CALGARY, Alberta, Dec. 1, 2014 (GLOBE NEWSWIRE) -- Quattro Exploration and Production Ltd. (TSX-V:QXP) ("Quattro" or the "Company") is pleased to announce the filing of its operating and financial results for the 3 and 9 months ending September 30, 2014, reporting record earnings and operating results;
Highlights
| -- Revenues for the 9 months ending September 30th, 2014 were $12,874,900 |
| -- Income from operations in the nine months of 2014 was $7,022,600, a netback of $18.18 per BOE |
| -- Earnings from operations for the nine month period was $0.12 per share |
| -- Diversified low cost production averaging 1,415 boe/d for the 9 months ending September 30, 2014 |
| -- Expansion of Development and Exploratory Drilling inventory to more than 200 locations |
Financial Update
| -- In the nine months of 2014, EBITDA of $0.16 per share or | $5,700,900 |
| -- 9 month net and comprehensive income of $0.14 per share or | $4,090,000 |
| -- Current assets (net of assets held for sale) of | $6,735,300 |
| -- Working capital of | $3,521,000 |
| -- Net debt (excluding decommissioning liabilities) of | $5,893,600 |
The Company's diversified production portfolio continues to be the source of funds for its capital program. Quattro's diversity has also provided flexibility and an agility to be proactive in the adaptation of its operations to ongoing industry challenges such as an additional 5 days of facilities maintenance and periodic reductions in service for pipeline inspections by TranCanada Pipelines Ltd. in Alberta and Spectra Energy in B.C. during the 3rd quarter. As a result of these reduced services and processing times for regulatory approvals, Quattro's production, remained strong but restricted to 1,530 boe/d at month end September 30, 2014, with an additional, 150 bbl/ day of oil and 180 boe/d of gas awaiting various forms of 3rd party engineering, scheduled maintenance and approvals.
Despite challenges the Company's measured execution of its sustainable business plan continues to be the foundation that allows Quattro to optimize and focus on its long term goals;
| 1.) Performance; a resilient and diversified low cost producer. |
| 2.) Capital; the efficient use and return on capital for its shareholders. |
| 3.) Project Execution; the optimization and balance of time, cost and objectives. |
| 4.) Growth; sustainable, accretive, and material year over year growth in shareholder value. |
Quattro's long term goals and ensuing growth remain on course, if necessary at a measured pace, if commodity prices go significantly lower than the current oil and natural gas pricing that range from $60 to $80 WTI for oil and $3.50 per mcf to a seasonal high of $5.50 per mcf AECO for natural gas in North America.
During the 3 months ended September 30 2014, Quattro's cash-flow from operations was $1,902,326 and the Company's EBITDA (earnings before interest, taxes, depreciation and amortization) was $1,994,198. Although a non IFRS accounting term, the Company believes EBITDA provides further guidance of funds flowing from operations for Quattro and provides investors an opportunity to understand the Company's growing capacity to fund its, operations, growing production, exploration and consolidation activities.
"The volatility in commodity prices was not unanticipated at Quattro," President and CEO Leonard Van Betuw commented. "Being a producer of commodities at these times is always both challenging but also interesting, with volatility comes opportunity. The third quarter continues to illustrate a number of Quattro's inherent strengths; including our capacity to be operationally conservative within the context of an aggressive growth plan. We completed a number of project evaluations, resulting in the identification of an additional 10 development and remediation projects to be completed in 2015. The Company's approach to these projects has always been through strict capital constraints; therefore their inherent value within the current price environment becomes a strategic source of additional cash-flow with minimal risk. These low capital projects and the ensuing future cash-flow advantageously position Quattro, to continue to be a consolidator of assets within its core areas of operations."
"Since year-end 2013 the Company has grown average production by over 135% in the past 9 months to 1,415 boe per day and grown its book value to $20.6 million or $0.59/share. We have achieved these results, while maintaining a conservative P&NG book value of $43.7m or less than $7.50 per boe, while we have maintained positive working capital and low long term debt to cash-flow multiples a formula for continued success. In the current price environment we continue to monitor and pursue a number of identified acquisition opportunities and currently anticipate Quattro's conservative approach to acquisition within current market volatility, will position the Company to continue to be an acquirer at evaluation levels that will be accretive to Quattro's business plan," said President and CEO Leonard B. Van Betuw.
As previously reported, Quattro commenced its operations in July on its first exploratory well. The 100% operated well in southern Saskatchewan at Wood Mountain was cased and rig released in October with the current evaluation of core and well logs on ongoing. The Company's initial evaluation of these results are nearing completion and we anticipate being able to update the market and our development plans in the next 2 weeks.
The Company continues to focus on weighing risk and opportunity, the four areas of focus being its exploration efforts in Saskatchewan, remediation in East Central Alberta and British Colombia and develop drilling McMullen where Quattro has licensed 8 wells to be drilled at McMullen Alberta on a 100% basis.
Therefore, the success at Wood Mountain, the growing evidence of improving access to competitive drilling services in October and the protracted regulatory approval processes at McMullen has resulted in Quattro, rescheduling the drilling of the first wells at McMullen until the 1st Quarter of 2015. As previously reported the commencement of the development drilling at McMullen and the remediation in progress formed the foundation for Quattro realizing an exit rate of 2,500 boe/d in 2015. Due to unanticipated 3rd party restrictions and the growing competing opportunities being identified by the Company, Quattro is reducing its 2014 exit target to between 1,700 to 1,800 boe/d. Stable natural gas pricing and our low cost structure provide Quattro the capacity to conserve cash while opportunities mature and that within three to six months the reasons for making these short term adjustments will be become clear to the market and provide further assurance that Quattro's robust and diverse business plan remains focused on the betterment of Quattro's shareholders.