Barnwell Industries (BRN), a diversified energy and land investment company, reported third quarter fiscal 2025 results on August 13, 2025. The company’s revenue fell sharply, as did profitability, with a net loss from continuing operations widening compared to the prior-year period. No analyst estimates were available, but the ongoing decline in operating results and the completed sale of all U.S. oil and gas assets signal a significant shift in business strategy. The quarter was marked by challenges across core operating segments and increased non-recurring administrative expenses, contributing to doubts over long-term financial viability.
| Metric | Q3 2025 | Q3 2024 | Y/Y Change |
|---|---|---|---|
| Revenue | $3.19 million | $4.51 million | (29.2 %) |
| Net Loss from Continuing Operations | $(1.55 million) | N/A | N/A |
| EPS from Continuing Operations | $(0.15) | $(0.10) | 50.0 % |
| Oil and Natural Gas Revenues | See narrative* | See narrative* | N/A |
| Foreign Currency (Gain) / Loss | $219,000 gain | $(61,000) loss | $280,000 improvement |
About Barnwell Industries and Its Business Segments
Barnwell operates across two main segments: oil and natural gas exploration and production in Alberta, Canada, and land investment in Hawaii. The company’s strategy blends resource extraction, property management, and operational services, aiming to stabilize income and manage risk by engaging in diverse sectors and locations.
In recent years, Barnwell has focused on optimizing its core energy operations while leveraging its Hawaiian real estate investments for diversification. The company’s success has hinged on commodity prices, efficient asset utilization, legal and shareholder dispute resolution, and strategic asset management. These key points remain especially critical as the company undergoes major operational changes.
Quarterly Highlights and Performance Drivers
The period showed a significant decrease in revenue and profitability. Revenue from continuing operations (GAAP) declined 29.2% compared to the same period in 2024. The drop was mainly due to lower oil and natural gas segment revenues, which fell by $1,299,000 compared to Q3 2024. The company noted that recently imposed tariffs have reduced oil prices and created uncertainty about oil and natural gas operating cash inflows. However, gains in currency did not offset the scale of decline in the energy business or higher administrative expenses. No segment breakdown was reported for contract drilling or land investment, and no new updates were provided for the Kukio Resort Land Development Partnerships in Hawaii.
This growth was largely the result of $657,000 in non-recurring legal fees and costs tied to a shareholder solicitation, legal disputes, and a proxy contest. Net of $348,000 in expected insurance recovery, related extraordinary operating costs are expected to continue beyond June 30, 2025, though the company is unable to estimate the amount of these future costs as the matter is ongoing. Legal and shareholder-related expenses now make up a large part of company expenses, weighing heavily on near-term profitability.
The company made a notable strategic move, completing an agreement on August 8, 2025, to sell all of its U.S. oil and gas assets. The $2.3 million sale price will result in a $700,000 loss, with proceeds set to fund Canadian field workovers and pay down working capital needs from ongoing dispute-related costs. This sale marks a complete retreat from U.S. oil and gas operations. Future energy activities will now be focused on the Twining field in Alberta, Canada.
Shifts in currency values supported results, with a $219,000 foreign currency gain compared to a $61,000 loss in Q3 2024. However, gains in currency did not offset the scale of decline in the energy business or higher administrative expenses. No segment breakdown was reported for contract drilling or land investment, and no new updates were provided for the Kukio Resort Land Development Partnerships in Hawaii.
Outlook and Areas to Watch
Barnwell’s management did not offer quantitative guidance for the next quarter or full year. The company disclosed substantial doubt about its ability to continue as a going concern, pointing to the need for further funding or asset sales, particularly from its Hawaiian land holdings or new debt or stock issuance. This forward-looking statement highlights ongoing liquidity risks, driven by non-recurring expenses and sharply reduced revenue from its core segment.
Legal fees tied to shareholder actions and proxy contests are expected to persist beyond June 30, 2025. The effects of the U.S. asset sale will unfold in coming quarters, impacting both capital needs and the ability to develop remaining energy assets in Canada. The company indicated it may seek to “dilute our fixed costs across a higher revenue base,” but further details on cost containment and revenue growth initiatives were not provided.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
