NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except per share data)
NOTE 1—BASIS OF PRESENTATION:
The accompanying Unaudited Consolidated Financial Statements have been prepared in accordance with generally accepted accounting principles ("GAAP") for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the three months ended March 31, 2026 are not necessarily indicative of the results that may be expected for future periods.
The Consolidated Balance Sheet at December 31, 2025 has been derived from the Audited Consolidated Financial Statements at that date but does not include all the notes required by generally accepted accounting principles for complete financial statements. For further information, refer to the Consolidated Financial Statements and related notes for the year ended December 31, 2025 included in CNX Resources Corporation's ("CNX," "CNX Resources," the "Company," "we," "us," or "our") Annual Report on Form 10-K as filed with the Securities and Exchange Commission ("SEC") on February 10, 2026 (the "2025 Form 10-K").
Certain amounts in prior periods have been reclassified to conform to the current period presentation.
Cash & Cash Equivalents:
Cash and cash equivalents of $3,748 and $779 as of March 31, 2026 and December 31, 2025, respectively, include cash on hand and on deposit at banking institutions as well as all highly liquid short-term securities with original maturities of three months or less.
Restricted Cash:
Restricted cash of $2,428 at March 31, 2026 consists of funds that the Company was contractually obligated to maintain in an escrow account in accordance with the terms of the purchase agreement to acquire various rights-of-way, surface acreage and other oil and gas royalty interests from a third party.
Restricted cash of $12,685 at December 31, 2025 consists of funds that the Company was contractually obligated to maintain in an escrow account in accordance with the terms of the purchase agreement to acquire the natural gas upstream and associated midstream business of Apex Energy II, LLC, as well as, funds that the Company was contractually obligated to maintain in an escrow account in accordance with the terms of the purchase agreement to acquire various rights-of-way, surface acreage and other oil and gas royalty interests from a third party. See Note 4 – Acquisitions and Dispositions for more information.
Trade Accounts Receivable and Allowance for Credit Losses:
As of March 31, 2026 and December 31, 2025, Accounts Receivable - Trade were $209,523 and $264,658, respectively, and Other Receivables were $27,928 and $61,249, respectively.
The measurement of expected credit losses is based on relevant information about past events, including historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. Management records an allowance for credit losses related to the collectability of third-party customers' receivables using the historical aging of the customer receivable balance. The collectability is determined based on past events, including historical experience, customer credit rating, as well as current market conditions. CNX monitors customer ratings and collectability on an on-going basis. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote.
The following represents activity related to the allowance for credit losses for the three months ended:
| | | | | | | | | | | |
| March 31, |
| 2026 | | 2025 |
| Allowance for Credit Losses - Trade, Beginning of Year | $ | 84 | | | $ | 84 | |
| Provision for Expected Credit Losses | — | | | — | |
| Allowance for Credit Losses - Trade, End of Period | $ | 84 | | | $ | 84 | |
| | | |
| Allowance for Credit Losses - Other Receivables, Beginning of Year | $ | 1,037 | | | $ | 1,233 | |
| | | |
| Provision for Expected Credit Losses | 2 | | | (14) | |
| | | |
| Allowance for Credit Losses - Other Receivables, End of Period | $ | 1,039 | | | $ | 1,219 | |
NOTE 2—EARNINGS PER SHARE:
Basic earnings per share is computed by dividing net income or net loss by the weighted average shares outstanding during the reporting period. Diluted earnings per share is computed similarly to basic earnings per share, except that the weighted average shares outstanding are increased to include, if dilutive, additional shares from stock options, restricted stock units, performance share units and shares issuable upon conversion of CNX's outstanding 2.25% convertible senior notes due May 2026 (the "Convertible Notes") (See Note 10 – Long-Term Debt). The number of additional shares is calculated by assuming that outstanding stock options were exercised, that outstanding restricted stock units and performance share units were released, that the shares that are issuable from the conversion of the Convertible Notes are issued (subject to the considerations discussed further in the paragraph below), and that the proceeds from such activities were used to acquire shares of common stock at the average market price during the reporting period. In periods when CNX recognizes a net loss, the impact of outstanding stock awards and the potential share settlement impact related to CNX's Convertible Notes are excluded from the diluted loss per share calculation as their inclusion would have an anti-dilutive effect.
The table below sets forth the share-based awards that have been excluded from the computation of diluted earnings per share because their effect would be anti-dilutive:
| | | | | | | | | | | | | | | | | |
| | | | For the Three Months Ended March 31, |
| | | | | | 2026 | | 2025 |
| Anti-Dilutive Options | | | | | — | | | 865,250 | |
| Anti-Dilutive Restricted Stock Units | | | | | 414 | | | 1,820,979 | |
| Anti-Dilutive Performance Share Units | | | | | 112,988 | | | 1,048,095 | |
| | | | | | | |
| | | | | 113,402 | | | 3,734,324 | |
The Convertible Notes, if converted by the holder, may be settled in cash, shares of the Company's common stock or a combination thereof, at the Company's election. On January 28, 2026, in accordance with the indenture governing the Convertible Notes, CNX issued a notice of settlement method election for all of the outstanding Convertible Notes providing that CNX would settle any of the Convertible Notes outstanding by issuing shares of the Company's common stock, together, if applicable, with cash in lieu of fractional shares, as provided for in the indenture.
Accounting Standards Update (“ASU”) 2020-06 - Accounting for Convertible Instruments and Contracts in an Entity's Own Equity ("ASU 2020-06") amended the diluted earnings per share calculation for convertible instruments by requiring the use of the if-converted method (See Note 10 – Long-Term Debt for more information). The if-converted method assumes the conversion of convertible instruments occurs at the beginning of the reporting period and diluted weighted average shares outstanding includes the common shares issuable upon conversion of the convertible instruments. In periods where CNX recognizes net income, the conversion spread has a dilutive impact on diluted earnings per share when the average market price of the Company's common stock for a given period exceeds the initial conversion price of $12.84 per share for the Convertible Notes. In connection with the Convertible Notes' issuance, the Company entered into privately negotiated capped call transactions with certain counterparties (the "Capped Calls" and "Capped Call Transactions"), which were not included in calculating the number of diluted shares outstanding, as their effect would have been anti-dilutive.
The Convertible Notes have been excluded from the computation of diluted earnings per share for the three months ended March 31, 2025 as the effect of including these shares in the calculation would have been anti-dilutive. When the convertible
notes are dilutive, interest on Convertible Notes, net of tax, is added back to net income in order to calculate diluted earnings available to shareholders.
The table below sets forth the potential common shares issuable upon conversion of the Convertible Notes that were excluded from the calculation of diluted earnings per share because their effect would be anti-dilutive:
| | | | | | | | | | | | | | | |
| | | | | For the Three Months Ended March 31, |
| | | | | 2026 | | 2025 |
| Convertible Notes | | | | | — | | | 25,751,869 | |
The table below sets forth the share-based awards that have been exercised or released: | | | | | | | | | | | | | | | | | |
| | | | For the Three Months Ended March 31, |
| | | | | | 2026 | | 2025 |
| Options | | | | | 149,275 | | | 82,007 | |
| Restricted Stock Units | | | | | 596,299 | | | 632,388 | |
| Performance Share Units | | | | | 455,069 | | | 483,570 | |
| | | | | 1,200,643 | | | 1,197,965 | |
The computations for basic and diluted earnings (loss) per share are as follows: | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, |
| | | | | | 2026 | | 2025 |
| Net Income (Loss) | | | | | $ | 348,147 | | | $ | (197,715) | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Basic Earnings (Loss) Available to Shareholders | | | | | $ | 348,147 | | | $ | (197,715) | |
| | | | | | | |
| Effect of Dilutive Securities: | | | | | | | |
| Add Back Interest on Convertible Notes (Net of Tax) | | | | | $ | 953 | | | $ | — | |
| Diluted Earnings (Loss) Available to Shareholders | | | | | $ | 349,100 | | | $ | (197,715) | |
| | | | | | | |
Weighted-Average Shares of Common Stock Outstanding | | | | | 142,202,197 | | | 147,778,141 | |
| Effect of Diluted Shares:* | | | | | | | |
| Options | | | | | 386,700 | | | — | |
| Restricted Stock Units | | | | | 871,156 | | | — | |
| Performance Share Units | | | | | 586,108 | | | — | |
| Convertible Notes | | | | | 16,242,445 | | | — | |
| Weighted-Average Diluted Shares of Common Stock Outstanding | | | | | 160,288,606 | | | 147,778,141 | |
| | | | | | | |
| Earnings (Loss) per Share: | | | | | | | |
| | | | | | | |
| | | | | | | |
| Basic | | | | | $ | 2.45 | | | $ | (1.34) | |
| | | | | | | |
| | | | | | | |
| | | | | | | |
| Diluted | | | | | $ | 2.18 | | | $ | (1.34) | |
| | | | | | | |
*During periods in which the Company incurs a net loss, diluted weighted average shares outstanding are equal to basic weighted average shares outstanding because the effect of all equity awards and the potential share settlement impact related to CNX’s Convertible Notes are antidilutive.
NOTE 3—REVENUE FROM CONTRACTS WITH CUSTOMERS:
Revenues are recognized when control of the promised goods or services is transferred to the Company’s customers, in an amount that reflects the consideration the Company expects to be entitled to in exchange for those goods or services. The Company has elected to exclude all taxes from the measurement of transaction price.
For natural gas, NGL and oil, and purchased gas revenue, the Company generally considers the delivery of each unit (MMBtu or Bbl) to be a separate performance obligation that is satisfied upon delivery. Payment terms for these contracts typically require payment within 25 days of the end of the calendar month in which the hydrocarbons are delivered. A significant number of these contracts contain variable consideration because the payment terms refer to market prices at future delivery dates. In these situations, the Company has not identified a standalone selling price because the terms of the variable payments relate specifically to the Company’s efforts to satisfy the performance obligations. A portion of the contracts contain fixed consideration (i.e., fixed price contracts or contracts with a fixed differential to NYMEX or index prices). The fixed consideration is allocated to each performance obligation on a relative standalone selling price basis. For these contracts, the Company generally concludes that the fixed price or fixed differentials in the contracts are representative of the standalone selling price. Revenue associated with natural gas, NGL and oil as presented on the accompanying Consolidated Statements of Income represent the Company’s share of revenues net of royalties and excluding revenue interests owned by others. When selling natural gas, NGL and oil on behalf of royalty owners or working interest owners, the Company is acting as an agent and thus reports the revenue on a net basis.
Included in Other Revenue and Operating Income in the Consolidated Statements of Income and in the below table are revenues generated from natural gas gathering services provided to third parties and sales of environmental attributes. The gas gathering services are interruptible in nature and include charges for the volume of gas actually gathered and do not guarantee access to the system. Volumetric based fees are based on actual volumes gathered. The Company generally considers the interruptible gathering of each unit (MMBtu) of natural gas as a separate performance obligation. Payment terms for these contracts typically require payment within 25 days of the end of the calendar month in which the hydrocarbons are gathered. All sales of environmental attributes (which includes items such as (but are not limited to): carbon credits, air quality credits, renewable or alternative energy credits, methane capture credits, methane performance certificates, emission reductions, offsets and/or allowances) are under short-term contracts, and revenue is recognized when the environmental attribute is transferred to a third party.
Disaggregation of Revenue
The following table is a disaggregation of revenue by major source:
| | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, |
| | | | 2026 | | 2025 |
| Revenue from Contracts with Customers: | | | | | | | |
| Natural Gas Revenue | | | | | $ | 658,610 | | | $ | 495,191 | |
| NGL Revenue | | | | | 60,060 | | | 54,001 | |
| Oil/Condensate Revenue | | | | | 3,374 | | | 1,902 | |
| Total Natural Gas, NGL and Oil Revenue | | | | | 722,044 | | | 551,094 | |
| | | | | | | |
| Purchased Gas Revenue | | | | | 12,687 | | | 11,550 | |
| | | | | | | |
| Other Sources of Revenue and Other Operating Income: | | | | | | | |
| Gain (Loss) on Commodity Derivative Instruments | | | | | 3,981 | | | (528,220) | |
| Other Revenue and Operating Income | | | | | 47,942 | | | 47,964 | |
| Total Revenue and Other Operating Income | | | | | $ | 786,654 | | | $ | 82,388 | |
The disaggregated revenue information corresponds with the Company’s segment reporting found in Note 14 – Segment Information.
Contract Balances
CNX invoices its customers once a performance obligation has been satisfied, at which point payment is unconditional. Accordingly, CNX's contracts with customers do not give rise to material contract assets or liabilities under ASC 606. The Company has no contract assets recognized from the costs to obtain or fulfill a contract with a customer.
Transaction Price Allocated to Remaining Performance Obligations
ASC 606 requires that the Company disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied. However, the guidance provides certain practical expedients that limit this requirement, including when variable consideration is allocated entirely to a wholly unsatisfied performance obligation or to a wholly unsatisfied promise to transfer a distinct good or service that forms part of a series.
A significant portion of CNX's natural gas, NGL and oil and purchased gas revenue is short-term in nature with a contract term of one year or less. For those contracts, CNX has utilized the practical expedient in ASC 606-10-50-14 exempting the Company from disclosure of the transaction price allocated to remaining performance obligations if the performance obligation is part of a contract that has an original expected duration of one year or less.
For revenue associated with contract terms greater than one year, a significant portion of the consideration in those contracts is variable in nature and the Company allocates the variable consideration in its contract entirely to each specific performance obligation to which it relates. Therefore, any remaining variable consideration in the transaction price is allocated entirely to wholly unsatisfied performance obligations. As such, the Company has not disclosed the value of unsatisfied performance obligations pursuant to the practical expedient.
For natural gas, NGL and oil revenue associated with contract terms greater than one year with a fixed price component, the aggregate amount of the transaction price allocated to remaining performance obligations was $15,577 as of March 31, 2026. The Company expects to recognize net revenue of $12,447 in the next 12 months and $2,458 over the following 12 months, with the remainder recognized thereafter.
For revenue associated with CNX's midstream contracts, which also have terms greater than one year, the interruptible gathering of each unit of natural gas represents a separate performance obligation; therefore, future volumes are wholly unsatisfied, and disclosure of the transaction price allocated to remaining performance obligations is not required.
Prior-Period Performance Obligations
CNX records revenue in the month production is delivered to the purchaser. However, settlement statements for certain natural gas, NGL and oil revenue may not be received for 30 to 90 days after the date production is delivered, and as a result, the Company is required to estimate the amount of production delivered to the purchaser and the price that will be received for the sale of the product. CNX records the differences between the estimate and the actual amounts received in the month that payment is received from the purchaser. The Company has existing internal controls for its revenue estimation process and the related accruals, and any identified differences between its revenue estimates and the actual revenue received historically have not been significant. For each of the three months ended March 31, 2026 and 2025, revenue recognized in the current reporting period related to performance obligations satisfied in a prior reporting period was not material.
NOTE 4—ACQUISITIONS AND DISPOSITIONS:
On January 27, 2025, the Company completed the acquisition of Apex Energy II, LLC (the "Apex Transaction") for total cash consideration of approximately $517,599, net of $1,588 of cash received, and subject to certain post-closing adjustments. The Apex Transaction was classified as an asset acquisition under GAAP as substantially all the fair value of the acquired assets is concentrated in a group of similar identifiable assets, which are primarily oil and gas properties, wells, and well-related equipment. Therefore, the properties were recorded at the total consideration paid, including purchase price adjustments and capitalized transaction costs. The purchase price was allocated to the assets and liabilities acquired based on their estimated fair value as of the acquisition date. The Apex Transaction expands CNX's existing Shale undeveloped leasehold in the central Pennsylvania region and provides an existing infrastructure footprint that can be leveraged for future development.
In connection with the Apex transaction, CNX maintained an escrow account pursuant to the purchase agreement to settle certain post‑closing adjustments, which was to be released on the one‑year anniversary of closing. During the three months ended March 31, 2026, approximately $10,255 previously classified as restricted cash was reflected in Apex Acquisitions (Net of Cash Acquired) in the Company’s Consolidated Statements of Cash Flows.
During the three months ended March 31, 2026, CNX made the first of three annual payments of $16,500 pursuant to an agreement that provides the Company with the right to acquire Utica Shale oil and gas interests underlying the legacy Apex Energy footprint, which was reflected in capital expenditures in the Company's Consolidated Statements of Cash Flows.
Additionally, Gain on Asset Sales and Abandonments, net in the Consolidated Statements of Income and Proceeds from Asset Sales in the Consolidated Statements of Cash Flows for the three months ended March 31, 2026 and 2025 include the sale of various non-core assets (rights-of-way, surface acreage and other non-operated oil and gas interests and assets), none of which were individually material.
NOTE 5—INCOME TAXES:
The effective tax rates for the three months ended March 31, 2026 and 2025 were 18.7% and 27.5%, respectively. The effective tax rate for the three months ended March 31, 2026 and 2025 differs from the U.S. federal statutory rate of 21% primarily due to the impact of equity compensation, federal tax credits, and state taxes.
The total amount of uncertain tax positions at March 31, 2026 and December 31, 2025 was $131,334 and $129,034, respectively. If these uncertain tax positions were recognized, approximately $131,334 and $129,034 would affect CNX's effective tax rate at March 31, 2026 and December 31, 2025, respectively. In 2026, CNX recognized an increase in unrecognized tax benefits of $2,300 for tax benefits resulting from tax positions anticipated to be claimed on our 2026 federal income tax return for additional federal tax credits.
CNX recognizes accrued interest and penalties related to uncertain tax positions in interest expense and income tax expense, respectively. As of March 31, 2026 and December 31, 2025, CNX had no accrued liabilities for interest and penalties related to uncertain tax positions.
CNX and its subsidiaries file federal income tax returns with the United States and tax returns within various states. With few exceptions, the Company is no longer subject to United States federal, state, local, or non-U.S. income tax examinations by tax authorities for the years before 2022.
NOTE 6—PROPERTY, PLANT AND EQUIPMENT: | | | | | | | | | | | |
| March 31,
2026 | | December 31,
2025 |
| Intangible Drilling Cost | $ | 6,850,393 | | | $ | 6,755,849 | |
| Gas Gathering Equipment | 2,777,947 | | | 2,771,747 | |
| Gas Wells and Related Equipment | 1,867,149 | | | 1,833,856 | |
| Proved Gas Properties | 1,459,993 | | | 1,457,919 | |
| Unproved Gas Properties | 775,900 | | | 747,528 | |
| Surface Land and Other Equipment | 179,294 | | | 179,676 | |
| Other | 312,041 | | | 310,649 | |
| Total Property, Plant and Equipment | 14,222,717 | | | 14,057,224 | |
| Less: Accumulated Depreciation, Depletion and Amortization | 6,310,588 | | | 6,193,871 | |
| | | |
| Total Property, Plant and Equipment - Net | $ | 7,912,129 | | | $ | 7,863,353 | |
| | | |
NOTE 7—GOODWILL AND OTHER INTANGIBLE ASSETS:
Goodwill:
All goodwill is attributed to the Midstream reporting unit within the Shale segment. Goodwill is evaluated for impairment at least annually and whenever events or changes in circumstance indicate that the fair value of a reporting unit is less than its carrying amount.
The accumulated impairment loss on goodwill is $473,045, resulting in a carrying value of $323,314 at both March 31, 2026 and December 31, 2025.
Other Intangible Assets:
The carrying amount and accumulated amortization of other intangible assets consist of the following: | | | | | | | | | | | |
| March 31,
2026 | | December 31,
2025 |
| Other Intangible Assets: | | | |
| Gross Amortizable Asset - Customer Relationships | $ | 109,752 | | | $ | 109,752 | |
| Less: Accumulated Amortization - Customer Relationships | 54,057 | | | 52,419 | |
| Total Other Intangible Assets, net | $ | 55,695 | | | $ | 57,333 | |
The customer relationship intangible asset is being amortized on a straight-line basis over approximately 17 years. Amortization expense related to other intangible assets was $1,638 for both the three months ended March 31, 2026 and 2025. The estimated annual amortization expense is expected to approximate $6,552 per year for each of the next five years.
NOTE 8—REVOLVING CREDIT FACILITIES:
CNX:
CNX as borrower and certain of its subsidiaries (not including CNX Midstream Partners LP ("CNXM")) as guarantor loan parties entered into a Fourth Amended and Restated Credit Agreement for a senior secured revolving credit facility (the "CNX Credit Facility"), dated as of May 17, 2024 and maturing on May 17, 2029, subject to the terms described below. On May 14, 2025, the CNX Credit Facility borrowing base increased from $2,250,000 to $2,400,000 as part of the semi-annual redetermination. Elected commitments remained unchanged at $1,400,000.
The availability under the CNX Credit Facility, including availability for letters of credit, is generally limited to a borrowing base, which is determined by the required number of lenders in good faith by calculating a loan value of the Company’s proved reserves.
In addition to refinancing all outstanding amounts under the prior CNX Credit Facility, borrowings under the CNX Credit Facility may be used by CNX for general corporate purposes.
Interest on outstanding indebtedness under the CNX Credit Facility currently accrues, at the Company’s option, at a rate based on either:
•the highest of (i) PNC Bank, National Association’s prime rate, (ii) the federal funds open rate plus 0.50%, and (iii) the one-month SOFR rate plus 1.0%, in each case, plus a margin ranging from 0.75% to 1.75%; or
•the SOFR rate plus a margin ranging from 1.75% to 2.75%.
The CNX Credit Facility matures on May 17, 2029, provided that if at any time on or after (1) January 30, 2026 (or October 31, 2025, if any debt (as defined in the CNX Credit Facility) is outstanding with a springing maturity date), if any of the Company’s 2.25% Convertible Senior Notes due 2026 are outstanding and (a) availability under the CNX Credit Facility minus (b) the aggregate principal amount of all such outstanding Convertible Senior Notes is less than 20% of the aggregate commitments under the CNX Credit Facility, or (2) October 16, 2028 (or July 17, 2028, if any debt (as defined in the CNX Credit Facility) is outstanding with a springing maturity date), if any of the Company’s 6.0% Senior Notes due 2029 are outstanding and (a) availability under the CNX Credit Facility minus (b) the aggregate principal amount of all such outstanding senior notes is less than 20% of the aggregate commitments under the CNX Credit Facility (the first such date, the "Springing Maturity Date"), then the CNX Credit Facility will mature on the Springing Maturity Date.
The CNX Credit Facility also requires that CNX maintain a maximum net leverage ratio of no greater than 3.50 to 1.00, which is calculated as the ratio of debt less cash on hand to consolidated EBITDA, measured quarterly. CNX must also maintain a minimum current ratio of no less than 1.00 to 1.00, which is calculated as the ratio of current assets, plus revolver availability, to current liabilities, excluding derivative asset/liability position, and convertible note liability until one year prior to maturity, and borrowings under the revolver, measured quarterly. The calculation of all of the ratios excludes CNXM, its subsidiaries, and its general partner. CNX was in compliance with all financial covenants as of March 31, 2026.
At March 31, 2026, the CNX Credit Facility had $76,300 of borrowings outstanding, with a weighted average interest rate of 5.81% and $27,997 of letters of credit outstanding, leaving $1,295,703 of unused capacity. At December 31, 2025, the CNX Credit Facility had $200,000 of borrowings outstanding, with a weighted average interest rate of 5.69% and $27,997 of letters of credit outstanding, leaving $1,172,003 of unused capacity.
CNXM:
CNXM as borrower and certain of its subsidiaries as guarantor loan parties entered into a Second Amended and Restated Credit Agreement for a senior secured revolving credit facility (the “CNXM Credit Facility"), dated as of May 17, 2024 and maturing on May 17, 2029. The CNXM Credit Facility has $600,000 of elected commitments and is not subject to semi-annual redetermination. CNX is not a guarantor under the CNXM Credit Facility.
In addition to refinancing all outstanding amounts under the prior CNXM Credit Facility, borrowings under the CNXM Credit Facility may be used by CNXM for general corporate purposes.
Interest on outstanding indebtedness under the CNXM Credit Facility currently accrues, at CNXM's option, at a rate based on either:
•the highest of (i) PNC Bank, National Association’s prime rate, (ii) the federal funds open rate plus 0.50%, and (iii) the one-month SOFR rate plus 1.0%, in each case, plus a margin ranging from 0.75% to 2.00%; or
•the SOFR rate plus a margin ranging from 1.75% to 3.00%.
In addition, CNXM is obligated to maintain at the end of each fiscal quarter (x) a maximum net leverage ratio of no greater than between 5.00 to 1.00 (ranging to no greater than 5.25 to 1.00 in certain circumstances); (y) a maximum secured leverage ratio of no greater than 3.25 to 1.00; and (z) a minimum interest coverage ratio of no less than 2.50 to 1.00; in each case as calculated in accordance with the terms and definitions determining such ratios contained in the CNXM Credit Facility. CNXM was in compliance with all financial covenants as of March 31, 2026.
At March 31, 2026, the CNXM Credit Facility had $105,000 of borrowings outstanding, with a weighted average interest rate of 5.45% and no letters of credit outstanding, leaving $495,000 of unused capacity. At December 31, 2025, the CNXM Credit Facility had $32,750 of borrowings outstanding, with a weighted average interest rate of 5.58%, and no letters of credit outstanding, leaving $567,250 of unused capacity.
NOTE 9—OTHER ACCRUED LIABILITIES: | | | | | | | | | | | |
| March 31,
2026 | | December 31,
2025 |
| Royalties | $ | 132,876 | | | $ | 121,078 | |
| Accrued Interest | 25,420 | | | 50,871 | |
| Transportation Charges | 17,016 | | | 21,706 | |
| Current Portion Settlement - See Note 11 | 13,569 | | | 23,216 | |
| Accrued Payroll & Benefits | 7,233 | | | 6,884 | |
| Accrued Other Taxes | 6,735 | | | 8,084 | |
| Deferred Revenue | 6,288 | | | 14,589 | |
| Short-Term Incentive Compensation | 3,022 | | | 22,658 | |
| Purchased Gas Payable | 306 | | | 554 | |
| Other | 24,168 | | | 32,614 | |
| Current Portion of Long-Term Liabilities: | | | |
| Asset Retirement Obligations | 21,075 | | | 21,075 | |
| Salary Retirement | 2,648 | | | 2,647 | |
| Total Other Accrued Liabilities | $ | 260,356 | | | $ | 325,976 | |
NOTE 10—LONG-TERM DEBT: | | | | | | | | | | | |
| March 31,
2026 | | December 31,
2025 |
Senior Notes due March 2032 at 7.25% (Principal of $600,000 less Unamortized Discount of $4,951 and $5,160, respectively) | $ | 595,049 | | | $ | 594,840 | |
Senior Notes due March 2034 at 5.875%, Issued at Par Value | 500,000 | | | — | |
Senior Notes due January 2031 at 7.375% (Principal of $500,000 less Unamortized Discount of $3,612 and $3,800, respectively) | 496,388 | | | 496,200 | |
CNX Midstream Partners LP Senior Notes due April 2030 at 4.75% (Principal of $400,000 less Unamortized Discount of $2,356 and $2,500, respectively)* | 397,644 | | | 397,500 | |
Convertible Senior Notes due May 2026 at 2.25% (Principal of $208,553 and $208,556 less Unamortized Discount and Issuance Costs of $106 and $425, respectively) | 208,447 | | | 208,131 | |
| CNX Midstream Partners LP Revolving Credit Facility* | 105,000 | | | 32,750 | |
| CNX Revolving Credit Facility | 76,300 | | | 200,000 | |
Senior Notes due January 2029 at 6.00%, Issued at Par Value | — | | | 500,000 | |
| Less: Unamortized Debt Issuance Costs | 11,975 | | | 8,062 | |
| 2,366,853 | | | 2,421,359 | |
| Less: Current Portion | 208,437 | | | 208,095 | |
| Long-Term Debt | $ | 2,158,416 | | | $ | 2,213,264 | |
*CNX is not a guarantor of CNXM's 4.75% Senior Notes due April 2030 or the CNXM Credit Facility.
During the three months ended March 31, 2026, CNX issued $500,000 aggregate principal amount of 5.875% Senior Notes due March 2034 (the "New Notes") at 100.0% of par. The New Notes, along with the related guarantees, were issued pursuant to an indenture, dated February 26, 2026, among the Company, the subsidiary guarantors party thereto and UMB Bank, N.A., as trustee. The New Notes are guaranteed by all of CNX's restricted subsidiaries that guarantee the CNX Credit Facility (see Note 8 – Revolving Credit Facilities). The New Notes accrue interest from February 26, 2026 at a rate of 5.875% per year. Interest on the New Notes is payable semi-annually in arrears on March 1 and September 1 of each year, beginning September 1, 2026.
During the three months ended March 31, 2026, CNX purchased and retired $500,000 of its outstanding 6.00% Senior Notes due January 2029. As part of the transaction, a loss of $12,009 was included in Loss on Debt Extinguishment in the Consolidated Statements of Income during the three months ended March 31, 2026.
On December 15, 2025, CNX entered into a privately negotiated exchange agreement (the “exchange agreement”) with a limited number of holders of its 2.25% Convertible Notes due May 2026 ("Convertible Notes") to exchange approximately $122,098 principal amount of Convertible Notes conversion right exercises by issuing an aggregate 9,509,188 shares of CNX common stock to the converting holders representing an average conversion price of $12.84 per share. The shares of CNX common stock issued in the transaction were issued pursuant to the exemption from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), afforded by Section 4(a)(2) of the Securities Act in transactions not involving any public offering. The exchange agreement also included additional cash consideration of approximately $855, including accrued interest. As part of the transaction, a loss of $842 was included in Loss on Debt Extinguishment in the Consolidated Statements of Income during the year ended December 31, 2025. During the three months ended March 31, 2026, a nominal amount of Convertible Notes were exchanged for CNX common stock.
During the three months ended March 31, 2025, CNX issued $200,000 aggregate principal amount of additional 7.25% Senior Notes due March 2032 (the "Notes") at a price of 100.5% of par, plus accrued interest from September 1, 2024 to the date of closing less an underwriter discount and other issuance costs of $1,500. The Notes were issued as additional notes under that certain indenture, dated February 23, 2024 (the "Indenture"), pursuant to which CNX previously issued $400,000 aggregate principal amount of 7.25% Senior Notes due 2032 (the "Initial Notes"). The Notes are guaranteed by all of CNX's restricted subsidiaries that guarantee the CNX Credit Facility (see Note 8 – Revolving Credit Facilities) and will have identical terms as the Initial Notes, other than the issue date, the initial offering price and the first interest payment date, and the Notes and the Initial Notes will be treated as a single class of securities under the Indenture and will vote together as a single class.
In 2020, CNX issued $345,000 in aggregate principal amount of the Convertible Notes in a private offering to qualified institutional buyers pursuant to Rule 144A under the Securities Act of 1933, including $45,000 aggregate principal amount of Convertible Notes issued pursuant to the exercise in full of the initial purchasers’ option to purchase additional Convertible Notes. The Convertible Notes are senior, unsecured obligations of the Company. The Convertible Notes bear interest at a fixed
rate of 2.25% per annum, payable semi-annually in arrears on May 1 and November 1 of each year, commencing on November 1, 2020. Proceeds from the issuance of the Convertible Notes totaled $334,650, net of initial purchaser discounts and issuance costs. The Convertible Notes are guaranteed by most of CNX's subsidiaries but does not include CNXM (or its subsidiaries or general partner). In addition to the December 15, 2025 exchange discussed above, CNX had previously purchased approximately $14,346 of its outstanding Convertible Notes during the year ended December 31, 2022.
The initial conversion rate is 77.8816 shares of CNX's common stock per $1,000 principal amount of Convertible Notes, which represents an initial conversion price of approximately $12.84 per share, subject to adjustment upon the occurrence of specified events.
The Convertible Notes will mature on May 1, 2026, unless earlier repurchased, redeemed or converted. Upon conversion, the Company may satisfy its conversion obligation by paying and/or delivering, as the case may be, cash, shares of the Company’s common stock or a combination of cash and shares of the Company’s common stock, at the Company’s election, in the manner and subject to the terms and conditions provided in the indenture governing the Convertible Notes. The conversion rate is subject to adjustment under certain circumstances in accordance with the terms of the indenture governing the Convertible Notes.
On January 28, 2026, in accordance with the indenture governing the Convertible Notes, CNX issued a notice of settlement method election for all of the outstanding Convertible Notes providing that CNX would settle any of the Convertible Notes outstanding by issuing shares of the company's common stock, together, if applicable, with cash in lieu of fractional shares, as provided for in the indenture. From and after February 1, 2026, note holders may convert their Convertible Notes at any time at their election until the close of business on the second scheduled trading day immediately before the maturity date.
Before February 1, 2026, noteholders had the right to convert their Convertible Notes only upon the occurrence of the following events:
•during any calendar quarter (and only during such calendar quarter) commencing after June 30, 2020, if the Last Reported Sale Price per share of Common Stock exceeds one hundred and thirty percent (130%) of the Conversion Price for each of at least twenty (20) Trading Days (whether or not consecutive) during the thirty (30) consecutive Trading Days ending on, and including, the last Trading Day of the immediately preceding calendar quarter;
•during the five (5) consecutive Business Days immediately after any ten (10) consecutive trading day period (such ten (10) consecutive Trading Day period, the "Measurement Period") if the trading Price per $1,000 principal amount of Notes, as determined following a request by a Holder in accordance with the procedures set forth in the indenture, for each trading day of the Measurement Period was less than ninety eight percent (98%) of the product of the last reported sale price per share of common stock on such trading day and the conversion rate on such trading day;
•if CNX calls any or all of the Convertible Notes for redemption, at any time prior to the close of business on the scheduled trading day immediately preceding the redemption date; or
•upon the occurrence of certain specified corporate events as set forth in the indenture governing the Convertible Notes.
If certain corporate events that constituted a “Fundamental Change” (as defined in the indenture governing the Convertible Notes) had occurred, the noteholders may have been required by the Company to repurchase their Convertible Notes at a cash repurchase price equal to the principal amount of the Notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the fundamental change repurchase date. The definition of Fundamental Change included certain business combination transactions involving the Company and certain de-listing events with respect to the Company’s common stock.
The reported interest expense for the Convertible Notes is equal to the 2.25% cash coupon rate. Also, the Company uses the if-converted method for the assumed conversion of the Convertible Notes when calculating diluted earnings per share.
In accounting for the debt issuance costs of $10,350, the Company allocated the total amount incurred to the liability and equity components using the same proportions as the proceeds of the Convertible Notes. Issuance costs attributable to the liability component were $7,024 and were being amortized to interest expense using the effective interest method over the contractual term of the Convertible Notes. Issuance costs attributable to the equity component were $3,326 and were netted with the equity component in Capital in Excess of Par Value in the Consolidated Statement of Stockholders Equity.
The net carrying amount of the liability and equity components of the Convertible Notes was as follows:
| | | | | | | | | | | |
| March 31,
2026 | | December 31,
2025 |
| Liability Component: | | | |
| Principal | $ | 208,553 | | | $ | 208,556 | |
| | | |
| Unamortized Issuance Costs | (106) | | | (425) | |
| Net Carrying Amount | $ | 208,447 | | | $ | 208,131 | |
| | | |
| Fair Value | $ | 626,566 | | | $ | 596,798 | |
| Fair Value Hierarchy | Level 2 | | Level 2 |
| | | |
| | | |
Interest expense related to the Convertible Notes is as follows:
| | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, |
| | | | | 2026 | | 2025 |
| Contractual Interest Expense | | | | | $ | 1,173 | | | $ | 1,860 | |
| | | | | | | |
| Amortization of Issuance Costs | | | | | 318 | | | 491 | |
| Total Interest Expense | | | | | $ | 1,491 | | | $ | 2,351 | |
In connection with the offering of the Convertible Notes, the Company entered into privately negotiated Capped Call Transactions with certain counterparties. The Capped Calls each have an initial strike price of $12.84 per share, subject to certain adjustments, which correspond to the initial conversion price of the Convertible Notes. The Capped Calls have an initial cap price of $18.19 per share, subject to certain adjustments. The Capped Calls cover, subject to anti-dilution adjustments, the aggregate number of shares of the Company’s common stock that initially underlie the Convertible Notes, and are expected generally to reduce potential dilution to the Company’s common stock upon any conversion of Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap, based on the cap price of the Capped Call Transactions. The conditions that cause adjustments to the initial strike price of the Capped Calls mirror the conditions that result in corresponding adjustments for the Convertible Notes. For accounting purposes, the Capped Calls are separate transactions, and not part of the terms of the Convertible Notes. As these transactions meet certain accounting criteria, the Capped Calls are recorded in stockholders’ equity and are not accounted for as derivatives. The cost of $35,673 incurred in connection with the Capped Calls was recorded as a reduction to Capital in Excess of Par Value.
NOTE 11—COMMITMENTS AND CONTINGENT LIABILITIES:
CNX and its subsidiaries are subject to various lawsuits and claims with respect to such matters as personal injury, royalty accounting, damage to property, climate change, governmental regulations including environmental violations and remediation, employment and contract disputes and other claims and actions arising out of the normal course of business. CNX accrues the estimated loss for these lawsuits and claims when the loss is probable and can be estimated. The Company's current estimated accruals related to these pending claims, individually and in the aggregate, are immaterial to the financial position, results of operations or cash flows of CNX. It is possible that the aggregate loss in the future with respect to these lawsuits and claims could ultimately be material to the financial position, results of operations or cash flows of CNX; however, such amounts cannot be reasonably estimated.
The 1992 Coal Industry Retiree Health Benefit Act ("Coal Act"), in Section 9711, requires coal companies that were providing health benefits to United Mine Workers of America ("UMWA") retirees as of February 1993 to continue providing health benefits to such individuals, in substantially the same coverages, for as long as the last signatory operator remains in business. Section 9711 also requires any "related person" to be joint and severally liable for the provision of these health benefits. On May 1, 2020, the court in the Murray Energy Corporation ("Murray") bankruptcy proceedings approved a settlement agreement between Murray and the UMWA that transferred to the UMWA 1992 Benefit Plan the Coal Act liabilities for retirees in Murray’s Section 9711 plan. The retirees transferred by Murray to the 1992 Benefit Plan include approximately 2,159 retirees allegedly traced to the December 2013 sale by Core Natural Resources, Inc., the successor by merger to CONSOL Energy (“Core”) to Murray Energy of the following possible last signatory operators: Consolidation Coal Company, McElroy Coal Company, Southern Ohio Coal Company, Central Ohio Coal Company, Keystone Coal Mining Corp., and Eighty-Four Mining Company (the "Sold Subsidiaries"). On May 2, 2020, the Trustees of the UMWA 1992 Benefit Plan sued CNX and Core in federal court contending that the Sold Subsidiaries were last signatory operators and that CNX and Core are related persons to the Sold Subsidiaries and, as such, CNX and Core are jointly and severally liable for the Coal Act health
benefits allegedly owed to the eligible retirees traced to the Sold Subsidiaries. The 1992 Benefit Plan seeks, among other relief, a declaration that CNX and Core are obligated to enroll the eligible retirees attributed to the Sold Subsidiaries in a Section 9711 plan; that CNX and Core are liable to post the security required by Section 9712; and, that CNX and Core are liable to pay per beneficiary premiums until the eligible retirees are enrolled in a Section 9711 plan, and other fees, costs and disbursements under the Coal Act. On March 29, 2022, the Court denied the Defendants’ Motions to Dismiss CNX and Core are now defending this action on the merits. Further, under the Separation and Distribution Agreement ("SDA") that was entered into at the time CNX spun-out its coal business in 2017, Core agreed to indemnify CNX for all coal-related liabilities, including this lawsuit. With respect to this matter, although a loss is possible, it is not probable, and accordingly no accrual has been recognized.
On July 22, 2021, CNX received a letter from the UMWA 1974 Pension Plan ("1974 Plan") requesting information related to the facts and circumstances surrounding the 2013 sale of certain of its coal subsidiaries to Murray Energy. The letter indicated that litigation related to potential withdrawal liabilities from the plan created by the 2019 bankruptcy of Murray Energy was reasonably foreseeable and at that time, no liability had been assessed. The 1974 Plan never issued an assessment to CNX. Following a period of discovery, CNX and the 1974 Plan mediated the claim in February 2024. By agreement dated March 4, 2024, CNX settled the 1974 Plan claim for $75,000 which is payable over five-years with the initial payment made at the end of March 2024. Under the SDA, Core became successor-in-interest to the “Coal Business” and accepted and agreed to assume and be responsible for all “Coal Liabilities.” The assumed “Coal Liabilities” are defined broadly in the SDA and specifically include claims, like the 1974 Plan claim, arising under ERISA; involving contributions or other obligations pursuant to any Benefits Plan; and any withdraw liabilities. Core also unequivocally agreed to defend and indemnify CNX for all liabilities relating to, arising out of or resulting from any “Coal Liabilities.” CNX timely tendered the 1974 Plan claim to Core for defense and indemnity in July 2021, which it denied. CNX continued to demand indemnity from Core including prior to, during and after the March 2024 mediation. After Core repudiated its contractual obligations to CNX, and after having timely fulfilled all SDA prerequisites for bringing the action, on March 7, 2024, CNX sued Core for breach of contract seeking an order requiring Core to indemnify CNX for the 1974 Plan claim settlement. On November 8, 2024, the court granted CNX’s Motion for Partial Summary Judgment (the “Summary Judgment Grant”), finding that Core is obligated to indemnify CNX for its settlement of the 1974 Plan claim and to reimburse CNX for its attorney’s fees and costs to defend and resolve the underlying 1974 Plan claim. As of March 31, 2026 and December 31, 2025, Core has reimbursed CNX for all settlement payments made to the 1974 Plan, plus interest. The present value of the $75,000 settlement, less payments made, is recognized in Other Liabilities in the Consolidated Balance Sheets as of March 31, 2026, with the current portion recognized in Other Accrued Liabilities. A corresponding receivable, less payments received, is recognized in Other Non-Current assets in the Consolidated Balance Sheets as of March 31, 2026, with the current portion recognized in Other Receivables, net. These balances may be adjusted from time to time, as appropriate, to reflect changes in circumstances.
At March 31, 2026, CNX has provided the following financial guarantees, unconditional purchase obligations, and letters of credit to certain third parties as described by major category in the following tables. These amounts represent the maximum potential of total future payments that the Company could be required to make under these instruments. These amounts have not been reduced for potential recoveries under recourse or collateralization provisions. Generally, recoveries under reclamation bonds would be limited to the extent of the work performed at the time of the default. No amounts related to these unconditional purchase obligations and letters of credit are recorded as liabilities in the financial statements. CNX management believes that the commitments in the following table will expire without being funded, and therefore will not have a material adverse effect on CNX's financial condition.
Certain guarantees and indemnifications do not have a stated expiration date and therefore are presented in the ‘Indefinite’ column. These amounts represent the maximum potential future payments under such arrangements and are not indicative of the expected timing of any payments.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Amount of Commitment Expiration Per Period |
| | Total
Amounts
Committed | | Less Than
1 Year | | 1-3 Years | | 3-5 Years | | Beyond
5 Years | | Indefinite |
| Letters of Credit: | | | | | | | | | | | |
| Firm Transportation | $ | 25,077 | | | $ | 25,077 | | | $ | — | | | $ | — | | | $ | — | | | $ | — | |
| | | | | | | | | | | |
| Other | 2,920 | | | 2,920 | | | — | | | — | | | — | | | — | |
| Total Letters of Credit | 27,997 | | | 27,997 | | | — | | | — | | | — | | | — | |
| Surety Bonds: | | | | | | | | | | | |
| Employee-Related | 2,250 | | | 2,250 | | | — | | | — | | | — | | | — | |
| Environmental | 47,947 | | | 47,947 | | | — | | | — | | | — | | | — | |
| Firm Transportation | 129,336 | | | 129,336 | | | — | | | — | | | — | | | — | |
| Financial Guarantees | 90,162 | | | 90,162 | | | — | | | — | | | — | | | — | |
| Other | 12,873 | | | 12,873 | | | — | | | — | | | — | | | — | |
| Total Surety Bonds | 282,568 | | | 282,568 | | | — | | | — | | | — | | | — | |
| Other Guarantees | 25,211 | | | 10,707 | | | 6,414 | | | 590 | | | — | | | 7,500 | |
| Total Commitments | $ | 335,776 | | | $ | 321,272 | | | $ | 6,414 | | | $ | 590 | | | $ | — | | | $ | 7,500 | |
Excluded from the above table are commitments and guarantees entered into in conjunction with the spin-off of the Company's coal business in November 2017. Although Core has agreed to indemnify CNX to the extent that CNX would be called upon to pay any of these liabilities, there is no assurance that Core will satisfy its obligations to indemnify CNX in the event that CNX is so called upon (See Part II. Item 1A. Risk Factors of this Form 10-Q and in the 2025 Form 10-K for additional information).
CNX enters into long-term unconditional purchase obligations to procure major equipment purchases, natural gas firm transportation, gas drilling services and other operating goods and services. These purchase obligations are not recorded in the Consolidated Balance Sheets. As of March 31, 2026, the purchase obligations for each of the next five years and beyond are as follows:
| | | | | |
| Obligations Due | Amount |
| Less than 1 year | $ | 267,705 | |
| 1 - 3 years | 444,913 | |
| 3 - 5 years | 253,066 | |
| More than 5 years | 427,298 | |
| Total Purchase Obligations | $ | 1,392,982 | |
NOTE 12—DERIVATIVE INSTRUMENTS:
CNX may enter into interest rate swap agreements to manage its exposure to interest rate volatility. These swaps change the variable-rate cash flow exposure on the debt obligations to fixed cash flows. The change in fair value of the interest rate swap agreements is accounted for on a mark-to-market basis with the changes in fair value recorded in current period earnings. There were no interest rate swap agreements entered into as of March 31, 2026.
CNX enters into financial derivative instruments (over-the-counter swaps) to manage its exposure to natural gas and NGL price fluctuations. Commodity hedges are accounted for on a mark-to-market basis with changes in fair value recorded in current period earnings.
CNX is exposed to credit risk in the event of non-performance by counterparties. The creditworthiness of counterparties is subject to continuing review. The Company has not experienced any issues of non-performance by derivative counterparties.
None of the Company's counterparty master agreements currently require CNX to post collateral for any of its positions. However, as stated in the applicable counterparty master agreements, if CNX's obligations with one of its counterparties cease to be secured on the same basis as similar obligations with the other lenders under the CNX Credit Facility, CNX would have to post collateral for instruments in a liability position in excess of defined thresholds. All of the Company's derivative instruments are subject to master netting arrangements with our counterparties. CNX recognizes all financial derivative instruments as either assets or liabilities at fair value in the Consolidated Balance Sheets on a gross basis.
Each of the Company's counterparty master agreements allows, in the event of default, the ability to elect early termination of outstanding contracts. If early termination is elected, CNX and the applicable counterparty would net settle all open hedge positions.
The total notional amounts of CNX's derivative instruments were as follows:
| | | | | | | | | | | | | | | | | |
| March 31, | | December 31, | | Forecasted to |
| 2026 | | 2025 | | Settle Through |
| Natural Gas Commodity Swaps (Bcf) | 867.1 | | | 929.8 | | | 2028 |
| Natural Gas Basis Swaps (Bcf) | 557.3 | | | 585.5 | | | 2029 |
| NGL Commodity Swaps (Mbbls) | 1,423.5 | | 180.0 | | 2027 |
| | | | | |
The gross fair value of CNX's derivative instruments was as follows:
| | | | | | | | | | | |
| March 31, | | December 31, |
| 2026 | | 2025 |
| Current Assets: | | | |
| Commodity Derivative Instruments: | | | |
| Natural Gas Commodity Swaps | $ | 138,896 | | | $ | 74,064 | |
| NGL Commodity Swaps | 1,062 | | | 1,730 | |
| Natural Gas Basis Swaps | 24,614 | | | 30,274 | |
| | | |
| Total Current Assets | $ | 164,572 | | | $ | 106,068 | |
| | | |
| Other Non-Current Assets: | | | |
| Commodity Derivative Instruments: | | | |
| Natural Gas Commodity Swaps | $ | 163,113 | | | $ | 117,524 | |
| Natural Gas Basis Swaps | 21,148 | | | 16,872 | |
| | | |
| Total Other Non-Current Assets | $ | 184,261 | | | $ | 134,396 | |
| | | |
| Current Liabilities: | | | |
| Commodity Derivative Instruments: | | | |
| Natural Gas Commodity Swaps | $ | 190,069 | | | $ | 323,169 | |
| NGL Commodity Swaps | 3,279 | | | — | |
| Natural Gas Basis Swaps | 50,973 | | | 54,776 | |
| | | |
| Total Current Liabilities | $ | 244,321 | | | $ | 377,945 | |
| | | |
| Non-Current Liabilities: | | | |
| Commodity Derivative Instruments: | | | |
| Natural Gas Commodity Swaps | $ | 66,047 | | | $ | 101,387 | |
| Natural Gas Basis Swaps | 41,897 | | | 56,981 | |
| | | |
| Total Non-Current Liabilities | $ | 107,944 | | | $ | 158,368 | |
The effect of commodity derivative instruments on the Company's Consolidated Statements of Income was as follows: | | | | | | | | | | | | | | | | | | | | | |
| | | | For the Three Months Ended | |
| | | | March 31, | |
| | | | | | 2026 | | 2025 | |
| Realized (Loss) Gain on Commodity Derivative Instruments: | | | | | | | | | |
| Natural Gas Commodity Swaps | | | | | | $ | (196,693) | | | $ | (83,477) | | |
| Natural Gas Basis Swaps | | | | | | (25,650) | | | (24,846) | | |
| NGL Commodity Swaps | | | | | | 743 | | | (1,364) | | |
| Total Realized Loss on Commodity Derivative Instruments | | | | | | (221,600) | | * | (109,687) | | ** |
| | | | | | | | | |
| Unrealized Gain (Loss) on Commodity Derivative Instruments: | | | | | | | | | |
| Natural Gas Commodity Swaps | | | | | | 209,606 | | | (504,143) | | |
| Natural Gas Basis Swaps | | | | | | 19,536 | | | 85,994 | | |
| NGL Commodity Swaps | | | | | | (3,561) | | | (384) | | |
| Total Unrealized Gain (Loss) on Commodity Derivative Instruments | | | | | | 225,581 | | | (418,533) | | |
| | | | | | | | | |
| Gain (Loss) on Commodity Derivative Instruments: | | | | | | | | | |
| Natural Gas Commodity Swaps | | | | | | 12,913 | | | (587,620) | | |
| Natural Gas Basis Swaps | | | | | | (6,114) | | | 61,148 | | |
| NGL Commodity Swaps | | | | | | (2,818) | | | (1,748) | | |
| Total Gain (Loss) on Commodity Derivative Instruments | | | | | | $ | 3,981 | | | $ | (528,220) | | |
*Includes $14,470 of commodity derivatives that have been settled but not received and $6,021 settled but not paid at March 31, 2026, and excludes $58,387 that were settled but not paid at December 31, 2025.
**Includes $42,305 of commodity derivatives that have been settled but not paid at March 31, 2025, and excludes $2,309 of commodity derivatives that were settled but not received and $23,212 that were settled but not paid at December 31, 2024.
The Company also enters into fixed price natural gas sales agreements that are satisfied by physical delivery. These physical commodity contracts qualify for the normal purchases and normal sales exception and are not subject to derivative instrument accounting.
NOTE 13—FAIR VALUE OF FINANCIAL INSTRUMENTS:
CNX determines the fair value of assets and liabilities based on the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. The fair values are based on assumptions that market participants would use when pricing an asset or liability, including assumptions about risk and the risks inherent in valuation techniques and the inputs to valuations. The fair value hierarchy is based on whether the inputs to valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources (including NYMEX forward curves, LIBOR and SOFR-based discount rates and basis forward curves), while unobservable inputs reflect the Company's own assumptions of what market participants would use.
The fair value hierarchy includes three levels of inputs that may be used to measure fair value as described below:
Level 1 - Quoted prices for identical instruments in active markets.
Level 2 - The fair value of the assets and liabilities included in Level 2 are based on standard industry income approach models that use significant observable inputs, including NYMEX forward curves, LIBOR and SOFR-based discount rates and basis forward curves.
Level 3 - Unobservable inputs significant to the fair value measurement supported by little or no market activity.
In those cases when the inputs used to measure fair value meet the definition of more than one level of the fair value hierarchy, the lowest level input that is significant to the fair value measurement in its totality determines the applicable level in the fair value hierarchy.
The financial instrument measured at fair value on a recurring basis is summarized below: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Fair Value Measurements at March 31, 2026 | | Fair Value Measurements at December 31, 2025 |
| Description | Level 1 | | Level 2 | | Level 3 | | Level 1 | | Level 2 | | Level 3 |
| Commodity Derivatives | $ | — | | | $ | (3,432) | | * | $ | — | | | $ | — | | | $ | (295,849) | | ** | $ | — | |
| | | | | | | | | | | |
| | | | | | | | | | | |
*Includes $14,470 of commodity derivatives that have been settled but not received and $6,021 settled but not paid at March 31, 2026.
**Includes $58,387 of commodity derivatives that have been settled but not paid at December 31, 2025.
The carrying amounts and fair values of financial instruments for which the fair value option was not elected are as follows:
| | | | | | | | | | | | | | | | | | | | | | | |
| | March 31, 2026 | | December 31, 2025 |
| | Carrying
Amount | | Fair
Value | | Carrying
Amount | | Fair
Value |
| Cash and Cash Equivalents | $ | 3,748 | | | $ | 3,748 | | | $ | 779 | | | $ | 779 | |
| Restricted Cash* | $ | 2,428 | | | $ | 2,428 | | | $ | 12,685 | | | $ | 12,685 | |
| | | | | | | |
| Long-Term Debt (Excluding Debt Issuance Costs) | $ | 2,378,828 | | | $ | 2,797,006 | | | $ | 2,429,421 | | | $ | 2,850,144 | |
*The March 31, 2026 and December 31, 2025 restricted cash balance are located in current assets in the Consolidated Balance Sheets.
Cash and cash equivalents and restricted cash represent highly-liquid instruments and constitute Level 1 fair value measurements. Certain of the Company’s debt is actively traded on a public market and, as a result, constitute Level 1 fair value measurements. The portion of the Company’s debt obligations that is not actively traded is valued through reference to the applicable underlying benchmark rate and, as a result, constitute Level 2 fair value measurements.
NOTE 14—SEGMENT INFORMATION:
The Company reports segment information based on the “management” approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Company’s reportable segments.
Operating segments are components of an enterprise for which discrete financial information is available and regularly evaluated by the Chief Operating Decision Maker ("CODM") for resource allocation and performance assessment. The Company's CODM is its Chief Executive Officer. The Company’s segment structure reflects the financial information and reports used by the CODM to make decisions regarding the Company’s business, including resource allocations and performance assessments, as well as the current operating focus.
CNX's principal activity is to produce pipeline quality natural gas for sale primarily to gas wholesalers, and the Company has two reportable segments that conduct those operations: Shale and Coalbed Methane. The Other Segment includes nominal shallow oil and gas production which is not significant to the Company. It also includes the Company's purchased gas activities, unrealized gain or loss on commodity derivative instruments, exploration and production related other costs, sales of environmental attributes, as well as various other expenses that are managed outside the reportable segments as discussed below.
The CODM evaluates the performance of the Company’s reportable segments using Income (Loss) Before Income Tax to assess segment performance primarily by comparing it across segments for the current period as well as for prior periods. Income (Loss) Before Income Tax for each segment is based on revenue less identifiable operating and non-operating expenses. Certain expenses are managed outside the reportable segments and therefore are not allocated. These expenses include, but are not limited to, interest expense, other operating expense, and other corporate expenses such as selling, general and administrative costs.
Reportable segment results for the three months ended March 31, 2026 are:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, 2026 | | | | | | | | | |
| | | Shale | | Coalbed Methane | | Other | | Consolidated | | | | | | | | | |
| Natural Gas, NGLs and Oil Revenue | | | $ | 662,900 | | | $ | 58,761 | | | $ | 383 | | | $ | 722,044 | | | | | | | | | | (A) |
| (Loss) Gain on Commodity Derivative Instruments | | | (208,340) | | | (13,197) | | | 225,518 | | | 3,981 | | | | | | | | | | |
| Purchased Gas Revenue | | | — | | | — | | | 12,687 | | | 12,687 | | | | | | | | | | |
| Other Revenue and Operating Income | | | 16,369 | | | — | | | 31,573 | | | 47,942 | | | | | | | | | | (B) |
| Total Revenue and Other Operating Income | | | $ | 470,929 | | | $ | 45,564 | | | $ | 270,161 | | | $ | 786,654 | | | | | | | | | | |
| Lease Operating Expense | | | 15,542 | | | 6,026 | | | 202 | | | 21,770 | | | | | | | | | | |
| Transportation, Gathering and Compression | | | 86,776 | | | 15,995 | | | (370) | | | 102,401 | | | | | | | | | | |
| Production, Ad Valorem, and Other Fees | | | 6,564 | | | 2,212 | | | 13 | | | 8,789 | | | | | | | | | | |
| Depreciation, Depletion and Amortization | | | 112,964 | | | 14,416 | | | 7,233 | | | 134,613 | | | | | | | | | | |
| Interest Expense | | | — | | | — | | | 40,470 | | | 40,470 | | | | | | | | | | |
| Other Segment Items | | | — | | | — | | | 50,206 | | | 50,206 | | | | | | | | | | |
| Total Costs and Expenses | | | $ | 221,846 | | | $ | 38,649 | | | $ | 97,754 | | | $ | 358,249 | | | | | | | | | | |
| Income Before Income Tax | | | $ | 249,083 | | | $ | 6,915 | | | $ | 172,407 | | | $ | 428,405 | | | | | | | | | | |
(A) Included in Natural Gas, NGLs and Oil Revenue are sales of $156,014 to NRG Business Marketing LLC and $83,346 to DTE Energy Trading, Inc., each of which comprises over 10% of revenue from contracts with external customers for the period. |
(B) Includes midstream revenue of $16,369 and equity in loss of unconsolidated affiliates of $463 for Shale and Other, respectively. Other also includes sales of environmental attributes of $14,940. |
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| | | For the Three Months Ended March 31, 2026 | | | | | | | | | |
| Other Segment Disclosures | | | Shale | | Coalbed Methane | | Other | | Consolidated | | | | | | | | | |
| Segment Assets | | | $ | 7,268,317 | | | $ | 894,991 | | | $ | 967,875 | | | $ | 9,131,183 | | | | | | | | | | (C) |
| Capital Expenditures | | | $ | 163,420 | | | $ | 5,400 | | | $ | 1,086 | | | $ | 169,906 | | | | | | | | | | |
(C) Includes investments in unconsolidated equity affiliates of $5,810. |
Reportable segment results for the three months ended March 31, 2025 are:
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, 2025 | | | | | | | | | |
| | | Shale | | Coalbed Methane | | Other | | Consolidated | | | | | | | | | |
| Natural Gas, NGLs and Oil Revenue | | | $ | 507,555 | | | $ | 43,278 | | | $ | 261 | | | $ | 551,094 | | | | | | | | | | (D) |
| Loss on Commodity Derivative Instruments | | | (102,700) | | | (6,953) | | | (418,567) | | | (528,220) | | | | | | | | | | |
| Purchased Gas Revenue | | | — | | | — | | | 11,550 | | | 11,550 | | | | | | | | | | |
| Other Revenue and Operating Income | | | 16,838 | | | — | | | 31,126 | | | 47,964 | | | | | | | | | | (E) |
| Total Revenue and Other Operating Income (Loss) | | | $ | 421,693 | | | $ | 36,325 | | | $ | (375,630) | | | $ | 82,388 | | | | | | | | | | |
| Lease Operating Expense | | | 17,219 | | | 5,969 | | | 145 | | | 23,333 | | | | | | | | | | |
| Transportation, Gathering and Compression | | | 78,050 | | | 16,783 | | | 326 | | | 95,159 | | | | | | | | | | |
| Production, Ad Valorem, and Other Fees | | | 5,500 | | | 1,766 | | | 7 | | | 7,273 | | | | | | | | | | |
| Depreciation, Depletion and Amortization | | | 106,360 | | | 13,812 | | | 6,890 | | | 127,062 | | | | | | | | | | |
| Interest Expense | | | — | | | — | | | 41,612 | | | 41,612 | | | | | | | | | | |
| Other Segment Items | | | — | | | — | | | 60,748 | | | 60,748 | | | | | | | | | | |
| Total Costs and Expenses | | | $ | 207,129 | | | $ | 38,330 | | | $ | 109,728 | | | $ | 355,187 | | | | | | | | | | |
| Income (Loss) Before Income Tax | | | $ | 214,564 | | | $ | (2,005) | | | $ | (485,358) | | | $ | (272,799) | | | | | | | | | | |
(D) Included in Natural Gas, NGLs and Oil Revenue are sales of $64,800 to Citadel Energy Marketing LLC, which comprises over 10% of revenue from contracts with external customers for the period. |
(E) Includes midstream revenue of $16,838 and equity in loss of unconsolidated affiliates of $58 for Shale and Other, respectively. Other also includes sales of environmental attributes of $22,886. |
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| | | For the Three Months Ended March 31, 2025 | | | | | | | | | |
| Other Segment Disclosures | | | Shale | | Coalbed Methane | | Other | | Consolidated | | | | | | | | | |
| Segment Assets | | | $ | 7,190,127 | | | $ | 909,369 | | | $ | 947,213 | | | $ | 9,046,709 | | | | | | | | | | (F) |
| Capital Expenditures | | | $ | 127,679 | | | $ | 2,743 | | | $ | 1,043 | | | $ | 131,465 | | | | | | | | | | |
(F) Includes investments in unconsolidated equity affiliates of $18,323. |
Reconciliation of Segment Information to Consolidated Amounts:
Revenue and Other Operating Income: | | | | | | | | | | | | | | | |
| | | For the Three Months Ended March 31, |
| | | | 2026 | | 2025 |
| Total Segment Revenue from Contracts with External Customers | | | | | $ | 751,100 | | | $ | 579,482 | |
| Gain (Loss) on Commodity Derivative Instruments | | | | | 3,981 | | | (528,220) | |
| Other Operating Income | | | | | 31,573 | | | 31,126 | |
| Total Consolidated Revenue and Other Operating Income | | | | | $ | 786,654 | | | $ | 82,388 | |
NOTE 15—STOCK REPURCHASE:
The Company’s stock repurchase program was initially announced on September 5, 2017, pursuant to authorization from the Company’s Board of Directors. The Board has periodically increased the authorized dollar amount under the program since its inception. On January 29, 2026, the Company announced that its Board of Directors approved a $2,000,000 increase to the Company's existing stock repurchase program, increasing total authorized repurchases to $4,900,000. As of March 31, 2026, $2,373,989 remained available for repurchases under the program and it is not subject to a termination or expiration date. The repurchases may be effected from time-to-time through open market purchases, privately negotiated transactions, Rule 10b5-1 plans, accelerated stock repurchases, block trades, derivative contracts or otherwise in compliance with Rule 10b-18. The timing of any repurchases will be based on a number of factors, including available liquidity, the Company's stock price, the Company's financial outlook, and alternative investment options. The stock repurchase program does not obligate the Company to repurchase any dollar amount or number of shares and the Board may modify, suspend, or discontinue its authorization of the program at any time. The Board of Directors will continue to evaluate the size of the stock repurchase program based on CNX's free cash flow position, leverage ratio, and capital plans.
During the three months ended March 31, 2026, 1,446,013 shares were repurchased and retired at an average price of $37.36 per share for a total cost of $50,633. During the three months ended March 31, 2025, 4,186,185 shares were repurchased and retired at an average price of $29.88 per share for a total cost of $126,161. The one-percent excise tax under the Inflation Reduction Act of 2022 is included in total costs for both periods.
NOTE 16—SUPPLEMENTAL CASH FLOW INFORMATION:
The following are non-cash transactions that impact the investing and financing activities of CNX.
As of March 31, 2026 and December 31, 2025, CNX purchased goods and services related to capital projects in the amount of $38,997 and $59,814, respectively, which are included in accounts payable.
The following table shows cash paid:
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| For the Three Months Ended March 31, |
| 2026 | | 2025 |
| Interest | $ | 63,384 | | | $ | 53,325 | |
| Income Taxes | $ | 1,100 | | | $ | 1,700 | |
NOTE 17—RECENT ACCOUNTING PRONOUNCEMENTS:
In November 2024, the FASB issued ASU 2024-03 - Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40). This ASU requires entities to disaggregate any relevant expense caption presented on the face of the income statement within continuing operations into the following required natural expense categories within the footnotes, as applicable: (1) purchases of inventory, (2) employee compensation, (3) depreciation, (4) intangible asset amortization, and (5) DD&A recognized as part of oil- and gas-producing activities or other depletion expenses. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted. The Company is still evaluating the impact of the adoption of this ASU.