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Freehold Royalties (FRU) Q3 2026 Earnings Report

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TSE:FRU Q3 2026 EPS Results

Actual EPS
CAD 0.28
Consensus EPS
CAD 0.28
Beat/Miss
Met expectations
One Year Ago EPS
CAD 0.21

TSE:FRU Q3 2026 Revenue Results

Actual Revenue
CAD 100.31M
Expected Revenue
―
Beat/Miss
―
YoY Revenue Growth
+34.88%

Earnings Announcement Details

Quarter
Q3 2026
Date
11/10/2026
Time
After Close
Conference Call
Tuesday, November 10, 2026
TSE:FRU Upcoming Earnings

Freehold Royalties's next earnings date is estimated for March 3, 2027, based on past reporting schedules.

Q3 2026 Earnings Call Audio

TSE:FRU Q3 2026 Earnings Call
0:00 / 0:00

Q3 2026 Earnings Slide Deck

Q3 2026 Earnings Call Summary

Q3 2026
Earnings Call Date:Nov 10, 2026|% Change Since:5.05%|
Earnings Call Sentiment|Positive

The call was strongly constructive. Freehold reported stable revenue, strong funds from operations, lower cash costs, robust drilling activity, continued Permian market-share gains, shareholder returns, debt reduction, and a new Duvernay growth platform. The main challenges were lower benchmark WTI prices, lower U.S. royalty interests, longer U.S. production lead times, and the impact of weak 2025 commodity prices on 2026 production spending and guidance. Overall, the positive operating momentum, financial performance, and growth initiatives significantly outweighed the stated challenges.

Company Guidance

Freehold expects full year 2026 production between 15,500 and 16,300 BOE per day, with approximately 65% weighted to crude oil and natural gas liquids; it expects the increase in U.S. activity to show up in production levels into 2027, with a little bit scheduled to come on in Q4 of this year and the bulk in 2027, while 2027 guidance is planned for early in 2027. The Duvernay asset has the potential to grow to 5%-10% of Canadian production over the next decade, with an initial investment of CAD 20 million paid upon closing in Q4 of this year, the balance expected to be deployed through 2027 and 2028 as specific operational milestones are achieved, including a CAD 5 million payment tied to production milestones expected in 2028; a one-rig program could occur potentially into 2028, following the first year and a half of initial drilling and assessments and a ramp-up in year two to three.

  • Sequential Production Growth and Strong Liquids MixQ3 production averaged 15,758 BOE per day, with a 65% liquids weighting. Production grew sequentially through the year, and management cited continued momentum heading into 2027.
  • U.S. Production Growth Led by the PermianU.S. production posted another quarter of modest growth, led by the Permian. Management attributed the improvement to high commodity prices, improving well productivities, and expanded natural gas egress capacity, which resulted in incremental production and improved pricing.
  • Robust Drilling ActivityGross drilling reached 412 wells in Q3, up 46% from the same period last year, while net wells increased approximately 8% year over year. Canadian drilling activity and wells brought online were higher in almost every play, making Q3 one of the busiest quarters since 2022.
  • Clearwater and Saskatchewan Activity MomentumClearwater development continued to lead as royalty payers increased drilling activity and continued implementing waterflooding to grow production and mitigate declines. Saskatchewan activity also continued to ramp up, supported by public and private operators, strong leasing, light oil pricing, and resource capture through open-hole multilateral drilling.
  • Permian Market Share and Ground Game ExecutionFreehold had 292 gross U.S. wells drilled in Q3, primarily in the Permian. One in every three wells drilled on the Midland side of the basin was on lands where Freehold holds a royalty interest. Drilling on Freehold's Permian lands increased from 135 gross wells in Q1 to 229 gross wells in Q3, a 70% increase versus a 5% increase basin-wide.
  • High-Quality Undrilled Permian InventoryFreehold has been acquiring core Permian lands that had not been drilled with horizontal wells at acquisition. Operators are prioritizing this inventory using current drilling and completion strategies, and 30% of gross wells drilled on Freehold's Midland land in Q3 were on acreage acquired through the ground game initiative.
  • High Permian Well ProductivityAlthough U.S. royalty interests are lower on average than in Canada, management said this is partially offset by initial well productivities and reserve recovery. Initial Permian productivities can be 10 times those of the average Canadian well in Freehold's portfolio.
  • Strategic Entry into the West Central Alberta DuvernayFreehold announced a strategic expansion into the West Central Alberta Duvernay by investing alongside Refraction Energy. Freehold will receive a 3% gross overriding royalty across 179 contiguous sections in the liquids-rich West Shale Basin.
  • Milestone-Based Duvernay InvestmentThe initial CAD 20 million investment is expected to be paid at closing in Q4 2026, with the balance deployed through 2027 and 2028 as operational milestones are achieved, including a CAD 5 million payment tied to production milestones expected in 2028.
  • Duvernay Long-Term Growth PotentialManagement said the current Duvernay development plan has the potential to grow the asset to 5%-10% of Freehold's Canadian production over the next decade. Freehold also has the ability to invest in additional acreage alongside the operator and expand its royalty footprint.
  • Established Duvernay Resource CharacteristicsThe West Shale Basin has porosity, permeability, and pressure characteristics demonstrated by key wells drilled and placed on production in 2013 and 2014. Offset operators have shown that current drilling and completion strategies can drive significant increases in productivity and reserves.
  • Duvernay Growth Outlook and Operator AlignmentIndustry Duvernay production has grown 25% per year over the past three years, with the West Shale Basin identified as the fastest-growing basin in the play. Refraction's initial program includes three licensed wells, with the first already spud; management expects initial drilling and assessment work before a potential one-rig, year-round program in the 2028 timeframe.
  • Stable Revenue Despite Lower Benchmark WTIQ3 revenue totaled CAD 100 million, unchanged from Q2 despite a decrease in benchmark WTI prices quarter over quarter. Revenue reflected strong realized pricing, bonus consideration, and lease rental revenue.
  • Strong Realized Pricing and Waha Hub ImprovementRealized pricing was nearly CAD 67 per BOE in Q3, driven primarily by U.S. production. NGL and natural gas realizations benefited from additional egress capacity, which led to improved pricing at the Waha Hub.
  • Bonus Consideration and Leasing RevenueFreehold generated over CAD 3 million of bonus consideration and lease rental revenue during the quarter. Leasing activity was successful in the Permian, including deeper Barnett Formation targets, and in Saskatchewan, where smaller operators were active.
  • Lower Cash Costs and Strong NetbacksCash cost declined to CAD 5.31 per BOE from CAD 5.58 per BOE in Q3 2025, driven by lower interest expense and Freehold's continued low-cost structure. Management said the structure supported netbacks of approximately 90% of revenue over the past five years.
  • Strong Funds From OperationsFreehold generated CAD 80 million in funds from operations, or CAD 0.49 per share, supported by strong operating fundamentals.
  • Continued U.S. Royalty Asset InvestmentFreehold spent CAD 46 million year to date, including CAD 17 million in Q3, on inventory-rich Permian lands as it continued executing its U.S. ground game strategy. Production associated with the initiative, launched in late 2024, has grown to over 400 BOE per day.
  • Balanced Capital Allocation and Shareholder ReturnsThrough September 30, Freehold had paid over CAD 130 million in dividends and reduced long-term debt by CAD 34 million. Management emphasized a disciplined and balanced approach to allocating favorable commodity prices and cash flow toward strategic investments, dividends, and debt reduction.
  • Maintained 2026 Production GuidanceFull-year 2026 production guidance was reiterated at 15,500 to 16,300 BOE per day, with approximately 65% weighted to crude oil and natural gas liquids.
  • Expanded Canadian Opportunity SetManagement said the Canadian opportunity set has improved over the past six to nine months, with new capital entering the sector and teams emerging from industry consolidation. Freehold is seeking meaningful, liquids-weighted investments, including additional westward exposure and potentially liquids-rich Montney assets, and cited more than 40 startup teams looking to deploy capital.

TSE:FRU Earnings History

TSE:FRU earnings history
Report DateFiscal QuarterForecast / EPSLast Year's EPSEPS YoY ChangePress Release
Mar 03, 20272026 (Q4)0.36-0.09――
Nov 10, 20262026 (Q3)0.280.280.2133.33% (+0.07)
Jul 29, 20262026 (Q2)0.270.350.04775.00% (+0.31)
May 12, 20262026 (Q1)0.180.210.23-8.70% (-0.02)
Mar 11, 20262025 (Q4)0.230.090.33-72.73% (-0.24)
Nov 13, 20252025 (Q3)0.160.210.1723.53% (+0.04)
Jul 30, 20252025 (Q2)0.150.040.26-84.62% (-0.22)
May 13, 20252025 (Q1)0.190.230.230.00% (+0.00)
Mar 12, 20252024 (Q4)0.360.330.2343.48% (+0.10)
Nov 07, 20242024 (Q3)0.300.170.28-39.29% (-0.11)

The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.

Beat Missed