average Price (per Bbl)6.21 (2.30) Oil Net of Settled Oil Derivatives (per Bbl)64.58 74.81 (14)%Natural Gas and NGLs (per Mcf) 2.89 2.47 17% E ect of Gain on Settled Natural Gas Derivatives on Average Price (per Mcf)0.56 0.80 Natural Gas and NGLs Net of Settled Natural Gas and NGL Derivatives (per Mcf)3.45 3.27 6%Realized Price on a Boe Basis Excluding Settled Commodity Derivatives40.87 49.98 (18)% E ect of Gain on Settled Commodity Derivatives on Average Price (per Boe)4.99 0.79 Realized Price on a Boe Basis Including Settled Commodity Derivatives45.86 50.77 (10)% Costs and Expenses (per Boe): Production Expenses $ 9.95$ 8.99 11%Production Taxes 2.92 4.33 (33)%General and Administrative Expenses 1.28 1.21 6%Depletion, Depreciation, Amortization and Accretion16.86 15.73 7% Net Producing Wells at Period End1,151.71,015.2 13% ____________________(1)Excludes the impact of certain non-cash adjustments to oil revenues. (2)Excludes the impact of a legal settlement (See Note 2 to our nancial statements included in our Form 10-Q led with the SEC for the quarter endedJune 30, 2025). HEDGING NOG hedges portions of its expected production volumes to increase the predictability of its cash ow and to help maintain a strong nancial position.The following table summarizes NOG’s open crude oil commodity derivative swap contracts scheduled to settle after June 30, 2025. Crude Oil Commodity Derivative SwapsCrude Oil Commodity Derivative Collars Contract PeriodVolume (Bbls/Day) Weighted Average Price ($/Bbl) Collar Call Volume (Bbls/Day) Collar Put Volume (Bbls/Day) Weighted Average Ceiling Price($/Bbl) Weighted Average Floor Price ($/Bbl) 2025: Q3 31,913$ 72.76 25,05419,761$ 77.43$ 69.15Q4 32,933 72.75 24,76619,473 77.55 69.15 2026: Q1 15,930$ 69.84 34,68027,187$ 72.98$ 62.94Q2 11,430 68.11 24,68017,187 71.35 63.55Q3 15,430 69.06 19,68012,187 72.33 65.01Q4 15,430 69.04 19,68012,187 72.33 65.01 ____________________(1)Includes derivative contracts entered into as of July 25, 2025. This table does not include volumes subject to swaptions and call options, which arecrude oil derivative contracts NOG has entered into which may increase swapped volumes at the option of NOG’s counterparties. This table alsodoes not include basis swaps. For additional information, see Note 10 to our nancial statements included in our Form 10-Q led with the SEC forthe quarter ended June 30, 2025. (1) (1) (2) (2) (1) (2) (1) (2) (1) 5
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The following table summarizes NOG’s open natural gas commodity derivative swap contracts scheduled to settle after June 30, 2025. Natural Gas CommodityDerivative SwapsNatural Gas Commodity Derivative Collars Contract PeriodVolume(MMBTU/Day) WeightedAveragePrice($/MMBTU) Collar CallVolume(MMBTU/Day) Collar PutVolume(MMBTU/Day) WeightedAverageCeiling Price($/MMBTU) WeightedAverageFloor Price($/MMBTU) 2025: Q3 102,929$ 3.99 101,828101,828$ 4.56$ 2.93Q4 108,188 4.09 106,364106,364 4.73 3.08 2026: Q1 87,333$ 4.13 114,203114,203$ 5.07$ 3.36Q2 74,121 3.93 113,348113,348 5.05 3.37Q3 70,000 4.02 105,486105,486 5.02 3.39Q4 79,891 4.25 76,681 76,681 4.95 3.37 2027: Q1 5,000$ 3.04 14,833 14,833$ 3.86$ 3.00Q2 5,055 2.96 15,165 15,165 3.86 3.00Q3 5,000 2.96 15,000 15,000 3.86 3.00Q4 4,946 2.96 9,946 9,946 3.86 3.00 ____________________(1)Includes derivative contracts entered into as of July 25, 2025. This table does not include basis swaps. For additional information, see Note 10 to our nancial statements included in our Form 10-Q led with the SEC for the quarter ended June 30, 2025. The following table summarizes NOG’s open NGL commodity derivative swap contracts scheduled to settle after June 30, 2025. NGL Contracts Swaps Contract Period Volume (BBL) Weighted Average Price($/BBL) 2025: Q3 59,800$ 36.16Q4 133,400 36.71 2026: Q1 92,250$ 36.00Q2 106,925 33.32Q3 96,600 33.03Q4 80,500 33.32 2027: Q1 65,250$ 32.30Q2 59,150 30.73Q3 57,500 30.69Q4 52,900 30.87 The following table presents NOG’s settlements on commodity derivative instruments and unsettled gains and losses on open commodity derivativeinstruments for the periods presented, which is included in the revenue section of NOG’s statement of operations: Three Months EndedJune 30, (In thousands) 2025 2024 Cash Received on Settled Derivatives $ 60,931$ 8,896 Non-Cash Mark-to-Market Gain (Loss) on Derivatives67,888(12,324) Gain (Loss) on Commodity Derivatives, Net$ 128,819$ (3,428) (1) 6
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CAPITAL EXPENDITURES & DRILLING ACTIVITY (In thousands, except for net well data and dollars per foot) Three MonthsEnded June 30, 2025Capital Expenditures Incurred: Organic Drilling and Development Capital Expenditures$ 178,820Ground Game Drilling and Development Capital Expenditures$ 7,305Ground Game Acquisition Capital Expenditures inclusive of pre-closing development costs$ 23,851Other $ 2,261Non-Budgeted Acquisitions $ 63,926Net Wells Added to Production 20.8Net Producing Wells (Period-End) 1,151.7Net Wells in Process (Period-End) 53.2Weighted Average Gross AFE for Wells Elected to$ 9,606Weighted Average Gross AFE for Wells Elected to, normalized for lateral length ($ per foot)$ 841 SECOND QUARTER 2025 EARNINGS RELEASE CONFERENCE CALL In conjunction with NOG’s release of its nancial and operating results, investors, analysts and other interested parties are invited to listen to a conference call with management on Friday, August 1, 2025 at 8:00 a.m. Central Time. Those wishing to listen to the conference call may do so via webcast or phone as follows: Webcast: https://events.q4inc.com/attendee/790034429Dial-In Number: (800) 715-9871 (US/Canada) and (646) 307-1963 (International)Conference ID: 4503139 - NOG Second Quarter 2025 Earnings Conference CallReplay Dial-In Number: (800) 770-2030 (US/Canada) and (647) 362-9199 (International) Replay Access Code: 4503139 - Replay will be available through August 15, 2025 ABOUT NOG NOG is a real asset company with a primary strategy of acquiring and investing in non-operated minority working and mineral interests in the premier hydrocarbon producing basins within the contiguous United States. More information about NOG can be found at www.noginc.com. SAFE HARBOR This press release contains forward-looking statements regarding future events and future results that are subject to the safe harbors created under the Securities Act of 1933, as amended, and the Securities Exchange Act of 1934, as amended. All statements other than statements of historical facts included in this release regarding NOG’s nancial position, operating and nancial performance, business strategy, dividend plans and practices, plans and objectives of management for future operations, industry conditions, and indebtedness covenant compliance are forward-looking statements. When used in this release, forward-looking statements are generally accompanied by terms or phrases such as “estimate,” “project,” “predict,” “believe,” “expect,” “continue,” “anticipate,” “target,” “could,” “plan,” “intend,” “seek,” “goal,” “will,” “should,” “may” or other words and similar expressions that convey the uncertainty of future events or outcomes. Items contemplating or making assumptions about actual or potential future production and sales, market size, collaborations, and trends or operating results also constitute such 7
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forward-looking statements. Forward-looking statements involve inherent risks and uncertainties, and important factors (many of which are beyond NOG’s control) that could cause actual results to di er materially from those set forth in the forward- looking statements, including the following: changes in crude oil and natural gas prices, the pace of drilling and completions activity on NOG’s current properties and properties pending acquisition; infrastructure constraints and related factors a ecting NOG’s properties; general economic or industry conditions, whether internationally, nationally and/or in the communities in which NOG conducts business, including any future economic downturn, supply chain disruptions, the impact of continued or further in ation, disruption in the nancial markets, changes in the interest rate environment and actions taken by OPEC and other oil producing countries as it pertains to the global supply and demand of, and prices for, crude oil, natural gas and NGLs; ongoing legal disputes over, and potential shutdown of, the Dakota Access Pipeline; NOG’s ability to identify and consummate additional development opportunities and potential or pending acquisition transactions, the projected capital e ciency savings and other operating e ciencies and synergies resulting from NOG’s acquisition transactions, integration and bene ts of property acquisitions, or the e ects of such acquisitions on NOG’s cash position and levels of indebtedness; changes in NOG’s reserves estimates or the value thereof; disruption to NOG’s business due to acquisitions and other signi cant transactions; changes in local, state, and federal laws, regulations or policies that may a ect NOG’s business or NOG’s industry (such as the e ects of tax law changes, and changes in environmental, health, and safety regulation and regulations addressing climate change, and trade policy and tari s); conditions of the securities markets; risks associated with NOG’s 3.625% convertible senior notes due 2029 (the “Convertible Notes”), including the potential impact that the Convertible Notes may have on NOG’s nancial position and liquidity, potential dilution, and that provisions of the Convertible Notes could delay or prevent a bene cial takeover of NOG; the potential impact of the capped call transaction undertaken in tandem with the Convertible Notes issuance, including counterparty risk; increasing attention to environmental, social and governance matters; NOG’s ability to raise or access capital on acceptable terms; cyber-incidents could have a material adverse e ect on NOG’s business, nancial condition or results of operations; changes in accounting principles, policies or guidelines; events beyond NOG’s control, including a global or domestic health crisis, acts of terrorism, political or economic instability or armed con ict in oil and gas producing regions; and other economic, competitive, governmental, regulatory and technical factors a ecting NOG’s operations, products and prices. Additional information concerning potential factors that could a ect future results is included in the section entitled “Item 1A. Risk Factors” and other sections of NOG’s most recent Annual Report on Form 10-K for the year ended December 31, 2024, and Quarterly Report on Form 10-Q, as updated from time to time in amendments and subsequent reports led with the SEC, which describe factors that could cause NOG’s actual results to di er from those set forth in the forward-looking statements. NOG has based these forward-looking statements on its current expectations and assumptions about future events. While management considers these expectations and assumptions to be reasonable, they are inherently subject to signi cant business, economic, competitive, regulatory and other risks, contingencies and uncertainties, most of which are di cult to predict and many of which are beyond NOG’s control. Accordingly, results actually 8
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achieved may di er materially from expected results described in these statements. NOG does not undertake any duty to update or revise any forward-looking statements, except as may be required by the federal securities laws. CONDENSED STATEMENTS OF OPERATIONS(UNAUDITED)Three Months EndedJune 30, (In thousands, except share and per share data)2025 2024 Revenues Oil and Gas Sales $ 574,369$ 561,025Gain (Loss) on Commodity Derivatives, Net128,819 (3,428) Other Revenues 3,621 3,169 Total Revenues 706,809 560,766 Operating Expenses Production Expenses 121,430 100,859Production Taxes 35,616 48,589General and Administrative Expenses 15,628 13,538Legal Settlement Expense 33,091 —Depletion, Depreciation, Amortization and Accretion205,741 176,612Impairment of Oil and Gas Assets 115,576 — Other Expenses 3,561 2,232 Total Operating Expenses 530,643 341,830 Income From Operations 176,166 218,936 Other Income (Expense) Interest Expense, Net of Capitalization (44,435) (37,696)Gain (Loss) on Unsettled Interest Rate Derivatives, Net1 — Other Income 46 63 Total Other Expense, Net (44,388) (37,633) Income Before Income Taxes 131,778 181,303 Income Tax Expense 32,193 42,746 Net Income $ 99,585$ 138,556 Net Income Attributable to Common Stockholders$ 99,585$ 138,556 Net Income Per Common Share – Basic$ 1.02$ 1.38 Net Income Per Common Share – Diluted$ 1.00$ 1.36 Weighted Average Common Shares Outstanding – Basic98,060,407100,266,462 Weighted Average Common Shares Outstanding – Diluted99,394,539101,985,074 CONDENSED BALANCE SHEETS(UNAUDITED) (In thousands, except par value and share data)June 30, 2025December 31,2024Assets Current Assets:Cash and Cash Equivalents $ 25,856$ 8,933Accounts Receivable, Net 410,245 389,673Advances to Operators 24,641 12,291Prepaid Expenses and Other 6,517 5,271Derivative Instruments 109,281 46,525 Income Tax Receivable 11,817 38,050 Total Current Assets 588,357 500,743 Property and Equipment:Oil and Natural Gas Properties, Full Cost Method of AccountingProved 10,850,66410,307,376Unproved 35,307 42,702 Other Property and Equipment 8,678 8,197 Total Property and Equipment 10,894,64910,358,275 Less – Accumulated Depreciation, Depletion and Impairment(5,801,503) (5,276,105) Total Property and Equipment, Net 5,093,1465,082,170Derivative Instruments 1,311 9,832 Other Noncurrent Assets, Net 19,679 11,077 9
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Total Assets $ 5,702,493$ 5,603,822 Liabilities and Stockholders’ Equity Current Liabilities:Accounts Payable $ 173,911$ 202,866Accrued Liabilities and Other 310,162 321,489 Derivative Instruments 4,124 19,915 Total Current Liabilities 488,197 544,270 Long-term Debt, Net 2,365,9422,369,294Deferred Tax Liability 298,749 228,038Derivative Instruments 86,187 93,606Asset Retirement Obligations 48,376 45,907 Other Noncurrent Liabilities 2,023 2,272 Total Liabilities $ 3,289,474$ 3,283,387 Commitments and ContingenciesStockholders’ Equity Common Stock, Par Value $0.001; 270,000,000 Shares Authorized;97,594,682 Shares Outstanding at 6/30/202599,113,645 Shares Outstanding at 12/31/2024500 501Additional Paid-In Capital 1,731,4341,877,416 Retained Earnings 681,085 442,518 Total Stockholders’ Equity 2,413,0192,320,435 Total Liabilities and Stockholders’ Equity$ 5,702,493$ 5,603,822 Non-GAAP Financial Measures Adjusted Net Income, Adjusted EBITDA and Free Cash Flow are non-GAAP measures. NOG de nes Adjusted Net Income as income before income taxes, excluding (i) (gain) loss on unsettled commodity derivatives, net of tax, (ii) (gain) loss on extinguishment of debt, net of tax, (iii) contingent consideration (gain) loss, net of tax, (iv) acquisition transaction costs, net of tax, (v) (gain) loss on unsettled interest rate derivatives, net of tax, and (vi) impairment of long-lived assets, net of tax. NOG de nes Adjusted EBITDA as net income before (i) interest expense, (ii) income taxes, (iii) depreciation, depletion, amortization and accretion, (iv) non-cash stock-based compensation expense, (v) (gain) loss on extinguishment of debt, (vi) contingent consideration (gain) loss (vii) acquisition transaction costs, (viii) (gain) loss on unsettled interest rate derivatives, (ix) (gain) loss on unsettled commodity derivatives, (x) impairment of long-lived assets, and (xi) other non-cash adjustments. NOG de nes Free Cash Flow as cash ows from operations before changes in working capital and other items, less (i) capital expenditures, excluding non-budgeted acquisitions and changes in accrued capital expenditures and other items. A reconciliation of each of these measures to the most directly comparable GAAP measure is included below. Management believes the use of these non-GAAP nancial measures provides useful information to investors to gain an overall understanding of current nancial performance. Management believes Adjusted Net Income and Adjusted EBITDA provide useful information to both management and investors by excluding certain expenses and unrealized commodity gains and losses that management believes are not indicative of NOG’s core operating results. Management believes that Free Cash Flow is useful to investors as a measure of a company’s ability to internally fund its budgeted capital expenditures, to service or incur additional debt, and to measure success in creating stockholder value. In addition, these non-GAAP nancial measures are used by management for budgeting and forecasting as well as subsequently measuring NOG’s performance, and management believes it is providing investors with nancial measures that most closely align to its internal measurement processes. The non-GAAP nancial measures included herein may be de ned di erently than similar measures used by other companies and should not be considered an alternative to, or more meaningful than, the comparable GAAP measures. From time to time NOG provides forward-looking Free Cash Flow estimates or targets; however, NOG is unable to provide a 10
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quantitative reconciliation of the forward looking non-GAAP measure to its most directly comparable forward looking GAAP measure because management cannot reliably quantify certain of the necessary components of such forward looking GAAP measure. The reconciling items in future periods could be signi cant. Reconciliation of Adjusted Net IncomeThree Months EndedJune 30, (In thousands, except share and per share data)2025 2024 Income Before Income Taxes $ 131,778$ 181,303Add:Impact of Selected Items:(Gain) Loss on Unsettled Commodity Derivatives(67,888) 12,324Acquisition Transaction Costs 1,046 2,112Gain on Unsettled Interest Rate Derivatives(1) — Impairment of Oil and Gas Assets 115,576 — Adjusted Income Before Adjusted Income Tax Expense180,511 195,739 Adjusted Income Tax Expense (44,225) (47,956) Adjusted Net Income (non-GAAP) $ 136,286$ 147,783 Weighted Average Shares Outstanding – Basic98,060,407100,266,462 Weighted Average Shares Outstanding – Diluted99,394,539101,985,074 Less: Dilutive E ect of Convertible Notes — 738,227 Weighted Average Shares Outstanding – Adjusted Diluted99,394,539101,246,847 Income Before Income Taxes Per Common Share – Basic$ 1.34$ 1.81Add: Impact of Selected Items 0.50 0.14 Impact of Income Tax (0.45) (0.48) Adjusted Net Income Per Common Share – Basic$ 1.39$ 1.47 Income Before Income Taxes Per Common Share – Adjusted Diluted$ 1.33$ 1.79Add:Impact of Selected Items 0.49 0.14 Impact of Income Tax (0.45) (0.47) Adjusted Net Income Per Common Share – Adjusted Diluted$ 1.37$ 1.46 ____________________(1)For the three months ended June 30, 2025 and June 30, 2024, this represents a tax impact using an estimated tax rate of 24.5%. (2)Weighted average shares outstanding - diluted, on a GAAP basis, includes diluted shares attributable to the Company’s Convertible Notes due 2029.However, the o setting impact of the capped call transactions that the Company entered into in connection therewith is not recognized on a GAAPbasis. As a result, for purposes of this calculation, the Company excludes the dilutive shares to the extent they would be o set by the capped calls. Reconciliation of Adjusted EBITDAThree Months Ended June 30, (In thousands) 2025 2024 Net Income $ 99,585$ 138,556Add:Interest Expense 44,435 37,696Income Tax Expense 32,193 42,747Depreciation, Depletion, Amortization and Accretion205,741 176,612Non-Cash Stock-Based Compensation 3,729 3,026Other Adjustments 6,000 —Acquisition Transaction Costs 1,046 2,112Gain on Unsettled Interest Rate Derivatives (1) —(Gain) Loss on Unsettled Commodity Derivatives(67,888) 12,324 Impairment of Oil and Gas Assets 115,576 — $ 440416 $ 413073 (1) (2) 11
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Adjusted EBITDA $ 440,416$ 413,073 Reconciliation of Free Cash FlowThree Months Ended June 30, (In thousands) 2025 Net Cash Provided by Operating Activities $ 362,112Exclude: Changes in Working Capital and Other Items(23,700) Less: Capital Expenditures (212,234) Free Cash Flow $ 126,178 __________________(1)Excludes the net impact of a legal settlement receivable (See Note 2 to our condensed nancial statements on Form 10-Q for quarter ended June30, 2025).(2)Capital expenditures are calculated as follows: Three Months Ended June 30, (In thousands) 2025 Cash Paid for Capital Expenditures $ 327,361Less: Non-Budgeted Acquisitions (61,555) Plus: Change in Accrued Capital Expenditures and Other(53,572) Capital Expenditures $ 212,234 Evelyn Infurna Vice President of Investor Relations 952-476-9800 ir@northernoil.com Source: Northern Oil and Gas, Inc. (1) (2) 12