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Item 1. Financial Statements

2025-05-15 compared with 2025-02-14 · 375 added, 212 removed, 296 unchanged (66% of the section changed)

3 unchanged sentences

CONDENSED CONSOLIDATED BALANCE SHEETS

December 31, 2024 September 30, 2024

2025 September 30,

Current assets:

1 unchanged sentence

Accounts and other receivables, net of allowance for credit losses of:

$ 350,000 at December 31, 2024;

$ 48,000 at March 31, 2025;

$ 141,000 at September 30, 2024

1,773,000 2,190,000

Assets held for sale 69,000 69,000

Note receivable 800,000 —

Other current assets 790,000 873,000

Current assets of discontinued operations — 1,535,000

Total current assets 4,795,000 8,883,000

1 unchanged sentence

Operating lease right-of-use assets 190,000 39,000

Other non-current assets 265,000 —

Property and equipment:

Proved oil and natural gas properties (full cost method) 79,402,000 83,557,000

Drilling rigs and other property and equipment 3,660,000 3,679,000

Other property and equipment 490,000 509,000

Total property and equipment 79,892,000 84,066,000

1 unchanged sentence

Total property and equipment, net 14,023,000 16,566,000

Non-current assets of discontinued operations — 282,000

Total assets $ 24,377,000 $ 30,669,000

7 unchanged sentences

Other current liabilities 517,000 301,000

Current liabilities of discontinued operations — 530,000

Total current liabilities 4,852,000 7,812,000

7 unchanged sentences

authorized, 40,000,000 shares:

10,221,434 issued at December 31, 2024;

10,221,434 issued at March 31, 2025;

10,195,990 issued at September 30, 2024

4 unchanged sentences

Treasury stock, at cost:

167,900 shares at December 31, 2024 and September 30, 2024

167,900 shares at March 31, 2025 and September 30, 2024

( 2,286,000 ) ( 2,286,000 )

Total stockholders’ equity

10,135,000 13,040,000

Non-controlling interests 20,000 22,000

6 unchanged sentences

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Oil and natural gas $ 3,543,000 $ 4,144,000 $ 7,440,000 $ 9,274,000

Contract drilling 543,000 993,000

Sale of interest in leasehold land — 500,000 — 500,000

Gas processing and other 26,000 34,000 63,000 66,000

2 unchanged sentences

Oil and natural gas operating 1,986,000 2,330,000 4,482,000 5,121,000

Contract drilling operating 720,000 1,169,000

General and administrative 2,162,000 1,256,000 3,325,000 2,576,000

1 unchanged sentence

Impairment of assets 52,000 1,677,000 665,000 1,677,000

Foreign currency loss (gain) 351,000 ( 126,000 )

Foreign currency (gain) loss ( 10,000 ) 128,000 341,000 2,000

Interest expense 1,000 — 1,000 —

4,945,000 6,733,000 10,472,000 12,177,000

Loss before equity in income of affiliates and income taxes ( 1,912,000 ) ( 596,000 )

Loss from continuing operations before equity in income of affiliates and income taxes ( 1,376,000 ) ( 2,055,000 ) ( 2,969,000 ) ( 2,337,000 )

Equity in income of affiliates — 1,071,000 — 1,071,000

Loss before income taxes ( 1,912,000 ) ( 596,000 )

Loss from continuing operations before income taxes ( 1,376,000 ) ( 984,000 ) ( 2,969,000 ) ( 1,266,000 )

Income tax provision 162,000 100,000 169,000 166,000

Net loss ( 1,919,000 ) ( 662,000 )

Net (loss) earnings attributable to non-controlling interests ( 2,000 ) 2,000

Net loss from continuing operations ( 1,538,000 ) ( 1,084,000 ) ( 3,138,000 ) ( 1,432,000 )

Net earnings (loss) from discontinued operations 331,000 ( 466,000 ) 12,000 ( 780,000 )

( 1,207,000 ) ( 1,550,000 ) ( 3,126,000 ) ( 2,212,000 )

Net earnings (loss) attributable to non-controlling interests

— 222,000 ( 2,000 ) 224,000

Net loss attributable to Barnwell Industries, Inc.

$ ( 1,207,000 ) $ ( 1,772,000 ) $ ( 3,124,000 ) $ ( 2,436,000 )

Basic and diluted net loss per common share attributable to Barnwell Industries, Inc.

Basic and diluted (loss) earnings per common share attributable to Barnwell Industries, Inc.

stockholders:

Net loss from continuing operations attributable to Barnwell Industries, Inc.

$ ( 0.15 ) $ ( 0.13 ) $ ( 0.31 ) $ ( 0.16 )

Net earnings (loss) from discontinued operations 0.03 ( 0.05 ) — ( 0.08 )

Net loss attributable to Barnwell Industries, Inc.

$ ( 0.12 ) $ ( 0.18 ) $ ( 0.31 ) $ ( 0.24 )

Weighted-average number of common shares outstanding:

5 unchanged sentences

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Net loss $ ( 1,207,000 ) $ ( 1,550,000 ) $ ( 3,126,000 ) $ ( 2,212,000 )

Other comprehensive income (loss):

Other comprehensive (loss) income:

Foreign currency translation adjustments, net of taxes of $ 0

2 unchanged sentences

Amortization of accumulated other comprehensive gain into net periodic benefit cost, net of taxes of $ 0

Total other comprehensive income 93,000 9,000

— ( 22,000 ) — ( 43,000 )

Total other comprehensive (loss) income ( 3,000 ) ( 44,000 ) 90,000 ( 35,000 )

Total comprehensive loss ( 1,210,000 ) ( 1,594,000 ) ( 3,036,000 ) ( 2,247,000 )

Comprehensive loss (income) attributable to non-controlling interests 2,000 ( 2,000 )

Comprehensive (income) loss attributable to non-controlling interests — ( 222,000 ) 2,000 ( 224,000 )

Comprehensive loss attributable to Barnwell Industries, Inc.

4 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

Three months ended December 31, 2024 and 2023

Three months ended March 31, 2025 and 2024

Outstanding Common

Stock Additional

Capital Retained

Earnings (Accumulated Deficit) Accumulated

Comprehensive

Income Treasury

Capital Retained Earnings (Accumulated Deficit) Accumulated

Comprehensive Income Treasury

Stock Non-controlling

Interests Total

Balance at September 30, 2023 9,990,778 $ 5,079,000 $ 7,687,000 $ 6,160,000 $ 2,104,000 $ ( 2,286,000 ) $ 13,000 $ 18,757,000

Balance at December 31, 2023 10,000,106 $ 5,084,000 $ 7,747,000 $ 5,496,000 $ 2,113,000 $ ( 2,286,000 ) $ 11,000 $ 18,165,000

Net (loss) earnings — — — ( 1,772,000 ) — — 222,000 ( 1,550,000 )

4 unchanged sentences

Issuance of common stock for restricted stock units vested

27,984 14,000 ( 14,000 ) — — — — —

Retirement plans:

1 unchanged sentence

— — — — ( 22,000 ) — — ( 22,000 )

Balance at March 31, 2024 10,028,090 $ 5,098,000 $ 7,779,000 $ 3,724,000 $ 2,069,000 $ ( 2,286,000 ) $ 14,000 $ 16,398,000

Balance at December 31, 2024 10,053,534 $ 5,111,000 $ 7,746,000 $ ( 1,322,000 ) $ 2,036,000 $ ( 2,286,000 ) $ 20,000 $ 11,305,000

Net loss — — — ( 1,207,000 ) — — — ( 1,207,000 )

Foreign currency translation adjustments, net of taxes of $ 0

— — — — ( 3,000 ) — — ( 3,000 )

Share-based compensation — — 60,000 — — — — 60,000

Balance at March 31, 2025 10,053,534 $ 5,111,000 $ 7,806,000 $ ( 2,529,000 ) $ 2,033,000 $ ( 2,286,000 ) $ 20,000 $ 10,155,000

See Notes to Condensed Consolidated Financial Statements

BARNWELL INDUSTRIES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF EQUITY

Six months ended March 31, 2025 and 2024

Outstanding Common

Stock Additional

Capital Retained Earnings (Accumulated Deficit) Accumulated

Comprehensive Income Treasury

Stock Non-controlling

Interests Total

Balance at September 30, 2023 9,990,778 $ 5,079,000 $ 7,687,000 $ 6,160,000 $ 2,104,000 $ ( 2,286,000 ) $ 13,000 $ 18,757,000

Net (loss) earnings — — — ( 2,436,000 ) — — 224,000 ( 2,212,000 )

Foreign currency translation adjustments, net of taxes of $ 0

— — — — 8,000 — — 8,000

Distributions to non-controlling interests — — — — — — ( 223,000 ) ( 223,000 )

Share-based compensation — — 111,000 — — — — 111,000

Issuance of common stock for restricted stock units vested

37,312 19,000 ( 19,000 ) — — — — —

Amortization of accumulated other comprehensive gain into net periodic benefit cost, net of taxes of $ 0

— — — — ( 43,000 ) — — ( 43,000 )

Balance at March 31, 2024 10,028,090 $ 5,098,000 $ 7,779,000 $ 3,724,000 $ 2,069,000 $ ( 2,286,000 ) $ 14,000 $ 16,398,000

Balance at September 30, 2024 10,028,090 $ 5,098,000 $ 7,690,000 $ 595,000 $ 1,943,000 $ ( 2,286,000 ) $ 22,000 $ 13,062,000

Net loss — — — ( 3,124,000 ) — — ( 2,000 ) ( 3,126,000 )

3 unchanged sentences

Issuance of common stock for restricted stock units vested

Balance at December 31, 2024 10,053,534 $ 5,111,000 $ 7,746,000 $ ( 1,322,000 ) $ 2,036,000 $ ( 2,286,000 ) $ 20,000 $ 11,305,000

25,444 13,000 ( 13,000 ) — — — — —

Balance at March 31, 2025 10,053,534 $ 5,111,000 $ 7,806,000 $ ( 2,529,000 ) $ 2,033,000 $ ( 2,286,000 ) $ 20,000 $ 10,155,000

See Notes to Condensed Consolidated Financial Statements

2 unchanged sentences

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended

Cash flows from operating activities:

Six months ended

Cash flows from operating activities of continuing operations:

Net loss $ ( 3,126,000 ) $ ( 2,212,000 )

Adjustments to reconcile net loss to net cash

(used in) provided by operating activities:

Net earnings (loss) from discontinued operations 12,000 ( 780,000 )

Net loss from continuing operations ( 3,138,000 ) ( 1,432,000 )

Adjustments to reconcile net loss from continuing operations to net cash (used in) provided by operating activities:

Equity in income of affiliates — ( 1,071,000 )

Depletion, depreciation, and amortization 1,658,000 2,801,000

Impairment of assets 665,000 1,677,000

Sale of interest in leasehold land, net of fees paid — ( 439,000 )

Distributions of income from equity investees — 1,071,000

Retirement benefits income ( 158,000 ) ( 173,000 )

Non-cash rent expense (income) 1,000 ( 13,000 )

Accretion of asset retirement obligation 391,000 434,000

Non-cash rent income — ( 7,000 )

Deferred income tax benefit ( 9,000 ) ( 2,000 )

Deferred income tax (benefit) expense ( 34,000 ) 51,000

Asset retirement obligation payments ( 275,000 ) ( 396,000 )

2 unchanged sentences

Credit loss (reversal) expense ( 10,000 ) 46,000

Foreign currency loss (gain) 351,000 ( 126,000 )

Foreign currency loss 341,000 2,000

(Decrease) increase from changes in current assets and liabilities ( 423,000 ) 333,000

Net cash (used in) provided by operating activities ( 759,000 ) 1,375,000

Cash flows from investing activities:

Proceeds from sale of oil and natural gas assets 282,000 —

Deposit for sale of contract drilling assets 585,000 —

Net cash (used in) provided by operating activities from continuing operations ( 854,000 ) 3,000,000

Cash flows from investing activities of continuing operations:

Proceeds from sale of interest in leasehold land, net of fees paid — 439,000

Proceeds from the sale of oil and natural gas assets 282,000 —

Capital expenditures - oil and natural gas ( 2,641,000 ) ( 1,624,000 )

Capital expenditures - all other — ( 1,000 )

Net cash used in investing activities ( 1,662,000 ) ( 1,019,000 )

Cash flows from financing activities:

Dividend received from discontinued operations 250,000 —

Cash divested from the sale of discontinued operations, net of proceeds ( 163,000 ) —

Net cash used in investing activities from continuing operations ( 2,272,000 ) ( 1,185,000 )

Cash flows from financing activities of continuing operations:

Repayments for insurance premium financing ( 15,000 ) —

Distributions to non-controlling interests — ( 223,000 )

Net cash used in financing activities from continuing operations ( 15,000 ) ( 223,000 )

Cash flows from discontinued operations:

Net cash used in operating activities ( 95,000 ) ( 738,000 )

Net cash provided by (used in) investing activities 538,000 ( 1,000 )

Net cash used in financing activities ( 250,000 ) —

Net cash provided by (used in) discontinued operations 193,000 ( 739,000 )

Effect of exchange rate changes on cash and cash equivalents ( 125,000 ) 2,000

1 unchanged sentence

Cash and cash equivalents at beginning of period 4,505,000 2,830,000

Cash and cash equivalents at end of period $ 1,957,000 $ 3,223,000

Cash and cash equivalents of discontinued operations at end of period — ( 118,000 )

Cash and cash equivalents of continuing operations at end of period $ 1,432,000 $ 3,567,000

See Notes to Condensed Consolidated Financial Statements

17 unchanged sentences

The Condensed Consolidated Balance Sheet as of September 30, 2024 has been derived from audited consolidated financial statements.

In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at December 31, 2024, results of operations, comprehensive loss, equity and cash flows for the three months ended December 31, 2024 and 2023, have been made.

The results of operations for the period ended December 31, 2024 are not necessarily indicative of the operating results for the full year.

In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position at March 31, 2025, results of operations, comprehensive loss, and equity for the three and six months ended March 31, 2025 and 2024, and cash flows for the six months ended March 31, 2025 and 2024, have been made.

The results of operations for the period ended March 31, 2025 are not necessarily indicative of the operating results for the full year.

Use of Estimates in the Preparation of Condensed Consolidated Financial Statements

2 unchanged sentences

Actual results could differ significantly from those estimates.

Significant assumptions are required in the valuation of deferred tax assets, asset retirement obligations, contract drilling estimated costs to complete,

proved oil and natural gas reserves, and such assumptions may impact the amount at which such items are recorded.

Significant assumptions are required in the

valuation of deferred tax assets, asset retirement obligations, proved oil and natural gas reserves, and such assumptions may impact the amount at which such items are recorded.

Significant Accounting Policies

There have been no changes to Barnwell's significant accounting policies as described in the Notes to Consolidated Financial Statements included in Item 8 of the Company's 2024 Annual Report.

Other than as set forth below, there have been no changes to Barnwell's significant accounting policies as described in the Notes to Consolidated Financial Statements included in Item 8 of the Company's 2024 Annual Report.

Discontinued Operations

On March 14, 2025, the Company entered into and completed the sale of its wholly-owned subsidiary, Water Resources International, Inc.

(“Water Resources”).

Water Resources drilled water wells and installed and repaired water pumping systems in Hawaii and represented our contract drilling segment.

As a result of the sale, the Company has classified the related assets and liabilities and the results of its contract drilling business as discontinued operations in the condensed consolidated financial statements for all periods presented.

Prior to the sale, the Company did not have any assurances that a sale of Water Resources was likely to occur.

See Note 3 “Discontinued Operations” for further discussion and additional disclosures related to discontinued operations.

Unless otherwise noted, the discussions in the notes to the condensed consolidated financial statements refers to the Company’s continuing operations.

GOING CONCERN

The accompanying condensed consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business for the twelve-month period following the date of issuance of these condensed consolidated financial statements.

Our ability to sustain our business in the future will depend on sufficient oil and natural gas operating cash flows, which are highly sensitive to potentially volatile oil and natural gas prices, timely repayment of the note receivable from the buyers of our contract drilling segment, and the amount and timing of costs incurred related to the shareholder consent solicitation and ongoing proxy contest.

A sufficient level of such cash inflows are necessary to fund discretionary oil and natural gas capital expenditures, which must be economically successful to provide sufficient returns to grow reserves and production or at a minimum replace declining production from aging wells.

Such a level of oil and natural gas capital expenditures may require funding from external debt or equity sources that are not currently in place, but those sources may not be feasible or sufficient.

In addition, we will need sufficient cash flows to fund our non-discretionary outflows such as oil and natural gas asset retirement obligations and ongoing operating and general and administrative expenses.

Due to the recent shareholder consent solicitation and the ongoing proxy contest costs incurred and estimated to be incurred and the impacts of recently imposed tariffs which have caused a reduction in oil prices and have had an impact on the U.S.

economy as a whole, we now face a greater uncertainty about our oil and natural gas operating cash inflows as described above, which in turn limits our ability to make the required discretionary cash outflows for the capital expenditures necessary to convert our proved undeveloped reserves to proved developed reserves.

Furthermore, because of the greater uncertainty about our cash inflows described above, there is substantial doubt about our ability to fund our non-discretionary cash outflows and thus substantial doubt about our ability to continue as a going concern for one year from the date of the filing of this report.

The Company is investigating potential sources of funding, including debt financing, non-core oil and natural gas property sales and the partial or complete sale of its remaining interests in the Kukio Resort Land Development Partnerships, however, no probable timing or amounts of such funding have yet been secured.

Because of this uncertainty as well as uncertainties regarding the potential duration and depth of the impacts of recently legislated tariffs on the economy as a whole, which in turn affects oil prices and our business as described above, substantial doubt about our ability to continue as a going concern for one year from the date of the filing of this report exists.

These financial statements do not include any adjustments that might result from the outcome of these uncertainties.

DISCONTINUED OPERATIONS

On March 14, 2025, the Company entered into a Stock Purchase Agreement with three unrelated individuals (collectively, the “Buyer”) whereby the Buyer acquired all of the shares of capital stock of Water Resources (the “Shares”) owned by the Company (the “Purchase Agreement”).

The sale and purchase of the Shares closed (the “Closing”) simultaneously with the execution and delivery of the Purchase Agreement by each of the parties thereto on March 14, 2025.

The aggregate purchase price for the Shares was $ 1,050,000 , which was paid at Closing by the Buyer as follows:

an initial aggregate cash payment of $ 250,000 and the delivery of a non-interest bearing promissory note with a principal amount of $ 800,000 (the “Promissory Note”).

The principal payments on the Promissory Note are to be paid in installments on the following schedule:

$ 200,000 on May 15, 2025;

and $ 150,000 on June 16, 2025, July 15, 2025, August 15, 2025, and September 15, 2025.

The Promissory Note is secured by certain specified assets of Water Resources and personal guarantees of the purchasers.

Water Resources drilled water wells and installed and repaired water pumping systems in Hawaii and represented our contract drilling segment.

Prior to the sale, the Company did not have any assurances that a sale of Water Resources was likely to occur.

The Company recorded a loss of $ 193,000 on the sale of Water Resources, which was included in the results from discontinued operations for the three and six months ended March 31, 2025.

There was no impact from the sale of Water Resources on the provision for income taxes.

The following table presents the financial results from discontinued operations presented in the Condensed Consolidated Statements of Operations.

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Contract drilling $ 613,000 $ 1,070,000 $ 1,156,000 $ 2,063,000

Other — 26,000 — 26,000

613,000 1,096,000 1,156,000 2,089,000

Costs and expenses:

Contract drilling operating 519,000 1,387,000 1,239,000 2,556,000

General and administrative 91,000 125,000 209,000 209,000

Depreciation and amortization 16,000 50,000 40,000 102,000

Interest expense 1,000 — 1,000 2,000

Gain on sale of assets (1)

( 538,000 ) — ( 538,000 ) —

89,000 1,562,000 951,000 2,869,000

Earnings (loss) from discontinued operations before income taxes 524,000 ( 466,000 ) 205,000 ( 780,000 )

Loss on sale of discontinued operations ( 193,000 ) — ( 193,000 ) —

Income tax provision — — — —

Net earnings (loss) from discontinued operations $ 331,000 $ ( 466,000 ) $ 12,000 $ ( 780,000 )

________________________

(1) In February 2025, the Company completed the sale of a contract drilling segment drilling rig and related ancillary equipment to an independent third party for proceeds of $ 538,000 , net of related costs.

The drilling rig and related ancillary equipment were fully depreciated and had a net book value of zero and as a result of the sale, the Company recognized a $ 538,000 gain during the three and six months ended March 31, 2025 which was recorded in discontinued operations.

The following table presents the carrying amounts of the assets and liabilities of discontinued operations on the Condensed Consolidated Balance Sheets.

2025 September 30,

Current assets:

Cash and cash equivalents $ — $ 220,000

Accounts and other receivables, net of allowance for credit losses of:

$ 0 at March 31, 2025;

$ 234,000 at September 30, 2024

Assets held for sale — 69,000

Other current assets — 666,000

Total current assets of discontinued operations $ — $ 1,535,000

Non-current assets:

Property and equipment:

Drilling rigs and other property and equipment $ — $ 3,170,000

Accumulated depreciation, impairment, and amortization — ( 2,888,000 )

Total non-current assets of discontinued operations $ — $ 282,000

Current liabilities:

Accounts payable $ — $ 37,000

Accrued compensation — 124,000

Accrued operating and other expenses — 369,000

Total current liabilities of discontinued operations $ — $ 530,000

LOSS PER COMMON SHARE

2 unchanged sentences

Potentially dilutive shares are excluded from the computation of diluted loss per share if their effect is anti-dilutive.

Options to purchase 465,000 shares of common stock and 216,712 restricted stock units were excluded from the computation of diluted shares for the three months ended December 31, 2024, as their inclusion would have been anti-dilutive.

Options to purchase 465,000 shares of common stock and 76,336 restricted stock units were excluded from the computation of diluted shares for the three months ended December 31, 2023, as their inclusion would have been anti-dilutive.

Reconciliations between net loss attributable to Barnwell stockholders and common shares outstanding of the basic and diluted net loss per share computations are detailed in the following tables:

Three months ended December 31, 2024

(Numerator) Shares

(Denominator) Per-Share

Basic $ ( 1,917,000 ) 10,047,173 $ ( 0.19 )

Effect of dilutive securities -

common stock options and restricted stock units — —

Diluted $ ( 1,917,000 ) 10,047,173 $ ( 0.19 )

Three months ended December 31, 2023

Net Loss (Numerator) Shares

(Denominator) Per-Share

Basic $ ( 664,000 ) 9,996,760 $ ( 0.07 )

Effect of dilutive securities -

common stock options and restricted stock units — —

Diluted $ ( 664,000 ) 9,996,760 $ ( 0.07 )

Options to purchase 465,000 shares of common stock and 258,699 restricted stock units were excluded from the computation of diluted shares for the three months ended March 31, 2025, as their inclusion would have been anti-dilutive.

Options to purchase 465,000 shares of common stock and 237,475 restricted stock units were excluded from the computation of diluted shares for the six months ended March 31, 2025, as their inclusion would have been anti-dilutive.

Options to purchase 465,000 shares of common stock and 76,336 restricted stock units were excluded from the computation of diluted shares for the three and six months ended March 31, 2024, as their inclusion would have been anti-dilutive.

Reconciliations between net loss attributable to Barnwell stockholders and common shares outstanding of the basic and diluted net loss per share computations are detailed in the following table:

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Net loss from continuing operations $ ( 1,538,000 ) $ ( 1,084,000 ) $ ( 3,138,000 ) $ ( 1,432,000 )

Net earnings (loss) attributable to non-controlling interests of continuing operations — 222,000 ( 2,000 ) 224,000

Net loss from continuing operations attributable to Barnwell Industries, Inc.

( 1,538,000 ) ( 1,306,000 ) ( 3,136,000 ) ( 1,656,000 )

Net earnings (loss) from discontinued operations 331,000 ( 466,000 ) 12,000 ( 780,000 )

Net loss attributable to Barnwell Industries, Inc.

$ ( 1,207,000 ) $ ( 1,772,000 ) $ ( 3,124,000 ) $ ( 2,436,000 )

Basic weighted-average number of common shares outstanding 10,053,534 10,019,172 10,050,319 10,007,905

Effect of dilutive securities - common stock options and restricted stock units — — — —

Diluted weighted-average number of common shares outstanding 10,053,534 10,019,172 10,050,319 10,007,905

Basic and diluted (loss) earnings per common share:

Net loss per common share from continuing operations attributable to Barnwell Industries, Inc.

$ ( 0.15 ) $ ( 0.13 ) $ ( 0.31 ) $ ( 0.16 )

Net earnings (loss) per common share from discontinued operations

0.03 ( 0.05 ) — ( 0.08 )

Net loss per common share attributable to Barnwell Industries, Inc.

stockholders $ ( 0.12 ) $ ( 0.18 ) $ ( 0.31 ) $ ( 0.24 )

ALLOWANCE FOR CREDIT LOSSES

The following table summarizes the activity in the balance of allowance for credit losses related to accounts and other receivables:

Three months ended

Six months ended

Allowance for credit losses at beginning of period

16 unchanged sentences

Barnwell continues to have an indirect 19.6 % non-controlling ownership interest in KD Kukio Resorts, LLLP, KD Maniniowali, LLLP, and KD I.

The partnerships derive income from the sale of residential parcels in Increment I, which is now completely sold, as well as from commissions on real estate resales by the real estate sales office and revenues resulting from the sale of a few remaining private club memberships.

The partnerships derive income from the sale of residential parcels in Increment I, which is now completely sold, as well as from commissions on real estate sales by the real estate sales office and revenues resulting from the sale of private club memberships.

The last two single-family lots of the 80 lots developed within Increment I were sold in the quarter ended March 31, 2024.

1 unchanged sentence

No definitive development plans have been made by KD II, the developer of Increment II, as of the date of this report.

Barnwell has the right to receive distributions from the Kukio Resort Land Development Partnerships via its non-controlling interests in KD Kona and KKM, based on its respective partnership sharing ratios of 75 % and 34.45 %, respectively.

No cash distributions were received during the three months ended December 31, 2024 and 2023.

Barnwell has the right to receive distributions from the Kukio Resort Land Development Partnerships via its non-controlling interest in KD Kona and KKM, based on its respective partnership sharing ratios of 75 % and 34.45 %, respectively.

No cash distributions were received during the three and six months ended March 31, 2025.

During the three and six months ended March 31, 2024, Barnwell received cash distributions of $ 1,071,000 (resulting in a net amount of $ 953,000 , after distributing $ 118,000 to non-controlling interests) from the Kukio Resort Land Development Partnerships.

Equity in income of affiliates was nil for the three and six months ended March 31, 2025, as compared to equity in income of affiliates of $ 1,071,000 for the three and six months ended March 31, 2024.

Summarized financial information for the Kukio Resort Land Development Partnerships is as follows:

Three months ended

Three months ended March 31,

Revenue $ 4,293,000 $ 10,153,000

Gross profit $ 2,179,000 $ 7,329,000

Net (loss) earnings

$ ( 48,000 ) $ 354,000

In the quarter ended June 30, 2021, the Company received cumulative distributions from the Kukio Resort Land Development Partnerships in excess of our investment balance and in accordance with applicable accounting guidance, the Company suspended its equity method earnings recognition and the Kukio Resort Land Development Partnership investment balance was reduced to zero with the distributions received in excess of our investment balance recorded as equity in income of affiliates because the distributions are not refundable by agreement or by law and the Company is not liable for the obligations of or otherwise committed to provide financial support to the Kukio Resort Land Development Partnerships.

The Company will record future equity method earnings only after our share of the Kukio Resort Land Development Partnership’s cumulative earnings in excess of distributions during the suspended period exceeds our share of the Kukio Resort Land Development Partnership’s income recognized for the excess distributions, and during this suspended period any distributions received will be recorded as equity in income of affiliates.

Accordingly, no equity in income of affiliates was recognized during the three months ended December 31, 2024.

Cumulative distributions received from the Kukio Resort Land Development Partnerships in excess of our investment balance was $ 382,000 at December 31, 2024 and $ 373,000 at September 30, 2024.

Net earnings $ 1,599,000 $ 6,658,000

Six months ended March 31,

Revenue $ 5,592,000 $ 12,039,000

Gross profit $ 2,658,000 $ 8,146,000

Net earnings $ 1,551,000 $ 7,012,000

In the quarter ended June 30, 2021, the Company received cumulative distributions from the Kukio Resort Land Development Partnerships in excess of our investment balance and in accordance with applicable accounting guidance, the Company suspended its equity method earnings recognition and the Kukio Resort Land Development Partnerships investment balance was reduced to zero with the distributions received in excess of our investment balance recorded as equity in income of affiliates because the distributions are not refundable by agreement or by law and the Company is not liable for the obligations of or otherwise committed to provide financial support to the Kukio Resort Land Development Partnerships.

The Company will record future equity method earnings only after our share of the Kukio Resort Land Development Partnerships’ cumulative earnings in excess of distributions during the suspended period exceeds our share of the Kukio Resort Land Development Partnerships’ income recognized for the excess distributions, and during this suspended period any distributions received will be recorded as equity in income of affiliates.

Accordingly, no equity in income of affiliates was recognized in the six months ended March 31, 2025.

Cumulative distributions received from the Kukio Resort Land Development Partnerships in excess of our investment balance was $ 31,000 at March 31, 2025 and $ 373,000 at September 30, 2024.

Sale of Interest in Leasehold Land

1 unchanged sentence

With respect to Increment I, Kaupulehu Developments was entitled to receive payments from KD I based on 10 % of the gross receipts from KD I’s sales of single-family residential lots in Increment I.

The last two single-family lots of the 80 lots developed within Increment I were sold in the quarter ended March 31, 2024.

There is no assurance with regards to the amounts of future payments from Increment II to be received or that the remaining acreage within Increment II will be developed.

In the quarter ended March 31, 2024, the last two single-family lots of the 80 lots developed within Increment I were sold.

The following table summarizes the Increment I revenues from KD I and the amount of fees directly related to such revenues:

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Sale of interest in leasehold land:

Revenues - sale of interest in leasehold land $ — $ 500,000 $ — $ 500,000

Fees - included in general and administrative expenses — ( 61,000 ) — ( 61,000 )

Sale of interest in leasehold land, net of fees paid $ — $ 439,000 $ — $ 439,000

There is no assurance with regards to any payments in the future from Increment II to be received or that the remaining acreage within Increment II will be developed.

No definitive development plans have been made by KD II, the developer of Increment II, as of the date of this report.

2 unchanged sentences

The lease terminates in December 2025.

ASSETS HELD FOR SALE

In the quarter ended March 31, 2024, the Company commenced the marketing of a portion of the contract drilling segment's property and equipment, the majority of which was already fully depreciated.

There was no impairment related to the classification change from held and used to held for sale as the fair value, less estimated selling costs, of the disposal group exceeded its carrying value.

The carrying value of these assets was recorded as “Assets held for sale” in the accompanying Condensed Consolidated Balance Sheets.

The property and equipment deemed necessary to complete the contract drilling segment's contracts in backlog continue to be classified as held and used as of December 31, 2024.

At December 31, 2024, a sale of the remainder of the contract drilling segment's property and equipment or the contract drilling segment as a whole was not estimated to be probable due to the lack of any definitive sale opportunities at that date.

In December 2024, the Company entered into an agreement with an independent third party for the sale of a contract drilling segment drilling rig and related ancillary equipment and received a payment of $ 585,000 from the buyer.

At December 31, 2024, the delivery of the drilling rig and the transfer of the legal title to the buyer had not yet occurred, and therefore, the Company did not record a sale during the three months ended December 31, 2024.

The payment received from the buyer was recognized as a deposit and recorded in “Other current liabilities” on the Company's Condensed Consolidated Balance Sheet at December 31, 2024.

This drilling rig and related ancillary equipment was included in assets held for sale at December 31, 2024, and had a net book value of zero as the assets were already fully depreciated.

In February 2025, the drilling rig and ancillary equipment was delivered and the legal title was transferred to the buyer, and as a result, the Company will recognize a gain, net of costs, on the sale of the drilling rig and ancillary equipment in the quarter ending March 31, 2025.

OIL AND NATURAL GAS PROPERTIES

OIL AND NATURAL GAS PROPERTIES AND ASSET RETIREMENT OBLIGATIONS

Oil and Natural Gas Property Dispositions

There were no significant oil and natural gas property dispositions during the three months ended December 31, 2024 and 2023.

The $ 282,000 of proceeds from sale of oil and natural gas properties included in the Condensed Consolidated Statement of Cash Flows for the three months ended December 31, 2024 represents proceeds that were credited to our cash in October 2024 from a sale of properties that closed in late September 2024.

There were no significant oil and natural gas property dispositions during the six months ended March 31, 2025 and 2024.

The $ 282,000 of proceeds from the sale of oil and natural gas properties included in the Condensed Consolidated Statement of Cash Flows for the six months ended March 31, 2025 represents proceeds that were credited to our cash in October 2024 from a sale of properties that closed in late September 2024.

Impairment of Oil and Natural Gas Properties

Under the full cost method of accounting, the Company performs quarterly oil and natural gas ceiling test calculations.

Changes in the 12-month rolling average first-day-of-the-month prices for oil, natural gas and natural gas liquids prices (except where prices are defined by contractual arrangements),

the value of reserve additions as compared to the amount of capital expenditures to obtain them, and changes in production rates and estimated levels of reserves, future development costs and the market value of unproved properties, impact the determination of the maximum carrying value of oil and natural gas properties.

During the three months ended December 31, 2024, the Company incurred a non-cash ceiling test impairment for our U.S.

oil and natural gas properties of $ 613,000 .

There was no ceiling test impairment during the three months ended December 31, 2023.

Changes in the 12-month rolling average first-day-of-the-month prices for oil, natural gas and natural gas liquids prices (except where prices are defined by contractual arrangements), the value of reserve additions as compared to the amount of capital expenditures to obtain them, and changes in production rates and estimated levels of reserves, future development costs and the market value of unproved properties, impact the determination of the maximum carrying value of oil and natural gas properties.

During the three and six months ended March 31, 2025, the Company incurred a non-cash ceiling test impairment for our U.S.

oil and natural gas properties of $ 52,000 and $ 665,000 , respectively.

During the three and six months ended March 31, 2024, the Company incurred a non-cash ceiling test impairment for our Canadian oil and natural gas properties of $ 1,677,000 .

As discussed above, the ceiling test uses a 12-month historical rolling average first-day-of-the-month prices.

As such, declines in the 12-month historical rolling average first-day-of-the-month prices used in our ceiling test calculation in future periods could result in impairment write-downs in future periods in the absence of any offsetting factors that are not currently known or projected.

Based on the oil and gas prices for April 1 and May 1 of 2025, the oil prices and natural gas prices used in the 12-month historical rolling first-day-of-the-month average oil price for the ceiling test at June 30, 2025 will be lower than at March 31, 2025.

Whereas we believe our Canadian full cost pool is below the ceiling limit, our U.S.

full cost pool had no ceiling excess at March 31, 2025, and thus a further impairment charge is more likely than not for our U.S full cost pool in the quarter ending June 30, 2025.

The Company is currently unable to estimate a range of the amount of any potential future impairment write-downs as variables that impact the ceiling limitation are dependent upon actual results of activity through the end of June 2025.

Asset Retirement Obligations

In 2021 the Company entered into an agreement with Canada’s Orphan Well Association (“OWA”), where the Company was required to pay abandonment and reclamation costs for certain properties in advance through two cash deposits, one for abandonment and one for reclamation.

Barnwell has provided $ 975,000 in cumulative cash deposits to the OWA since the program began in the fall of 2021, and any amount remaining after completion of the abandonments was to be refunded to the Company, and then upon commencement of the reclamation program a new deposit was to be made for those estimated costs.

To date, the excess deposits that relate to abandonment work have not yet been refunded but have been used to fund the reclamation part of the program and the Company now estimates that a portion of the unused deposit will instead be applied to future reclamation work over the next several years.

The estimated current portion of the unused deposit was $ 226,000 and $ 527,000 at March 31, 2025 and September 30, 2024, respectively, and is included in “Other current assets” on the Company’s Condensed Consolidated Balance Sheets.

The non-current portion of the unused deposit of $ 215,000 along with $ 50,000 of non-current receivables at March 31, 2025, is included in “Other non-current assets” on the Company’s Condensed Consolidated Balance Sheet at March 31, 2025.

RETIREMENT PLANS

2 unchanged sentences

Effective December 31, 2019, the accrual of benefits for all participants in the Pension Plan and SERP was frozen and the plans were closed to new participants from that point forward.

The following table details the components of net periodic benefit (income) cost for Barnwell’s retirement plans:

The following tables detail the components of net periodic benefit (income) cost for Barnwell’s retirement plans:

Pension Plan SERP

Three months ended December 31,

Three months ended March 31,

2025 2024 2025 2024

3 unchanged sentences

Net periodic benefit (income) cost $ ( 103,000 ) $ ( 89,000 ) $ 24,000 $ 2,000

Pension Plan SERP

Six months ended March 31,

2025 2024 2025 2024

Interest cost $ 195,000 $ 205,000 $ 47,000 $ 48,000

Expected return on plan assets ( 400,000 ) ( 383,000 ) — —

Amortization of net actuarial gain — — — ( 43,000 )

Net periodic benefit (income) cost $ ( 205,000 ) $ ( 178,000 ) $ 47,000 $ 5,000

The net periodic benefit (income) cost is included in “General and administrative” expenses in the Company's Condensed Consolidated Statements of Operations.

3 unchanged sentences

Fluctuations in actual equity market returns as well as changes in general interest rates will result in changes in the market value of plan assets and may result in increased or decreased retirement benefits costs and contributions in future periods.

The components of loss before income taxes, after adjusting the loss for non-controlling interests, are as follows:

The components of loss from continuing operations before income taxes, after adjusting the loss for non-controlling interests, are as follows:

Three months ended

March 31, Six months ended

2025 2024 2025 2024

United States $ ( 1,526,000 ) $ 1,004,000 $ ( 2,673,000 ) $ 629,000

1 unchanged sentence

$ ( 1,376,000 ) $ ( 1,206,000 ) $ ( 2,967,000 ) $ ( 1,490,000 )

The components of the income tax provision are as follows:

The components of the income tax provision from continuing operations are as follows:

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Current $ 187,000 $ 47,000 $ 203,000 $ 115,000

9 unchanged sentences

Our operations in Texas are subject to a franchise tax assessed by the state of Texas, however no significant amounts have been incurred to date.

SEGMENT INFORMATION

As disclosed in Note 3 “Discontinued Operations,” on March 14, 2025, the Company completed the sale of Water Resources, which represented the Company’s contract drilling segment.

The financial results of the Company’s contract drilling business has been presented as discontinued operations and therefore is excluded from segment reporting.

Accordingly, Barnwell’s continuing operations include the following two principal business segments:

Oil and Natural Gas Segment - Barnwell engages in oil and natural gas development, production, acquisitions and sales in Canada and in the U.S.

states of Oklahoma and Texas.

Land Investment Segment - Barnwell owns leasehold land interests in Hawaii.

The following table presents certain financial information related to Barnwell’s reporting segments.

All revenues reported are from external customers with no intersegment sales or transfers.

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Oil and natural gas $ 3,543,000 $ 4,144,000 $ 7,440,000 $ 9,274,000

Land investment — 500,000 — 500,000

Other 22,000 16,000 33,000 33,000

Total before interest income 3,565,000 4,660,000 7,473,000 9,807,000

Interest income 4,000 18,000 30,000 33,000

Total revenues $ 3,569,000 $ 4,678,000 $ 7,503,000 $ 9,840,000

Depletion, depreciation, and amortization:

Oil and natural gas $ 753,000 $ 1,342,000 $ 1,657,000 $ 2,800,000

Other 1,000 — 1,000 1,000

Total depletion, depreciation, and amortization $ 754,000 $ 1,342,000 $ 1,658,000 $ 2,801,000

Oil and natural gas $ 52,000 $ 1,677,000 $ 665,000 $ 1,677,000

Total impairment $ 52,000 $ 1,677,000 $ 665,000 $ 1,677,000

Operating profit (loss) (before general and administrative expenses):

Oil and natural gas $ 752,000 $ ( 1,205,000 ) $ 636,000 $ ( 324,000 )

Land investment — 500,000 — 500,000

Other 21,000 16,000 32,000 32,000

Total operating profit (loss) 773,000 ( 689,000 ) 668,000 208,000

Equity in income of affiliates:

Land investment — 1,071,000 — 1,071,000

General and administrative expenses ( 2,162,000 ) ( 1,256,000 ) ( 3,325,000 ) ( 2,576,000 )

Foreign currency gain (loss) 10,000 ( 128,000 ) ( 341,000 ) ( 2,000 )

Interest expense ( 1,000 ) — ( 1,000 ) —

Interest income 4,000 18,000 30,000 33,000

Loss from continuing operations before income taxes $ ( 1,376,000 ) $ ( 984,000 ) $ ( 2,969,000 ) $ ( 1,266,000 )

REVENUE FROM CONTRACTS WITH CUSTOMERS

Disaggregation of Revenue

The following tables provides information about disaggregated revenue by revenue streams, reportable segments, geographical region, and timing of revenue recognition for the three months ended December 31, 2024 and 2023.

Three months ended December 31, 2024

Oil and natural gas Contract drilling Land investment Other Total

The following tables provide information about disaggregated revenue by revenue streams, reportable segments, geographical region, and timing of revenue recognition based upon continuing operations for the three and six months ended March 31, 2025 and 2024.

Three months ended March 31, 2025

Oil and natural gas Land investment Other Total

Revenue streams:

2 unchanged sentences

Natural gas liquids 454,000 — — 454,000

Drilling and pump — 543,000 — — 543,000

Other — — 22,000 22,000

6 unchanged sentences

Goods transferred at a point in time $ 3,543,000 $ — $ 22,000 $ 3,565,000

Services transferred over time — 543,000 — — 543,000

Three months ended March 31, 2024

Oil and natural gas Land investment Other Total

Revenue streams:

Oil $ 2,985,000 $ — $ — $ 2,985,000

Natural gas 678,000 — — 678,000

Natural gas liquids 481,000 — — 481,000

Contingent residual payments — 500,000 — 500,000

Other — — 16,000 16,000

Total revenues before interest income $ 4,144,000 $ 500,000 $ 16,000 $ 4,660,000

Three months ended December 31, 2023

Oil and natural gas Contract drilling Land investment Other Total

Geographical regions:

United States $ 674,000 $ 500,000 $ — $ 1,174,000

Canada 3,470,000 — 16,000 3,486,000

Total revenues before interest income $ 4,144,000 $ 500,000 $ 16,000 $ 4,660,000

Timing of revenue recognition:

Goods transferred at a point in time $ 4,144,000 $ 500,000 $ 16,000 $ 4,660,000

Six months ended March 31, 2025

Oil and natural gas Land investment Other Total

Revenue streams:

2 unchanged sentences

Natural gas liquids 859,000 — — 859,000

Drilling and pump — 993,000 — — 993,000

Other — — 33,000 33,000

6 unchanged sentences

Goods transferred at a point in time $ 7,440,000 $ — $ 33,000 $ 7,473,000

Services transferred over time — 993,000 — — 993,000

Six months ended March 31, 2024

Oil and natural gas Land investment Other Total

Revenue streams:

Oil $ 6,877,000 $ — $ — $ 6,877,000

Natural gas 1,390,000 — — 1,390,000

Natural gas liquids 1,007,000 — — 1,007,000

Contingent residual payments — 500,000 — 500,000

Other — — 33,000 33,000

Total revenues before interest income $ 9,274,000 $ 500,000 $ 33,000 $ 9,807,000

Geographical regions:

United States $ 1,428,000 $ 500,000 $ — $ 1,928,000

Canada 7,846,000 — 33,000 7,879,000

Total revenues before interest income $ 9,274,000 $ 500,000 $ 33,000 $ 9,807,000

Timing of revenue recognition:

Goods transferred at a point in time $ 9,274,000 $ 500,000 $ 33,000 $ 9,807,000

Contract Balances

The following table provides information about accounts receivables, contract assets and contract liabilities from contracts with customers:

December 31, 2024 September 30, 2024 September 30, 2023

The following table provides the balances of our receivables from contracts with customers which is included in "Accounts and other receivables, net of allowance for credit losses," in the accompanying Condensed Consolidated Balance Sheets.

March 31, 2025 September 30, 2024 September 30, 2023

Accounts receivables from contracts with customers $ 1,240,000 $ 1,472,000 $ 2,344,000

Contract assets 333,000 267,000 958,000

Contract liabilities — — 377,000

Accounts receivables from contracts with customers are included in "Accounts and other receivables, net of allowance for credit losses," in the accompanying Condensed Consolidated Balance Sheets and contract assets, which includes costs and estimated earnings in excess of billings and retainage, are included in “Other current assets” in the accompanying Condensed Consolidated Balance Sheets.

Contract liabilities, which includes billings in excess of costs and estimated earnings are included in “Other current liabilities” in the accompanying Condensed Consolidated Balance Sheets.

Retainage, included in contract assets, represents amounts due from customers, but where payments are withheld contractually until certain construction milestones are met.

Amounts retained typically range from 5 % to 10 % of the total invoice, up to contractually-specified maximums.

The Company classifies as a current asset those retainages that are expected to be collected in the next twelve months.

Contract assets represent the Company’s rights to consideration in exchange for services transferred to a customer that have not been billed as of the reporting date.

The Company’s rights are generally unconditional at the time its performance obligations are satisfied.

When the Company receives consideration, or such consideration is unconditionally due, from a customer prior to transferring goods or services to the customer under the terms of a sales contract, the Company records deferred revenue, which represents a contract liability.

Such deferred revenue typically results from billings in excess of costs and estimated earnings on uncompleted contracts.

During the three months ended December 31, 2024 and 2023, the amount of revenue recognized that was previously included in contract liabilities as of the beginning of the respective period was nil and $ 229,000 , respectively.

Contracts are sometimes modified for a change in scope or other requirements.

The Company considers contract modifications to exist when the modification either creates new or changes the existing enforceable rights and obligations.

Most of the Company’s contract modifications are for goods and services that are not distinct from the existing performance obligations.

The effect of a contract modification on the transaction price, and the measure of progress for the performance obligation to which it relates, is recognized as an adjustment to revenue (either as an increase or decrease) on a cumulative catchup basis.

Performance Obligations

The Company’s remaining performance obligations for drilling and pump installation contracts (hereafter referred to as “backlog”) represent the unrecognized revenue value of the Company’s contract commitments.

The Company’s backlog may vary significantly each reporting period based on the timing

of major new contract commitments.

In addition, our customers have the right, under some infrequent circumstances, to terminate contracts or defer the timing of the Company’s services and their payments to us.

Nearly all of the Company's contract drilling segment contracts have original expected durations of one year or less.

At December 31, 2024, the Company had three contract drilling jobs with original expected durations of greater than one year, for which 100 % of the remaining performance obligation of $ 208,000 is expected to be recognized as revenue in the next twelve months.

Contract Fulfillment Costs

Preconstruction costs, which include costs such as set-up and mobilization, are capitalized and allocated across all performance obligations and deferred and amortized over the contract term on a progress towards completion basis.

As of December 31, 2024 and September 30, 2024, the Company had $ 92,000 and $ 173,000 , respectively, in unamortized preconstruction costs related to contracts that were not completed.

During the three months ended December 31, 2024 and 2023, the amortization of preconstruction costs related to contracts were not material and were included in the accompanying Condensed Consolidated Statements of Operations.

Additionally, no impairment charges in connection with the Company’s preconstruction costs were recorded during the three months ended December 31, 2024 and 2023.

SEGMENT INFORMATION

Barnwell operates the following segments:

1) acquiring, developing, producing and selling oil and natural gas in Canada and the U.S.

(oil and natural gas);

2) leasehold land interests in Hawaii (land investment);

and 3) drilling wells and installing and repairing water pumping systems in Hawaii (contract drilling).

The following table presents certain financial information related to Barnwell’s reporting segments.

All revenues reported are from external customers with no intersegment sales or transfers.

Three months ended

Oil and natural gas $ 3,897,000 $ 5,130,000

Contract drilling 543,000 993,000

Other 11,000 17,000

Total before interest income 4,451,000 6,140,000

Interest income 26,000 15,000

Total revenues $ 4,477,000 $ 6,155,000

Depletion, depreciation, and amortization:

Oil and natural gas $ 904,000 $ 1,458,000

Contract drilling 24,000 52,000

Other — 1,000

Total depletion, depreciation, and amortization $ 928,000 $ 1,511,000

Oil and natural gas $ 613,000 $ —

Total impairment $ 613,000 $ —

Operating (loss) profit (before general and administrative expenses):

Oil and natural gas $ ( 116,000 ) $ 881,000

Contract drilling ( 201,000 ) ( 228,000 )

Other 11,000 16,000

Total operating (loss) profit ( 306,000 ) 669,000

General and administrative expenses ( 1,281,000 ) ( 1,404,000 )

Foreign currency (loss) gain

( 351,000 ) 126,000

Interest expense — ( 2,000 )

Interest income 26,000 15,000

Loss before income taxes $ ( 1,912,000 ) $ ( 596,000 )

ACCUMULATED OTHER COMPREHENSIVE INCOME

1 unchanged sentence

Three months ended

March 31, Six months ended

2025 2024 2025 2024

Foreign currency translation:

2 unchanged sentences

Income taxes — — — —

Net current period other comprehensive income 93,000 30,000

Net current period other comprehensive (loss) income ( 3,000 ) ( 22,000 ) 90,000 8,000

Ending accumulated foreign currency translation 310,000 228,000 310,000 228,000

8 unchanged sentences

FAIR VALUE MEASUREMENTS

The carrying values of cash and cash equivalents, accounts and other receivables, accounts payable and accrued current liabilities approximate their fair values due to the short-term nature of the instruments.

The carrying values of cash and cash equivalents, accounts and other receivables, note receivable, accounts payable and accrued current liabilities approximate their fair values due to the short-term nature of the instruments.

Assets and Liabilities Measured at Fair Value on a Nonrecurring Basis

3 unchanged sentences

Barnwell estimates the fair value of asset retirement obligations based on the projected discounted future cash outflows required to settle abandonment and restoration liabilities.

Such an estimate requires assumptions and judgments regarding the existence of liabilities, the amount and timing of cash outflows required to settle the liability, what constitutes adequate restoration, inflation factors, credit adjusted discount rates, and consideration of changes in legal, regulatory, environmental and political environments.

Abandonment and restoration cost estimates are determined in conjunction with Barnwell’s reserve engineers based on historical information regarding costs incurred to abandon and restore similar

well sites, information regarding current market conditions and costs, and knowledge of subject well sites and properties.

Such an estimate requires

assumptions and judgments regarding the existence of liabilities, the amount and timing of cash outflows required to settle the liability, what constitutes adequate restoration, inflation factors, credit adjusted discount rates, and consideration of changes in legal, regulatory, environmental and political environments.

Abandonment and restoration cost estimates are determined in conjunction with Barnwell’s reserve engineers based on historical information regarding costs incurred to abandon and restore similar well sites, information regarding current market conditions and costs, and knowledge of subject well sites and properties.

Asset retirement obligation fair value measurements in the current period were Level 3 fair value measurements.

Insurance Premium Financing

In March 2025, the Company entered into a short-term financing agreement with a third-party to finance the Company’s directors and officers insurance premium in the amount of $ 183,000 , with a term of 11 months and an annual interest rate of 9.4 %.

The Company made a down payment of $ 15,000 and is required to make monthly principal and interest payments of $ 16,000 over the term of the agreement, which matures in February 2026.

As of March 31, 2025, the insurance premium financing liability was $ 153,000 and is included in “Other current liabilities” in the accompanying Condensed Consolidated Balance Sheets.

STOCKHOLDERS' EQUITY

Restricted Stock Units

On October 24, 2024, the Board of Directors of the Company granted a total of 105,820 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board.

The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting date.

The following table summarizes Barnwell’s restricted stock unit activity from October 1, 2024 through December 31, 2024:

On October 24, 2024, the Company’s Board of Directors (the “Board”) granted a total of 105,820 restricted stock units to the independent directors of the Board as partial payment of director fees for their service as members of the Board.

The restricted stock units vest ratably over a three-year period, subject to the director’s continued service through the applicable vesting dates.

On January 19, 2025, the Board granted a total of 66,000 restricted stock units to the Company's President and Chief Executive Officer.

The restricted stock units vest ratably over a three-year period, subject to the employee’s continued service through the applicable vesting dates.

The following table summarizes Barnwell’s restricted stock unit activity from October 1, 2024 through March 31, 2025:

Restricted Stock Units Shares Weighted-Average

2 unchanged sentences

Forfeited ( 39,178 ) 2.13

Nonvested at December 31, 2024 216,712 $ 2.27

Nonvested at March 31, 2025

243,534 $ 2.14

Compensation cost for restricted stock unit awards is measured at fair value and is recognized as an expense over the requisite service period.

During the three months ended December 31, 2024 and 2023, the Company recognized share-based compensation expense related to restricted stock units of $ 69,000 and $ 30,000 , respectively.

As of December 31, 2024, the total remaining unrecognized compensation cost related to nonvested restricted stock units was $ 331,000 , which is expected to be recognized over the weighted-average remaining requisite service period of 1.7 years.

During the three and six months ended March 31, 2025, the Company recognized share-based compensation expense related to restricted stock units of $ 60,000 and

$ 129,000 , respectively.

During the three and six months ended March 31, 2024, the Company recognized share-based compensation expense related to restricted stock units of $ 31,000 and $ 61,000 , respectively.

As of March 31, 2025, the total remaining unrecognized compensation cost related to nonvested restricted stock units was $ 301,000 , which is expected to be recognized over the weighted-average remaining requisite service period of 1.7 years.

Limited-Duration Shareholder Rights Plan

On January 26, 2025, the Board adopted a shareholder rights plan and declared a dividend of one right (a “Right”) in respect of each of the Company’s issued and outstanding shares of common stock, par value $ 0.50 per share (“Common Stock”).

The dividend was payable to the shareholders of record at the close of business on February 7, 2025.

Each Right initially entitled the registered holder, subject to the terms of the Rights Agreement (as defined below), to purchase from the Company one share of Common Stock, at a price equal to $ 9.00 , subject to certain adjustments (as adjusted from time to time, the “Exercise Price”).

The terms of the Rights are set forth in the Rights Agreement, dated as of January 26, 2025 (as it may be amended from time to time, the “Rights Agreement”), by and between the Company and Broadridge Corporate Issuer Solutions, LLC, as rights agent (or any successor rights agent, the “Rights Agent”).

In general terms, the Rights Agreement imposes significant dilution upon any person or group (other than the Company or certain related persons) that is or becomes the beneficial owner of 20 % (the “Triggering Percentage”) or more of the Company’s outstanding Common Stock without the prior approval of the Board.

A person or group that becomes the beneficial owner of the Triggering Percentage or more is called an “Acquiring Person.” Any Rights held by an Acquiring Person will be null and void and may not be exercised.

Shareholders that beneficially own the Triggering Percentage or more of the Company’s outstanding Common Stock on the date the plan is adopted, are not considered Acquiring Persons;

however, such Shareholders generally may not acquire, or obtain the right to acquire, beneficial ownership of 0.25 % or more additional shares of the Company’s outstanding Common Stock.

The term “beneficial ownership” is defined in the Rights Agreement and includes, among other things, certain securities that may be exercised or converted into shares of Common Stock and certain derivative arrangements.

The Rights will expire prior to the earliest of (i) the close of business on January 26, 2026 (subject to the shareholders of the Company approving an extension of the Rights Agreement through a date on or prior to January 26, 2028);

(ii) the time at which the Rights are redeemed pursuant to the Rights Agreement;

(iii) the time at which the Rights are exchanged pursuant to the Rights Agreement;

and (iv) upon the occurrence of certain transactions.

This description of the Rights Agreement herein does not purport to be complete and is qualified in its entirety by reference to Exhibit 4.1 to the Company’s Current Report on Form 8-K, filed with the Securities and Exchange Commission on January 27, 2025.

CONTINGENCIES

3 unchanged sentences

Barnwell’s management is not aware of any claims or litigation involving Barnwell that are likely to have a material adverse effect on its results of operations, financial position or liquidity.

In fiscal 2020, the Staff of the State of Hawaii’s Commission on Water Resource Management (“Commission”) circulated a draft of a proposed recommendation to the Commission under which the Company, the water utility, the water utility's independent hydrologist firm and the owner of the land on which two water wells were drilled would be assessed penalty fines because each of the wells were calculated to have been drilled beyond the depth permitted by the permit.

The wells were drilled to a depth to penetrate certain layers of impermeable rock necessary to access the aquifer at the instructions and on the advice of the hydrologist hired by the owner of the well.

Subsequently, the Staff of the Commission

acknowledged that one well had not been drilled to a depth beyond its permitted depth and the fines on that well were eliminated.

Additionally, the fines applicable to the depth of the second well were dropped in lieu of the parties entering into an agreement to perform a water quality study and repurpose a current well into a monitoring well.

The liability related to this contingency was $ 200,000 at December 31, 2024 and September 30, 2024 and is included in “Accrued operating and other expenses” in the accompanying Condensed Consolidated Balance Sheets.

It is unknown when this contingent liability related to the required drilling of the monitoring well in satisfaction of a regulatory assessment will be settled.

INFORMATION RELATING TO THE CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Three months ended

Six months ended

Supplemental disclosure of cash flow information:

Cash paid during the year for:

Income taxes paid

$ 136,000 $ 44,000

Capital expenditure accruals related to oil and natural gas exploration and development decreased $ 2,215,000 and $ 523,000 during the three months ended December 31, 2024 and 2023, respectively.

Additionally, capital expenditure accruals related to oil and natural gas asset retirement obligations increased $ 32,000 and $ 115,000 during the three months ended December 31, 2024 and 2023, respectively.

Income taxes $ 168,000 $ 71,000

Supplemental disclosure of non-cash financing activities:

Prepaid insurance funded directly by short-term premium financing borrowing $ 168,000 $ —

Capital expenditure accruals related to oil and natural gas exploration and development decreased $ 2,259,000 and $ 569,000 during the six months ended March 31, 2025 and 2024, respectively.

Additionally, capital expenditure accruals related to oil and natural gas asset retirement obligations increased $ 149,000 and $ 179,000 during the six months ended March 31, 2025 and 2024, respectively.

RELATED PARTY TRANSACTIONS

3 unchanged sentences

Changes to the arrangement above, effective March 7, 2019, are discussed in Note 6.

SUBSEQUENT EVENTS

Restricted Stock Units

In January 2025, the Company's Board of Directors (the “Board”) granted a total of 66,000 restricted stock units to the Company's President and Chief Executive Officer.

The restricted stock units vest ratably over a three-year period, subject to the employee’s continued service through the applicable vesting dates.

Limited-Duration Shareholder Rights Plan

On January 26, 2025, the Board adopted a shareholder rights plan and declared a dividend of one

right (a “Right”) in respect of each of the Company’s issued and outstanding shares of common stock, par value $ 0.50 per share (“Common Stock”).

The dividend is payable to the shareholders of record at the close of business on February 7, 2025.

Each Right initially entitles the registered holder, subject to the terms of the Rights Agreement (as defined below), to purchase from the Company one share of Common Stock, at a price equal to $ 9.00 , subject to certain adjustments (as adjusted from time to time, the “Exercise Price”).

Shareholders that beneficially own the Triggering Percentage or more of the Company’s outstanding Common Stock on the date the plan is adopted, are not considered Acquiring Persons;

however, such Shareholders generally may not acquire, or obtain the right to acquire, beneficial ownership of 0.25 % or more additional shares of the Company’s outstanding Common Stock.

(ii) the time at which the Rights are redeemed pursuant to the Rights Agreement;

(iii) the time at which the Rights are exchanged pursuant to the Rights Agreement;

and (iv) upon the occurrence of certain transactions.

No lots were sold during the six months ended March 31, 2025.

During the six months ended March 31, 2024, Barnwell received $ 500,000 in percentage of sales payments from KD I from the sale of the last two single-family lots within Increment I.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements