Kimbell Royalty Partners LP
Q4 2025 Earnings
Market Reaction
S&P 500 over the same 30 days: −8.32%.
Did KRP Beat Earnings? Q4 2025 Results
Kimbell Royalty Partners delivered a standout Q4 2025, posting earnings of $0.21 per unit against a consensus estimate of $0.15, a beat of 43.74%, while revenue of $82.45 million cleared the $69.07 million estimate by 19.38% and climbed 16.4% year-over-year. The primary engine behind the strong result was a $5.37 million gain on commodity derivatives, a sharp reversal from a $4.15 million loss in the prior-year period, combined with higher oil, natural gas, and NGL revenues of $76.02 million versus $69.08 million a year ago. Equally significant, the absence of the $56.16 million property impairment charge that weighed on Q4 2024 allowed operating income to swing to $32.62 million from a loss of $38.66 million. The company also announced a $100 million common unit repurchase program, adding a capital return dimension alongside its 75% distribution payout ratio. Looking ahead, Kimbell initiated 2026 production guidance of 24,000 to 27,000 Boe/d, signaling confidence in the stability of its royalty-driven production base.
- Q4 2025 run-rate daily production of 25,627 Boe/d exceeded mid-point of guidance
- Organic production growth from Q3 2025 to Q4 2025
- 85 active rigs on acreage representing 16.1% market share of U.S. land rig count
- No impairment charges in Q4 2025 versus $56.2 million impairment in Q4 2024
- Gain on commodity derivative instruments of $5.4 million in Q4 2025 versus loss of $4.1 million in Q4 2024
- Proved developed reserves increased approximately 8% year-over-year to nearly 73 million Boe
- Superior five-year annual average PDP decline rate of 14%
“2025 was another outstanding year for Kimbell. In Q1 2025, we closed the $230 million acquisition of mineral and royalty interests in properties located under the historic Mabee Ranch in the Midland Basin, further bolstering the Permian Basin as our leading basin in terms of production, active rig count, DUCs, permits and undrilled inventory. In Q2 2025, we redeemed 50% of the Series A Cumulative Convertible Preferred Units, further simplifying our capital structure and lowering our cost of capital. During the year, we paid out $1.60 per common unit in quarterly distributions, 100% of which was considered return of capital and not subject to dividend income taxes. We paid down approximately $57.4 million on our credit facility during 2025 by allocating 25% of cash available for distribution for debt paydown. Finally, proved developed reserves increased by approximately 8% to a record of nearly 73 million Boe.”
Kimbell Royalty Partners CEO, on the earnings call
Forward Guidance & Outlook
Kimbell initiated 2026 operational guidance with net production of 24,000–27,000 Boe/d (mid-point 25,500 Boe/d), unchanged from the 2025 guidance range, reinforcing production base stability. Oil is expected to comprise 30%–34% of production, natural gas 46%–50%, and NGLs 18%–22%. Unit cost guidance includes Cash G&A of $2.45–$2.65/Boe, marketing and other deductions of $1.40–$2.20/Boe, and depreciation/depletion of $13.00–$20.00/Boe. Production and ad valorem taxes are guided at 6.0%–8.0% of oil, natural gas and NGL revenues. The company intends to maintain a 75% payout ratio with 25% allocated to debt paydown. Management expressed confidence in continued M&A consolidation activity within the royalty sector.
KRP YoY Financials
KRP Revenue by Segment
Figures from SEC filings and company reports. Not investment advice.