Granite Ridge Resources Inc (STU:Y60)

Q2 2026 Granite Ridge Resources, Inc. Earnings Call Transcript

Aug 7, 2026 / 03:00 PM GMT

Release Date Price: €3.92 (-2.49%)

Transcript 10-Q8-K

Key Points

Positve

Granite Ridge Resources Inc (GRNT) reaffirmed that 2026 is the final year of outspend, with a clear path to a free cash flow inflection in 2027, targeting a double-digit free cash flow yield at $65 oil.
The operator partnership platform, led by Admiral, continues to deliver proprietary, high-return inventory at entry costs well below marketed deals, adding 21.9 net undeveloped locations in Q2.
The company maintains a strong balance sheet with conservative leverage of approximately 1.4 times and ample liquidity, while continuing to pay a quarterly dividend.
Permian natural gas takeaway is improving with new pipelines like Huberenson coming online, which is expected to firm Waha basis and significantly boost gas revenues in the second half of 2026.
The company has built-in capital flexibility, able to cut 40-50% of development budget if oil falls below $65, or accelerate activity if conditions warrant, protecting the base business and dividend.
The planned distribution of shares by Gray Rock is viewed positively, as it will broaden the shareholder base, increase public float and trading liquidity, and transition the company to a fully independent governance structure.

Negative

Lease operating expense (LOE) ran above plan for the second consecutive quarter, driven by water handling costs in the Permian and higher early-life costs on newer pads, leading to increased full-year LOE guidance.
Permian natural gas realizations remained soft due to record-low Waha basis weakness, with Q2 gas sales of only $9.6 million, though this is expected to improve.
2026 production volumes are expected to trend towards the lower end of the guidance range due to shifts in timing, pushing a larger positive impact into Q1 2027.
The company is still investing ahead of free cash flow in 2026, with Q3 expected to be the heaviest spending quarter of the year, which could pressure near-term cash flow.
The Gray Rock share distribution, while positive long-term, could create near-term overhang and selling pressure on the stock as shares are methodically distributed to limited partners over the next six to nine months.

Refinitiv StreetEvents Event Transcript
E D I T E D V E R S I O N

GRNT.N - Granite Ridge Resources, Inc.
Q2 2026 Granite Ridge Resources, Inc. Earnings Call
Aug 07, 2026 / 03:00PM GMT

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Presentation
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Unidentified_1 [1]
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Good day and welcome to the Granite Ridge Resources Second Quarter 2026 Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question, you will need to press *11 on your touchtone phone. Please note this call is being recorded. I would like to turn the call over to James Masters, Vice President Investor Relations. Please go ahead.

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Unidentified_2 [2]
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Thank you, operator. Good morning, everyone. We appreciate your interest

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