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2022 Highlights
- Average production of 11,022 boe/d (45% liquids), an increase of 23% from 2021
- Oil and gas sales of $243 million, an increase of 73% from 2021
- Funds flow from operations of $177 million ($1.92 per share – fully diluted) an increase of 95% from 2021
- Adjusted EBITDA of $187 million ($2.03 per share – fully diluted)
- Net income of $106 million ($1.16 per share – fully diluted), resulting in an income margin of 44%
- Return on capital employed of 20.4%
- Operating costs of $7.29/boe (including $1.21/boe of transportation costs)
- Operating netback of $47.64/boe
- Operating margin of 79% and funds flow from operations margin of 73%
- G&A costs of $1.01/boe
- Royalties at 8% of oil and gas revenue
- Capital expenditures of $109 million for 32 wells versus a budget of $110 million for 30 wells
- Adjusted net debt of $134 million, a decrease of $62.4 million from 2021
- Retained earnings of $265 million
- Decommissioning liabilities of $14 million (discounted)
- Less than $1.0 million is required to abandon all non-producing wells
- Expenditures on abandonments and reclamations of $0.3 million for calendar 2022
Fourth Quarter Highlights
- Funds flow from operations of $42 million ($0.45 per share – fully diluted), an increase of 29% from the same period in 2021
- $13 million of adjusted net debt repayments
- Oil and gas sales of $60 million, an increase of 27% from the same period in 2021
- Adjusted EBITDA of $45 million ($0.48 per share – fully diluted), an increase of 28% from the same period in 2021
- Net income of $25 million ($0.27 per share – fully diluted), an increase of 28% from the same period in 2021
- Average production of 11,712 boe/d (45% liquids), a 16% increase from the same period in 2021
- Operating costs of $7.99/boe (including $1.22/boe of transportation costs)
- Operating netback of $42.84/boe
- Operating margin of 77% and funds flow from operations margin of 69%
- G&A costs of $1.21/boe
- Royalties at 9% of oil and gas revenue
- All in cash costs of $17.19/boe
- Capital expenditures of $28 million
- Adjusted net debt to fourth quarter annualized funds flow from operations of 0.80 : 1
Financial Summary
|
2022 |
2021 |
Year Ended |
||||
|
Q4 |
Q3 |
Q4 |
2022 |
2021 |
||
|
Statements of Income and Comprehensive Income |
||||||
|
Petroleum & natural gas sales |
$ 60,292 |
$ 62,791 |
$ 47,405 |
$ 243,056 |
$ 140,289 |
|
|
Income before tax |
$ 31,075 |
$ 36,193 |
$ 25,547 |
$ 137,745 |
$ 65,213 |
|
|
Net income |
$ 25,071 |
$ 27,936 |
$ 19,644 |
$ 106,358 |
$ 50,014 |
|
|
Net income per share – basic |
$ 0.29 |
$ 0.32 |
$ 0.23 |
$ 1.22 |
$ 0.58 |
|
|
Net income per share – diluted |
$ 0.27 |
$ 0.30 |
$ 0.22 |
$ 1.16 |
$ 0.56 |
|
|
Statements of Cash Flow |
||||||
|
Funds flow from operations |
$ 41,808 |
$ 45,602 |
$ 32,425 |
$ 177,194 |
$ 90,921 |
|
|
Funds flow from operations per share – basic |
$ 0.48 |
$ 0.52 |
$ 0.38 |
$ 2.03 |
$ 1.06 |
|
|
Funds flow from operations per share – diluted |
$ 0.45 |
$ 0.49 |
$ 0.36 |
$ 1.92 |
$ 1.02 |
|
|
Cash flow from operating activities |
$ 40,675 |
$ 47,440 |
$ 36,835 |
$ 169,664 |
$ 91,266 |
|
|
Weighted average number of shares – basic |
87,956 |
87,951 |
86,449 |
87,423 |
85,892 |
|
|
Weighted average number of shares – diluted |
92,742 |
92,609 |
90,636 |
92,054 |
89,376 |
|
|
December 31, 2022 |
December 31, 2021 |
|
|
Statements of Financial Position |
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|
Property and equipment |
$ 701,045 |
$ 627,948 |
|
Total assets |
$ 768,058 |
$ 683,469 |
|
Working capital (deficit) surplus |
$ (136,920) |
$ (3,729) |
|
Adjusted net debt |
$ 134,364 |
$ 196,794 |
|
Shareholders equity |
$ 473,574 |
$ 364,959 |
Company Netbacks ($/boe)
|
2022 |
2021 |
Year Ended |
||||
|
Q4 |
Q3 |
Q4 |
2022 |
2021 |
||
|
Sales price |
$ 55.95 |
$ 58.09 |
$ 51.22 |
$ 60.42 |
$ 43.04 |
|
|
Royalty expense |
(5.22) |
(4.93) |
(3.55) |
(4.77) |
(2.68) |
|
|
Production costs |
(6.77) |
(6.26) |
(6.32) |
(6.07) |
(5.60) |
|
|
Transportation costs |
(1.22) |
(1.15) |
(1.09) |
(1.21) |
(1.10) |
|
|
Field operating netback |
42.74 |
45.74 |
40.26 |
48.37 |
33.66 |
|
|
Realized gain (loss) on commodity contract settlement |
0.10 |
(0.30) |
(0.94) |
(0.73) |
(1.39) |
|
|
Operating netback |
42.84 |
45.44 |
39.32 |
47.64 |
32.27 |
|
|
G&A |
(1.21) |
(0.78) |
(1.09) |
(1.01) |
(0.90) |
|
|
Cash finance expenses |
(2.86) |
(2.56) |
(3.53) |
(2.79) |
(2.52) |
|
|
Depletion and depreciation |
(9.44) |
(9.05) |
(9.42) |
(9.36) |
(8.34) |
|
|
Non Cash – finance expenses |
(0.41) |
(0.18) |
1.67 |
(0.09) |
(0.05) |
|
|
Stock-based compensation |
(0.11) |
(0.16) |
(0.40) |
(0.16) |
(0.41) |
|
|
Unrealized gain (loss) on financial instruments |
0.03 |
0.76 |
1.04 |
0.01 |
(0.04) |
|
|
Deferred income tax |
(5.57) |
(7.64) |
(6.38) |
(7.80) |
(4.66) |
|
|
Net income netback |
$ 23.26 |
$ 25.84 |
$ 21.21 |
$ 26.44 |
$ 15.34 |
|
Business Environment
|
2022 |
2021 |
Year Ended |
||||
|
Q4 |
Q3 |
Q4 |
2022 |
2021 |
||
|
Realized Pricing (Including realized commodity contracts) |
||||||
|
Light Crude Oil ($/bbl) |
$ 112.53 |
$ 116.44 |
$ 89.49 |
$ 116.26 |
$ 78.24 |
|
|
NGL ($/bbl) |
$ 51.64 |
$ 56.35 |
$ 51.54 |
$ 61.53 |
$ 45.11 |
|
|
Natural Gas ($/mcf) |
$ 5.25 |
$ 4.61 |
$ 4.67 |
$ 5.53 |
$ 3.75 |
|
|
Realized Pricing (Excluding commodity contracts) |
||||||
|
Light Crude Oil ($/bbl) |
$ 112.53 |
$ 116.44 |
$ 89.49 |
$ 117.78 |
$ 82.01 |
|
|
NGL ($/bbl) |
$ 51.70 |
$ 56.28 |
$ 51.61 |
$ 61.45 |
$ 45.10 |
|
|
Natural Gas ($/mcf) |
$ 5.21 |
$ 4.71 |
$ 4.95 |
$ 5.64 |
$ 3.87 |
|
|
Oil Price Benchmarks |
||||||
|
West Texas Intermediate (“WTI”) (US$/bbl) |
$ 82.79 |
$ 93.18 |
$ 77.45 |
$ 94.41 |
$ 67.65 |
|
|
Edmonton Par ($/bbl) |
$ 107.43 |
$ 116.64 |
$ 91.70 |
$ 119.40 |
$ 79.80 |
|
|
Edmonton Par to WTI differential (US$/bbl) |
$ (3.68) |
$ (3.37) |
$ (4.67) |
$ (2.47) |
$ (3.89) |
|
|
Natural Gas Price Benchmarks |
||||||
|
AECO gas ($/mcf) |
$ 4.85 |
$ 3.95 |
$ 4.41 |
$ 4.99 |
$ 3.49 |
|
|
Foreign Exchange |
||||||
|
Canadian Dollar/U.S. Exchange |
0.74 |
0.77 |
0.79 |
0.77 |
0.80 |
|
Operations Summary
Net petroleum and natural gas production and revenue are summarized below:
|
2022 |
2021 |
Year Ended |
||||
|
Q4 |
Q3 |
Q4 |
2022 |
2021 |
||
|
Daily production volumes |
||||||
|
Natural Gas (mcf/d) |
38,971 |
37,214 |
33,774 |
36,702 |
29,092 |
|
|
Light Crude Oil (bbl/d) |
3,077 |
3,248 |
2,744 |
2,798 |
2,373 |
|
|
NGL’s (bbl/d) |
2,140 |
2,300 |
1,687 |
2,106 |
1,709 |
|
|
Combined (BOE/d 6:1) |
11,712 |
11,750 |
10,060 |
11,022 |
8,931 |
|
|
Revenue |
||||||
|
Petroleum & natural gas sales – Gross |
$ 60,292 |
$ 62,791 |
$ 47,405 |
$ 243,056 |
$ 140,289 |
|
|
Realized gain (loss) on commodity contract settlement |
106 |
(325) |
(872) |
(2,920) |
(4,529) |
|
|
Total sales |
60,398 |
62,466 |
46,533 |
240,136 |
135,760 |
|
|
Royalty expense |
(5,627) |
(5,333) |
(3,287) |
(19,170) |
(8,722) |
|
|
Total Revenue – Net of royalties |
$ 54,771 |
$ 57,133 |
$ 43,246 |
$ 220,966 |
$ 127,038 |
|
Adjusted Net Debt Summary
The following table summarizes the change in adjusted net debt during the year ended December 31, 2022 and December 31, 2021:
|
Year ended |
Year ended |
|
|
December 31, 2022 |
December 31, 2021 |
|
|
Adjusted net debt – beginning of period |
$ (196,794) |
$ (197,414) |
|
Funds flow from operations |
177,194 |
90,921 |
|
Additions to property and equipment |
(109,354) |
(88,153) |
|
Decommissioning costs incurred |
(291) |
(881) |
|
Additions to E&E Assets |
(3,888) |
(387) |
|
Issuance of shares |
1,077 |
1,131 |
|
Lease obligation repayment |
(2,331) |
(2,003) |
|
Other |
23 |
(8) |
|
Adjusted net debt – end of period |
$ (134,364) |
$ (196,794) |
|
Credit facility limit |
$ 180,000 |
$ 210,000 |
Capital Spending
Capital spending is summarized as follows:
|
2022 |
2021 |
Year Ended |
||||
|
Cash additions |
Q4 |
Q3 |
Q4 |
2022 |
2021 |
|
|
Land, acquisitions and lease rentals |
$ 26 |
$ 200 |
$ (89) |
$ 427 |
$ 54 |
|
|
Drilling and completion |
26,009 |
28,114 |
23,994 |
96,271 |
77,991 |
|
|
Geological and geophysical |
94 |
164 |
114 |
571 |
547 |
|
|
Equipment |
1,596 |
4,345 |
2,349 |
11,200 |
8,872 |
|
|
Other asset additions |
305 |
273 |
255 |
885 |
689 |
|
|
$ 28,030 |
$ 33,096 |
$ 26,623 |
$ 109,354 |
$ 88,153 |
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|
Exploration & evaluation assets |
$ – |
$ 3,506 |
$ 212 |
$ 3,888 |
$ 387 |
|
Annual General Meeting of Shareholders
The Company’s Annual General Meeting of Shareholders is scheduled for 10:00 AM on Thursday April 27, 2023 in the Tillyard Management Conference Centre, Main Floor, 715 5th Avenue SW, Calgary, AB.
Year End Disclosure
The Company’s December 31, 2022 audited consolidated financial statements, management’s discussion and analysis and annual information form have been filed on SEDAR (www.sedar.com) and are available on the Company’s website (www.yangarra.ca).
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