Key Highlights

  • Revenue was USD 513.89 million against a USD 474.39 million estimate, with EPS of USD 0.35 against USD 0.58.
  • Net income was USD 80.5 million, while adjusted Net Income was USD 166.3 million, or USD 0.71 per diluted share.
  • Production averaged 117.3 Mboe/d, with oil at 49.1 Mbbls/d, and fourth quarter production is guided to 159 to 161 Mboe/d.
  • The board added 15 million shares to its repurchase authorization, bringing the remaining total to 22.6 million shares.

Magnolia Oil & Gas Corporation (NYSE:MGY) issued guidance for the first full quarter of ownership of WildFire Energy assets. Fourth quarter production is guided to 159 to 161 Mboe/d, with oil at 49% to 50% of volumes, and drilling and completion Capital spending is estimated at roughly USD 235 million. For 2027, production is projected to grow 4% to 5%, with drilling and completion capital of USD 900 million to USD 950 million.

Guidance and Outlook

Other fourth quarter guidance includes Lease Operating Expense of USD 5.80 to USD 6.20 per Boe, depreciation, depletion and amortization of USD 14.00 to USD 15.00 per Boe, and interest expense of USD 35 million to USD 40 million. The effective tax rate is guided to about 21%.

The 2027 production growth range is measured from a second quarter 2026 pro forma base of approximately 78 Mbbls/d of oil and 158 Mboe/d. Chief executive Chris Stavros said the 2027 drilling program targets roughly 65% of activity in the Austin Chalk and 35% in the Eagle Ford.

The Quarter in Detail

Total revenues were USD 513.9 million against USD 324.9 million a year earlier. Net income was USD 80.5 million, or USD 0.35 per diluted share, against USD 78.2 million, or USD 0.40. Adjusted net income, which excludes transaction and integration costs for the WildFire Acquisition and net unrealized derivative losses, was USD 166.3 million, up 114%.

Adjusted EBITDAX was USD 392.0 million against USD 218.8 million. Net cash provided by Operating Activities was USD 369.0 million and adjusted free Cash Flow was USD 223.7 million. Drilling and completion capital was USD 147.4 million, which the company said was below its earlier guidance, and adjusted pre-tax Margin was 43%.

Production, Pricing and Operations

Production of 117.3 Mboe/d was up 17% from 100.5 Mboe/d, and oil production of 49.1 Mbbls/d was up 24%. Giddings production rose 23% to 97.7 Mboe/d, with oil volumes up 39%, and Giddings represented 83% of total volumes. Oil was about 42% of third quarter volumes, against a guided 49% to 50% in the fourth quarter.

The average realized price was USD 87.18 per barrel of oil against USD 63.55 and USD 47.63 per Boe in total against USD 35.14. Management said it is running four rigs and two completion crews and that synergy capture is ahead of its plans.

Balance Sheet and Capital Returns

Magnolia ended the quarter with USD 17.5 million of cash and USD 435 million of borrowings on its revolving Credit facility. Cash paid for acquisitions was USD 2,555.4 million, while financing flows included USD 1,225.6 million from common stock issuance and USD 500.0 million from long-term debt. Management stated that net Debt is approximately USD 1.9 billion.

The company repurchased 2.3 million shares for USD 60.2 million and paid dividends of USD 43.1 million, which it said returned USD 103.3 million, or 46% of adjusted free cash flow. A quarterly Dividend of USD 0.18 per share is payable on December 1, 2026 to holders of record on November 10.

Dates and Milestones Named

Revenue of USD 513.89 million sits alongside net income of USD 80.5 million, adjusted free cash flow of USD 223.7 million and net debt of approximately USD 1.9 billion.

Management named a short list of dated items: the USD 0.18 dividend payable December 1, 2026, fourth quarter production of 159 to 161 Mboe/d, and 2027 capital of USD 900 million to USD 950 million. It also described a practice of repurchasing at least 1% of shares outstanding each quarter and a remaining authorization of 22.6 million shares, nearly 8.5% of current shares outstanding.