Evolution Petroleum Corporation Water Tower Research Virtual Insights Conference

I'm pleased to welcome Evolution Petroleum for this session. Joining us for today's discussion are CEO, Kelly Loyd, CFO, Ryan Stash, and Director of Operations and Engineering, Peter Pham. I am Jeff Robertson, Managing Director of Natural Resources. Before we begin, I would like to note that Evolution's safe harbor disclosures regarding forward-looking statements can be found under the Investors tab of the company's homepage. Also, investors can submit questions through the conference portal, which we will seek to address in the follow-up management series report, and indications of interest in meeting with management, and our teams will work to coordinate those. Kelly, Ryan, Peter, thank you for taking the time to join us today.

Thanks for having us, Jeff.

Appreciate it. Evolution Petroleum is an independent energy company focused on maximizing total shareholder returns through the ownership of and investment in working in royalty interests in onshore U.S. oil and gas properties.

The company strives to build and maintain a diversified portfolio of long-life properties through acquisitions, selective development opportunities, production enhancements, and other exploitation efforts. Kelly, I'd just like to start off today's discussion with strategy. Evolution's asset base includes both non-operating working interests that have been augmented in the past year with a growing portfolio of royalty and mineral interests. How do these types of assets support the company's total shareholder return framework, and really guide your efforts to deliver value for shareholders?

Yeah. Perfect, Jeff. Thanks for doing this for us. We think about our model in terms of total return per share. Our working interest assets really give us long life base production, plus opportunities to add value through selective development and workovers and production enhancements. The mineral and royalty side, it brings high margin cash flow and operator funded growth without requiring us to pay for any of the drilling and completion. Really, when you put those two together, it gives us much more flexibility to support the dividend, and reinvest selectively and pursue potentially further acquisitions. I think in 2026 you really could see that balance. We held production at a little over 7,000 BOE per day, and we replaced more than 100% of the 2.6 million barrels of oil equivalent that we produced, and also kept our dividend.

The company owns assets in multiple geographies and producing basins. How important is geographic diversity and also commodity diversity in how you think about running the company?

Easy for you to say, right? Look, Jeff, we think it's really important to our model. We got exposure to oil, we got exposure to natural gas and NGLs across several basins, and with several different operators. Really no single field or commodity or partner will drive the result. Fiscal Q4 is a good example. Natural gas realizations were really still a headwind, but stronger liquids pricing and better operations elsewhere helped us to increase our revenue 20% sequentially. Our adjusted EBITDA was able to more than double quarter versus the previous quarter. Diversity, it doesn't remove all the risks, but it certainly does make our cash flow more resilient through the cycle.

The company closed its first royalty acquisition in August of 2025 and has closed several since then. Can you talk about how that asset class fits into the portfolio to support the long-term cash flow profile?

Yeah. We really like what that does for the quality of our cash flows. Minerals and royalties generally have very low field level operating cost and come with no future drilling and completion expenses to us. So we benefit when strong operators develop the acreage. We also get current production with a long inventory of future wells, and that fits very nicely alongside our working interest portfolio, where we tend to have, in some cases, some more influence with operators. They generally, if we're developing, we got to pay our share, right? And you got to pay your LOE costs. The two very much complement each other.

Pro forma for the latest mineral deal, which closed in August, just a few weeks ago in the Midland Basin. The mineral royalty cash flow side of the house represents about 20% of pro forma total company cash flow. Is there a target you have in mind for how large or how big of a contribution you would like to see from that asset class, or is it all just opportunity driven or where you see the best values?

Yeah. It's really the latter. I would say the reason that that's grown there, again, we strategically did want to have a significant piece. Like I said, it has future drilling without CapEx, which is huge for us. But we don't have a target. We do want to always look for the most accretive opportunity and frankly, with some of what we've been able to put together with our relationships and partners, that's where we're starting to see the value.

But no specific model. Speaking of relationships and partners, how does a company go about sourcing transactions in today's A&D market?

There's a few ways. We're always going to look at the marketed side of the business, because honestly, you'd be a fool not to. To be frank, we're seeing deals where we can create the deal from scratch, and we're having a lot of traction there, where literally there's not a deal. We go out with our partners and offer at a certain different reserve categories, meaning PDP or DUCs or future locations. We want to have them a certain mix of those that fit our profile, and go out and offer those. They may be small little bolt-ons like we're doing in the Haynesville-Bossier Shale, but over time, they really add up and can be quite impactful.

We've seen M&A continue to be a part of the industry, even with the oil price volatility that's been taking place since the Persian Gulf War started. Kelly Loyd, can you share your perspective on the current status of the A&D market, especially with respect to that pipeline that Evolution is exposed to?