Kolibri Global Energy Posts Record Quarter, Eyes Growth

Kolibri Global Energy Inc. ((TSE:KEI)) has held its Q1 earnings call. Read on for the main highlights of the call.

Kolibri Global Energy Inc. used its latest earnings call to paint a broadly upbeat picture, highlighting record production, revenue and adjusted EBITDA alongside greater liquidity and higher working interests in new wells. Management acknowledged some pressure points, including a drop in net income tied to noncash hedge losses and a temporary spike in operating costs, but reiterated confidence in its multi‑year growth strategy and balance sheet discipline.

Record Output, Revenue and EBITDA

Kolibri reported its strongest quarter yet, with average production reaching 4,685 BOE per day and net revenue climbing 20% year on year to $19.6 million. Adjusted EBITDA rose 16% to $14.8 million, underscoring the operating leverage in the business as volumes expand and giving the company more flexibility for investment and balance sheet management.

Sustained Production Growth Track Record

Production grew 15% compared with the same quarter last year, rising from 4,077 to 4,685 BOE per day, and also improved versus the prior quarter. Using 2025 as a base, management said production has compounded at roughly 35% annually over the past three years, framing the latest results as part of a broader growth trajectory rather than a one‑off jump.

Stronger Liquidity and Ongoing Deleveraging

The company secured an increase in its credit facility borrowing capacity to $75 million from $65 million, bolstering liquidity for its drilling plans. Net debt stood at $45 million at quarter‑end, down slightly from year‑end, and management highlighted a further $4 million repayment post‑quarter plus another $4 million targeted in May, signaling a commitment to gradual deleveraging.

Netback Gains and Solid Realized Pricing

Netback from operations improved 2% to $38.41 per BOE, while netback including commodity contracts came in at $37.72 per BOE, reflecting solid field‑level economics. The company realized an average oil price of about $70.31 per barrel and emphasized that recent strength in crude prices has been a meaningful tailwind for cash generation.

Higher Working Interests in New Clifton Mack Wells

Kolibri said its working interest in the three‑well Clifton Mack drilling program has risen from roughly two‑thirds to the high‑80% range, cited at around 88%. That higher stake means the company will capture a larger share of production and cash flows from these wells once they are online, amplifying the impact of successful completions on future earnings.

Growth Program and Capital Allocation Options

The three‑well program is already drilling, with all wells expected to be brought online in the third quarter, and management estimates about 20 days of drilling and roughly three months total cycle time per well. With rising cash flow, the company is weighing whether to prioritize more drilling, further debt reductions or share repurchases, and is involving new board members in those capital allocation debates.

Hedging Strategy Balances Protection and Upside

By the end of the quarter, Kolibri had hedged around half of its projected production, excluding volumes from the new wells, using a mix of collars, swaps and deferred puts. Management said this structure offers downside protection while still leaving room to benefit from higher prices and estimated that every $5‑per‑barrel move in oil can shift EBITDA by roughly $2.8 million after hedging.

Net Income Hit by Noncash Hedge Loss

Despite stronger operational metrics, net income slipped to $4.0 million, or $0.11 per basic share, from $5.8 million, or $0.16 per share, a year earlier. The main driver was a $2.9 million noncash mark‑to‑market unrealized loss on commodity contracts tied to rising March oil prices, which reduced reported profit but did not affect cash flow for the quarter.

Operating Costs and One‑Time Expense Pressures

Operating expense per BOE increased to $8.00 from $7.07, a roughly 13% rise that management linked to workover spending on a non‑operated well, reassessed gathering and processing fees, and elevated water‑hauling costs. These factors were front‑loaded in the quarter, with water‑hauling expenses in March reportedly about half of January levels, suggesting some normalization is already underway.

Remaining Exposure to Oil Price Volatility

With only about half of its expected base production hedged, Kolibri remains materially exposed to swings in oil prices for the balance of its volumes. Management framed this as a deliberate choice to participate in higher prices while maintaining some downside cover, but it does mean earnings and cash flow could be more volatile if crude prices retreat.

Execution Risks Around Well Completions

The company guided to a general third‑quarter window for bringing the three Clifton Mack wells online but stopped short of providing precise dates amid ongoing tweaks to completion design. Management said the wells are performing as expected so far, yet the involvement of new board members in design decisions introduces some timing and performance uncertainty around the ramp‑up.

Forward Guidance Emphasizes Growth and Discipline

Looking ahead, Kolibri expects continued production growth driven by the Clifton Mack program, with drilling underway and first production anticipated in the third quarter on roughly three‑month cycles per well. The company plans to balance its use of cash between additional drilling, share buybacks and further debt reduction, supported by higher netbacks, a widened credit facility and a multi‑year record of strong production growth.

Kolibri’s earnings call portrayed a company leaning into its growth opportunities while trying to keep a conservative handle on leverage and risk. Record volumes, rising netbacks and higher working interests in new wells are offset by higher near‑term operating costs and partial exposure to oil‑price swings, leaving investors to weigh the upside of the drilling program against execution and commodity risks over the coming quarters.