Claren Energy Corp T.CEN

Good Positive Explanation for EBIT ...

[RichyRich$]

I copy n pasted this from a member on Investor Village. It answered a concern I had about EBIT being lower but not when you factor in all these variables. Let's hope BAY STREET agrees with this by their bid/ask share price in pre-market trading tomorrow morning !!! Just finished a Corporate Finance course (tough as hell!)... so some of the q2 report is making sense. Lol. From the Q2 report filed on sedar This caught my eye in the news release:EBITDAX for Q2 2013 was $83.3 million, a 36% decline from the $130.2 million recorded in Q2 2012. The decrease in EBITDAX was driven entirely by the timing of crude oil sales, as the Companyrecorded an increase in crude oil inventory of 526,017 bbl during the second quarter, the revenue from which will be recognized in the third quarter. Looked at the MD&A filed at sedar and see a bit more info: EBITDAX for Q2 2013 was $83.3 million, 36% lower than the $130.3 million recorded in Q2 2012 mostlydue to the timing of liftings during Q2 2013. The Company’s inventory levels increased by 526,017barrels (280%) over this period such that 714,132 barrels were on hand at quarter end, the revenuefrom which will be recognized in the third quarter.  That's a huge increase in inventory. 526,017 barrels @ $100/barrel would have added over $50M in revs,netbacks were 62.62, so for 526K barrels would have been an additional  $33M in net income.  year over year increase in inventories from Q2 2012, inventories at the end of Q2 2013 were up ~250K. (714K vs 460K).Add in the exploration writeoff of $13M, and bottom line was similar to Q2 2012. Not bad for a crappy quarter.