REIMEDIUM SIGNALFINANCIAL10-K

REI completed the Lime Rock Acquisition while experiencing declining revenue and substantially higher interest expense, reflecting the financial impact of debt-financed growth.

The acquisition expanded REI's Permian Basin footprint by adding significant acreage and shifting the reserve mix toward more horizontal drilling opportunities, but came at the cost of increased leverage and debt service burden. The revenue decline despite asset expansion suggests challenging commodity price conditions or integration impacts that investors should monitor closely.

Comparing 2026-03-04 vs 2025-03-05View on EDGAR →
FINANCIAL ANALYSIS

REI's financial profile shows the mixed impact of debt-financed acquisition activity, with revenue declining 16% to $307M while interest expense grew substantially to $44M, indicating meaningful additional borrowing. Operating cash flow decreased 22% to $151M, though current assets increased 23%, and cash position dropped by half to just $903K, suggesting tight liquidity management following the transaction.

FINANCIAL STATEMENT CHANGES
Interest Expense
P&L
+89.6%
$23.2M→$43.9M

Interest expense surged 89.6% — significant debt increase or rising rates materially impacting earnings.

Cash & Equivalents
Balance Sheet
-51.6%
$1.9M→$903K

Cash declined 51.6% — significant cash burn or deployment; verify adequacy of remaining liquidity runway.

Inventory
Balance Sheet
+31.2%
$4.0M→$5.3M

Inventory surged 31.2% — growing faster than typical sales pace; potential demand softening or supply chain overcorrection.

Current Assets
Balance Sheet
+23%
$50.4M→$62.1M

Current assets grew 23% — improving short-term liquidity or inventory/receivables build.

Operating Cash Flow
Cash Flow
-22.4%
$194.4M→$150.8M

Operating cash flow softened — monitor whether temporary working capital timing or structural deterioration.

Revenue
P&L
-16.1%
$366.3M→$307.2M

Revenue softened 16.1% — monitor whether this is cyclical or structural.

Accounts Receivable
Balance Sheet
-14.5%
$36.2M→$30.9M

Receivables declined — improved collection efficiency or conservative revenue recognition.

LANGUAGE CHANGES
NEW — 2026-03-04
PRIOR — 2025-03-05
ADDED
As of March 4, 2026, the registrant had outstanding 209,395,110 shares of common stock ($0.001 par value).
As of December 31, 2025, our leasehold acreage positions totaled 111,714 gross (96,234 net) acres and we held interests in 919 gross (758 net) producing wells.
All of our properties are located in the Permian Basin and our proved reserves are oil-weighted, with approximately 59% consisting of oil, 19% consisting of natural gas, and 22% consisting of NGLs.
Approximately 68% of the reserves are classified as PD and 32% are classified as PUD.
Within the PD reserve category, 238 recompletion and re-activation opportunities are classified as PDNP and within the PUD reserve category, we have a total of 247 proved locations (38% horizontal and 62% vertical) based on the reserve report as of December 31, 2025.
2025 Highlights and Major Developments Closed the Lime Rock Acquisition on March 31, 2025.
Achieved record full year production of 20,253 Boepd (65% oil), a year-over-year increase in total Boe of 3%.
Lowered lifting costs to $10.73 per Boe, or 1% year over year including 9 months of the LRR acquisition assets.
Responded to lower commodity price environment by pulling back on capital expenditures, executing a phased drilling program in 2025 that included drilling 18 gross, 17 net operated wells consisting of 12 horizontal and six vertical wells (gross).
Total proved reserves were 153.3 MMBoe at year-end 2025, which increased 19.1 MMBoe, or 14% from year-end 2024.
REMOVED
As of March 5, 2025, the registrant had outstanding 199,955,529 shares of common stock ($0.001 par value).
As of December 31, 2024, our leasehold acreage positions totaled 97,599 gross (80,919 net) acres and we held interests in 935 gross (763 net) producing wells.
All of our properties are located in the Permian Basin and our proved reserves are oil-weighted, with approximately 60% consisting of oil, 19% consisting of natural gas, and 21% consisting of NGLs.
Approximately 69% of the reserves are classified as PD and 31% are classified as PUD.
Within the PD reserve category, 220 recompletion and re-activation opportunities are classified as PDNP and within the PUD reserve category, we have a total of 211 proved locations (27% horizontal and 73% vertical) based on the reserve report as of December 31, 2024.
2024 Highlights and Major Developments Achieved record full year production of 19,648 Boepd (68% oil), a year-over-year increase in total Boe of 9% Executed a phased drilling program in 2024 that included drilling 44.00 gross / 43.94 net operated wells consisting of 22.00 horizontal and 22.00 vertical wells (gross).
Maintained our revolving credit facility borrowing base of $600 million Total proved reserves were 134.2 MMBoe at year-end 2024, which increased 4.4 MMBoe, or 3% from year-end 2023.
Lime Rock Purchase and Sale Agreement On February 25, 2025, the Company, as buyer, and Lime Rock Resources IV-A, L.P.
("LRRC" and with LRRA, "Lime Rock"), as seller, entered into a purchase and sale agreement (the "Purchase Agreement").
The Purchase Agreement provides that the Company will acquire (the "Lime Rock Acquisition") interests in oil and gas leases and related property of Lime Rock located in the Central Basin Platform of Texas for a purchase price (the "Purchase Price") of approximately $90 million in cash with $80 million due at closing and $10 million due on the nine months anniversary of closing, and 7,388,799 shares of our common stock.
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