EVOLUTION PETROLEUM CORP

As of June 30, 2025, we had $2.5 million in cash and cash equivalents and $37.5 million outstanding borrowings on our Senior Secured Credit Facility compared to $6.4 million in cash and cash equivalents and $39.5 million outstanding borrowings on our Senior Secured Credit Facility at June 30, 2024. Our primary sources of liquidity and capital resources during the year ended June 30, 2025 were cash provided by operations and net proceeds from the ATM Sales agreement. Our primary uses of liquidity and capital resources for the year ended June 30, 2025 were cash dividend payments to our common stockholders, our TexMex Acquisition, net repayments of borrowings under our Senior Secured Credit Facility and development capital expenditures, primarily at Chaveroo Field and SCOOP/STACK. As of June 30, 2025, working capital was a deficit of $4.0 million. As of June 30, 2024, working capital was $5.9 million.

As noted above, on June 30, 2025, we entered into a syndicated amended and restated senior secured reserve-based credit agreement (the “Senior Secured Credit Facility”) with MidFirst Bank, as administrative agent for the lenders party thereto. The Senior Secured Credit Facility has a maximum capacity of $200.0 million subject to a borrowing base determined by the lenders based on the value of our oil and natural gas properties. The Senior Secured Credit Facility has a current borrowing base of $65.0 million. As of June 30, 2025, we had $37.5 million of indebtedness outstanding and availability of $27.5 million. The Senior Secured Credit Facility is secured by substantially all of our oil and natural gas properties and matures on June 30, 2028.

Borrowings bear interest, at our option, at either (i) the SOFR, subject to a minimum SOFR of 3.25%, plus a credit spread adjustment of 0.05%, or (ii) the Prime Rate, as defined under the Senior Secured Credit Facility, plus 1.0%, plus, in either case of (i) or (ii), an applicable margin of 2.75%. For the years ended June 30, 2025 and 2024, the weighted average interest on our borrowings were 7.48% and 8.12%, respectively. The Senior Secured Credit Facility contains covenants requiring the maintenance of (i) a total leverage ratio of not more than 3.00 to 1.00, (ii) a current ratio of not less than 1.00 to 1.00, and (iii) a consolidated tangible net worth of not less than $40.0 million, each as defined in the Senior Secured Credit Facility. In addition, the Senior Secured Credit Facility contains hedging requirements that apply when utilization is greater than 25% of (x) the Margined Collateral Value, as defined under the Senior Secured Credit Facility, at any time when the leverage ratio is less than 2.25 to 1.00, or (y) the borrowing base, at any time when the leverage ratio is greater than or equal to 2.25 to 1.00. It also contains other customary affirmative and negative covenants, and events of default. As of June 30, 2025, we were in compliance with all covenants under the Senior Secured Credit Facility.

The Senior Secured Credit Facility requires for redeterminations of the borrowing base to occur semi-annually. At each redetermination, the Margined Collateral Value is updated based on the estimated value of our oil and natural gas

properties, which includes our proved developed reserves, proved undeveloped reserves, and other relevant factors consistent with customary oil and natural gas lending criteria. On August 29, 2025, we entered into an amendment to our Senior Secured Credit Facility with MidFirst Bank, whereas it was determined for purposes of the hedge covenant that total crude oil and natural gas volumes from proved developed producing reserves will be combined on a barrels of oil equivalent (“BOE”) basis to determine compliance with the hedging covenant.

We have historically funded operations through cash from operations and working capital. Our primary source of cash is the sale of produced crude oil, natural gas, and NGLs. A portion of these cash flows is used to fund capital expenditures and pay cash dividends to shareholders. We expect to fund near-future capital development activities for our properties with cash flows from operating activities, and, as needed, borrowings under our Senior Secured Credit Facility and proceeds from the ATM Sales Agreement (as described in “Recent Developments” above).

We are pursuing new growth opportunities through acquisitions and other transactions. In addition to cash on hand, we have access to the undrawn portion of the borrowing base available under our Senior Secured Credit Facility, totaling $27.5 million as of June 30, 2025. As stated above in*“Recent Developments,”*on August 4, 2025, we purchased mineral and royalty interests in the SCOOP/STACK area of Oklahoma for approximately $17.0 million. We funded the acquisition with borrowings of $15.0 million on our Senior Secured Credit Facility and cash on hand. On August 5, 2025, we issued an $0.8 million letter of credit agreement to Enterprise Products Operating, LLC, in connection with our gathering and processing agreements at Jonah Field, in exchange for the return of our cash collateral that had been previously provided. This additional borrowing and letter of credit reduced our remaining availability to $11.7 million subsequent to our fiscal year end. We also have an effective shelf registration statement with the SEC under which we may issue up to $500.0 million of new debt or equity securities.

On October 21, 2024, we entered into an ATM Sales Agreement with Roth Capital Partners, LLC as our Lead Agent, Northland Securities Inc., and A.G.P./Alliance Global Partners pursuant to which we may issue and sell, from time to time, up to $30.0 million of shares of common stock through or to the Lead Agent, acting as agent or principal. For the year ended June 30, 2025, we sold a total of approximately 0.7 million shares of our common stock under the ATM Sales Agreement for net proceeds of approximately $3.5 million, after deducting $0.3 million in offering costs.

Our Board of Directors instituted a cash dividend on common stock in December 2013. We have since paid 47 consecutive quarterly dividends. Distribution of a substantial portion of free cash flow in excess of operating and capital requirements through cash dividends remains a priority of our financial strategy, and it is our long-term goal to increase dividends over time, as appropriate. On September 11, 2025, the Board of Directors declared a quarterly cash dividend of $0.12 per share of common stock to shareholders of record on September 22, 2025 and payable on September 30, 2025.

On September 8, 2022, our Board of Directors approved a share repurchase program, under which we were authorized to repurchase up to $25.0 million of our common stock in the open market through December 31, 2024. As we continue to focus on our goal of maximizing total shareholder return, the Board of Directors along with the management team believe that a share repurchase program may be complimentary to the existing dividend policy and could be a tax efficient means to further improve shareholder return. In fiscal year 2025, we did not repurchase any shares under the program. In fiscal year 2024, we entered into a Rule 10b5-1 plan that authorized a broker to repurchase shares in the open market subject to pre-defined limitations on trading volume and price. The plan was effective until June 30, 2024 and had a maximum authorized amount of $0.8 million over that period. During the fiscal year ended June 30, 2024, approximately 0.1 million shares of the Company’s common stock were repurchased under the plan at a cost of approximately $0.8 million, including incremental direct transaction costs. We funded repurchases from working capital and cash provided by operating activities. These shares were subsequently cancelled. We may enter into additional share repurchase programs in the future as well as Rule 10b5-1 plans, the terms of which will be approved by the Board of Directors.

Capital Expenditures

For the year ended June 30, 2025, we incurred $13.2 million on development capital expenditures. A majority of our spending occurred at the Chaveroo Field where we participated in drilling and completion of four gross wells, and at SCOOP/STACK where our operators have brought 13 gross (0.14 net) wells online during the fiscal year.

Based on discussions with our operators, we expect capital workover projects to continue in most of our fields. Overall, for fiscal year 2026, we expect budgeted capital expenditures to be in the range of $4.0 million to $6.0 million, which excludes any potential acquisitions. Our expected capital expenditures for the next 12 months include bringing approximately five gross wells online at our SCOOP/STACK properties. Additionally, as our third-party operators continue to be active around our acreage, we would expect additional wells to be drilled and/or completed. At Chaveroo Field, we expect to have drilling permits in hand for the next round of six wells before the end of the fiscal third quarter 2026 and the final decision by us and our partner as to timing for spudding these wells will be made based on oil prices and completed well costs at that time.

As of June 30, 2025, our PUD reserves included 4.4 MMBOE of reserves and approximately $75.1 million of future development costs primarily associated with the Chaveroo Field, Williston Basin, and SCOOP/STACK properties.

Funding for our anticipated capital expenditures over the near-term is expected to be met from cash flows from operations and as needed from borrowings under our Senior Secured Credit Facility.

Full Cost Pool Ceiling Test

Under the full cost method of accounting, capitalized costs of oil and natural gas properties, net of accumulated depletion, depreciation, and amortization and related deferred taxes, are limited to the estimated future net cash flows from proved oil and natural gas reserves, discounted at 10%, plus the lower of cost or fair value of unproved properties, as adjusted for related income tax effects (the valuation “ceiling”). If capitalized costs exceed the full cost ceiling, the excess would be charged to expense as a write-down of oil and natural gas properties in the quarter in which the excess occurred. The quarterly ceiling test calculation requires that we use the average first day of the month price for our petroleum products during the 12-month period ending with the balance sheet date. The prices used in calculating our ceiling test as of June 30, 2025 were $71.20 per barrel of oil, $2.87 per MMBtu of natural gas and $25.24 per barrel of NGLs. As of June 30, 2025, our capitalized costs of oil and natural gas properties were below the full cost valuation ceiling. If commodity price levels were to substantially decline from the 12-month average first day of the month pricing levels as of June 30, 2025 and remain down for a prolonged period of time, our valuation ceiling over our capitalized costs may be reduced and adversely impact our ceiling tests in future quarters. We cannot give assurance that a write-down of capitalized oil and natural gas properties will not be required in the future. Additionally, a 10% reduction in respective commodity prices at June 30, 2025, while all other factors remained constant, would not have generated an impairment.

Overview of Cash Flow Activities

Cash provided by operating activities increased $10.3 million during the fiscal year ended June 30, 2025 compared to fiscal year ended June 30, 2024 primarily due to changes in the timing of our working capital. Cash flows provided by operating activities before changes in working capital for the year ended June 30, 2025 decreased $1.8 million compared to the year ended June 30, 2024, primarily due to increases in our lease operating costs and interest expenses in the current year partially offset by realized gains on derivative contracts in the current year of $1.0 million compared to

realized losses on derivative contracts in the prior year of $0.4 million. Refer to “Results of Operations” below for further information.

Cash used in investing activities for the year ended June 30, 2025 decreased $28.0 million from the prior year primarily due to the acquisition of our SCOOP/STACK properties in February 2024. In the prior year, net cash spent on acquisitions was $38.7 million, whereas in the current year, net cash spent on acquisitions was $9.0 million. In addition, in fiscal year 2025, we spent $12.6 million on development capital expenditures as compared to $10.9 million in the prior year. In the current fiscal year capital expenditures included drilling and completing four gross (2.0 net) Chaveroo wells and thirteen gross (0.14 net) SCOOP/STACK wells. In the prior year, the Company participated in drilling and completing three gross (1.5 net) Chaveroo wells and to a lesser extent, drilling and completion expenditures at Delhi Field and SCOOP/STACK.

Net cash flows used in financing activities for the year ended June 30, 2025 were $15.3 million compared to net cash flows provided by financing activities of $22.3 million for the year ended June 30, 2024. In the current year period, we paid $16.3 million in cash dividends to our common stockholders, repaid $2.0 million of net borrowings under our Senior Secured Credit Facility, and receivednet proceeds from the sale of common stock under the ATM Sales Agreement of approximately $3.5 million, after deducting $0.3 million in offering costs. In the prior year period, we received net borrowings of $39.5 million under our Senior Secured Credit Facility to finance our SCOOP/STACK Acquisitions, paid $16.0 million in cash dividends to our common stockholders together with $0.8 million paid to repurchase shares of common stock under our share repurchase plan.