Sign Up for FREE Daily Energy News
 
BREAKING NEWS:
WEC - Western Engineered Containment
Copper Tip Energy Services
Hazloc Heaters
WEC - Western Engineered Containment
Copper Tip Energy
Hazloc Heaters

Yangarra announces 2020 first quarter financial and operating results


CALGARY – Yangarra Resources Ltd. (“Yangarra” or the “Company“) (TSX:YGR) announces its financial and operating results for the three months ended March 31, 2020.

Annual General and Special Meeting of Shareholders

The Company’s Annual General and Special Meeting of Shareholders is scheduled for 10:00 AM on Thursday April 30, 2020.

As a precaution due to the COVID-19 pandemic, there will not be a corporate presentation at the conclusion of the meeting and the following conference call number will be utilized to allow registered shareholders to listen to the formal portion of the meeting:

Toll free (Canada/North America) dial in is 1-877-385-4099

Participant code is 2618233

The participant will dial in using the dial in number then they will enter the participant code and wait to be connected to conference call

First Quarter Highlights

  • Average production of 12,122 boe/d (47% liquids) during the quarter a 1% increase from the same period in 2019
  • Oil and gas sales were $27.4 million, a decrease of 31% from the same period in 2019
  • Funds flow from operations of $15.3 million ($0.18 per share – basic), a decrease of 45% from the same period in 2019
  • Adjusted EBITDA (which excludes changes in derivative financial instruments) was $17.1 million ($0.21 per share – basic)
  • Net income of $2.8 million ($0.03 per share – basic, $3.9 million before tax), a decrease of 76% from the same period in 2019 and represents the 13th consecutive quarter of net income
  • Operating costs were $6.67/boe (including $1.00/boe of transportation costs)
  • Field operating netbacks were $16.71/boe
  • Operating netbacks, which include the impact of commodity contracts, were $16.76/boe
  • Operating margins were 67% and funds flow from operations margins were 56%
  • G&A costs of $0.72/boe
  • Royalties were 6% of oil and gas revenue
  • All in cash costs were $11.06/boe
  • Capital expenditures (including $0.4 million on land) were $25.4 million
  • Net Debt to first quarter annualized funds flow from operations was 3.24 : 1
  • Retained earnings of $107 million
  • Corporate LMR is 11.0 with decommissioning liabilities of $16 million (discounted)
  • Yangarra drilled six wells and completed five wells in the first quarter of 2020 leaving four wells drilled and uncompleted at the end of the quarter. Yangarra elected to reduce first quarter activity as per the Company’s strategy of reducing capital spending when commodity pricing falls below internal thresholds for rates of return.

Operations Update

COVID-19 protocols remain in place and all personnel have remained on salary in both the head office and the field. Yangarra will qualify for 75% wage coverage from the federal government due to the significant reduction in revenue from 2019. The wage subsidy combined with very low G&A and operating costs has allowed the Company to avoid laying off any staff.

Yangarra did not nominate any sweet oil sales for May due to very high sweet oil differentials. Field inventory is currently low, and the company expects to utilize this storage until spot oil prices are at a more reasonable level. In addition, 30 low volume wells have been shut in as that production will continue to accumulate downhole for up to four months. Current production is approximately 11,000 boe/d.

Financial Summary

2020

2019

Q1

Q4

Q1

Statements of Comprehensive Income

Petroleum & natural gas sales

$

27,435

$

35,990

$

39,907

Net income (before tax)

$

3,877

$

9,405

$

16,386

Net income

$

2,835

$

7,020

$

11,514

Net income per share – basic

$

0.03

$

0.08

$

0.13

Net income per share – diluted

$

0.03

$

0.08

$

0.13

Statements of Cash Flow

Funds flow from operations

$

15,293

$

21,005

$

27,731

Funds flow from operations per share – basic

$

0.18

$

0.25

$

0.32

Funds flow from operations per share – diluted

$

0.18

$

0.25

$

0.32

Cash from operating activities

$

15,725

$

25,469

$

22,963

Statements of Financial Position

Property and equipment

$

558,956

$

541,799

$

511,113

Total assets

$

608,468

$

592,195

$

566,081

Working capital deficit (surplus)

$

9,278

$

(906)

$

18,699

Adjusted Net Debt

$

198,253

$

187,712

$

188,063

Shareholders equity

$

307,265

$

303,643

$

268,584

Weighted average number of shares – basic

85,380

85,370

85,359

Weighted average number of shares – diluted

85,524

85,708

86,772

Company Netbacks ($/boe)

2020

2019

Q1

Q4

Q1

Sales price

$

24.87

$

31.13

$

37.09

   Royalty expense

(1.49)

(2.49)

(2.79)

   Production costs

(5.67)

(6.19)

(5.87)

   Transportation costs

(1.00)

(1.11)

(0.96)

Field operating netback

16.71

21.34

27.46

  Realized gain (loss) on commodity contract settlement

0.05

0.25

0.16

Operating netback

16.76

21.59

27.62

   G&A

(0.72)

(1.17)

(0.32)

   Cash Finance expenses

(2.17)

(1.58)

(1.53)

   Depletion and depreciation

(8.36)

(8.33)

(8.48)

   Non Cash – Finance expenses

(2.11)

0.02

(0.50)

Abandonment Expenses

(0.75)

Provision for Credit Losses

(0.57)

   Stock-based compensation

(0.51)

(0.61)

(1.18)

   Unrealized gain (loss) on financial instruments

0.57

(0.44)

(0.39)

   Deferred income tax

(0.94)

(2.06)

(4.53)

Net Income netback

$

2.51

$

6.09

$

10.70

Business Environment

2020

2019

Q1

Q4

Q1

Realized Pricing (Including realized commodity contracts)

   Oil ($/bbl)

$

52.19

$

67.06

$

66.00

   NGL ($/bbl)

$

16.64

$

19.65

$

38.21

   Gas ($/mcf)

$

2.11

$

2.48

$

2.56

Realized Pricing (Excluding commodity contracts)

   Oil ($/bbl)

$

52.05

$

67.06

$

66.00

   NGL ($/bbl)

$

16.59

$

18.03

$

37.18

   Gas ($/mcf)

$

2.11

$

2.48

$

2.56

Oil Price Benchmarks

   West Texas Intermediate (“WTI”) (US$/bbl)

$

46.17

$

56.95

$

54.90

   Edmonton Par (C$/bbl)

$

51.44

$

68.05

$

66.48

   Edmonton Par to WTI differential (US$/bbl)

$

(7.85)

$

(5.40)

$

(4.91)

Natural Gas Price Benchmarks

   AECO gas (Cdn$/mcf)

$

2.03

$

2.48

$

1.94

Foreign Exchange

   U.S./Canadian Dollar Exchange

0.75

0.76

0.75

Operations Summary

Net petroleum and natural gas production, pricing and revenue are summarized below:

2020

2019

Q1

Q4

Q1

Daily production volumes

   Natural gas (mcf/d)

38,712

41,483

34,707

   Oil (bbl/d)

3,550

3,712

4,343

   NGL’s (bbl/d)

2,120

1,942

1,829

   Combined (boe/d 6:1)

12,122

12,568

11,956

Revenue

Petroleum & natural gas sales – Gross

$

27,435

$

35,990

$

39,907

Realized gain (loss) on commodity contract settlement

53

290

170

Total sales

27,488

36,280

40,077

Royalty expense

(1,640)

(2,879)

(3,003)

Total Revenue – Net of royalties

$

25,848

$

33,401

$

37,074

Working Capital Summary

The following table summarizes the change in working capital during the months ended March 31, 2020 and December 31, 2019: 

Three months ended

Year ended

March 31, 2020

December 31, 2019

Adjusted Net Debt – beginning of period

$

(187,711)

$

(155,882)

 Funds flow from operations

15,293

92,236

 Additions to property and equipment

(25,008)

(115,276)

 Decommissioning costs incurred

(966)

 Additions to E&E Assets

(426)

(5,723)

 Issuance of shares

41

 Other

(401)

(2,141)

 Adjusted Net Debt – end of period 

$

(198,253)

$

(187,711)

Credit facility limit

$

225,000

$

225,000

Capital Spending

Capital spending is summarized as follows:

2020

2019

Cash additions

Q1

Q4

Q1

Land, acquisitions and lease rentals

$

104

$

38

$

38

Drilling and completion

22,563

16,997

38,908

Geological and geophysical

171

447

237

Equipment

1,968

2,503

18,320

Other asset additions

201

193

500

$

25,008

$

20,178

$

58,004

Exploration & evaluation assets

$

426

$

480

$

1,044

Quarter End Disclosure

The Company’s financial statements, notes to the financial statements and management’s discussion and analysis will be filed on SEDAR (www.sedar.com) and are available on the Company’s website (www.yangarra.ca).



Share This:



More News Articles


New SHOWCASE Directory Companies

 

Caliper Inspection
Challenger Geomatics
CDN Controls
Insight Analytical
Canline Pipeline Solutions
Environmental Mats
Gemini Fabrication
DyCat Solutions