🧾 What This Document Is

This is a press release attached to an 8-K filing. Think of it as the company's official "report card" and announcement for investors. It shares the financial results for the final quarter (Q4) and the entire year (2025) and tells the story behind the numbers.

🏢 What The Company Does

👉 In simple terms, KOIL Energy builds and services the specialized equipment that helps produce energy from deep underwater oil and gas fields. They're like the mechanics and engineers for the complex "plumbing" on the ocean floor.

💰 Financial Highlights: The Record Quarter

The big headline is a record-breaking fourth quarter.

• Revenue: $7.3 million in Q4 2025. This was up 22% from the same quarter last year and 14% from the previous quarter.
• Profitability: They made $2.5 million in gross profit (what's left after direct costs). Their profit margin dipped to 35% from 40% last year because they worked on a less profitable mix of projects.
• The "Real" Profit (Adjusted EBITDA): After accounting for growth investments, their core profit was $704,000, or 10% of revenue.

Why it matters: The strong quarter pushed full-year revenue to $24 million, a 6% increase over 2024. However, full-year Adjusted EBITDA fell to $970,000 from $3.5 million in 2024 because the company chose to spend heavily on its future.

🚀 Key Moves: Investing for the Future

Instead of showing higher profit in 2025, management decided to reinvest the cash.

• Buying Tools: They spent money on new rental equipment.
• Building New Hubs: They established new operations in Brazil, a key market for deepwater energy.
• Creating New Tech: They funded the development of new intellectual property (IP).
• Expanding Reach: They invested in building international sales channels.

Why it matters: These are bets on long-term growth. The record Q4 revenue suggests these investments are starting to pay off.

📦 Financial Position: The Company's Health Check

• Cash: They ended 2025 with $1.5 million in cash, down from $3.4 million at the end of 2024. This drop reflects their heavy spending on growth.
• Debt: Total liabilities grew modestly to $10.9 million.
• Overall Size: Total assets reached $19.8 million.

Why it matters: The company is using its cash to build its future capabilities, which is a strategic choice that comes with short-term risk.

💸 Cash Flow Story: Where the Money Went

This is where you see the "investing for the future" story in action.

• Operating Cash Flow: The business itself used $901,000 in cash for the full year 2025 (compared to generating $1.7 million in 2024).
• Investing Cash Flow: They spent $1.53 million on investments (like equipment and new facilities).

Why it matters: Negative operating cash flow while investing heavily shows they are in "building mode," spending more than they're taking in to grow.

🔮 What's Next: The Road to 2030

Management is confident and looking ahead.

• Strategy: They are "refining our growth strategy and setting ambitious new goals through 2030."
• Show and Tell: They will present these plans at a special investor conference in Houston on May 7-8, 2026.
• Outlook: They say recent project awards have positioned them strongly for a good 2026.

⚖️ Big Picture: Strengths & Risks

• 👍 Strengths: Achieved record quarterly revenue. Demonstrated strong growth (22% in Q4). Clearly articulating a long-term (2030) vision. Winning new projects.
• ⚠️ Risks: Significant drop in annual profitability (Adjusted EBITDA). Cash position has decreased. The growth strategy requires continued heavy spending, which pressures short-term profits.

🧠 The Analogy

KOIL Energy is like a specialized construction company that decided to pause building houses for a year to instead build its own fleet of trucks and open a new office in another city. They made less money this year, but they're now set up to win bigger contracts and build more houses, faster, in the future.

📇 Key Contacts & People

• Investor Relations Contact: [email protected] | 281-862-2201
• CEO: Erik Wiik (President and Chief Executive Officer)

🧩 Final Takeaway

KOIL Energy sacrificed short-term profit in 2025 to heavily invest in equipment, new markets, and technology. The gamble is already showing signs of success with a record revenue quarter to close the year. The core question for 2026 is whether this aggressive investment will lead to sustained, profitable growth.