SEATTLE (Oil Monster): Diversified Energy reported $256 million in adjusted EBITDA for the third quarter of 2026 as the company prepares to complete its approximately $1.8 billion acquisition of Birch Resources.
Diversified Energy reported average third-quarter production of 1,189 MMcfe per day, equivalent to approximately 198,000 barrels of oil equivalent per day.
The company's production mix was 72% natural gas, 14% oil and 14% natural gas liquids.
Total commodity revenue reached $470 million, while adjusted free cash flow was $153 million and operating cash flow totaled $136 million.
Diversified said it returned approximately $157 million to shareholders year to date through November 4.
That total included approximately $94 million in share repurchases and $63 million through its fixed dividend program.
The company also declared a third-quarter dividend of $0.29 per share.
The Birch acquisition is potentially more significant than the quarterly earnings headline. Diversified estimates the transaction could increase pro forma adjusted EBITDA by about 55% and more than double adjusted free cash flow, while expanding its position in the Permian Basin.
Diversified said its acquisition of Birch Resources remains on schedule to close in the fourth quarter of 2026.
The approximately $1.8 billion transaction would add about 46,000 net mineral acres in the Midland Basin, including roughly 500 gross operated wells along with associated midstream and water infrastructure.
Following completion, Diversified expects to rank among the top 15 U.S. publicly listed independent oil and gas companies based on production.
The company estimates the acquisition could increase pro forma adjusted EBITDA by approximately 55% and adjusted free cash flow by more than 100%.
Natural gas accounted for approximately 72% of Diversified's third-quarter production.
The company reiterated full-year 2026 production guidance of 1,180 to 1,210 MMcfe per day and adjusted EBITDA guidance of $960 million to $1.01 billion. The Birch acquisition is not included in that guidance.
Also Read: Diversified Energy Signed Agreement to Acquire Maverick Natural Resources
The key milestone is completion of the Birch transaction during the fourth quarter. Investors will then be able to assess how quickly the acquisition contributes to production, cash flow and operating synergies.
Diversified is also scheduled to discuss its third-quarter results during an earnings call on November 5 at 8:30 a.m. ET.
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Courtesy: www.tradersunion.com
