SANDRIDGE ENERGY INC

Previous wording

The financial information with respect to the three months ended March 31, 2025 and 2024, discussed below, is unaudited. In the opinion of management, this information contains all adjustments, which consist only of normal recurring adjustments unless otherwise disclosed, necessary to state fairly the accompanying unaudited condensed consolidated financial statements. The results of operations for the interim periods are not necessarily indicative of the results of operations for the full fiscal year.

Current wording

The financial information with respect to the three and six months ended June 30, 2025 and 2024, discussed below, is unaudited. In the opinion of management, this information contains all adjustments, which consist only of normal recurring adjustments unless otherwise disclosed, necessary to state fairly the accompanying unaudited condensed consolidated financial statements. The results of operations for the interim periods are not necessarily indicative of the results of operations for the full fiscal year.

Previous wording

The charts below show production by product and percent revenues for the three months ended March 31, 2025 and 2024:

Current wording

The charts below show production by product and percent revenues for the three and six months ended June 30, 2025 and 2024:

Previous wording

We remain committed to growing the value of our asset base in a safe, responsible and efficient manner, while prudently allocating capital to high-return, organic growth projects. Currently, these projects include (1) One rig development in the Cherokee Shale Play (2) Production Optimization program through artificial lift conversions to more efficient and cost-effective systems and high-graded recompletions (3) leasing program that will bolster future development and extend development in our Cherokee assets. Our leaseholds are approximately 95% held by production, which cost-effectively maintains our development option over a reasonable tenor. We will continue to monitor forward-looking commodity prices, project results, costs, impacts of tariffs and other factors that could influence returns and cash flows, and will adjust our program accordingly, to include curtailment of capital activity and wells, if needed, or conversely, well reactivations in higher commodity price environments. These and other factors, including reasonable reinvestment rates, maintaining our cash flows and prioritizing our regular-way dividend, will continue to shape our development decisions for the remainder of the year and beyond. We also remain vigilant in evaluating further merger and acquisition opportunities, with consideration of our strong balance sheet and commitment to our capital return program.

Current wording

We remain committed to growing the value of our asset base in a safe, responsible and efficient manner, while prudently allocating capital to high-return growth projects. Currently, these projects include; (1) One rig development in the Cherokee Shale Play (2) Evaluation of accretive merger and acquisition opportunities, with consideration of our strong balance sheet and commitment to our capital return program (3) Production Optimization program through artificial lift conversions to more efficient and cost-effective systems and high-graded recompletions and (4) A leasing program that will bolster future development and extend development in our Cherokee assets. Our leaseholds are approximately 95% held by production, which cost-effectively maintains our development option over a reasonable tenor. We will continue to monitor forward-looking commodity prices, project results, costs, impacts of tariffs and other factors that could influence returns and cash flows, and will adjust our program accordingly, to include curtailment of capital activity and wells, if needed, or conversely, well reactivations in higher commodity price environments. These and other factors, including reasonable reinvestment rates, maintaining our cash flows and prioritizing our regular-way dividend, will continue to shape our development decisions for the remainder of the year and beyond.

Previous wording

Consolidated revenues for the three months ended March 31, 2025 and 2024 are presented in the table below (in thousands):

Current wording

Consolidated revenues for the three and six months ended June 30, 2025 and 2024 are presented in the table below (in thousands):

Previous wording

Our production and pricing information for the three months ended March 31, 2025 and 2024 is shown in the table below:

Current wording

Our production and pricing information for the three and six months ended June 30, 2025 and 2024 is shown in the table below:

Previous wording

Variances in oil, natural gas and NGL revenues attributable to changes in the average prices received for our production and total production volumes sold for the three months ended March 31, 2025 are shown in the table below (in thousands):

Current wording

Variances in oil, natural gas and NGL revenues attributable to changes in the average prices received for our production and total production volumes sold for the three and six months ended June 30, 2025 are shown in the table below (in thousands):

Previous wording

Operating expenses for the three months ended March 31, 2025 and 2024 consisted of the following (in thousands):

Current wording

Operating expenses for the three and six months ended June 30, 2025 and 2024 consisted of the following (in thousands):

Previous wording

Lease operating expenses for the three months ended March 31, 2025 were consistent versus the same period in 2024. Lease operating expenses per Boe improved over the same period due to continued efficient operations and increased sales volumes associated with our Cherokee acquisition in 2024.

Current wording

Lease operating expenses for the three and six months ended June 30, 2025 decreased in total and per Boe versus the same period in 2024 primarily due to a $2.1 million one-time non-cash adjustment of an operating accrual dating back to the Company’s emergence from bankruptcy (see“Note 1—Basis of Presentation” to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report for further information), as well as continued efficient operations and increased sales volumes associated with our Cherokee acquisition in 2024 and ongoing development program.

Previous wording

Production, ad valorem, and other taxes for the three months ended March 31, 2025 increased primarily due to higher commodity prices, sales volumes, and related revenues. Production, ad valorem, and other taxes per BOE increased for the three months ended March 31, 2025 primarily due to higher commodity prices.

Current wording

Production, ad valorem, and other taxes for the three and six months ended June 30, 2025 increased primarily due to higher average commodity prices, sales volumes, and related revenues. Production, ad valorem, and other taxes per BOE were consistent for the three months ended June 30, 2025 versus the same period in 2024 and increased for the six months ended June 30, 2025 primarily due to higher average commodity prices.

Previous wording

A ceiling limitation calculation is performed at the end of each quarter. If the full cost pool balance exceeds the ceiling limitation, an impairment of the full cost pool is required. Calculation of the full cost ceiling test is based on, among other factors, trailing twelve-month first-day-of-the-month index prices (“SEC prices”) as adjusted for price differentials and other contractual arrangements. The SEC prices utilized in the calculation of proved reserves included in the full cost ceiling test at March 31, 2025 were $74.52 per barrel of oil and $2.44 per MMBtu of natural gas, before price differential adjustments.

Current wording

A ceiling limitation calculation is performed at the end of each quarter. If the full cost pool balance exceeds the ceiling limitation, an impairment of the full cost pool is required. Calculation of the full cost ceiling test is based on, among other factors, trailing twelve-month first-day-of-the-month index prices (“SEC prices”) as adjusted for price differentials and other contractual arrangements. The SEC prices utilized in the calculation of proved reserves included in the full cost ceiling test at June 30, 2025 were $70.48 per barrel of oil and $2.86 per MMBtu of natural gas, before price differential adjustments.

Previous wording

The ceiling limitation was not exceeded; therefore, no full cost ceiling limitation impairments were recorded during the three months ended March 31, 2025 or 2024. During certain periods within the past five years, the SEC prices used in the full cost ceiling test have been lower than the SEC prices used for the March 31, 2025 full cost ceiling test and resulted in material ceiling limitation impairments. Full cost pool ceiling limitation impairments have no impact to our cash flow or liquidity.

Current wording

The ceiling limitation was not exceeded; therefore, no full cost ceiling limitation impairments were recorded during the three or six months ended June 30, 2025 or 2024. During certain periods within the past five years, the SEC prices used in the full cost ceiling test have been lower than the SEC prices used for the June 30, 2025 full cost ceiling test and resulted in material ceiling limitation impairments. Full cost pool ceiling limitation impairments have no impact to our cash flow or liquidity.

Previous wording

Based on the SEC prices over the trailing ten months ended April 30, 2025, as well as two months of NYMEX strip pricing for May and June of 2025 as of April 30, 2025, we estimate the SEC prices utilized in the June 30, 2025 full cost ceiling test may be $70.13 per barrel of oil and $2.91 per MMBtu of natural gas (the "estimated second quarter prices"). Applying these estimated second quarter prices, and holding all other inputs constant to those used in the calculation of our March 31, 2025 ceiling test, we expect that no full cost ceiling limitation impairment is indicated for the second quarter of 2025.

Current wording

Based on the SEC prices over the trailing ten months ended July 31, 2025, as well as two months of NYMEX strip pricing for August and September of 2025 as of July 31, 2025, we estimate the SEC prices utilized in the September 30, 2025 full cost ceiling test may be $67.96 per barrel of oil and $3.13 per MMBtu of natural gas (the "estimated third quarter prices"). Applying these estimated third quarter prices, and holding all other inputs constant to those used in the calculation of our June 30, 2025 ceiling test, we expect that no full cost ceiling limitation impairment is indicated for the third quarter of 2025.

Previous wording

Other operating expenses for the three months ended March 31, 2025 and 2024 consisted of the following (in thousands):

Current wording

Other operating expenses for the three and six months ended June 30, 2025 and 2024 consisted of the following (in thousands):

Previous wording

The increase in general and administrative expenses for the three-month period ended March 31, 2025 was primarily the result of an increase in personnel and other costs.

Current wording

General and administrative expenses were consistent for the three months ended June 30, 2025 versus the same period in 2024. The increase in general and administrative expenses for the six months ended June 30, 2025 was primarily the result of an increase in personnel and other costs.

Previous wording

Our other income (expense) for the three months ended March 31, 2025 and 2024 are presented in the table below (in thousands):

Current wording

Our other income (expense) for the three and six months ended June 30, 2025 and 2024 are presented in the table below (in thousands):

Previous wording

Interest income, net during the three month periods ended March 31, 2025 and 2024 is primarily comprised of interest income on cash deposits. The decrease in interest income, net is due to the Company’s lower cash balance primarily as a result of our acquisitions as well as capital expenditures, share repurchases, and quarterly dividend payments.

Current wording

Interest income, net during the three and six month periods ended June 30, 2025 and 2024 is primarily comprised of interest income on cash deposits. The decrease in interest income, net is due to the Company’s lower cash balance primarily as a result of our acquisitions as well as capital expenditures, share repurchases, and quarterly dividend payments.

Previous wording

As of March 31, 2025, our cash and cash equivalents, including restricted cash was $101.1 million. We expect our cash on hand and cash from operations to be adequate to meet our short and long-term liquidity needs. We had no outstanding term or revolving debt obligations as of March 31, 2025.

Current wording

As of June 30, 2025, our cash and cash equivalents, including restricted cash was $104.2 million. We expect our cash on hand and cash from operations to be adequate to meet our short and long-term liquidity needs. We had no outstanding term or revolving debt obligations as of June 30, 2025.

Previous wording

Cash flows from operations was the primary driver in the increase in working capital to $69.4 million at March 31, 2025 compared to $67.1 million at December 31, 2024. Capital expenditures of $6.4 million, $5.0 million in repurchases of our common stock, dividend payments to shareholders of $4.1 million, and $2.6 million in cash payments for acquisitions of oil and gas properties partially offset the increase.

Current wording

Cash flows from operations was the primary driver in the increase in working capital to $76.9 million at June 30, 2025 compared to $67.1 million at December 31, 2024. Capital expenditures of $22.0 million, $5.9 million in repurchases of our common stock, dividend payments to shareholders of $8.2 million, and $4.4 million in cash payments for acquisitions of oil and gas properties partially offset the increase.

Previous wording

Our cash flows for the three months ended March 31, 2025 and 2024 are presented in the following table and discussed below (in thousands):

Current wording

Our cash flows for the six months ended June 30, 2025 and 2024 are presented in the following table and discussed below (in thousands):

Previous wording

(1) Includes $4.1 million and $59.7 million in dividend payments for the three months ended March 31, 2025 and 2024, respectively.

Current wording

(1) Includes $8.2 million and $64.0 million in dividend payments for the six months ended June 30, 2025 and 2024, respectively.

Previous wording

The increase in cash flows from operations for the three months ended March 31, 2025 compared to the same period in 2024 is primarily due to an increase in revenues from higher average commodity prices and higher sales volumes from our 2024 acquisition in the Cherokee Play of the Mid-Con.

Current wording

The increase in cash flows from operations for the six months ended June 30, 2025 compared to the same period in 2024 is primarily due to an increase in revenues from higher average commodity prices and higher sales volumes from our 2024 acquisition in the Cherokee Play of the Mid-Con.

Previous wording

Capital expenditures and acquisitions of oil and gas properties for the three months ended March 31, 2025 and 2024 are summarized below (in thousands):

Current wording

Capital expenditures and acquisitions of oil and gas properties for the six months ended June 30, 2025 and 2024 are summarized below (in thousands):

Previous wording

Cash used in financing activities for the three months ended March 31, 2025 consisted primarily of $5.0 million in repurchases of common stock, $4.1 million in cash dividends, $0.1 million of cash used for tax withholdings paid in exchange for shares withheld on employee vested stock awards that were settled by net exercise, and finance lease payments of $0.2 million. Since 2023, the Company has paid cash dividends totaling $157.9 million, which represents $3.50 per share in special dividends and $0.75 per share in quarterly dividends for a total of $4.25 per share in cash dividends. Cash used in financing activities for the three months ended March 31, 2024 consisted primarily of $59.7 million in cash dividends, $0.1 million of cash used for tax withholdings paid in exchange for shares withheld on employee vested stock awards that were settled by net exercise, and finance lease payments of $0.2 million. Net exercises of stock awards allows the holder of a stock award to tender back to us a number of shares at fair value upon the vesting of such stock award, that equals the employee payroll tax obligation due. We then remit a cash payment to the relevant taxing authority on behalf of the employee for their payroll tax obligations resulting from the vesting of their stock award.

Current wording

Cash used in financing activities for the six months ended June 30, 2025 consisted of $5.9 million in repurchases of common stock, $8.2 million in cash dividends, $0.2 million of cash used for tax withholdings paid in exchange for shares withheld on employee vested stock awards that were settled by net exercise, and finance lease payments of $0.4 million. Since 2023, the Company has paid cash dividends totaling $162.0 million, which represents $3.50 per share in special dividends and $0.86 per share in quarterly dividends for a total of $4.36 per share in cash dividends. Cash used in financing activities for the six months ended June 30, 2024 consisted primarily of $64.0 million in cash dividends, $0.2 million of cash used for tax withholdings paid in exchange for shares withheld on employee vested stock awards that were settled by net exercise, and finance lease payments of $0.4 million. Net exercises of stock awards allows the holder of a stock award to tender back to us a number of shares at fair value upon the vesting of such stock award, that equals the employee payroll tax obligation due. We then remit a cash payment to the relevant taxing authority on behalf of the employee for their payroll tax obligations resulting from the vesting of their stock award.

Previous wording

For a description of our critical accounting policies and estimates, refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the 2024 Form 10-K. For a discussion of recent accounting pronouncements, newly adopted and recent accounting pronouncements not yet adopted, see“Note 1—Basis of Presentation” to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report. We did not have any material changes in critical accounting policies, estimates, judgments and assumptions during the first three months of 2025.

Current wording

For a description of our critical accounting policies and estimates, refer to Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations included in the 2024 Form 10-K. For a discussion of recent accounting pronouncements, newly adopted and recent accounting pronouncements not yet adopted, see“Note 1—Basis of Presentation” to the accompanying unaudited condensed consolidated financial statements included in Item 1 of this Quarterly Report. We did not have any material changes in critical accounting policies, estimates, judgments and assumptions during the first six months of 2025.