Zefiro Methane Reports Fourth Quarter and Fiscal 2026 Financial Results

Fourth Quarter Marked by the Viking Well Service Fleet Acquisition and Groundbreaking on the Largest Government Award in Company History

Bradford, Pennsylvania--(Newsfile Corp. - September 28, 2026) - Zefiro Methane Corp. (CBOE CA: ZEFI) (FSE: Y6B) (OTCQB: ZEFIF) (the "Company", "Zefiro", or "ZEFI"), a North American environmental services company specializing in methane abatement and the plugging of orphaned and end-of-life oil and gas wells, has reported its financial results for the fourth quarter and fiscal year ended June 30, 2026. All figures are presented in U.S. dollars.

Fourth Quarter Fiscal 2026 & Subsequent Operational Highlights:

• Grew fiscal 2026 revenue 31.1% to a record $42.5 million and gross profit 66.0% to $12.4 million, with gross margin expanding from 23.0% in fiscal 2025 to 29.2% in fiscal 2026.

• Reduced fiscal 2026 operating expenses 10.2% to $14.4 million, narrowed net loss 67.5% to $3.5 million, and delivered positive adjusted EBITDA of $3.8 million, a $7.8 million improvement over fiscal 2025.

• Acquired the operating assets of Viking Well Service, Inc. in May 2026 for $4.3 million, adding five rigs, operating capability in five additional states, and approximately $10 million of incremental annual revenue capacity.

• Broke ground on the Company's $19.6 million Ohio Department of Natural Resources orphan well contract, the largest government award in Company history, and completed 27 of 37 wells on the Wood 12F orphan well project in Ohio by quarter end.

• Generated approximately $1.4 million of wastewater disposal well remediation revenue, deployed a second rig for a major natural gas producer client in West Virginia, and expanded methane monitoring operations into Pennsylvania.

• Subsequent to quarter end, was awarded an $11.5 million state-funded well plugging contract in September 2026, with work scheduled to begin in November 2026 and continue through June 2029, along with three additional federally funded well plugging projects in Ohio and Pennsylvania valued at approximately $1.9 million.

• Completed private placements in April and June 2026 for aggregate gross proceeds of approximately $5.7 million in support of the Viking Well Service acquisition.

Management Commentary

Catherine Flax, Interim Chief Executive Officer of Zefiro, said: "The fourth quarter was a quarter of foundation building. We brought the Viking Well Service fleet under our roof and broke ground on the largest government contract in our history. Each of those carried cost in the quarter, and none of them was yet running at full rate."

"Fiscal 2026 was a transformative year for Zefiro. We achieved record revenue and adjusted EBITDA, completed multiple equity raises, paid down high-interest debt, and made a strategic acquisition. Together, these give us a strong foundation for growth in fiscal 2027."

"We enter fiscal 2027 with five additional rigs, operating capability in five more states, the $19.6 million Ohio contract underway, and an $11.5 million state-funded award that runs through June 2029. Power and data center developers have also become a real source of private-sector work, because they can't build on sites with unplugged legacy wells beneath them. That demand doesn't wait on an appropriation cycle."

"Fiscal 2027 is about maximizing our utilization, converting the largest contracted pipeline in our history into revenue, and putting the Viking fleet fully to work, while continuing to win on reliability and market credibility rather than on price," concluded Flax.

Fourth Quarter and Fiscal 2026 Financial Results Summary

Revenue for the fourth quarter of fiscal 2026 increased 16.7% to $9.3 million, as compared to $8.0 million in the same year-ago quarter. The increase was primarily driven by the initial contribution of the equipment fleet acquired from Viking Well Service.

Gross profit was $1.7 million, or 18.6% of revenue, in the fourth quarter of fiscal 2026, as compared to $2.6 million, or 32.8% of revenue, in the same year-ago quarter. The contraction reflects the onboarding of the Viking fleet and crews ahead of full utilization, mobilization costs on the Ohio Department of Natural Resources contract in advance of scaled billing, the twenty additional field employees hired by Plants & Goodwin to service the new corporate accounts onboarded in June 2026, as well as a less favorable revenue mix in the quarter.

Operating expenses totaled $4.4 million in the fourth quarter of fiscal 2026, as compared to $2.7 million in the same year-ago quarter. The increase primarily reflects share-based compensation of $0.7 million, as compared to an income position of $0.5 million in the year-ago quarter that had been reduced by the reversal of accumulated share-based compensation on forfeitures. Fourth quarter results also included a non-recurring $0.5 million non-cash impairment of property and equipment, reflecting an independent appraisal of the assets acquired from Viking Well Service.

Net loss for the fourth quarter of fiscal 2026 was $2.8 million, or $(0.03) per basic and diluted share, as compared to a net loss of $1.2 million, or $(0.02) per basic and diluted share, in the same year-ago quarter.

Adjusted EBITDA loss, a non-IFRS measure, was $0.6 million in the fourth quarter of fiscal 2026, as compared to positive adjusted EBITDA of $0.3 million in the same year-ago quarter. For fiscal 2026, adjusted EBITDA was positive $3.8 million, as compared to a loss of $4.0 million in fiscal 2025, an improvement of $7.8 million. Fiscal 2026 adjusted EBITDA excludes $1.3 million of non-recurring legal, capital raise and marketing expenses, of which $0.5 million was incurred in the fourth quarter.

About Zefiro Methane Corp.

Zefiro Methane Corp. (CBOE: ZEFI) (FSE: Y6B) (OTCQB: ZEFIF) is a North American environmental services company specializing in methane abatement and the plugging of orphaned and end-of-life oil and gas wells. Through operating subsidiary Plants & Goodwin, Inc., a third-generation well services company with a 50-plus-year operating history, Zefiro is vertically integrated across the well lifecycle - measurement and monitoring, plugging and abandonment, site restoration, and carbon credit origination - serving government and private-sector customers across 15 U.S. states. For more information, visit zefiroglobal.com.

Use of Non-IFRS Financial Measures

This press release includes EBITDA and adjusted EBITDA, non-IFRS financial measures that do not have a standardized meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. The Company defines EBITDA as net income (loss) for the period before interest, income taxes, and amortization, and defines adjusted EBITDA as EBITDA further adjusted to exclude share-based compensation and other non-operating and non-recurring items, including impairment of property and equipment, changes in the fair value of investments and of the derivative liability, losses on the settlement and modification of debt, foreign exchange, and gains on the sale of equipment. Management believes these measures, when considered together with the corresponding IFRS measure, provide useful information to investors and management regarding financial and business trends relating to the Company's results of operations, as they remove the effect of non-cash charges and of items that are not indicative of the Company's underlying operating performance. Adjusted EBITDA has significant limitations, in that it does not reflect all of the costs and other items associated with the operation of the Company's business as determined in accordance with IFRS, including interest, income taxes, amortization, and the capital expenditures required to maintain the existing equipment fleet. It should be considered in addition to, and not as a substitute for or superior to, measures of financial performance prepared in accordance with IFRS. A reconciliation of adjusted EBITDA to net income (loss) for the period, its most directly comparable IFRS measure, is presented below.

Adjusted EBITDA Reconciliation
(in U.S. dollars)

(1) Change in fair value of investments and of the derivative liability.
(2) Foreign exchange, loss (gain) on debt settlement and modification, settlement of the convertible note receivable, and loss (gain) on sale of equipment.
(3) Legal, capital raise, and marketing expenses identified as non-recurring.

Notice Regarding References to Zefiro Entities

In this press release, the standalone name/term "Zefiro" collectively refers to both (i) Zefiro Methane Corp. (incorporated in the province of British Columbia, Canada) and (ii) Subsidiaries of Zefiro Methane Corp. unless explicitly stated or otherwise implied by the context. Likewise, first-person linguistic mechanisms such as "We", "Our", and "Us" also collectively refer to Zefiro Methane Corp. and its subsidiaries unless explicitly stated or otherwise implied by the context.

For instances in which a precise entity must be identified, the exact legal name of the entity in question will generally be stated (e.g., "Zefiro Methane Corp." would refer to this entity only and not any of its subsidiaries).

This convention is used only for convenience to facilitate simple and plain-language disclosures to investors, and a comprehensive overview of Zefiro Methane Corp.'s subsidiaries that are collectively referred to with the "Zefiro" name/term can be found in the Company's most recent MD&A, which can be accessed on SEDAR+ at www.sedarplus.ca/.

Forward-Looking Statements

This news release may contain forward-looking statements within the meaning of applicable securities laws, including U.S. and Canadian securities regulations and laws. These forward-looking statements are based on current expectations, estimates, projections, beliefs, and assumptions of management, including those of Zefiro Methane Corp., as of the date of this news release. Forward-looking statements typically include words such as "anticipates," "outlook", "seeks", "expects," "intends," "plans," "believes," "estimates," "may," "will," "should," "could," "would," "continue," "forecast," "potential," "targets," "goals," "vision," "strategy," and similar expressions or variations thereof. These statements may relate to, among other things, the Company's operational outlook, expansion plans, future direction, strategic initiatives, business plans, regulatory environment, growth prospects, pipeline, financial performance, timing and scope of projects, future market conditions, funding and capital requirements, partnerships, or other business developments. The forward-looking information reflects management's current expectations based on information currently available and are subject to a number of risks and uncertainties that may cause outcomes to differ materially from those discussed in the forward-looking information. Although the Company believes that the assumptions and factors used in preparing the forward-looking information are reasonable, undue reliance should not be placed on such information and no assurance can be given that such events will occur in the disclosed timeframes or at all.

In addition, any statements made in this news release are not guarantees of future performance and are subject to a number of known and unknown risks, uncertainties, and other factors, many of which are outside the Company's control, that could cause actual results or outcomes to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to: fluctuations in commodity prices, changes in regulatory or political environments, operational risks, financing risks, market demand for emissions reduction or environmental services, delays in project execution, reliance on third-party partners or vendors, competition, and the overall economic environment. For a more detailed discussion of these factors and other risks, see the section entitled "Financial Risks" in Zefiro's management's discussion and analysis for the year ended June 30, 2025 and "Risk Factors" in Zefiro's annual information form for the year ended June 30, 2025, each of which is available under Zefiro's profile on SEDAR+ at www.sedarplus.ca/.

Factors that could cause actual results or events to differ materially from current expectations include, but are not limited to: (i) Adverse general market and economic conditions; (ii) Changes to and price and volume volatility in the carbon market; (iii) Changes to the regulatory landscape and global policies applicable to the Company's business; (iv) Failure to obtain all necessary regulatory approvals; (v) The timing of commencement and completion of the projects described in this press release, which remain subject to weather, permitting, site conditions and scheduling; (vi) Variability in the revenue and margin ultimately realized on these projects relative to their awarded contract values; (vii) The continued availability and deployment of federal and state funding for orphaned well remediation; (viii) Anticipated outcomes from the projects as outlined in the press release; as well as other risk factors set forth in the Company's most recent Prospectus under the heading "Risk Factors". The Company operates in a rapidly evolving environment where technologies are in the early stage of adoption. New risk factors emerge from time to time, and it is impossible for the Company's management to predict all risk factors, nor can the Company assess the impact of all factors on Company's business or the extent to which any factor, or combination of factors, may cause actual results to differ from those contained in any forward-looking information. Forward-looking information in this news release is based on the opinions and assumptions of management considered reasonable as of the date hereof, including, but not limited to, the assumption that general business and economic conditions will not change in a materially adverse manner. Although the Company believes that the assumptions and factors used in preparing the forward-looking information in this news release are reasonable, undue reliance should not be placed on such information. The forward-looking information included in this news release is made as of the date of this news release and the Company expressly disclaims any intention or obligation to update or revise any forward-looking information whether as a result of new information, future events or otherwise, except as required by applicable law.

Zefiro Methane Corp. does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as required by applicable law. Readers are cautioned not to place undue reliance on these forward-looking statements.

Also, this news release may include market and industry data obtained from various publicly available sources and other sources believed by the Company to be true. Although the Company believes it to be reliable, the Company has not independently verified any of the data from third-party sources referred to in this presentation or analyzed or verified the underlying reports relied upon or referred to by such sources, or ascertained the underlying assumptions relied upon by such sources. The Company does not make any representation as to the accuracy of such information.

This news release is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities of Zefiro Methane Corp., nor shall it form the basis of or be relied upon in connection with any investment decision.

Statement Regarding Third-Party Investor Relations Firms

Disclosures relating to investor relations firms retained by Zefiro Methane Corp. can be found under the Company's profile on SEDAR+ at www.sedarplus.ca/.

Consolidated Statements of Financial Position
(Expressed in U.S. dollars)

Consolidated Statements of Operations and Comprehensive Loss
(Audited)
(Expressed in U.S. dollars, except per share data)

To view the source version of this press release, please visit https://www.newsfilecorp.com/release/316307

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