LandBridge Co LLC - 10-Q Filing Summary (Q2 2026)
Business Context and Reporting Period
This Quarterly Report on Form 10-Q covers the period ended June 30, 2026. LandBridge Company LLC is a Delaware limited liability company operating as a holding company for DBR Land Holdings LLC (OpCo). The company owns and manages over 325,000 surface acres in the Delaware Basin and Central Basin Platform, generating revenue primarily through surface use royalties, easements, resource sales (brackish water, sand), and oil and gas royalties. The company shares a legacy financial sponsor and management team with WaterBridge Infrastructure LLC.
Key Financial Metrics
| Metric | Q2 2026 (3 Months) | YTD 2026 (6 Months) |
|---|---|---|
| Total Revenues | $66.8 million | $117.8 million |
| Net Income | $31.0 million | $48.9 million |
| Net Income Attributable to LandBridge | $12.3 million | $21.0 million |
| Adjusted EBITDA | $59.8 million | $104.6 million |
| Operating Cash Flow | $41.4 million | $82.5 million |
| Free Cash Flow | $40.2 million | $81.2 million |
| Cash and Equivalents | $39.8 million (as of June 30) | - |
| Total Debt | $545.2 million | - |
| Liquidity | $269.8 million | - |
Note: Liquidity includes $230.0 million available under the revolving credit facility and cash on hand.
Material Changes vs. Prior Period
- Revenue Growth: Total revenues increased 41% in Q2 2026 compared to Q2 2025, driven by a 53% increase in surface use royalties and a 52% increase in easement revenues. This growth is attributed to the Wolf Bone Ranch and 1918 Acquisitions and increased produced water handling volumes.
- Profitability: Net income rose 68% year-over-year in Q2. Adjusted EBITDA margin remained stable at 89%.
- Expense Increases: Depreciation, depletion, and amortization (DD&A) increased 72% year-over-year due to the amortization of intangible assets from the 1918 Acquisition. Interest expense increased 17% due to a higher weighted average debt balance.
- Acquisitions: The company acquired approximately 9,000 surface acres for $10.5 million during the first six months of 2026.
Guidance, Outlook, and Risks
- Strategic Conversion: The Board approved a plan to convert from a Delaware LLC to a Texas corporation, primarily to improve index eligibility. Shareholder approval is sought, with completion expected in Q3 2026.
- Capital Markets: On August 4, 2026, the company amended its 2025 Revolving Credit Facility, increasing commitments from $275 million to $375 million and reducing interest margins by 0.25%.
- Dividends: A quarterly dividend of $0.12 per share was declared for Class A shares, payable September 10, 2026. A share repurchase program of up to $50 million was approved in February 2026.
- Risks: Key risks include geopolitical instability (specifically the war between the U.S. and Iran affecting commodity prices), reliance on a limited number of customers in the Permian Basin, and regulatory changes regarding energy production and water usage.
Investor Verification Checklist
- Verify the impact of the pending conversion to a Texas corporation on index inclusion and tax status.
- Confirm the sustainability of produced water handling volumes driving the 53% increase in surface use royalties.
- Review the terms of the amended Revolving Credit Facility and the company's leverage ratios against covenants.
- Assess the valuation and integration of the recently agreed $20 million acquisition of 560 acres and the associated environmental waste management facility.
- Monitor the execution of the $50 million share repurchase program and its impact on liquidity.