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Alexander Energy Ltd. Announces 2013 Third Quarter Results
CALGARY, ALBERTA--(Marketwired - Nov. 14, 2013) - Alexander Energy Ltd. ("Alexander" or the "Company") (TSX VENTURE:ALX) has filed its Unaudited Condensed Interim Financial Statements and related Management's Discussion and Analysis for the three and nine months ended September 30, 2013 all of which are available on the Company's profile at www.SEDAR.com ("SEDAR").
Operations
In Q3 2013 the Company produced an average of 805 boe/d, comprised of 495 bbl/d of oil and 1,857 mcf/d of natural gas. This represents a 4% reduction in overall corporate production but a 7% increase in average oil volumes compared to Q2 2013. The overall oil weighting increased from 55% in Q2 to 61% in Q3 2013.
The new Management's corporate initiatives have resulted in dropping overall unit operating costs by 18% (from $14.90/boe to $12.16/boe inclusive of transportation) compared to the previous quarter. Also, overall general and administrative unit costs were reduced by 46% (from $5.83/boe to $3.12/boe) compared to the previous quarter. These measures, along with strong oil pricing, helped to increase the Q3 2013 cash flow net back by 33% to $32.34/boe giving an operating margin of 52% based on realized pricing of $62.27/boe.
Financial
In Q3 the Company focused on reducing general and administrative expenses and field operating expenses while optimizing existing production volumes. Cash flow from operations in Q3 2013 increased to $2.4 million on revenues of $4.6 million as compared to cash flow of $1.8 million on revenues of $4.1 million in Q2 2013. Basic cash flow per share for the period was $0.035/share or $0.14/share annualized.
On September 13, 2013 the Company completed a private placement of 8,666,667 common shares at a price of $0.15/share for net proceeds of $1,272,000.
In the three months ended September 30, 2013 net debt decreased by 28% to $8.4 million, down from $11.6 million at June 30, 2013. The net debt to annualized cash flow ratio decreased to 0.86:1 at September 30, 2013 down from 1.58:1 at June 30, 2013.
Corporate Update
Alexander plans to strengthen its financial and operating position by continuing the following near term corporate directives:
Continue to reduce administrative and field operating costs to direct more operating cash flow to strengthening the Company's balance sheet.
Continue to build an inventory of drilling opportunities that fit with a company of this size.
Seek mergers and acquisitions where the resulting entity benefits the current shareholders of Alexander.
Evaluate the drilling of several infill oil wells.
Financial Summary
Three months ended September 30 | ||||||||
Thousands - CDN$ | 2013 | 2012 | % Change | |||||
Oil and gas revenue | $ | 4,610 | $ | 3,305 | 39 | |||
Cash flow from operations (1) | 2,394 | 1,563 | 53 | |||||
Per share - basic and diluted (1) | 0.04 | 0.03 | 49 | |||||
Comprehensive income | 802 | 123 | 552 | |||||
Per share - basic and diluted | 0.01 | 0.00 | - | |||||
Net debt (1) | 8,385 | 11,644 | (28 | ) | ||||
Capital expenditures | $ | 418 | $ | 511 | (18 | ) | ||
Shares outstanding - end of period | 70,906,144 | 62,239,477 | 14 | |||||
Nine months ended September 30 | ||||||||
Thousands - CDN$ | 2013 | 2012 | % Change | |||||
Oil and gas revenue | $ | 12,510 | $ | 8,683 | 44 | |||
Cash flow from operations (1) | 6,041 | 3,302 | 83 | |||||
Per share - basic and diluted (1) | 0.10 | 0.05 | 81 | |||||
Comprehensive income (loss) | (49 | ) | 938 | (105 | ) | |||
Per share - basic and diluted | (0.00 | ) | 0.02 | - | ||||
Net debt (1) | 8,385 | 11,644 | (28 | ) | ||||
Capital expenditures | $ | 3,097 | $ | 2,113 | 47 | |||
Shares outstanding - end of period | 70,906,144 | 62,239,477 | 14 | |||||
(1) Non IFRS measure.
Daily Production and Commodity Prices
Three months ended September 30 | 2013 | 2012 | % Change | ||
Daily production | |||||
Oil and NGLs (bbl/d) | 495 | 437 | 13 | ||
Natural gas (mcf/d) | 1,857 | 1,646 | 13 | ||
Oil equivalent (boe/d @ 6:1) | 805 | 712 | 13 | ||
Realized commodity prices ($CDN) | |||||
Oil and NGLs (bbl) | $ | 90.99 | $ | 72.77 | 25 |
Natural gas (mcf) | $ | 2.72 | $ | 2.48 | 10 |
Oil equivalent (boe @ 6:1) | $ | 62.27 | $ | 50.46 | 23 |
Nine months ended September 30 | 2013 | 2012 | % Change | ||
Daily production | |||||
Oil and NGLs (bbl/d) | 470 | 363 | 29 | ||
Natural gas (mcf/d) | 2,267 | 2,082 | 9 | ||
Oil equivalent (boe/d @ 6:1) | 848 | 710 | 19 | ||
Realized commodity prices ($CDN) | |||||
Oil and NGLs (bbl) | $ | 80.87 | $ | 74.20 | 9 |
Natural gas (mcf) | $ | 3.45 | $ | 2.33 | 48 |
Oil equivalent (boe @ 6:1) | $ | 54.05 | $ | 44.79 | 21 |
Oil and Natural Gas Revenue by Product
Three months ended September 30 | 2013 | 2012 | % Change | ||
Thousands - CDN$ | |||||
Oil and NGL revenue | 4,145 | 2,929 | 42 | ||
Natural gas revenue | 465 | 376 | 24 | ||
Total revenue | 4,610 | 3,305 | 39 | ||
% Oil and NGLs | 90 | % | 89 | % | |
% Natural gas | 10 | % | 11 | % | |
Nine months ended September 30 | 2013 | 2012 | % Change | ||
Thousands - CDN$ | |||||
Oil and NGL revenue | 10,374 | 7,358 | 41 | ||
Natural gas revenue | 2,136 | 1,325 | 61 | ||
Total revenue | 12,510 | 8,683 | 44 | ||
% Oil and NGLs | 83 | % | 85 | % | |
% Natural gas | 17 | % | 15 | % |
Netbacks
Three months ended September 30 | 2013 | 2012 | % Change | |||
(CDN$ / boe) | (CDN$ / boe) | |||||
Operating netback | ||||||
Revenue | 62.27 | 50.46 | 23 | |||
Royalties | (11.40 | ) | (6.29 | ) | 81 | |
Operating expenses | (12.16 | ) | (11.89 | ) | 2 | |
Operating netback | 38.71 | 32.28 | 20 | |||
Realized gain (loss) on financial derivative instruments | (1.49 | ) | 0.64 | (332 | ) | |
General and administrative expenses | (3.12 | ) | (7.10 | ) | (56 | ) |
Interest expense | (1.77 | ) | (2.00 | ) | (12 | ) |
Cash flow from operations | 32.34 | 23.87 | 35 | |||
Nine months ended September 30 | 2013 | 2012 | % Change | |||
(CDN$ / boe) | (CDN$ / boe) | |||||
Operating netback | ||||||
Revenue | 54.05 | 44.79 | 21 | |||
Royalties | (8.99 | ) | (5.33 | ) | 69 | |
Operating expenses | (13.62 | ) | (12.50 | ) | 9 | |
Operating netback | 31.44 | 26.96 | 17 | |||
Realized gain (loss) on financial derivative instruments | 0.60 | (0.39 | ) | 253 | ||
General and administrative expenses | (4.20 | ) | (7.35 | ) | (43 | ) |
Interest expense | (1.74 | ) | (2.18 | ) | (20 | ) |
Cash flow from operations | 26.10 | 17.04 | 53 |
Forward-Looking Statements: All statements, other than statements of historical fact, set forth in this news release, including without limitation, assumptions and statements regarding the financial results, and future plans, operations and objectives of the Company are forward-looking statements that involve substantial known and unknown risks and uncertainties. Some of these risks and uncertainties are beyond management's control, including but not limited to, the impact of general economic conditions, industry conditions, fluctuation of commodity prices, fluctuation of foreign exchange rates, environmental risks, industry competition, availability of qualified personnel and management, availability of materials, equipment and third party services, stock market volatility, timely and cost effective access to sufficient capital from internal and external sources. The reader is cautioned that assumptions used in the preparation of such information, although considered reasonable by the Company at the time of preparation, may prove to be incorrect. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements.
These assumptions and statements necessarily involve known and unknown risks and uncertainties inherent in the oil and gas industry such as geological, technical, drilling and processing problems and other risks and uncertainties, as well as the business risks discussed in Management's Discussion and Analysis of the Company under the heading "Business Risks". The Company does not undertake any obligation, except as required by applicable securities legislation, to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise.
Barrels of oil equivalent (boe) is calculated using the conversion factor of 6 mcf (thousand cubic feet) of natural gas being equivalent to one barrel of oil. Boes may be misleading, particularly if used in isolation. A boe conversion ratio of 6 mcf:1 bbl (barrel) is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
To receive Press Releases and Corporate Updates directly via email send your email address to info@alexanderenergy.ca.
