Comstock Resources Q2 Earnings Call Highlights

Comstock Resources Q2 Earnings Call Highlights

Comstock Resources NYSE: CRK reported higher second-quarter production but lower financial results as natural gas prices declined, while advancing drilling activity and infrastructure development across its Western and Legacy Haynesville positions. Second-quarter production averaged 1.2 billion cubic feet equivalent per day, up 16% from the first quarter and slightly above the year-earlier period. Natural gas and oil sales, including realized hedging gains, totaled $332 million, while operating cash flow excluding working-capital changes was $189 million, or $0.65 per share. Adjusted EBITDA was $245 million.

Chairman and Chief Executive Officer Jay Allison said the company’s drilling results in the Western Haynesville, Legacy Haynesville and Horseshoe developments are supporting future production and reserve growth. However, lower natural gas prices weighed on quarterly revenue and profitability. Financial Results and Balance Sheet President and Chief Financial Officer Roland Burns said Comstock recorded a non-GAAP profit of $0.03 per share in the quarter. The result included a $1 million unrealized mark-to-market gain associated with the company’s hedge book. Excluding that gain, seismic-related exploration expense in the Western Haynesville and other non-recurring items, Comstock reported adjusted net income of $8 million, or $0.03 per share. For the first half of 2026, Comstock generated $670 million in oil and gas sales, $496 million in EBITDAX and $380 million in cash flow. Reported first-half profit was $116 million, or $0.40 per share, including an $84 million pre-tax unrealized hedge gain. Adjusted net income for the six-month period was $48 million, or $0.16 per share, Burns said. The company’s weighted average NYMEX natural gas settlement price was $2.89 per million British thermal units during the second quarter. Comstock realized an unhedged gas price of $2.54 per Mcf, reflecting a $0.35 basis differential to the NYMEX settlement price. The company was 63% hedged during the quarter, which lifted its realized gas price to $2.93 per Mcf. Operating costs averaged $0.77 per Mcfe, down $0.16 from the first quarter. Burns attributed the improvement largely to higher production volumes, lower lifting and general-and-administrative costs per unit, as well as lower gathering costs and taxes. The company’s EBITDAX margin improved to 74%. At quarter-end, Comstock had $545 million outstanding under its upstream credit facility, which has a $2 billion borrowing base and a $1.5 billion elected commitment. The midstream credit facility had no outstanding borrowings following the company’s Pinnacle transaction. Comstock reported nearly $1.2 billion of liquidity and a last-12-month leverage ratio of three times. Pinnacle Transaction On June 15, Comstock completed the sale of a 27% non-controlling common equity interest in its Pinnacle Gas Services midstream subsidiary to funds manag...