YPF Sociedad Anónima Q3 FY2025 earnings call

• Continued solid operational performance despite international price contraction. Shale production growth with 70% of CapEx focused on unconventional resources. Completed longest well in Vaca Muerta (over 8,200 meters) and fastest wells in Vaca Muerta. La Plata Refinery recognized for operational excellence. LNG project progress with Eni and ADNOC, with FID expected H1 2026. Financials: negative free cash flow of $759 million due to asset acquisition and mature field exit, net debt at $9.6 billion and net leverage ratio at 2.1x.

Upstream

• Revenues totaled $4.6 billion, 12% below the previous year, aligning with the 13% year-on-year decline in Brent price. Adjusted EBITDA reached approximately $1.4 billion, a sequential increase of over 20% but flat year-over-year. Shale oil production increased 35% internally in Q3, reaching 170,000 barrels per day, with October preliminary figures showing 190,000 barrels per day. Natural gas production was 38.4 million cubic meters per day, down 3% sequentially. Lifting costs saw a 28% quarter-over-quarter and 45% year-over-year reduction.

Downstream

• Processing levels averaged 326,000 barrels per day in Q3, the highest since 2009, 9% higher year-over-year. La Plata Refinery was named Refinery of the Year in Latin America and ranked in the first quartile across several KPIs. Market share for domestic sales of diesel and gasoline was 57%, expanding to 60% including third-party stations.

• Expect to meet full-year 2025 shale oil production target of ~165,000 barrels per day and slightly exceed December 2025 target of 190,000 barrels per day. LNG project FID expected in H1 2026, with commercial operations for the first floating LNG by 2030 and subsequent ones by 2031-2032. CapEx to remain focused on unconventional resources.

• Oil price volatility impacting revenues. Regulatory changes affecting LNG project and operational costs. Leverage levels above comfortable range if not managed effectively. Potential challenges in M&A and divestment timelines.

Q: Indication of production growth into 2026, 2027?

A: Expect production around 215,000 barrels per day in 2026 and 290,000 barrels per day in 2027, with more precise numbers in future calls.

Q: Capital allocation and M&A?

A: Active portfolio management (buy and sell) based on value creation. No major acquisitions expected in Vaca Muerta next year, but strategy remains flexible.

Q: Divestments of Metrogas and YPF Agro?

A: Metrogas concession extension process ongoing, plan to sell soon; YPF Agro to seek strategic partner for 50-50 stake to maximize value.

Q: LNG project funding?

A: Project finance with nonrecourse financing from ECAs, development banks, and commercial banks as potential anchors.

Q: Working capital losses and lifting costs?

A: Working capital losses due to seasonality, natural gas collection delays, inventory changes, etc. Lifting costs reduced by shale production shift from conventional to shale.

Q: Lifting and D&C costs trajectory?

A: Working on reducing unit costs via negotiations with service companies, aiming for further cost reductions.

Q: Leverage and hedging?

A: Comfortable leverage range, no immediate plans to hedge oil price exposure as focus is on operational performance and value creation.

Q: Fuel prices and regulations?

A: Dynamic pricing with moving average policy. Regulatory impacts on LNG and fuel prices being monitored, but no direct involvement in regulation formulation.