Presidio Production Co. 10-Q Summary: Quarter Ended June 30, 2026
Business Context and Reporting Period
Presidio Production Co. (Presidio) is an independent oil and natural gas company operating in the Western Anadarko Basin (Texas, Oklahoma, Kansas). The reporting period covers the quarter ended June 30, 2026. This filing reflects the "Successor" period following a Business Combination and domestication completed on March 4, 2026, which converted the company from a private partnership (Predecessor) to a public Up-C corporation. The company also completed the acquisition of EQV Resources LLC (EQVR) on the closing date.
Key Financial Metrics
| Metric | Three Months Ended June 30, 2026 (Successor) | Six Months Ended June 30, 2026 (Combined) |
|---|---|---|
| Total Revenues | $54.0 million | $104.7 million |
| Net Income (Loss) | $15.5 million | $(11.5) million |
| Net Income Attributable to Presidio | $14.4 million | $(11.0) million |
| Adjusted EBITDA | $33.2 million | $35.8 million |
| Adjusted Unhedged EBITDA | $26.3 million | $33.0 million |
| Cash and Cash Equivalents | $42.3 million | $42.3 million (as of June 30) |
| Restricted Cash | $11.3 million | $11.3 million (as of June 30) |
| Total Debt (Gross) | $350.1 million | $350.1 million (as of June 30) |
| Production (MBoe/d) | 22.8 | 22.6 (YTD) |
Material Changes vs. Prior Period
- Revenue Growth: Total revenues for the three months ended June 30, 2026, increased 27% to $54.0 million compared to $42.6 million in the prior year period. This was driven by a 23% increase in average realized sales prices (excluding hedges) and a 3% increase in production volumes due to the EQVR acquisition.
- Profitability: The company reported net income of $15.5 million for the quarter, compared to $24.5 million in the prior year quarter. However, the six-month combined period resulted in a net loss of $11.5 million, primarily due to significant transaction costs and a $4.5 million loss on the early extinguishment of debt.
- Debt Refinancing: On June 9, 2026, the company issued $350.0 million in ABS III Notes to redeem the ABS II Notes in full and repay the Citizens RBL. This extended the debt maturity profile to 2041.
- Derivative Impact: The company recorded a $24.8 million gain on commodity derivatives for the quarter, compared to a $22.6 million gain in the prior year quarter. This included an $18.0 million unrealized gain.
Guidance, Outlook, and Risks
Management Commentary: Management emphasizes operating cash flow and a strategy of acquiring existing producing assets to extend asset life using AI-driven analytics. The company maintains a disciplined hedging program, required by debt covenants, to hedge 85% of projected production for oil and NGLs and 85% for natural gas over specified periods.
Subsequent Events:
- On July 1, 2026, the company entered into a $1.0 billion senior secured warehouse credit facility with Goldman Sachs Bank USA.
- In July 2026, the company acquired additional Oklahoma properties for approximately $53.1 million in cash and 1.96 million shares of Class A common stock.
- On August 11, 2026, the Board declared a quarterly cash dividend of $0.3375 per share of Class A Common Stock.
Risks and Contingencies:
- Commodity Price Volatility: While hedged, unhedged production remains exposed to price declines.
- Debt Covenants: The company must maintain specific collateral ratios and hedge coverage levels under the ABS III Notes and Citizens RBL.
- Legal and Environmental: Standard risks related to litigation, environmental remediation, and regulatory changes in the oil and gas sector.
Investor Verification Checklist
- Debt Structure: Verify the terms and covenants of the new ABS III Notes and the $1.0 billion Goldman Sachs warehouse facility.
- Hedge Portfolio: Review the specific volumes and strike prices of the derivative contracts to understand the realized price floor for future production.
- Preferred Stock Obligations: Assess the impact of the 12% cumulative dividend requirement on Series A Redeemable Preferred Stock on future cash flows.
- Acquisition Integration: Monitor the production performance and cost integration of the EQVR and July 2026 acquisitions.
- Non-Controlling Interest: Track the 5.7% non-controlling interest held by PIH Rollover Holders and potential exchange rights.