Canada's Vermilion Energy posts Q3 net loss, plans 4% dividend hike

Overview

• Canada oil and gas producer reported Q3 net loss due to unrealized derivative losses

• Production averaged 117,349 boe/d, reflecting planned maintenance, with output restored in September

• Company plans 4% dividend increase for 2027, subject to board approval

Outlook

• Vermilion expects Q4 2026 production to average 121,000 boe/d

• Company guides 2027 average production of 122,000-126,000 boe/d, 71% natural gas

• Vermilion plans 2027 E&D capital expenditures of C$675 mln to C$725 mln

• Company plans to increase quarterly dividend by 4% in Q1 2027

Result Drivers

• DERIVATIVE LOSSES - Q3 net loss driven by unrealized losses on derivative instruments due to higher forward oil and European gas prices

• PLANNED MAINTENANCE - Production reflected planned maintenance in Ireland, Germany, and Canada, with output fully restored by September

• EUROPEAN GAS PRICING - Realized natural gas prices were more than triple the AECO benchmark, benefiting from exposure to premium international markets

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "buy" and the breakdown of recommendations is 5 "strong buy" or "buy", 5 "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the integrated oil & gas peer group is "buy"

• Wall Street's median 12-month price target for Vermilion Energy Inc. is C$22.00, about 26.8% above its November 3 closing price of C$17.35

• The stock recently traded at 13 times the next 12-month earnings vs. a P/E of 14 three months ago

Reuters Recommended Reads

• Nov 3 - Canada's Suncor Q3 adjusted operating earnings jump on higher upstream prices

• Nov 3 - Ovintiv Q3 profit rises on higher energy prices, lower costs

• Nov 3 - Canada's Spartan Delta Q3 oil and gas sales jump 145% on liquids growth, increased Duvernay activity

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)