0001558370-24-000857 | 10-Q | XBRL Viewer

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Fair Value Measurement (Details) - USD ($)	Dec. 31, 2023	Jun. 30, 2023
Fair Value Measurement
Open positions	$ 0	$ 0

Earnings (Loss) per Common Share

6 Months Ended

Dec. 31, 2023

Earnings (Loss) per Common Share

Earnings (Loss) per Common Share

Note 11. Earnings (Loss) per Common Share

The following table sets forth the computation of basic and diluted earnings (loss) per common share, reflecting the application of the two-class method (in thousands, except per share amounts):


	Three Months Ended				Six Months Ended
	December 31,				December 31,
	2023		2022		2023		2022
Numerator
Net income (loss)	$	1,082	$	10,387	$	2,556	$	21,094
Undistributed earnings allocated to unvested restricted stock		(24)		(162)		(51)		(274)
Net income (loss) for earnings per share calculation	$	1,058	$	10,225	$	2,505	$	20,820

Denominator
Weighted average number of common shares outstanding — Basic		32,693		33,174		32,676		33,154
Effect of dilutive securities:
Unvested restricted stock awards		171		206		225		195
Unvested contingent restricted stock units		36		14		39		7
Weighted average number of common shares and dilutive potential common shares used in diluted earnings per share		32,900		33,394		32,940		33,356

Net income (loss) per common share — Basic	$	0.03	$	0.31	$	0.08	$	0.63
Net income (loss) per common share — Diluted	$	0.03	$	0.31	$	0.08	$	0.62

Unvested restricted stock awards (both time-vested and performance-based), totaling approximately 0.2 million and 0.1 million for the three and six months ended December 31, 2023, respectively, were not included in the computation of diluted earnings per common share because the effect would have been anti-dilutive.

Unvested restricted stock awards (both time-vested and performance-based), totaling approximately 90,000 and 49,000 for the three and six months ended December 31, 2022, respectively, were not included in the computation of diluted earnings per common share because the effect would have been anti-dilutive.

In addition, unvested performance-based restricted stock awards and unvested contingent restricted stock units that would not meet the performance criteria as of the period end are excluded from the computation of diluted earnings per common share.

Stockholders' Equity - Dividends (Details) - $ / shares	3 Months Ended
Stockholders' Equity - Dividends (Details) - $ / shares	Dec. 31, 2023	Sep. 30, 2023	Dec. 31, 2022	Sep. 30, 2022
Stockholders' Equity
Cash dividends paid (in USD per share)	$ 0.120	$ 0.120	$ 0.120	$ 0.120

Additional Financial Statement Information

6 Months Ended

Dec. 31, 2023

Additional Financial Statement Information

Additional Financial Statement Information

Note 12. Additional Financial Statement Information

Certain amounts on the unaudited condensed consolidated balance sheets are comprised of the following (in thousands):


	December 31, 2023		June 30, 2023
Prepaid expenses and other current assets:
Other receivables	$	21	$	18
Prepaid insurance		468		727
Prepaid federal and state income taxes		1,371		805
Carryback of EOR tax credit		347		347
Prepaid other		362		380
Total prepaid expenses and other current assets	$	2,569	$	2,277

Other assets:
Deposit	$	1,158	$	1,158
Right of use asset under operating lease		179		183
Total other assets	$	1,337	$	1,341

Accrued liabilities and other:
Accrued payables	$	2,890	$	3,005
Accrued capital expenditures		593		167
Accrued incentive and other compensation		611		941
Accrued royalties payable		1,046		977
Accrued taxes other than federal and state income tax		980		739
Accrued severance		—		81
Operating lease liability		97		59
Asset retirement obligations due within one year		41		55
Accrued - other		36		3
Total accrued liabilities and other	$	6,294	$	6,027

Stockholders' Equity (Tables)

6 Months Ended

Dec. 31, 2023

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Dividends declared and paid


	Fiscal Year
	2024		2023
Second quarter ended December 31,	$	0.120	$	0.120
First quarter ended September 30,		0.120		0.120

Schedule of share repurchases


	Six Months Ended
	December 31,
	2023		2022
Number of treasury shares acquired		29,236		12,049
Average cost per share	$	7.29	$	7.19
Total cost of treasury shares acquired	$	213,015	$	86,690

Schedule of Market-based Award Valuation Assumptions

For performance-based awards granted during the six months ended December 31, 2023 and 2022, the assumptions used in the Monte Carlo simulation valuations were as follows:


	Six Months Ended
	December 31,
	2023		2022
Weighted average fair value of performance-based awards granted	$	3.58	$	6.69
Risk-free interest rate		4.87%		3.91% to 4.44%
Expected term in years		2.77		2.66 to 2.78
Expected volatility		55.0%		69.6% to 70.9%
Dividend yield		7.4%		6.1%

Schedule of restricted stock unit transactions

Unvested restricted stock awards as of December 31, 2023 consisted of the following:


		Weighted
	Number of	Average
	Restricted	Grant-Date
Award Type	Shares	Fair Value
Time-vested awards	439,603	$	6.61
Performance-based awards	278,688		5.46
Unvested at December 31, 2023	718,291	$	6.16

Restricted Stock

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Schedule of restricted stock unit transactions

The following table sets forth the restricted stock award transactions for the six months ended December 31, 2023:


						Weighted
		Weighted		Unamortized		Average
	Number of	Average		Compensation		Remaining
	Restricted	Grant-Date		Expense		Amortization
	Shares	Fair Value		(In thousands)		Period (Years)
Unvested at June 30, 2023	595,414		6.48	$	2,827	2.4
Time-vested shares granted	152,192		6.24
Performance-based shares granted	136,315		4.80
Vested	(165,630)		6.26
Unvested at December 31, 2023	718,291	$	6.16	$	3,470	2.1

Contingent restricted stock grants

Share-based Compensation Arrangement by Share-based Payment Award [Line Items]

Schedule of restricted stock unit transactions

The following table sets forth contingent restricted stock unit transactions for the six months ended December 31, 2023:


						Weighted
				Unamortized		Average
	Number of	Weighted Average		Compensation		Remaining
	Restricted	Grant-Date		Expense		Amortization
	Stock Units	Fair Value		(In thousands)		Period (Years)
Unvested at June 30, 2023	96,398	$	3.49	$	195	1.9
Performance-based awards granted	102,239		1.95
Unvested at December 31, 2023	198,637	$	2.70	$	320	2.0

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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+ Details

Additional Financial Statement Information - Consolidated Balance Sheets (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Prepaid expenses and other current assets:
Other receivables	$ 21	$ 18
Prepaid insurance	468	727
Prepaid federal and state income taxes	1,371	805
Carryback of EOR tax credit	347	347
Prepaid other	362	380
Total prepaid expenses and other current assets	2,569	2,277
Other assets:
Deposit	1,158	1,158
Right of use asset under operating lease	179	183
Total other assets	1,337	1,341
Accrued liabilities and other:
Accrued payables	2,890	3,005
Accrued capital expenditures	593	167
Accrued incentive and other compensation	611	941
Accrued royalties payable	1,046	977
Accrued taxes other than federal and state income tax	980	739
Accrued severance		81
Operating lease liability	97	59
Asset retirement obligations due within one year	41	55
Accrued - other	36	3
Total Accrued liabilities and other	$ 6,294	$ 6,027

Stockholders' Equity - Fair Value Assumptions (Details) - $ / shares	6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Weighted average fair value of market-based awards granted (in USD per share)	$ 3.58	$ 6.69
Risk-free interest rate	4.87%
Risk-free interest rate, minimum		3.91%
Risk-free interest rate, maximum		4.44%
Expected life in years	2 years 9 months 7 days
Expected volatility	55.00%
Expected volatility, minimum		69.60%
Expected volatility, maximum		70.90%
Dividend yield	7.40%	6.10%
Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life in years		2 years 7 months 28 days
Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expected life in years		2 years 9 months 10 days

Pay vs Performance Disclosure - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
Pay vs Performance Disclosure - USD ($) $ in Thousands	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Pay vs Performance Disclosure
Net Income (Loss)	$ 1,082	$ 10,387	$ 2,556	$ 21,094

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

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+ Details

Financial Statement Presentation

6 Months Ended

Dec. 31, 2023

Summary of Significant Events and Accounting Policies

Summary of Significant Events and Accounting Policies

Note 1. Financial Statement Presentation

Nature of Operations. Evolution Petroleum Corporation (“Evolution,” and together with its consolidated subsidiaries, the “Company”) is an independent energy company focused on maximizing returns to shareholders through the ownership of and investment in onshore oil and natural gas properties in the United States. The Company’s long-term goal is to maximize total shareholder return from a diversified portfolio of long-life oil and natural gas properties built through acquisitions and through selective development opportunities, production enhancement, and other exploitation efforts on its oil and natural gas properties.

The Company’s oil and natural gas properties consist of non-operated interests in the following areas: the Jonah Field in Sublette County, Wyoming, a natural gas and natural gas liquids producing field; the Williston Basin in North Dakota, producing oil and natural gas properties; the Barnett Shale located in North Texas, natural gas and natural gas liquids producing properties; the Hamilton Dome Field located in Hot Springs County, Wyoming, a secondary recovery field utilizing water injection wells to pressurize the reservoir; the Delhi Holt-Bryant Unit in the Delhi Field in Northeast Louisiana, a CO₂ enhanced oil recovery project; the Chaveroo oilfield in Chaves and Roosevelt Counties of New Mexico; as well as small overriding royalty interests in four onshore Texas wells.

Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. All adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the interim periods presented have been included. The interim financial information and notes hereto should be read in conjunction with the Company’s 2023 Annual Report on Form 10-K for the fiscal year ended June 30, 2023, as filed with the SEC on September 13, 2023. The results of operations for interim periods are not necessarily indicative of results to be expected for a full fiscal year. The Company has evaluated events and transactions through the date of issuance of these unaudited condensed consolidated financial statements.

Principles of Consolidation and Reporting. The unaudited condensed consolidated financial statements include the accounts of Evolution Petroleum Corporation and its wholly-owned subsidiaries. All significant intercompany transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements for the previous year may be condensed or include certain reclassifications to conform to the current presentation. To conform with the current year presentation, $0.6 million of accrued ad valorem and production taxes at June 30, 2023 are included with “Accrued taxes other than federal and state income tax” instead of “Accrued payables” as disclosed in Note 12, “Additional Financial Statement Information.” This reclassification has no impact on the previously reported unaudited condensed consolidated balance sheets, net income or stockholders’ equity.

Risk and Uncertainties. The Company’s oil and natural gas interests are operated by third-party operators and involve other third-party working interest owners. As a result, the Company has limited ability to influence the operation or future development of such properties. However, the Company is proactive with its third-party operators to review capital projects and related spending and present alternative plans as appropriate.

Oil and Natural Gas Properties. The Company uses the full-cost method of accounting for its investments in oil and natural gas properties. Under this method of accounting, all costs incurred in the acquisition, exploration and development of oil and natural gas properties, including unproductive wells, are capitalized. This includes any internal costs that are directly related to property acquisition, exploration, and development activities but does not include any costs related to production, general corporate overhead, or similar activities. Oil and natural gas properties include costs that are excluded from depletion and amortization, which represent investments in unproved and unevaluated properties and include non-

producing leasehold, geologic and geophysical costs associated with leasehold or drilling interests, and exploration drilling costs. These costs are excluded until the project is evaluated and proved reserves are established or impairment is determined. The Company entered into a strategic partnership with PEDEVCO Corp. (“PEDEVCO”) on September 12, 2023, to jointly develop the Chaveroo oilfield in the Permian Basin in New Mexico (the “Chaveroo Field”). Per the terms of the participation agreement (the “Participation Agreement”) with PEDEVCO, Evolution paid for acreage associated with nine initial drilling locations totaling approximately $0.4 million. As of December 31, 2023, the Company recorded the payment for the initial acreage as unevaluated costs, excluded from the full cost pool. Refer to Note 3, “Property and Equipment,” for further details.

Use of Estimates. The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities, if any, at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Significant estimates include (a) reserve quantities and estimated future cash flows associated with proved reserves, which may significantly impact depletion expense and potential impairments of oil and natural gas properties, (b) asset retirement obligations, (c) stock-based compensation, (d) fair values of derivative contract assets and liabilities, (e) income taxes and the valuation of deferred income tax assets, (f) commitments and contingencies, and (g) accruals of crude oil, natural gas, and NGL revenues and expenses. The Company analyzes estimates and judgments based on historical experience and various other assumptions and information that are believed to be reasonable. Estimates and assumptions about future events and their effects cannot be predicted with certainty and, accordingly, these estimates may change as additional information is obtained, as new events occur, and as the Company’s environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company’s unaudited condensed consolidated financial statements.

Recently Issued Accounting Pronouncements

In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 enhances the transparency of income tax disclosures by expanding the income tax rate reconciliation disclosure and income taxes paid information. ASU 2023-09 also includes certain other amendments to improve the effectiveness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating ASU 2023-09 and the impact it may have to the Company’s financial position, results of operations, cash flow or disclosures.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (“ASU 2016-13”). ASU 2016-13 changes the impairment model for most financial assets and certain other instruments, including trade and other receivables, and requires the use of a new forward-looking expected loss model that will result in the earlier recognition of allowances for losses. Early adoption is permitted and entities must adopt the amendment using a modified retrospective approach to the first reporting period in which the guidance is effective. For smaller reporting companies, as provided by ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842), ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2022. The Company adopted ASU 2016-13 effective July 1, 2023. The adoption did not have a material effect on the Company’s financial position, results of operations, cash flows or disclosures.

Other accounting pronouncements that have recently been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations, cash flows or disclosures.

Earnings (Loss) per Common Share - Schedule of Outstanding Potentially Dilutive Securities (Details) - shares	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Restricted Stock Units (RSUs)
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Antidilutive shares (in shares)	200,000	90,000	100,000	49,000,000

Commitments and Contingencies

6 Months Ended

Dec. 31, 2023

Commitments and Contingencies.

Commitments and Contingencies

Note 9. Commitments and Contingencies

The Company is subject to various claims and contingencies in the normal course of business. In addition, from time to time, the Company receives communications from government or regulatory agencies concerning investigations or allegations of noncompliance with laws or regulations in jurisdictions in which the Company operates. The Company discloses such matters if it believes there is a reasonable possibility that a future event or events will confirm a material loss through impairment of an asset or the incurrence of a material liability. The Company accrues a material loss if it believes it probable that a future event or events will confirm a loss and the loss is reasonably subject to estimation. Furthermore, the Company will disclose any matter that is unasserted if it considers it probable that a claim will be asserted and there is a reasonable possibility that the outcome will be unfavorable and material in amount. The Company expenses legal defense costs as they are incurred.

Stockholders' Equity - Schedule of Restricted Stock and Contingent Restricted Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	6 Months Ended		12 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Number of Restricted Shares
Granted (in shares)	400,000	400,000
Weighted Average Grant-Date Fair Value
Granted (in USD per share)	$ 3.58	$ 6.69
Restricted Stock
Number of Restricted Shares
Unvested, beginning of period (in shares)	595,414
Vested (in shares)	(165,630)
Unvested, end of period (in shares)	718,291		595,414
Weighted Average Grant-Date Fair Value
Unvested, beginning of period (in USD per share)	$ 6.48
Vested (in USD per share)	6.26
Unvested, end of period (in USD per share)	$ 6.16		$ 6.48
Unamortized compensation expense	$ 3,470		$ 2,827
Weighted Average Remaining Amortization Period (Years)	2 years 1 month 6 days		2 years 4 months 24 days
Restricted Stock, Performance Based
Number of Restricted Shares
Granted (in shares)	136,315	100,000
Unvested, end of period (in shares)	278,688
Weighted Average Grant-Date Fair Value
Granted (in USD per share)	$ 4.80
Unvested, end of period (in USD per share)	$ 5.46
Restricted Stock Time Vested
Number of Restricted Shares
Granted (in shares)	152,192	300,000
Unvested, end of period (in shares)	439,603
Weighted Average Grant-Date Fair Value
Granted (in USD per share)	$ 6.24
Unvested, end of period (in USD per share)	$ 6.61
Contingent Restricted Stock Grants
Number of Restricted Shares
Unvested, beginning of period (in shares)	96,398
Granted (in shares)	102,239
Unvested, end of period (in shares)	198,637		96,398
Weighted Average Grant-Date Fair Value
Unvested, beginning of period (in USD per share)	$ 3.49
Granted (in USD per share)	1.95
Unvested, end of period (in USD per share)	$ 2.70		$ 3.49
Unamortized compensation expense	$ 320		$ 195
Weighted Average Remaining Amortization Period (Years)	2 years		1 year 10 months 24 days

Asset Retirement Obligations (Tables)

6 Months Ended

Dec. 31, 2023

Asset Retirement Obligations

Schedule of Reconciliations of the Beginning and Ending Asset Retirement Obligation Balances

The following is a reconciliation of the activity related to the Company’s ARO liability (inclusive of the current portion) for the period ended December 31, 2023 (in thousands):


	December 31, 2023
Asset retirement obligations — beginning of period	$	17,067
Accretion of discount		712
Asset retirement obligations — end of period		17,779
Less: current asset retirement obligations		(41)
Long-term portion of asset retirement obligations	$	17,738

Subsequent Events (Details) $ / shares in Units, $ in Thousands	Feb. 05, 2024 $ / shares	Jan. 30, 2024 $ / bbl bbl	Jan. 05, 2024 USD ($) location	May 05, 2023 USD ($)	Sep. 12, 2023 location
Subsequent Event [Line Items]
Number of gross wells in process \| location					9
Subsequent Event
Subsequent Event [Line Items]
Dividend declared (in dollars per share) \| $ / shares	$ 0.120
Dividend declared, date declared	Feb. 05, 2024
Dividend declared, date of record	Mar. 15, 2024
Dividend declared, date to be paid	Mar. 28, 2024
Oil and Natural Gas Assets in the SCOOP and STACK Plays [Member] \| Subsequent Event
Subsequent Event [Line Items]
Agreement date			Jan. 05, 2024
Effective date			Nov. 01, 2023
Combined purchase price expected \| $			$ 43,500
Payments for productive assets \| $			$ 3,260
Average working interest			3.00%
Number o producing wells \| location			231
Number of wells funded through completion by the sellers \| location			21
Energy Related Derivative [Member] \| Crude Oil [Member] \| Subsequent Event
Subsequent Event [Line Items]
Volumes in Barrels \| bbl		40,775
Derivative, start date		Feb. 01, 2024
Derivative, end date		Jun. 30, 2024
Crude Oil Put Positions [Member] \| Crude Oil [Member] \| Subsequent Event
Subsequent Event [Line Items]
Derivative, strike price / Price (in USD per barrel) \| $ / bbl		75.00
Crude Oil Fixed Price Swap Positions [Member] \| Crude Oil [Member] \| Subsequent Event
Subsequent Event [Line Items]
Fixed-price / Price (in USD per barrel) \| $ / bbl		73.41
Revolving credit facility \| Senior Secured Reserve-Based Credit Facility \| Line of Credit
Subsequent Event [Line Items]
Credit facility maturity date				Apr. 09, 2026
Margined collateral value \| $				$ 95,000
Revolving credit facility \| Senior Secured Reserve-Based Credit Facility \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Line of Credit
Subsequent Event [Line Items]
Credit spread adjustment				0.05%

Fair Value Measurement

6 Months Ended

Dec. 31, 2023

Fair Value Measurement

Fair Value Measurement

Note 7. Fair Value Measurement

Accounting guidelines for measuring fair value establish a three-level valuation hierarchy for disclosure of fair value measurements. The valuation hierarchy categorizes assets and liabilities measured at fair value into one of three different levels depending on the observability of the inputs employed in the measurement.

The three levels are defined as follows:

Level 1—Observable inputs such as quoted prices in active markets at the measurement date for identical, unrestricted assets or liabilities.

Level 2—Other inputs that are observable directly or indirectly, such as quoted prices in markets that are not active or inputs which are observable, either directly or indirectly, for substantially the full term of the asset or liability.

Level 3—Unobservable inputs for which there are little or no market data and which the Company makes its own assumptions about how market participants would price the assets and liabilities.

Fair Value of Derivative Instruments. The Company’s determination of fair value incorporates not only the credit standing of the counterparties involved in transactions with the Company resulting in receivables on the Company’s unaudited condensed consolidated balance sheets, but also the impact of the Company’s nonperformance risk on its own liabilities. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC 820 establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The Company utilizes market data or assumptions that market participants would use in pricing the asset or liability, including assumptions about risk and the risks inherent in the inputs to the valuation technique. These inputs can be readily observable (Level 1) market corroborated (Level 2), or generally unobservable (Level 3). The Company classifies fair value balances based on observability of those inputs.

As required by ASC 820, a financial instrument’s level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. The Company’s assessment of the significance of a particular input to the fair value measurement requires judgement, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. There were no transfers between fair value hierarchy levels for any period presented in this report. The Company did not have any open positions at December 31, 2023 or June 30, 2023.

Other Fair Value Measurements. The following disclosure of the estimated fair value of financial instruments is made in accordance with the requirements of ASC 825, Financial Instruments. The estimated fair value amounts have been determined at discrete points in time based on relevant market information. These estimates involve uncertainties and cannot be determined with precision. The estimated fair value of cash and cash equivalents, accounts receivable, and accounts payable approximates their carrying value due to their short-term nature. The estimated fair value of the Company’s Senior Secured Credit Facility approximates carrying value because the interest rates approximate current market rates.

The Company follows the provisions of ASC 820, for nonfinancial assets and liabilities measured at fair value on a non-recurring basis. These provisions apply to the Company’s initial measurement and any subsequent revision of asset retirement obligations (“ARO”) for which fair value is calculated using discounted future cash flows derived from historical costs and management’s expectations of future cost environments. Significant Level 3 inputs used in the calculation of ARO include the costs of plugging and abandoning wells, surface restoration, and reserve lives. Subsequent to initial recognition, revisions to estimated asset retirement obligations are made when changes occur for input values. See Note 8, “Asset Retirement Obligations,” for a reconciliation of the beginning and ending balances of the liability for the Company’s ARO.

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Stockholders' Equity

6 Months Ended

Dec. 31, 2023

Stockholders' Equity

Stockholders' Equity

Note 10. Stockholders’ Equity

Common Stock

As of December 31, 2023, the Company had 33,506,794 shares of common stock outstanding.

The Company began paying quarterly cash dividends on common stock in December 2013. As of December 31, 2023, the Company has cumulatively paid over $110.4 million in cash dividends. The Company paid dividends of $8.0 million and $8.1 million to its common stockholders during the six months ended December 31, 2023 and 2022, respectively. The following table reflects the dividends paid per share within the respective three-month periods:


	Fiscal Year
	2024		2023
Second quarter ended December 31,	$	0.120	$	0.120
First quarter ended September 30,		0.120		0.120

On September 8, 2022, the Board of Directors approved a share repurchase program, under which the Company is authorized to repurchase up to $25.0 million of its common stock in the open market through December 31, 2024. The Company intends to fund repurchases from working capital and cash provided by operating activities. The Board of Directors along with the management team believe that a share repurchase program is complimentary to the existing dividend policy and is a tax efficient means to further improve shareholder return. The shares may be repurchased from time to time in open market transactions, through privately negotiated transactions or by other means in accordance with federal securities laws. The timing, as well as the number and value of shares repurchased under the program, will depend on a variety of factors, including management’s assessment of the intrinsic value of the Company’s shares, the market price of the Company’s common stock, the Company’s capital needs and resources, general market and economic conditions, and applicable legal requirements. The value of shares authorized for repurchase by the Company’s Board of Directors does not require the Company to repurchase such shares or guarantee that such shares will be repurchased, and the program may be suspended, modified, or discontinued at any time without prior notice.

In November 2023, the Company entered into a Rule 10b5-1 plan that authorizes a broker to repurchase shares in the open market subject to pre-defined limitations on trading volume and price. The plan is effective until June 30, 2024, unless extended, renewed or terminated by the Company, and has a maximum authorized amount of $0.8 million over that period. The Company may alter the terms of the plan from time to time to the extent it determines changes are necessary to achieve the intended objectives of the repurchase program. No shares were purchased under this plan during the period ended December 31, 2023.

During the six months ended December 31, 2023 and 2022, the Company acquired treasury stock upon the ordinary course of scheduled vestings of employee stock-based awards to fund payroll tax withholding obligations. These treasury shares were subsequently cancelled. Such shares were valued at fair market value on the date of vesting.

The following table summarizes all treasury stock purchases during the six months ended December 31, 2023 and 2022:


	Six Months Ended
	December 31,
	2023		2022
Number of treasury shares acquired		29,236		12,049
Average cost per share	$	7.29	$	7.19
Total cost of treasury shares acquired	$	213,015	$	86,690

Expected Tax Treatment of Dividends

For the fiscal year ended June 30, 2023, all common stock dividends for that fiscal year were treated for tax purposes as qualified dividend income to the recipients. Based on its current projections for the fiscal year ended June 30, 2024, the Company expects all common stock dividends for such period to be treated as qualified dividend income to the recipients. Such projections are based on the Company’s reasonable expectations as of December 31, 2023 and are subject to change based on the Company’s final tax calculations at the end of the fiscal year.

Stock-Based Incentive Plan

The Evolution Petroleum Corporation 2016 Equity Incentive Plan (as amended, the “2016 Plan”) authorizes the issuance of 3.6 million shares of common stock prior to its expiration on December 8, 2026. Incentives under the 2016 Plan may be granted to employees, directors, and consultants of the Company in any one or a combination of the following forms: incentive stock options and non-statutory stock options, stock appreciation rights, restricted stock awards and restricted stock unit awards, performance share awards, performance cash awards, and other forms of incentives valued in whole or in part by reference to, or otherwise based on, the Company’s common stock, including its appreciation in value. As of December 31, 2023 and June 30, 2023, approximately 0.9 million shares and 1.3 million shares, respectively, remained available for grant under the 2016 Plan.

The Company estimates the fair value of stock-based compensation awards on the grant date to provide the basis for future compensation expense. During the three and six months ended December 31, 2023, the Company recognized $0.6 million and $1.0 million, respectively, related to stock-based compensation. During the three and six months ended December 31, 2022, the Company recognized $0.5 million and $0.7 million, respectively, related to stock-based compensation expense. Stock-based compensation expense is recorded as a component of “General and administrative expenses” on the unaudited condensed consolidated statements of operations.

Time-Vested Restricted Stock Awards

Time-vested restricted stock awards contain service-based vesting conditions and expire after a maximum of four years from the date of grant if unvested. The common shares underlying these awards are issued on the date of grant and participate in dividends paid by the Company. These service-based awards vest with continuous employment by the Company, generally in annual installments over terms of three to four years. Awards to the Company’s directors

generally have one-year cliff vesting. For such awards, grant date fair value is based on market value of the Company’s common stock at the time of grant. This value is then amortized ratably over the service period. Previously recognized amortization expense subsequent to the last vesting date of an award is reversed in the event that the holder has no longer rendered service to the Company resulting in forfeiture of the award.

Performance-Based Restricted Stock Awards and Performance-Based Contingent Stock Units

Performance-based restricted stock awards and performance-based contingent stock units contain market-based vesting conditions based on the price of the Company’s common stock, the intrinsic value indexed solely to its common stock or the intrinsic value indexed to its common stock compared to the performance of the common stock of its peers. The common shares underlying the Company’s performance-based restricted stock awards are issued on the date of grant and participate in dividends paid by the Company and expire after a maximum of four years from the date of grant if unvested. Performance-based contingent share units do not participate in dividends and shares are only issued in part or in full upon the attainment of vesting conditions, generally have a lower probability of achievement and expire after a maximum of four years from the date of grant if unvested. Shares underlying performance-based contingent share units are reserved from the 2016 Plan. Performance-based restricted stock awards and contingent restricted stock units are valued using a Monte Carlo simulation and geometric Brownian motion techniques applied to the historical volatility of the Company’s total stock return compared to the historical volatilities of other companies or indices to which the Company compares its performance and/or the Company’s absolute total stock return. For certain awards, this Monte Carlo simulation also provides an expected vesting term. Stock-based compensation is recognized ratably over the expected vesting period, so long as the award holder remains an employee of the Company. Previously recognized compensation expense is only reversed for the awards with market-based vesting conditions if the requisite service period is not rendered by the holder resulting in forfeiture of the award or as a result of regulatory required clawback.

Vesting of grants with performance-based vesting conditions is dependent on the future price of the Company’s common stock. Such awards vest in part or in full if the trailing total returns on the Company’s common stock for a specified three-year period exceed the corresponding total returns of various quartiles of indices consisting of peer companies or, in some cases, vest when the average of the Company’s closing common stock price over a defined measurement period meets or exceeds a required common stock price.

During the six months ended December 31, 2023, the Company granted a total of 0.4 million equity awards that included 0.2 million time-vested restricted stock awards, 0.1 million performance-based restricted stock awards, and 0.1 million performance-based contingent stock units.

During the six months ended December 31, 2022, the Company granted a total of 0.4 million equity awards that included 0.3 million time-vested restricted stock awards, 0.1 million performance-based restricted stock awards, and less than 0.05 million of performance-based contingent stock units.

For performance-based awards granted during the six months ended December 31, 2023 and 2022, the assumptions used in the Monte Carlo simulation valuations were as follows:


	Six Months Ended
	December 31,
	2023		2022
Weighted average fair value of performance-based awards granted	$	3.58	$	6.69
Risk-free interest rate		4.87%		3.91% to 4.44%
Expected term in years		2.77		2.66 to 2.78
Expected volatility		55.0%		69.6% to 70.9%
Dividend yield		7.4%		6.1%

Unvested restricted stock awards as of December 31, 2023 consisted of the following:


		Weighted
	Number of	Average
	Restricted	Grant-Date
Award Type	Shares	Fair Value
Time-vested awards	439,603	$	6.61
Performance-based awards	278,688		5.46
Unvested at December 31, 2023	718,291	$	6.16

The following table sets forth the restricted stock award transactions for the six months ended December 31, 2023:


						Weighted
		Weighted		Unamortized		Average
	Number of	Average		Compensation		Remaining
	Restricted	Grant-Date		Expense		Amortization
	Shares	Fair Value		(In thousands)		Period (Years)
Unvested at June 30, 2023	595,414		6.48	$	2,827	2.4
Time-vested shares granted	152,192		6.24
Performance-based shares granted	136,315		4.80
Vested	(165,630)		6.26
Unvested at December 31, 2023	718,291	$	6.16	$	3,470	2.1

The following table sets forth contingent restricted stock unit transactions for the six months ended December 31, 2023:


						Weighted
				Unamortized		Average
	Number of	Weighted Average		Compensation		Remaining
	Restricted	Grant-Date		Expense		Amortization
	Stock Units	Fair Value		(In thousands)		Period (Years)
Unvested at June 30, 2023	96,398	$	3.49	$	195	1.9
Performance-based awards granted	102,239		1.95
Unvested at December 31, 2023	198,637	$	2.70	$	320	2.0

- Definition

The entire disclosure for equity.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 235
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481062/946-235-50-2

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 505
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481004/946-505-50-6

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 815
-SubTopic 40
-Name Accounting Standards Codification
-Section 50
-Paragraph 6
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480237/815-40-50-6

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480008/505-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 505
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//505/tableOfContent

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-13

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 14
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-14

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 16
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-16

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Topic 505
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 18
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481112/505-10-50-18

+ Details

Stockholders' Equity - Treasury Shares (Details) - USD ($)	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Stockholders' Equity
Number of treasury shares acquired (in shares)			29,236	12,049
Average cost per share (in USD per share)			$ 7.29	$ 7.19
Total cost of treasury shares acquired	$ 108,000	$ 61,000	$ 213,015	$ 86,690

Income Taxes (Details) - USD ($)	3 Months Ended		6 Months Ended
Income Taxes (Details) - USD ($)	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Income Taxes
Unrecognized tax benefits	$ 0	$ 0	$ 0	$ 0
Accrued interest and penalties	0	0	0	0
Income tax expense (benefit)	$ 554,000	$ 2,933,000	$ 1,017,000	$ 5,997,000
Income tax rate percentage			28.50%	22.10%
Statutory federal tax rate			21.00%	21.00%

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Subsequent Events

6 Months Ended

Dec. 31, 2023

Subsequent Events

Subsequent Events

Note 13. Subsequent Events

Dividend Declaration

On February 5, 2024, the Company declared a quarterly cash dividend of $0.120 per share of common stock to shareholders of record on March 15, 2024 and payable on March 28, 2024.

Derivatives

On January 30, 2024, the Company entered into new derivative contracts covering 40,775 barrels of its crude oil comprised of put positions at $75.00 per barrel and fixed-price swap positions at $73.41 per barrel over the effective period of February 2024 through June 2024.

SCOOP/STACK Acquisitions

On January 5, 2024, the Company entered into separate Purchase and Sale Agreements (“PSAs”) with Red Sky Resources III, LLC, Red Sky Resources IV, LLC, and Coriolis Energy Partners I, LLC. Pursuant to the PSAs, the Company will acquire non-operating working interests in oil and natural gas properties in the SCOOP and STACK plays in central Oklahoma for a combined purchase price of approximately $43.5 million in cash. Contemporaneous with the execution of the PSAs, the Company paid deposits totaling $3.26 million. The Company expects to fund the balance of the consideration to be paid in the transactions with a combination of cash on hand and borrowings under its senior secured credit facility.

The acquired assets consist of an average working interest of approximately 3% net to Evolution, in 231 producing wells and as of the effective date, 21 gross drilled and uncompleted wells to be funded through completion by the sellers, in the SCOOP and STACK plays of the Anadarko Basin in Blaine, Canadian, Carter, Custer, Dewey, Garvin, Grady, Kingfisher, McClain, and Stephens counties, Oklahoma.

The effective date of these acquisitions is November 1, 2023 and each transaction is expected to close in mid-February during the third quarter of fiscal 2024. The PSAs governing each transaction contain customary representations and warranties, covenants, indemnification, closing conditions and termination provisions and also provide for various purchase price adjustments, including adjusting the purchase price for the net cash flows of the properties between the effective date and closing date of the acquisition, to be calculated as of the closing date.

Property and Equipment

6 Months Ended

Dec. 31, 2023

Property and Equipment

Property and Equipment

Note 3. Property and Equipment

Property and equipment as of December 31, 2023 and June 30, 2023 consisted of the following (in thousands):


	December 31, 2023		June 30, 2023
Oil and natural gas properties
Property costs subject to amortization	$	199,526	$	197,049
Property costs not subject to amortization		3,370		—
Less: Accumulated depletion, depreciation, and impairment		(99,415)		(91,268)
Oil and natural gas properties, net	$	103,481	$	105,781

As of December 31, 2023, $3.4 million of oil and natural gas property costs were not subject to amortization. On September 12, 2023, the Company entered into a Participation Agreement with PEDEVCO for the joint development of a portion of PEDEVCO’s Permian Basin property in the Chaveroo Field, located in Chaves and Roosevelt Counties, New Mexico. The Participation Agreement does not include any of PEDEVCO’s existing vertical or horizontal wells.

Upon signing the Participation Agreement, the Company paid total cash consideration of $0.4 million, which includes less than $0.1 million of capitalized transactions costs, in exchange for a 50% working interest share in the existing leases associated with two initial development blocks, or nine drilling locations. Following completion of the initial nine development wells, the Company will have the right, but not the obligation, to elect to participate and acquire a 50% working interest share in the next development block, for up to a total of approximately 16,000 gross acres for the payment of $450 per acre. The Company allocated all of the acreage costs associated with the initial acreage purchase to unevaluated oil and natural gas properties. As of December 31, 2023, the Company has incurred approximately $3.0 million in capital expenditures related to the drilling and completion of an initial three wells. These capital expenditures are recorded as unevaluated property costs.

The Company uses the full cost method of accounting for its investments in oil and natural gas properties. All costs of acquisition, exploration, and development of oil and natural gas reserves are capitalized as the cost of oil and natural gas properties when incurred. To the extent capitalized costs of evaluated oil and natural gas properties, net of accumulated depletion, exceed the discounted future net revenues of proved oil and natural gas reserves, net of deferred taxes, such excess capitalized costs would be charged to expense as a write-down of oil and natural gas properties.

Additionally, the Company assesses all properties classified as unevaluated property on a quarterly basis for possible impairment. The Company assesses properties on an individual basis or as a group, if properties are individually insignificant. The assessment includes consideration of the following factors, among others: intent to drill; remaining lease term; geological and geophysical evaluations; drilling results and activity; the assignment of proved reserves; and the economic viability of development if proved reserves are assigned. During any period in which these factors indicate impairment, the cumulative drilling costs incurred to date for such property and all or a portion of the associated leasehold costs are transferred to the full cost pool and are then subject to depletion and the full cost ceiling test limitation.

Depletion of oil and natural gas properties was $8.1 million and $6.5 million for the six months ended December 31, 2023 and 2022, respectively. During the six months ended December 31, 2023 and 2022, the Company incurred development capital expenditures of $2.4 million and $2.1 million, respectively.

At December 31, 2023, the ceiling test value of the Company’s reserves was calculated based on the first-day-of-the-month average for the 12-months ended December 31, 2023 of the West Texas Intermediate (“WTI”) crude oil spot price

of $78.21 per barrel and Henry Hub natural gas spot price of $2.63 per MMBtu, adjusted by market differentials by field. The net price per barrel of NGLs was $31.57, which was based on historical differentials to WTI as NGLs do not have any single comparable reference index price. Using these prices, at December 31, 2023 the cost center ceiling was higher than the capitalized costs of oil and natural gas properties, and as a result, no write-down was necessary.

At December 31, 2022, the ceiling test value of the Company’s reserves was calculated based on the first-day-of the month average for the 12-months ended December 31, 2022 of the WTI crude oil spot price of $94.14 per barrel and Henry Hub natural gas spot price of $6.40 per MMBtu, adjusted by market differentials by field. The net price per barrel of NGLs was $48.50, which was based on historical prices received as NGLs do not have any single comparable reference index price. Using these prices, at December 31, 2022 the cost center ceiling was higher than the capitalized costs of oil and natural gas properties, and as a result, no write-down was necessary.

Derivatives (Tables)

6 Months Ended

Dec. 31, 2023

Derivatives

Derivative Instruments, Gain (Loss)


Derivatives not designated	Location of gain (loss)	Three Months Ended				Six Months Ended
as hedging contracts	recognized in income on	December 31,				December 31,
under ASC 815	derivative contracts	2023		2022		2023		2022
Commodity contracts:
Realized gain (loss) on derivative contracts	Other income and expenses - net gain (loss) on derivative contracts	$	—	$	(224)	$	—	$	(1,946)
Unrealized gain (loss) on derivative contracts	Other income and expenses - net gain (loss) on derivative contracts		—		1,070		—		2,189
Total net gain (loss) on derivative contracts		$	—	$	846	$	—	$	243

Senior Secured Credit Facility

6 Months Ended

Dec. 31, 2023

Senior Secured Credit Facility

Senior Secured Credit Facility

Note 4. Senior Secured Credit Facility

On April 11, 2016, the Company entered into a three-year, senior secured reserve-based credit facility, as amended, (the “Senior Secured Credit Facility”) with MidFirst Bank in an amount up to $50.0 million with a current borrowing base of $50.0 million. On May 5, 2023, the Company entered into the Tenth Amendment to the Senior Secured Credit Facility extending the maturity to April 9, 2026. The Tenth Amendment also replaced the London Interbank Offered Rate ("LIBOR") with the Secured Overnight Financing Rate (“SOFR”) plus a credit spread adjustment of 0.05% to effectively convert SOFR to a LIBOR equivalent and modifies the Margined Collateral Value, as defined in the Ninth Amendment to the Senior Secured Credit Facility, to $95.0 million. The borrowing base will be redetermined semiannually, with the lenders and the Company each having the right to one interim unscheduled redetermination between any two consecutive semi-annual redeterminations. The borrowing base takes into account the estimated value of the Company’s oil and natural gas properties, proved reserves, total indebtedness, and other relevant factors consistent with customary oil and natural gas lending criteria. The Senior Secured Credit Facility carries a commitment fee of 0.25% per annum on the undrawn portion of the borrowing base. Any borrowings under the Senior Secured Credit Facility will bear interest, at the Company’s option, at either SOFR plus 2.80%, which includes a 0.05% credit spread adjustment from LIBOR, subject to a minimum SOFR of 0.50%, or the Prime Rate, as defined under the Senior Secured Credit Facility, plus 1.00%.

The Company may elect, at its option, to prepay any borrowings outstanding under the Senior Secured Credit Facility without premium or penalty. Amounts outstanding under the Senior Secured Credit Facility are guaranteed by the Company’s direct and indirect subsidiaries and secured by a security interest in substantially all of the properties of the Company and its subsidiaries. Borrowings under the Senior Secured Credit Facility may be used for the acquisition and development of oil and natural gas properties, investments in cash flow generating properties complimentary to the production of oil and natural gas, and for letters of credit or other general corporate purposes.

The Senior Secured Credit Facility contains certain events of default, including non-payment; breaches or representation and warranties; non-compliance with covenants; cross-defaults to material indebtedness; voluntary or involuntary bankruptcy; judgments and change in control. The Senior Secured Credit Facility also contains financial covenants including a requirement that the Company maintain, as of the last day of each fiscal quarter, (i) a maximum total leverage ratio of not more than 3.00 to 1.00, (ii) a current ratio of not less than 1.00 to 1.00, and (iii) a consolidated tangible net worth of not less than $40.0 million, each as defined in the Senior Secured Credit Facility. As of December 31, 2023, the Company did not have any borrowings outstanding under its Senior Secured Credit Facility, resulting in $50.0 million of available borrowing capacity. As of December 31, 2023, the Company is in compliance with the financial covenants under the Senior Secured Credit Facility.

On February 7, 2022, the Company entered into the Ninth Amendment to the Senior Secured Credit Facility. This amendment, among other things, modified the definition of utilization percentage related to the required hedging covenant such that for the purposes of determining the amount of future production to hedge, the utilization of the Senior

Secured Credit Facility will be based on the Margined Collateral Value, as defined in the agreement, to the extent it exceeds the borrowing base then in effect.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (h)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(c))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Topic 470
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//470/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (g)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1B
-Subparagraph (i)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1C
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1E
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Topic 470
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 1I
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I

+ Details

Property and Equipment (Tables)

6 Months Ended

Dec. 31, 2023

Property and Equipment

Schedule of property and equipment

Property and equipment as of December 31, 2023 and June 30, 2023 consisted of the following (in thousands):


	December 31, 2023		June 30, 2023
Oil and natural gas properties
Property costs subject to amortization	$	199,526	$	197,049
Property costs not subject to amortization		3,370		—
Less: Accumulated depletion, depreciation, and impairment		(99,415)		(91,268)
Oil and natural gas properties, net	$	103,481	$	105,781

Property and Equipment - Other (Details) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Oil and natural gas properties
Property costs subject to amortization	$ 199,526	$ 197,049
Property costs not subject to amortization	3,370
Less: Accumulated depletion, depreciation, and accretion	(99,415)	(91,268)
Total property and equipment, net	$ 103,481	$ 105,781

Additional Financial Statement Information (Tables)

6 Months Ended

Dec. 31, 2023

Additional Financial Statement Information

Additional Financial Statement Information

Certain amounts on the unaudited condensed consolidated balance sheets are comprised of the following (in thousands):


	December 31, 2023		June 30, 2023
Prepaid expenses and other current assets:
Other receivables	$	21	$	18
Prepaid insurance		468		727
Prepaid federal and state income taxes		1,371		805
Carryback of EOR tax credit		347		347
Prepaid other		362		380
Total prepaid expenses and other current assets	$	2,569	$	2,277

Other assets:
Deposit	$	1,158	$	1,158
Right of use asset under operating lease		179		183
Total other assets	$	1,337	$	1,341

Accrued liabilities and other:
Accrued payables	$	2,890	$	3,005
Accrued capital expenditures		593		167
Accrued incentive and other compensation		611		941
Accrued royalties payable		1,046		977
Accrued taxes other than federal and state income tax		980		739
Accrued severance		—		81
Operating lease liability		97		59
Asset retirement obligations due within one year		41		55
Accrued - other		36		3
Total accrued liabilities and other	$	6,294	$	6,027

Earnings (Loss) per Common Share (Tables)

6 Months Ended

Dec. 31, 2023

Earnings (Loss) per Common Share

Schedule of computation of basic and diluted income (loss) per share

The following table sets forth the computation of basic and diluted earnings (loss) per common share, reflecting the application of the two-class method (in thousands, except per share amounts):


	Three Months Ended				Six Months Ended
	December 31,				December 31,
	2023		2022		2023		2022
Numerator
Net income (loss)	$	1,082	$	10,387	$	2,556	$	21,094
Undistributed earnings allocated to unvested restricted stock		(24)		(162)		(51)		(274)
Net income (loss) for earnings per share calculation	$	1,058	$	10,225	$	2,505	$	20,820

Denominator
Weighted average number of common shares outstanding — Basic		32,693		33,174		32,676		33,154
Effect of dilutive securities:
Unvested restricted stock awards		171		206		225		195
Unvested contingent restricted stock units		36		14		39		7
Weighted average number of common shares and dilutive potential common shares used in diluted earnings per share		32,900		33,394		32,940		33,356

Net income (loss) per common share — Basic	$	0.03	$	0.31	$	0.08	$	0.63
Net income (loss) per common share — Diluted	$	0.03	$	0.31	$	0.08	$	0.62

Income Taxes

6 Months Ended

Dec. 31, 2023

Income Taxes

Income Taxes

Note 5. Income Taxes

The Company files a consolidated federal income tax return in the United States and various combined and separate filings in several state and local jurisdictions.

There were no unrecognized tax benefits, nor any accrued interest or penalties associated with unrecognized tax benefits during the periods presented in the unaudited condensed consolidated financial statements. The Company believes that it has appropriate support for the income tax positions taken and to be taken on the Company’s tax returns and that the accruals for tax liabilities are adequate for all open years based on its assessment of many factors including past experience and interpretations of tax law applied to the facts of each matter. The Company’s federal and state income tax returns are open to audit under the statute of limitations for the fiscal years ended June 30, 2020 through June 30, 2023 for federal tax purposes and for the fiscal years ended June 30, 2019 through June 30, 2023 for state tax purposes. To the extent the Company utilizes net operating losses (“NOLs”) generated in earlier years, such earlier years may also be subject to audit.

For six months ended December 31, 2023, the Company recognized income tax expense of $1.0 million and had an effective tax rate of 28.5% compared to income tax expense of $6.0 million and an effective tax rate of 22.1% for the six months ended December 31, 2022.

The Company’s effective tax rate will typically differ from the statutory federal rate as a result of state income taxes, primarily in the states of Louisiana, North Dakota, and Texas, percentage depletion in excess of basis, and other permanent differences. For both periods, the respective statutory federal tax rate was 21%.

Deferred income taxes primarily represent the net tax effect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 946
-SubTopic 20
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480990/946-20-50-13

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 235
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-Name Accounting Standards Codification
-Publisher FASB
-URI https://asc.fasb.org//740/tableOfContent

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
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-Paragraph 14
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-14

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Section 50
-Paragraph 21
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-21

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Name Accounting Standards Codification
-Section 50
-Paragraph 1
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482526/740-270-50-1

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
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-Paragraph 17
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482685/740-10-50-17

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-1

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479360/740-10-S99-2

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 740
-SubTopic 30
-Name Accounting Standards Codification
-Section 50
-Paragraph 2
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482603/740-30-50-2

+ Details

Cover Page - shares	6 Months Ended
Cover Page - shares	Dec. 31, 2023	Feb. 02, 2024
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Dec. 31, 2023
Current Fiscal Year End Date	--06-30
Document Transition Report	false
Entity File Number	001-32942
Entity Registrant Name	EVOLUTION PETROLEUM CORP
Entity Incorporation, State or Country Code	NV
Entity Tax Identification Number	41-1781991
Entity Address, Address Line One	1155 Dairy Ashford Road
Entity Address, Address Line Two	Suite 425
Entity Address, City or Town	Houston
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	77079
City Area Code	713
Local Phone Number	935-0122
Title of 12(b) Security	Common Stock, $0.001 par value
Trading Symbol	EPM
Security Exchange Name	NYSEAMER
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		33,456,330
Entity Central Index Key	0001006655
Document Fiscal Year Focus	2024
Document Fiscal Period Focus	Q2
Amendment Flag	false

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Unaudited) - USD ($) shares in Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings	Treasury Stock, Common	Total
Balance (shares) at Jun. 30, 2022	33,471
Balance at Jun. 30, 2022	$ 33,000	$ 42,629,000	$ 32,852,000		$ 75,514,000
Increase (Decrease) in Stockholders' Equity
Issuance of restricted common stock (shares)	375
Issuance of restricted common stock	$ 1,000	(1,000)
Forfeitures of restricted stock (shares)	(26)
Common stock repurchases, including stock surrendered for tax withholding				$ (87,000)	(86,690)
Retirements of treasury stock (in shares)	(12)
Retirements of treasury stock		(87,000)		87,000
Stock-based compensation		702,000			702,000
Net Income (Loss)			21,094,000		21,094,000
Common stock dividends paid			(8,085,000)		(8,085,000)
Balance (shares) at Dec. 31, 2022	33,808
Balance at Dec. 31, 2022	$ 34,000	43,243,000	45,861,000		89,138,000
Balance (shares) at Sep. 30, 2022	33,546
Balance at Sep. 30, 2022	$ 33,000	42,811,000	39,533,000		82,377,000
Increase (Decrease) in Stockholders' Equity
Issuance of restricted common stock (shares)	296
Issuance of restricted common stock	$ 1,000	(1,000)
Forfeitures of restricted stock (shares)	(26)
Common stock repurchases, including stock surrendered for tax withholding				(61,000)	(61,000)
Retirements of treasury stock (in shares)	(8)
Retirements of treasury stock		(61,000)		61,000
Stock-based compensation		494,000			494,000
Net Income (Loss)			10,387,000		10,387,000
Common stock dividends paid			(4,059,000)		(4,059,000)
Balance (shares) at Dec. 31, 2022	33,808
Balance at Dec. 31, 2022	$ 34,000	43,243,000	45,861,000		89,138,000
Balance (shares) at Jun. 30, 2023	33,248
Balance at Jun. 30, 2023	$ 33,000	40,098,000	51,963,000		92,094,000
Increase (Decrease) in Stockholders' Equity
Issuance of restricted common stock (shares)	288
Issuance of restricted common stock	$ 1,000	(1,000)
Common stock repurchases, including stock surrendered for tax withholding				(213,000)	(213,015)
Retirements of treasury stock (in shares)	(29)
Retirements of treasury stock		(213,000)		213,000
Stock-based compensation		1,036,000			1,036,000
Net Income (Loss)			2,556,000		2,556,000
Common stock dividends paid			(8,034,000)		(8,034,000)
Balance (shares) at Dec. 31, 2023	33,507
Balance at Dec. 31, 2023	$ 34,000	40,920,000	46,485,000		87,439,000
Balance (shares) at Sep. 30, 2023	33,440
Balance at Sep. 30, 2023	$ 33,000	40,465,000	49,424,000		89,922,000
Increase (Decrease) in Stockholders' Equity
Issuance of restricted common stock (shares)	84
Issuance of restricted common stock	$ 1,000	(1,000)
Common stock repurchases, including stock surrendered for tax withholding				(108,000)	(108,000)
Retirements of treasury stock (in shares)	(17)
Retirements of treasury stock		(108,000)		$ 108,000
Stock-based compensation		564,000			564,000
Net Income (Loss)			1,082,000		1,082,000
Common stock dividends paid			(4,021,000)		(4,021,000)
Balance (shares) at Dec. 31, 2023	33,507
Balance at Dec. 31, 2023	$ 34,000	$ 40,920,000	$ 46,485,000		$ 87,439,000

Derivatives

6 Months Ended

Dec. 31, 2023

Derivatives

Derivatives

Note 6. Derivatives

The Company is exposed to certain risks relating to its ongoing business operations, including commodity price risk and interest rate risk. In accordance with the Company’s strategy and the requirements under the Senior Secured Credit Facility (as discussed in Note 4, “Senior Secured Credit Facility”), it may hedge or may be required to hedge a varying portion of anticipated oil and natural gas production for future periods. Derivatives are carried at fair value on the unaudited condensed consolidated balance sheets as assets or liabilities, with the changes in the fair value included in the unaudited condensed consolidated statements of operations for the period in which the change occurs. The Company’s hedge strategies and objectives may change significantly as its operational profile changes or as required under the Senior Secured Credit Facility. The Company does not enter into derivative contracts for speculative trading purposes.

It is the Company’s policy to enter into derivative contracts only with counterparties that are creditworthy financial or commodity hedging institutions deemed by management as competent and competitive market makers. As of June 30, 2023, all of the Company’s derivative contracts had expired. The Company has no open derivative contracts as of December 31, 2023 or June 30, 2023, and the Company did not post collateral under any of its derivative contracts during the periods in which contracts were open as they were secured under the Company’s Senior Secured Credit Facility.

The Company has in the past, and may utilize in the future, commodity derivative contracts such as costless put/call collars and fixed-price swaps to hedge a portion of its anticipated future production. A costless collar consists of a sold

call, which establishes a maximum price the Company will receive for the volumes under contract, and a purchased put that establishes a minimum price. Fixed-price swaps are designed so that the Company receives or makes payments based on a differential between fixed and variable prices for the volumes under contract. The Company has elected not to designate its open derivative contracts for hedge accounting. Accordingly, the Company records the net change in the mark-to-market valuation of the derivative contracts and all payments and receipts on settled derivative contracts in “Net gain (loss) on derivative contracts” on the unaudited condensed consolidated statements of operations.

All derivative contracts are recorded at fair market value in accordance with ASC 815, Derivatives and Hedging (“ASC 815”) and ASC 820, Fair Value Measurement (“ASC 820”). The following table summarizes the location and amounts of the Company’s realized and unrealized gains and losses on derivative contracts in the Company’s unaudited condensed consolidated statements of operations for the six months ended December 31, 2023 and 2022 (in thousands). “Realized gain (loss) on derivative contracts” represents all receipts (payments) on derivative contracts settled during the period. “Unrealized gain (loss) on derivative contracts” represents the net change in the mark-to-market valuation of the derivative contracts.


Derivatives not designated	Location of gain (loss)	Three Months Ended				Six Months Ended
as hedging contracts	recognized in income on	December 31,				December 31,
under ASC 815	derivative contracts	2023		2022		2023		2022
Commodity contracts:
Realized gain (loss) on derivative contracts	Other income and expenses - net gain (loss) on derivative contracts	$	—	$	(224)	$	—	$	(1,946)
Unrealized gain (loss) on derivative contracts	Other income and expenses - net gain (loss) on derivative contracts		—		1,070		—		2,189
Total net gain (loss) on derivative contracts		$	—	$	846	$	—	$	243

The Company enters into an International Swap Dealers Association Master Agreements (“ISDA”) with each counterparty prior to a derivative contract with such counterparty. The ISDA is a standard contract that governs all derivative contracts entered into between the Company and the respective counterparty. The ISDA allows for offsetting of amounts payable or receivable between the Company and the counterparty, at the election of both parties, for transactions that occur on the same date and in the same currency.

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Revenues
Total revenues	$ 21,024	$ 33,676	$ 41,625	$ 73,473
Operating costs
Lease operating costs	12,358	15,041	24,241	34,157
Depletion, depreciation, and accretion	4,598	3,458	8,860	7,056
General and administrative expenses	2,502	2,581	5,105	5,053
Total operating costs	19,458	21,080	38,206	46,266
Income (loss) from operations	1,566	12,596	3,419	27,207
Other income (expense)
Net gain (loss) on derivative contracts		846		243
Interest and other income	104	7	220	13
Interest expense	(34)	(129)	(66)	(372)
Income (loss) before income taxes	1,636	13,320	3,573	27,091
Income tax (expense) benefit	(554)	(2,933)	(1,017)	(5,997)
Net income (loss)	$ 1,082	$ 10,387	$ 2,556	$ 21,094
Net income (loss) per common share:
Basic (in dollars per share)	$ 0.03	$ 0.31	$ 0.08	$ 0.63
Diluted (in dollars per share)	$ 0.03	$ 0.31	$ 0.08	$ 0.62
Weighted average number of common shares outstanding:
Basic (in shares)	32,693	33,174	32,676	33,154
Diluted (in shares)	32,900	33,394	32,940	33,356
Crude oil
Revenues
Total revenues	$ 11,759	$ 13,100	$ 24,375	$ 28,263
Natural gas liquids
Revenues
Total revenues	2,734	3,206	5,167	7,992
Natural gas
Revenues
Total revenues	$ 6,531	$ 17,370	$ 12,083	$ 37,218

Revenue Recognition (Tables)

6 Months Ended

Dec. 31, 2023

Revenue Recognition

Schedule of disaggregates the Company's revenues by major product


	Three Months Ended				Six Months Ended
	December 31,				December 31,
	2023		2022		2023		2022
Revenues
Crude oil	$	11,759	$	13,100	$	24,375	$	28,263
Natural gas		6,531		17,370		12,083		37,218
Natural gas liquids		2,734		3,206		5,167		7,992
Total revenues	$	21,024	$	33,676	$	41,625	$	73,473

Asset Retirement Obligations - Summary of Asset Retirement Obligations (Details) - USD ($) $ in Thousands	6 Months Ended
	Dec. 31, 2023	Jun. 30, 2023
Reconciliation of the beginning and ending asset retirement obligation
Asset retirement obligations - beginning of period	$ 17,067
Accretion of discount	712
Asset retirement obligations - end of period	17,779	$ 17,067
Less: current asset retirement obligations	(41)	(55)
Long-term portion of asset retirement obligations	$ 17,738	$ 17,012

Revenue Recognition - Revenues By Major Product (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Revenue Recognition
Total revenues	$ 21,024	$ 33,676	$ 41,625	$ 73,473
Crude oil
Revenue Recognition
Total revenues	11,759	13,100	24,375	28,263
Natural gas
Revenue Recognition
Total revenues	6,531	17,370	12,083	37,218
Natural gas liquids
Revenue Recognition
Total revenues	$ 2,734	$ 3,206	$ 5,167	$ 7,992

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 924
-SubTopic 10
-Name Accounting Standards Codification
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479941/924-10-S99-1

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-5

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
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-Paragraph 30
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-30

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
-Paragraph 42
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-42

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Section 50
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 40
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-40

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 22
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-22

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 32
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-32

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Topic 280
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-Name Accounting Standards Codification
-Section 50
-Paragraph 41
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147482810/280-10-50-41

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
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-Section 50
-Paragraph 4
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-4

+ Details

Insider Trading Arrangements	6 Months Ended
Insider Trading Arrangements	Dec. 31, 2023
Trading Arrangements, by Individual
Rule 10b5-1 Arrangement Adopted	false
Non-Rule 10b5-1 Arrangement Adopted	false
Rule 10b5-1 Arrangement Terminated	false
Non-Rule 10b5-1 Arrangement Terminated	false

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended		121 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023
Cash flows from operating activities:
Net income (loss)			$ 2,556	$ 21,094
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
Depletion, depreciation, and accretion	$ 4,598	$ 3,458	8,860	7,056
Stock-based compensation			1,036	702
Settlement of asset retirement obligations				(71)
Deferred income taxes			(642)	(355)
Unrealized (gain) loss on derivative contracts				(2,189)
Accrued settlements on derivative contracts				(919)
Other			3	(4)
Changes in operating assets and liabilities:
Receivables from crude oil, natural gas, and natural gas liquids revenues			(2,239)	8,113
Prepaid expenses and other current assets			(274)	(316)
Accounts payable and accrued liabilities			2,443	(5,398)
State and federal income taxes payable			(365)	56
Net cash provided by operating activities			11,378	27,769
Cash flows from investing activities:
Acquisition of oil and natural gas properties				(31)
Capital expenditures for oil and natural gas properties			(5,705)	(2,886)
Net cash used in investing activities			(5,705)	(2,917)
Cash flows from financing activities:
Common stock dividends paid			(8,034)	(8,085)	$ (110,400)
Common stock repurchases, including stock surrendered for tax withholding			(213)	(87)
Repayments of senior secured credit facility				(21,250)
Net cash (used in) provided by financing activities			(8,247)	(29,422)
Net increase (decrease) in cash and cash equivalents			(2,574)	(4,570)
Cash and cash equivalents, beginning of period			11,034	8,280
Cash and cash equivalents, end of period	$ 8,460	$ 3,710	8,460	3,710	$ 8,460
Non-cash investing and financing transactions:
Increase (decrease) in accrued capital expenditures for oil and natural gas properties			$ (142)	$ (768)

Financial Statement Presentation - Nature of Operations (Details) $ in Thousands	Sep. 12, 2023 USD ($) location	Dec. 31, 2023 USD ($) item	Jun. 30, 2023 USD ($)
Reclassification [Line Items]
Amount paid for interest in drilling locations	$ 400
Number of initial drilling locations \| location	9
Number of wells with overriding royalty interest \| item		4
Accrued taxes other than federal and state income tax		$ 980	$ 739
Accrued payables		$ 2,890	3,005
Revision of Prior Period, Reclassification, Adjustment [Member]
Reclassification [Line Items]
Accrued taxes other than federal and state income tax			600
Accrued payables			$ (600)

Revenue Recognition (Details)	6 Months Ended
Revenue Recognition (Details)	Dec. 31, 2023
Minimum
Revenue Recognition
Period of receives payment from the sale of oil and natural gas production	1 month
Number of production received by field operators	1 month
Maximum
Revenue Recognition
Period of receives payment from the sale of oil and natural gas production	2 months
Number of production received by field operators	2 months

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

+ References + Details

Derivatives - Gain and Loss on Derivatives (Details) $ in Thousands	3 Months Ended	6 Months Ended
	Dec. 31, 2022 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2023 USD ($) agreement	Jun. 30, 2023 USD ($) agreement
Derivatives
Realized gain (loss) on derivative contracts	$ (224)	$ (1,946)
Unrealized gain (loss) on derivative contracts	1,070	2,189
Total net gain (loss) on derivative contracts	$ 846	$ 243
Open derivative contract \| agreement			0	0
Collateral			$ 0	$ 0

- Definition

The net change in the difference between the fair value and the carrying value, or in the comparative fair values, of derivative instruments, including options, swaps, futures, and forward contracts, held at each balance sheet date, that was included in earnings for the period.

+ References + Details

Senior Secured Credit Facility (Details) $ in Millions			6 Months Ended
Senior Secured Credit Facility (Details) $ in Millions	May 05, 2023 USD ($) agreement	Apr. 11, 2016 USD ($)	Dec. 31, 2023 USD ($)
Debt Instrument [Line Items]
Minimum current ratio		1.00
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Minimum
Debt Instrument [Line Items]
Debt instrument, variable interest rate		0.50%
Line of Credit \| Senior Secured Reserve-Based Credit Facility \| Revolving credit facility
Debt Instrument [Line Items]
Term of debt instrument		3 years
Maximum borrowing capacity		$ 50.0
Available borrowing capacity			$ 50.0
Credit facility maturity date	Apr. 09, 2026
Credit facility, number of rights to interim unscheduled redeterminations \| agreement	1
Minimum consolidated tangible net worth		$ 40.0
Commitment fee percentage		0.25%
Maximum total leverage ratio (not more than)		3.00
Current borrowing base			$ 50.0
Margined collateral value	$ 95.0
Covenant compliance			As of December 31, 2023, the Company is in compliance with the financial covenants under the Senior Secured Credit Facility.
Line of Credit \| Senior Secured Reserve-Based Credit Facility \| Prime Rate \| Revolving credit facility
Debt Instrument [Line Items]
Basis spread on variable rate		1.00%
Line of Credit \| Senior Secured Reserve-Based Credit Facility \| Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate \| Revolving credit facility
Debt Instrument [Line Items]
Basis spread on variable rate	2.80%
Credit spread adjustment	0.05%

Stockholders' Equity - Stock-Based Incentive Plan Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022	Jun. 30, 2023
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			400,000	400,000
Stock-based compensation expense	$ 0.6	$ 0.5	$ 1.0	$ 0.7
Director
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			1 year
Restricted Stock and Contingent Restricted Stock
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			100,000	50,000.00
Restricted Stock, Market Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			3 years
Restricted Stock, Performance Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			136,315	100,000
Contingent restricted stock grants
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			102,239
Restricted Stock Time Vested
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			152,192	300,000
2016 Equity Incentive Plan
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares authorized for granting (in shares)	3,600,000		3,600,000
Shares available for grant (shares)	900,000		900,000		1,300,000
Minimum \| Restricted Stock Time Vested
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			3 years
Maximum \| Restricted Stock, Performance Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expiration period (in years)			4 years
Maximum \| Restricted Stock Time Vested
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting period (in years)			4 years
Employee \| Restricted Stock, Performance Based
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			100,000
Employee \| Restricted Stock Time Vested
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)			200,000

Financial Statement Presentation (Policies)	6 Months Ended
Financial Statement Presentation (Policies)	Dec. 31, 2023
Summary of Significant Events and Accounting Policies
Nature of Operations	Nature of Operations. Evolution Petroleum Corporation (“Evolution,” and together with its consolidated subsidiaries, the “Company”) is an independent energy company focused on maximizing returns to shareholders through the ownership of and investment in onshore oil and natural gas properties in the United States. The Company’s long-term goal is to maximize total shareholder return from a diversified portfolio of long-life oil and natural gas properties built through acquisitions and through selective development opportunities, production enhancement, and other exploitation efforts on its oil and natural gas properties. The Company’s oil and natural gas properties consist of non-operated interests in the following areas: the Jonah Field in Sublette County, Wyoming, a natural gas and natural gas liquids producing field; the Williston Basin in North Dakota, producing oil and natural gas properties; the Barnett Shale located in North Texas, natural gas and natural gas liquids producing properties; the Hamilton Dome Field located in Hot Springs County, Wyoming, a secondary recovery field utilizing water injection wells to pressurize the reservoir; the Delhi Holt-Bryant Unit in the Delhi Field in Northeast Louisiana, a CO₂ enhanced oil recovery project; the Chaveroo oilfield in Chaves and Roosevelt Counties of New Mexico; as well as small overriding royalty interests in four onshore Texas wells.
Interim Financial Statements	Interim Financial Statements. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) for interim financial information and the appropriate rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations. All adjustments (consisting of normal recurring accruals) which are, in the opinion of management, necessary for a fair presentation of the financial position and results of operations for the interim periods presented have been included. The interim financial information and notes hereto should be read in conjunction with the Company’s 2023 Annual Report on Form 10-K for the fiscal year ended June 30, 2023, as filed with the SEC on September 13, 2023. The results of operations for interim periods are not necessarily indicative of results to be expected for a full fiscal year. The Company has evaluated events and transactions through the date of issuance of these unaudited condensed consolidated financial statements.
Principles of Consolidation and Reporting	Principles of Consolidation and Reporting. The unaudited condensed consolidated financial statements include the accounts of Evolution Petroleum Corporation and its wholly-owned subsidiaries. All significant intercompany transactions have been eliminated in consolidation. The unaudited condensed consolidated financial statements for the previous year may be condensed or include certain reclassifications to conform to the current presentation. To conform with the current year presentation, $0.6 million of accrued ad valorem and production taxes at June 30, 2023 are included with “Accrued taxes other than federal and state income tax” instead of “Accrued payables” as disclosed in Note 12, “Additional Financial Statement Information.” This reclassification has no impact on the previously reported unaudited condensed consolidated balance sheets, net income or stockholders’ equity.
Risk and Uncertainties	Risk and Uncertainties. The Company’s oil and natural gas interests are operated by third-party operators and involve other third-party working interest owners. As a result, the Company has limited ability to influence the operation or future development of such properties. However, the Company is proactive with its third-party operators to review capital projects and related spending and present alternative plans as appropriate.
Use of Estimates	Use of Estimates. The preparation of the Company’s unaudited condensed consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities, if any, at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the respective reporting periods. Significant estimates include (a) reserve quantities and estimated future cash flows associated with proved reserves, which may significantly impact depletion expense and potential impairments of oil and natural gas properties, (b) asset retirement obligations, (c) stock-based compensation, (d) fair values of derivative contract assets and liabilities, (e) income taxes and the valuation of deferred income tax assets, (f) commitments and contingencies, and (g) accruals of crude oil, natural gas, and NGL revenues and expenses. The Company analyzes estimates and judgments based on historical experience and various other assumptions and information that are believed to be reasonable. Estimates and assumptions about future events and their effects cannot be predicted with certainty and, accordingly, these estimates may change as additional information is obtained, as new events occur, and as the Company’s environment changes. Actual results may differ from the estimates and assumptions used in the preparation of the Company’s unaudited condensed consolidated financial statements.
Oil and Natural Gas Properties	Oil and Natural Gas Properties. The Company uses the full-cost method of accounting for its investments in oil and natural gas properties. Under this method of accounting, all costs incurred in the acquisition, exploration and development of oil and natural gas properties, including unproductive wells, are capitalized. This includes any internal costs that are directly related to property acquisition, exploration, and development activities but does not include any costs related to production, general corporate overhead, or similar activities. Oil and natural gas properties include costs that are excluded from depletion and amortization, which represent investments in unproved and unevaluated properties and include non- producing leasehold, geologic and geophysical costs associated with leasehold or drilling interests, and exploration drilling costs. These costs are excluded until the project is evaluated and proved reserves are established or impairment is determined. The Company entered into a strategic partnership with PEDEVCO Corp. (“PEDEVCO”) on September 12, 2023, to jointly develop the Chaveroo oilfield in the Permian Basin in New Mexico (the “Chaveroo Field”). Per the terms of the participation agreement (the “Participation Agreement”) with PEDEVCO, Evolution paid for acreage associated with nine initial drilling locations totaling approximately $0.4 million. As of December 31, 2023, the Company recorded the payment for the initial acreage as unevaluated costs, excluded from the full cost pool. Refer to Note 3, “Property and Equipment,” for further details.
Recently Adopted and Issued Accounting Pronouncements	Recently Issued Accounting Pronouncements In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 enhances the transparency of income tax disclosures by expanding the income tax rate reconciliation disclosure and income taxes paid information. ASU 2023-09 also includes certain other amendments to improve the effectiveness of income tax disclosures. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating ASU 2023-09 and the impact it may have to the Company’s financial position, results of operations, cash flow or disclosures. In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (“ASU 2016-13”). ASU 2016-13 changes the impairment model for most financial assets and certain other instruments, including trade and other receivables, and requires the use of a new forward-looking expected loss model that will result in the earlier recognition of allowances for losses. Early adoption is permitted and entities must adopt the amendment using a modified retrospective approach to the first reporting period in which the guidance is effective. For smaller reporting companies, as provided by ASU 2019-10, Financial Instruments - Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842), ASU 2016-13 is effective for annual periods, including interim periods within those annual periods, beginning after December 15, 2022. The Company adopted ASU 2016-13 effective July 1, 2023. The adoption did not have a material effect on the Company’s financial position, results of operations, cash flows or disclosures. Other accounting pronouncements that have recently been issued by the FASB or other standards-setting bodies are not expected to have a material impact on the Company’s financial position, results of operations, cash flows or disclosures.

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (Parenthetical) - $ / shares	Dec. 31, 2023	Jun. 30, 2023
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	100,000,000	100,000,000
Common stock, issued shares (in shares)	33,506,794	33,247,523
Common stock, outstanding shares (in shares)	33,506,794	33,247,523

Earnings (Loss) per Common Share - Schedule of Basic and Diluted Earnings (Loss) Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Dec. 31, 2022
Numerator
Net income (loss)	$ 1,082	$ 10,387	$ 2,556	$ 21,094
Undistributed earnings allocated to unvested restricted stock	(24)	(162)	(51)	(274)
Net income (loss) for earnings per share calculation	$ 1,058	$ 10,225	$ 2,505	$ 20,820
Denominator
Weighted average number of common shares outstanding - Basic (in shares)	32,693	33,174	32,676	33,154
Effect of dilutive securities:
Unvested restricted stock (in shares)	171	206	225	195
Unvested contingent restricted stock units (in shares)	36	14	39	7
Weighted average number of common shares and dilutive potential common shares used in diluted earnings per share (in shares)	32,900	33,394	32,940	33,356
Net earnings (loss) per common share - Basic (in dollars per share)	$ 0.03	$ 0.31	$ 0.08	$ 0.63
Net earnings (loss) per common share - Diluted (in dollars per share)	$ 0.03	$ 0.31	$ 0.08	$ 0.62

Revenue Recognition

6 Months Ended

Dec. 31, 2023

Revenue Recognition

Revenue Recognition

Note 2. Revenue Recognition

The Company’s revenues are primarily generated from its crude oil, natural gas and NGL production from the Jonah Field in Sublette County, Wyoming, the Williston Basin in North Dakota, the Barnett Shale located in North Texas, the Hamilton Dome Field in Wyoming, and the Delhi Field in Northeast Louisiana. Additionally, an overriding royalty interest retained in a past divestiture of Texas properties provides de minimis revenue. The following table disaggregates the Company’s revenues by major product for the three and six months ended December 31, 2023 and 2022 (in thousands):


	Three Months Ended				Six Months Ended
	December 31,				December 31,
	2023		2022		2023		2022
Revenues
Crude oil	$	11,759	$	13,100	$	24,375	$	28,263
Natural gas		6,531		17,370		12,083		37,218
Natural gas liquids		2,734		3,206		5,167		7,992
Total revenues	$	21,024	$	33,676	$	41,625	$	73,473

In the Jonah Field, the Company has elected to take its natural gas and NGL working interest production in-kind and markets its NGL production to Enterprise Products Partners L.P. and its natural gas production to different purchasers.

The Company does not take production in-kind at any of its other properties and does not negotiate contracts with customers for such production. The Company recognizes crude oil, natural gas, and NGL production revenue at the point in time when custody and title (“control”) of the product transfers to the customer. The sales of oil and natural gas are made under contracts which the Company’s third-party operators of its wells have negotiated with customers, which typically include variable consideration that is based on pricing tied to local indices and volumes delivered in the current month. The Company receives payment from the sale of oil and natural gas production one to two months after delivery.

Judgments made in applying the guidance in ASC 606, Revenue from Contracts with Customers, relate primarily to determining the point in time when control of product transfers to the customer. The Company does not believe that significant judgments are required with respect to the determination of the transaction price, including amounts that represent variable consideration, as volume and price carry a low level of estimation uncertainty given the precision of volumetric measurements and the use of index pricing with predictable differentials. Accordingly, the Company does not consider estimates of variable consideration to be constrained.

The Company’s contractual performance obligations arise upon the production of hydrocarbons from wells in which the Company has an ownership interest. The performance obligations are considered satisfied upon control of produced hydrocarbons transferring to a customer at a specified delivery point. Consideration is allocated to completed performance obligations at the end of an accounting period.

Revenue is recorded in the month when contractual performance obligations are satisfied. However, settlement statements from the purchasers of hydrocarbons and the related cash consideration are received by field operators one to two months before the Company receives payment and documentation from the operator, which is typical in the oil and natural gas industry. As a result, the Company must estimate the amount of production delivered to the customer and the consideration that will ultimately be received for the sale of the product. To estimate accounts receivable from operators’ contracts with customers, the Company uses knowledge of its properties, information from field operators, historical performance, contractual arrangements, index pricing, quality and transportation differentials, and other factors. Because the contractual performance obligations have been satisfied and an unconditional right to consideration exists as of the balance sheet date, the Company recognized amounts due from contracts with field operators as “Receivables from crude oil, natural gas, and natural gas liquids revenues” on the unaudited condensed consolidated balance sheets.

Differences between estimates and actual amounts received for product sales are recorded in the month that payments received from purchasers are remitted to the Company by field operators.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 9
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-9

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 10
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-10

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 15
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-15

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (a)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (b)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (c)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (d)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 12
-Subparagraph (e)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-12

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Topic 606
-SubTopic 10
-Name Accounting Standards Codification
-Section 50
-Paragraph 13
-Subparagraph (b)(2)
-Publisher FASB
-URI https://asc.fasb.org//1943274/2147479806/606-10-50-13

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Name Accounting Standards Codification
-Topic 606
-Publisher FASB
-URI https://asc.fasb.org//606/tableOfContent

+ Details

Stockholders' Equity - Narrative (Details) - USD ($) $ in Thousands		2 Months Ended	6 Months Ended		121 Months Ended
	Sep. 08, 2022	Dec. 31, 2023	Dec. 31, 2023	Dec. 31, 2022	Dec. 31, 2023	Jun. 30, 2023
Class of Stock [Line Items]
Common stock, outstanding shares (in shares)		33,506,794	33,506,794		33,506,794	33,247,523
Common stock dividends paid			$ 8,034	$ 8,085	$ 110,400
Cash dividends to common stockholders			$ 8,000	$ 8,100
Number of treasury shares acquired (in shares)			29,236	12,049
2022 Share Repurchase Program
Class of Stock [Line Items]
Amount authorized to be repurchased	$ 25,000
Stock repurchase program expiration date	Dec. 31, 2024
Rule 10b5 1 plan
Class of Stock [Line Items]
Amount authorized to be repurchased		$ 800	$ 800		800
Stock repurchase program expiration date		Jun. 30, 2024
Repurchase amount		$ 0	$ 0		$ 0

CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Dec. 31, 2023	Jun. 30, 2023
Current assets
Cash and cash equivalents	$ 8,460	$ 11,034
Receivables from crude oil, natural gas, and natural gas liquids revenues	10,119	7,884
Prepaid expenses and other current assets	2,569	2,277
Total current assets	21,148	21,195
Property and equipment, net of depletion, depreciation, and impairment
Oil and natural gas properties, subject to amortization, net	100,111	105,781
Property costs not subject to amortization	3,370
Total property and equipment, net	103,481	105,781
Other assets	1,337	1,341
Total assets	125,966	128,317
Current liabilities
Accounts payable	8,233	5,891
Accrued liabilities and other	6,294	6,027
State and federal taxes payable		365
Total current liabilities	14,527	12,283
Long term liabilities
Deferred income taxes	6,161	6,803
Asset retirement obligations	17,738	17,012
Operating lease liability	101	125
Total liabilities	38,527	36,223
Commitments and contingencies (Note 10)
Stockholders' equity
Common stock; par value $0.001; 100,000,000 shares authorized: issued and outstanding 33,506,794 and 33,247,523 shares as of December 31, 2023 and June 30, 2023, respectively	34	33
Additional paid-in capital	40,920	40,098
Retained earnings	46,485	51,963
Total stockholders' equity	87,439	92,094
Total liabilities and stockholders' equity	$ 125,966	$ 128,317

Property and Equipment (Details) $ in Thousands		6 Months Ended
Property and Equipment (Details) $ in Thousands	Sep. 12, 2023 USD ($) a location $ / a	Dec. 31, 2023 USD ($) $ / MMBTU $ / bbl	Dec. 31, 2022 USD ($) location $ / MMBTU $ / bbl	Jun. 30, 2023 USD ($)
Property and Equipment
Amount paid for interest in drilling locations	$ 400
Working interest share, percentage	50.00%
Percentage or working interest available to acquire	50.00%
Number of initial development blocks \| location	2
Number of initial drilling locations \| location	9
Cost per acre of optional development block \| $ / a	450
Property costs subject to amortization		$ 199,526		$ 197,049
Unproved Properties costs not subject to amortization		3,370
Depletion		8,100	$ 6,500
Capital expenditures		2,400	2,100
Impairment of proved property		$ 0	$ 0
Natural Gas and Natural Gas Liquids
Property and Equipment
Oil and gas prices first day average of twelve months of Henry Hub price for ceiling test \| $ / MMBTU		2.63	6.40
Net price per barrel (in dollars per barrel) \| $ / bbl		31.57	48.50
Crude oil
Property and Equipment
Oil and gas prices first day average of twelve months of West Texas Intermediate spot market price for ceiling test \| $ / bbl		78.21	94.14
Maximum
Property and Equipment
Capitalized transactions costs	$ 100
Development block, acres gross \| a	16,000
Barnett Shale
Property and Equipment
Initial wells drilled \| location			3
Capital expenditures			$ 3,000

Asset Retirement Obligations

6 Months Ended

Dec. 31, 2023

Asset Retirement Obligations

Asset Retirement Obligations

Note 8. Asset Retirement Obligations

The Company’s ARO represents the estimated present value of the amount expected to be incurred to plug, abandon, and remediate its oil and natural gas properties at the end of their productive lives in accordance with applicable laws and regulations. The Company records the ARO liability on the unaudited condensed consolidated balance sheets and capitalizes the cost in “Oil and natural gas properties, subject to amortization, net” during the period in which the obligation is incurred. The Company records the accretion of its ARO liabilities in “Depletion, depreciation and accretion” expense in the unaudited condensed consolidated statements of operations.

The following is a reconciliation of the activity related to the Company’s ARO liability (inclusive of the current portion) for the period ended December 31, 2023 (in thousands):


	December 31, 2023
Asset retirement obligations — beginning of period	$	17,067
Accretion of discount		712
Asset retirement obligations — end of period		17,779
Less: current asset retirement obligations		(41)
Long-term portion of asset retirement obligations	$	17,738