Company: PED
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001654954-25-005762
Chunk: 26

Company: PEDEVCO CORP
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 26
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 table presents a reconciliation of the GAAP financial measure of net income to the non-GAAP financial measure of Adjusted EBITDA (in thousands):

 24Table of Contents

  Three Months Ended March 31,    2025  2024 Net income $140  $773 Add (deduct)        Income tax expense  76   - Depreciation, depletion, amortization and accretion  3,346   3,485 EBITDA  3,562   4,258 Add (deduct)        Share-based compensation  475   475 Impairment of oil and gas properties  232   - Gain on sale of fixed asset  -   (12)Adjusted EBITDA $4,269  $4,721 

Critical Accounting Estimates

Our discussion and analysis of our financial condition and results of operations is based on our financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. We base our estimates on historical experience and on various other assumptions that we believe to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions. We believe the following critical accounting policies affect our most significant judgments and estimates used in preparation of our financial statements.

Oil and Gas Properties, Successful Efforts Method. The successful efforts method of accounting is used for oil and gas exploration and production activities. Under this method, all costs for development wells, support equipment and facilities, and proved mineral interests in oil and gas properties are capitalized. Geological and geophysical costs are expensed when incurred. Costs of exploratory wells are capitalized as exploration and evaluation assets pending determination of whether the wells find proved oil and gas reserves. Proved oil and gas reserves are the estimated quantities of crude oil and natural gas which geological and engineering data demonstrate with reasonable certainty to be recoverable in future years from known reservoirs under existing economic and operating conditions, (i.e., prices and costs as of the date the estimate is made). Prices include consideration of changes in existing prices provided only by contractual arrangements, but not on escalations based upon future conditions.

Exploratory wells in