Infinity Natural Resources, Inc. (INR) Earnings

Management highlights

### Leadership Changes - Founding CFO David Sproule stepped down; new hires Kerry Bates (EVP & CFO, effective August 12) and Andrew Judge (SVP of Finance) join the leadership team to support scaled long-term growth - Bates brings deep experience raising capital, leading major transactions, and building scalable financial infrastructure; Judge adds in-basin upstream expertise, capital raising capabilities, M&A evaluation experience, and strong investor relationship skills ### Core Production & Operational Execution - 10 new wells were brought online in Q2 2026, including the first 3 rich gas wells from the recently acquired Antero Ohio Utica assets and 7 volatile oil wells - 9 new wells were spotted during the quarter: 4 volatile oil in Ohio, 2 rich gas in Ohio, 2 dry gas in Pennsylvania, plus the first deep dry gas Utica well in Pennsylvania, where a 9,500-foot lateral was drilled and core data collected for technical analysis - Drilling and completion efficiency improved 15% YoY (lateral feet drilled per day vs. 2025 average), with 100% in-zone geosteering accuracy maintained - A revised completion design was validated that cuts completion costs by $50 per foot in Guernsey County via higher proppant loading, extended stage spacing, and fewer frac stages - Midstream system utilization increased 30% since the end of Q1 2026; 70% of current gross natural gas production now flows through Infinity's low-cost wholly owned midstream system, leaving significant spare capacity to support future production growth without major incremental capital investment ### Commercial & Strategic Updates - The company began taking in-kind most propane, butane, and pentane products in March 2026, delivering an uplift in propane price realizations compared to prior periods - The integrated midstream system provides strategic value: replicating the current footprint would require substantial capital, long lead times, and complex execution, and also improves marketing flexibility via premium access to RECS Zone 3 gas markets - The diversified dual commodity portfolio across Ohio and Pennsylvania provides operational flexibility to allocate capital to the highest return opportunities - The company maintains a disciplined long-term strategy: scale production, increase midstream utilization, maintain high capital efficiency, lower controllable costs, and evaluate strategic M&A to strengthen the platform and improve long-term cash generation - Capital allocation prioritizes projects with the highest returns regardless of commodity type, with project-level hedging used to lock in returns and stabilize cash flow visibility; for the remainder of 2026, 81% of natural gas and 70% of total production volumes are hedged based on guidance midpoints

Guidance

- Full-year 2026 guidance is fully reaffirmed, with no upward or downward revision - Management continues to expect full-year 2026 average net production of 345 to 375 million cubic feet equivalent per day, representing approximately 70% year-over-year production growth - Total development capital expenditure guidance (covering drilling, completions, and midstream investments) is maintained at $450 million to $500 million, with management confident of executing within this range despite modest upward pressure on input costs, as operational efficiency gains offset inflation

Segment performance

Infinity Natural Resources is an upstream and midstream natural resource operator focused on Appalachian assets. For Q2 2026, the firm reported total revenue of $171 million and a company record adjusted EBITDAX of $115 million, with adjusted EBITDAX margins of $3.62 per MCFE, roughly double the Appalachian peer group average. Net production averaged 348 million cubic feet equivalent per day (MMcfe/d), a 75% year-over-year increase: natural gas production averaged 217 million cubic feet per day (up 73% YoY, 62% of total production volume), oil production averaged 12.4 thousand barrels per day (up 102% YoY, 21% of total production volume), and NGL production averaged 9.5 thousand barrels per day (up 57% YoY, 16% of total production volume). The wholly owned midstream segment operates 1 billion cubic feet per day (BCF/d) of gathering capacity (400 million cubic feet per day in Pennsylvania, 600 million cubic feet per day in Ohio), with 35% total system utilization as of Q2 2026. Controllable cash operating costs totaled $1.58 per MCFE in Q2 2026, down 9% YoY. Capital expenditures for the quarter were $137 million, with $129 million allocated to development activities and $8 million to land activities.

Risks & headwinds

- Forward-looking statements are inherently uncertain, and actual results may differ materially from guidance due to commodity price volatility, changes in input/service costs, and other risks beyond the company's control. Key risks are disclosed in the company's SEC filings - Operational risk remains for the new deep Utica shale play evaluation, as core and well performance analysis is still ongoing, with no guarantees of commercial viability - The company faces modest industry-wide input cost inflation pressure for diesel, steel, and other drilling/completion inputs - Third-party midstream revenue growth is uncertain and not expected to materialize meaningfully in the near term

Analyst Q&A

• Q: The well timing schedule shows an oil skew in H1 2026 and more gas coming online in Q4 2026. Is this intentional to capture natural gas price seasonality, and how will timing be managed in 2027? /

  A: Management notes the company does not chase short-term commodity price cycles. The observed timing reflects standard rig cadence, operational reorganization, and project hedging practices rather than an attempt to time gas price movements. The schedule is shared publicly to help analysts model future production accurately, not to signal a market timing strategy.

• Q: What skills do the new leadership hires bring that justify the executive change, per the board? /

  A: The board views this as the right leadership change for the company's current growth stage. Outgoing CFO David Sproule was thanked for 10 years of foundational contributions. New CFO Kerry Bates has decades of public company experience suited to supporting Infinity's planned scaled growth, and his skills complement Andrew Judge's in-basin expertise to position the company well for its strategic plan.

• Q: What are initial observations on well performance and costs for the newly acquired Antero assets, compared to prior operator results? /

  A: It remains early in the development cycle, but the first three wells from the Antero acquisition have met or exceeded all performance and underwriting expectations. Drilling and rig movement across pads has been very efficient to date. Infinity is using a completion design that adds 1,000 pounds of additional sand per foot compared to Antero's prior design, which management expects will deliver improved long-term well results. Further synergy and performance updates will be provided in future quarters as more data is collected.

• Q: What are the next operational efficiency opportunities for completion and drilling after the recent Q2 improvements? /

  A: Management will continue rolling out the proven higher-proppant, lower-stage-count completion design from Carroll County to other producing areas, which maximizes daily pumping efficiency. Additional efficiency gains are expected on the drilling side, via optimization of bottom hole assemblies to increase daily drilled footage, which will cut 1-2 days of drilling time per well, allowing more wells to be completed annually within the existing capital budget.

• Q: When and how will midstream asset benefits show up in financial results as utilization increases? /

  A: The recent increase in reported GP&T costs is driven mostly by the acquired REX Zone 3 firm transportation contract (which enables higher price realizations, not just higher costs) and a shift to higher liquids production, which requires more expensive processing than dry gas. As more new production flows through Infinity's low-cost owned midstream over the next two quarters, per-unit GP&T costs will decline structurally. The primary strategic goal of the midstream system is to deliver best-in-class break-evens for upstream operations, not near-term third-party revenue, so success will be seen in lower unit costs and higher project returns rather than third-party top-line growth.