CALGARY, AB, April 30, 2026 /CNW/ - Headwater Exploration Inc. (the "Company" or "Headwater") (TSX:HWX) is pleased to announce its operating and financial results for the three months ended March 31, 2026, guidance increase and increase in quarterly dividend. Selected financial and operational information is outlined below and should be read in conjunction with the unaudited interim condensed financial statements and the related management's discussion and analysis ("MD&A"). These filings will be available at www.sedarplus.ca and the Company's website at www.headwaterexp.com.

Financial and Operating Highlights

Three months ended

March 31,

 

Percent

Change

2026

2025

Financial (thousands of dollars except share data)

Total sales, net of blending expense (1) (4)

169,905

163,188

4

Adjusted funds flow from operations (2)

97,359

92,359

5

     Per share - basic (3)

0.41

0.39

5

                     - diluted (3)

0.41

0.39

5

Cash flows provided by operating activities 

40,069

69,935

(43)

     Per share - basic

0.17

0.29

(41)

                     - diluted

0.17

0.29

(41)

Net income

35,567

50,004

(29)

     Per share - basic

0.15

0.21

(29)

                     - diluted

0.15

0.21

(29)

Capital expenditures (1)

66,740

62,847

6

Adjusted working capital (2)

2,439

63,616

(96)

Shareholders' equity

757,568

723,431

5

Dividends declared

26,154

26,155

-

     Per share

0.11

0.11

-

Weighted average shares (thousands) 

     Basic

237,763

237,772

-

     Diluted

239,366

237,813

1

Shares outstanding, end of period (thousands)

     Basic

237,763

237,774

-

     Diluted (5)

237,763

237,904

-

Operating (6:1 boe conversion)

Average daily production

  Heavy crude oil (bbls/d)

21,857

19,511

12

  Natural gas (mmcf/d)

13.0

14.5

(10)

  Natural gas liquids (bbls/d)

135

142

(5)

  Barrels of oil equivalent (9) (boe/d)

24,154

22,066

9

Average daily sales (6) (boe/d)

23,930

22,019

9

Netbacks ($/boe) (7)

  Operating

     Sales, net of blending expense (4)

78.89

82.35

(4)

     Royalties

(12.46)

(14.47)

(14)

     Transportation

(5.79)

(5.41)

7

     Production expenses

(8.20)

(7.93)

3

Operating netback (3)

52.44

54.54

(4)

     Realized losses on financial derivatives 

(2.54)

(1.60)

59

  Operating netback, including financial derivatives (3)

49.90

52.94

(6)

     General and administrative expense

(1.47)

(1.44)

2

     Interest income and other expense (8)

0.27

0.59

(54)

     Current tax expense

(3.50)

(5.43)

(36)

     Settlement of decommissioning liability

-

(0.05)

(100)

 Adjusted funds flow netback (3)

45.20

46.61

(3)

(1)

Non-GAAP financial measure. Refer to "Non-GAAP and Other Financial Measures" within this press release.

(2)

Capital management measure. Refer to "Non-GAAP and Other Financial Measures" within this press release.

(3)

Non-GAAP ratio. Refer to "Non-GAAP and Other Financial Measures" within this press release.

(4)

Heavy oil sales are netted with blending expense to compare the realized price to benchmark pricing while transportation expense is shown separately. In the interim financial statements blending expense is recorded within blending and transportation expense.

(5)

Restricted share units ("RSU") and performance share units ("PSU") have been excluded as the Company intends to cash settle these awards.