Canada's Cardinal Energy Q2 adjusted funds flow jumps 150% on higher output

Overview

• Canada oil and gas producer's Q2 revenue rose 82% yr/yr, driven by Reford 1 SAGD project

• Adjusted funds flow for Q2 jumped 150% yr/yr, supported by higher oil prices and lower costs

• Company reduced net debt by 39% from December 2025, increasing financial flexibility

Outlook

• Cardinal expects to exit 2026 with net debt well below original projections

• Company plans to expand its abandonment and reclamation budget to C$20 mln for 2026

• Reford 2 SAGD project expected to begin contributing to revenues in Q4 2027

Result Drivers

• REFORD 1 PRODUCTION - Co said Q2 production rose 21% yr/yr, mainly due to crude oil output from the Reford 1 SAGD project, which exceeded nameplate capacity

• LOWER OPERATING COSTS - Co said net operating expenses per boe fell 12% yr/yr, reflecting lower cost Reford production and decreased carbon taxes and power prices

• HIGHER OIL PRICES - Co said strong quarter for light, medium, and heavy crude oil prices contributed to higher adjusted funds flow

Company press release: ID:nNFC2ftVVt

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 4 "strong buy" or "buy", 1 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the oil gas exploration and production peer group is "buy"

• Wall Street's median 12-month price target for Cardinal Energy Ltd (Alberta) is C$13.25, about 18.3% above its July 27 closing price of C$11.20

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 36 three months ago

Reuters Recommended Reads

• July 28 - Canada's Tamarack Valley Q2 revenue rises on higher oil prices

• July 27 - Canada's Topaz Energy raises 2026 production outlook after royalty revenue jumps

• July 27 - Baker Hughes flags lower spending by oil and gas producers in 2026

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)