Cannacord Comments [Wednesday] after market, TOU reported Q1/24 results ahead of expectations and announced another increase to its base dividend alongside a special dividend. Q1/24 production of 592.1 mboe/d was in line with both our forecast and consensus at 589.2 mboe/d and 591.5 mboe/d, respectively, while CFPS of $2.48 was modestly ahead of expectations of $2.35 (CGe) and $2.38 (consensus),” said Mr. Mueller. “The company also announced it has closed on its non-core Duvernay disposition where it sold ~1,600-1,800 boe/d of current production for gross proceeds of $53.1M. Recall that TOU originally acquired these assets through its acquisition of Bonavista last November.
“Following suit with its Q4 release in March, TOU announced another $0.50/share special dividend (payable May 2024) and another 7-per-cent base quarterly dividend increase to $0.32/share (1.9-per-cent yield annualized). While the size of the special dividends has decreased (following the shift in commodity prices), this demonstrates why the company went towards this model in the first place. The most recent increase to the base dividend marks the fourteenth increase since 2018 with no cuts since implementing it, providing a ratable dividend with upside via the specials.”