EVOLUTION PETROLEUM CORP

Results of Operations

Three Months Ended March 31, 2026 and 2025

We reported net losses of $8.9 million and $2.2 million for the three months ended March 31, 2026 and 2025, respectively. The following table summarizes the comparison of financial information for the periods presented:

Revenues

Crude oil, natural gas and NGL revenues were $20.2 million and $22.6 million for the three months ended March 31, 2026 and 2025, respectively, with the decrease in revenues due to a decrease in our average realized price per BOE partially offset by a 0.5% increase in production volumes. Our average realized commodity price (excluding the impact of derivative contracts) for the three months ended March 31, 2026 decreased approximately $4.15 per BOE, or 11.0%, over the prior year period. Average daily equivalent production was primarily flat quarter over quarter. Increased production from our SCOOP/STACK Minerals Acquisition and TexMex Acquisition was predominately offset by downtime at our other fields. In January 2026, multiple fields were impacted by heavy ice storms and power outages which shut-in production multiple days. The current quarter oil revenue at Delhi Field was also impacted by $1.2 million of prior period adjustments for transportation charges due to a new marketing contract entered into by the operator dating back to December 2024. During the current quarter, decreases in natural gas revenues at Jonah Field and Barnett Shale were driven by their declines in field differentials, which declined on average by $1.96 per Mcf and $0.90 per Mcf, respectively, when compared to Henry Hub in the prior year period.

Lease Operating Costs

Ad valorem and production taxes were $1.3 million and $1.5 million, respectively, for the three months ended March 31, 2026 and 2025. The decrease is primarily due to lower commodity prices received. On a per unit basis, ad valorem and production taxes were $2.18 per BOE and $2.46 per BOE for the three months ended March 31, 2026 and 2025, respectively.

Gathering, transportation and other costs were $2.8 million for the three months ended March 31, 2026 compared to $2.9 million for the three months ended March 31, 2025. These costs are gathering, transportation and processing fees we incur primarily for our natural gas producing properties. The decrease is primarily due to decreased natural gas sales at Jonah Field and Barnett Shale. On a per unit basis, gathering, transportation and other costs were $4.70 per BOE and $4.86 per BOE for the three months ended March 31, 2026 and 2025, respectively.

Other lease operating costs were $8.8 million for the three months ended March 31, 2026 compared to $9.0 million for the three months ended March 31,2025. Other lease operating costs decreased primarily due to the cessation of CO 2 purchases at Delhi late during the third quarter of fiscal 2025. For the three months ended March 31, 2025, we had net CO 2 purchases of $1.5 million. Partially offsetting the overall decrease in other lease operating costs were increases due tothe TexMex Acquisition in April 2025. During the current quarter, the operator at TexMex focused on workover projects and facilities upgrades in the field. On a per unit basis, other lease operating costs decreased to $14.61 per BOE for the three months ended March 31, 2026 from $15.00 per BOE in the three months ended March 31, 2025.

Depletion of Full Cost Proved Oil and Natural Gas Properties

Depletion expense increased from $4.6 million for the three months ended March 31, 2025 to $4.9 million for the three months ended March 31, 2026 primarily due to an increase in the depletion rate and decrease in reserves volumes. On a per unit basis, depletion expense was $8.13 per BOE and $7.68 per BOE for the three months ended March 31, 2026 and 2025, respectively.

General and Administrative Expenses

General and administrative expenses were $1.9 million for each of the three months ended March 31, 2026 and 2025. On a per unit basis, general and administrative expenses were $3.11 per BOE and $3.22 per BOE for the three months ended March 31, 2026 and 2025, respectively.

Net Gain (Loss) on Derivative Contracts

We utilize commodity derivative financial instruments to reduce our exposure to fluctuations in oil and natural gas prices. Financial hedges are a requirement under our Senior Secured Credit Facility and help establish commodity price floors, contributing to stable cash flows when derivative contracts are settled. We have elected not to designate our open derivative contracts for hedge accounting, and accordingly, we recorded the net change in the mark-to-market valuation of the derivative contracts in the unaudited condensed consolidated statements of operations. The amounts recorded on the unaudited condensed consolidated statements of operations related to derivative contracts represent the (i) gains (losses) related to fair value adjustments on our open, or unrealized, derivative contracts, and (ii) gains (losses) on settlements of derivative contracts for positions that have settled or been realized. The table below summarizes our net realized and unrealized gains (losses) on derivative contracts as well as the impact of net realized gains (losses) on our average realized prices for the periods presented. As a result of our recent acquisitions and the corresponding borrowings on our Senior Secured Credit Facility, we were required by terms in our Senior Secured Credit Facility to hedge a portion of our production. During the quarter, WTI oil prices reached their highest levels since 2022 due to crude oil disruptions at key oil shipping routes in the Middle East, contributing to commodity price volatility. The significant increase in forward commodity prices as of March 31, 2026, resulted in an unrealized loss on the mark-to-market of our hedges. As of March 31, 2026, we had $3.1 million derivative assets, $2.4 million of which was classified as current, and $9.3 million derivative liabilities, $8.5 million of which was classified as current. We expect to see continued volatility in the fair value of our derivative contracts as commodity prices fluctuate.

Interest Expense

Interest expense increased $0.3 million for the three months ended March 31, 2026 compared to the prior year period primarily due to additional borrowings drawn on our Senior Secured Credit Facility to finance our SCOOP/STACK Minerals Acquisition in August 2025.

Income Tax (Expense) Benefit

For the three months ended March 31, 2026, we recognized an income tax benefit of $2.4 million on net losses before income taxes of $11.4 million compared to income tax benefit of $0.7 million on net losses before income taxes of $2.9 million for the three months ended March 31, 2025. The effective tax rates were 21.4% and 24.0% for three months ended March 31, 2026 and 2025, respectively. We continue to evaluate our tax provision on a quarterly basis and adjust our effective tax rate for any given changes in facts and circumstances that are expected in the future.

Nine Months Ended March 31, 2026 and 2025

We reported net losses of $7.0 million and $1.9 million for the nine months ended March 31, 2026 and 2025, respectively. The following table summarizes the comparison of financial information for the periods presented:

Revenues

Crude oil, natural gas and NGL revenues were $62.1 million and $64.7 million for the nine months ended March 31, 2026 and 2025, respectively, with the decrease in revenues due to decreases in our average realized price per BOE partially offset by increases in production volumes. Average daily equivalent production increased 1.5% from 7,033 BOEPD in the prior year period to 7,135 BOEPD in the current period primarily as a result ofproduction from our SCOOP/STACK Minerals Acquisition in August 2025 and TexMex Acquisition in April 2025 partially offset by downtime at our other fields. In January 2026, multiple fields were impacted by heavy ice storms and power outages which shut-in production multiple days. Our average realized commodity price (excluding the impact of derivative contracts) for the nine months ended March 31, 2026 decreased approximately $1.81 per BOE, or 5.4%, over the prior year period as our realized crude oil decreased 14.4% and realized NGL prices decreased 15.1% from the nine months ended March 31, 2025. The current period oil revenue at Delhi Field was also impacted by $1.2 million of prior period adjustments for transportation charges due to a new marketing contract entered into by the operator dating back to December 2024. The overall decrease in our crude oil and NGL realized prices was partially offset by a 15.3% increase in our realized natural gas prices over the prior period.

Lease Operating Costs

Ad valorem and production taxes were $3.3 million and $4.3 million for the nine months ended March 31, 2026 and 2025, respectively. The decrease is primarily related to a $0.8 million reduction of calendar years 2024 and 2025 ad valorem taxes which were passed along from the operator of our Barnett Shale natural gas properties. On a per unit basis, ad valorem and production taxes were $1.70 per BOE and $2.25 per BOE for the nine months ended March 31, 2026 and 2025, respectively.

Gathering, transportation and other costs were $8.4 million for the nine months ended March 31, 2026 compared to $8.6 million for the nine months ended March 31, 2025. These costs are gathering, transportation and processing fees we incur primarily for our natural gas producing properties. The decrease is primarily due to decreased natural gas sales at Jonah Field partially offset by increased natural gas sales at Barnett Shale. On a per unit basis, gathering, transportation and other costs were $4.29 per BOE and $4.46 per BOE for the nine months ended March 31, 2026 and 2025, respectively.

Other lease operating costs were $25.8 million for the nine months ended March 31, 2026 compared to $25.1 million for the nine months ended March 31,2025. Other lease operating costs increased primarily due tothe TexMex Acquisition in April 2025, which increased other lease operating costs by $3.8 million over the prior year period. Partially offsetting the overall increase in other lease operating costs is the cessation of CO 2 purchases at Delhi late during the third quarter of fiscal 2025. For the nine months ended March 31, 2025, we had net CO 2 purchases of $2.6 million. On a per unit basis, other lease operating costs increased to $13.22 per BOE for the nine months ended March 31, 2026 from $13.00 per BOE in the nine months ended March 31, 2025.

Depletion of Full Cost Proved Oil and Natural Gas Properties

Depletion expense increased from $15.0 million for the nine months ended March 31, 2025 to $16.0 million for the nine months ended March 31, 2026 primarily due to an increase in the depletion rate and decrease in reserves volumes. On a per unit basis, depletion expense was $8.18 per BOE and $7.76 per BOE for the nine months ended March 31, 2026 and 2025, respectively.

General and Administrative Expenses

General and administrative expenses for the nine months ended March 31, 2026 and 2025 were $5.6 million and $5.9 million, respectively. The decrease in the current period is primarily due to a decrease in professional fees. On a per unit basis, general and administrative expenses were $2.89 per BOE and $3.06 per BOE for the nine months ended March 31,2026 and 2025, respectively.

Stock-based Compensation Expense

Stock-based compensation expense for the nine months ended March 31, 2026 was $1.7 million compared to $1.9 million for theyear-ago period. The decrease is due to the vesting of sign-on awards granted in prior years.

Net Gain (Loss) on Derivative Contracts

We utilize commodity derivative financial instruments to reduce our exposure to fluctuations in oil and natural gas prices. Financial hedges are a requirement under our Senior Secured Credit Facility and help establish commodity price floors, contributing to stable cash flows when derivative contracts are settled. We have elected not to designate our open derivative contracts for hedge accounting, and accordingly, we recorded the net change in the mark-to-market valuation of the derivative contracts in the unaudited condensed consolidated statements of operations. The amounts recorded on the unaudited condensed consolidated statements of operations related to derivative contracts represent the (i) gains (losses) related to fair value adjustments on our open, or unrealized, derivative contracts, and (ii) gains (losses) on settlements of derivative contracts for positions that have settled or been realized. The table below summarizes our net realized and unrealized gains (losses) on derivative contracts as well as the impact of net realized gains (losses) on our average realized prices for the periods presented. As a result of our recent acquisitions and the corresponding borrowings on our Senior Secured Credit Facility, we were required by terms in our Senior Secured Credit Facility to hedge a portion of our production. During the fiscal third quarter, WTI oil prices reached their highest levels since 2022 due to crude oil disruptions at key oil shipping routes in the Middle East, contributing to commodity price volatility. The significant increase in forward commodity prices as of March 31, 2026, resulted in an unrealized loss on the mark-to-market of our hedges. As of March 31, 2026, we had $3.1 million derivative assets, $2.4 million of which was classified as current, and $9.3 million derivative liabilities, $8.5 million of which was classified as current. We expect to see continued volatility in the fair value of our derivative contracts as commodity prices fluctuate.

Interest Expense

Interest expense increased $0.6 million for the nine months ended March 31, 2026 compared to the prior year period primarily due to additional borrowings drawn on our Senior Secured Credit Facility to finance our SCOOP/STACK Minerals Acquisition in August 2025. The weighted average interest rate on our borrowings was 6.78% for the nine months ended March 31, 2026 compared to 7.59% for the nine months ended March 31, 2025.

Income Tax (Expense) Benefit

For the nine months ended March 31, 2026, we recognized income tax benefit of $1.2 million on net losses before income taxes of $8.3 million compared to income tax benefit of $0.6 million on net losses before income taxes of $2.5 million for the nine months ended March 31, 2025. The effective tax rates were 14.9% and 22.9% for nine months ended March 31, 2026 and 2025, respectively. We continue to evaluate our tax provision on a quarterly basis and adjust our effective tax rate for any given changes in facts and circumstances that are expected in the future.