RE:News out!
Whitecap Resources earns $453.14-million in fiscal 2014
2015-03-17 18:00 ET - News Release
Mr. Grant Fagerheim reports
WHITECAP RESOURCES INC. ANNOUNCES FOURTH QUARTER AND YEAR END 2014 RESULTS
Whitecap Resources Inc. has released its operating and audited financial results for the year ended Dec. 31, 2014.
Whitecap's audited consolidated financial statements, management's discussion and analysis, and annual information form will be available at SEDAR and on the company's website.
FINANCIAL AND OPERATING HIGHLIGHTS
(In thousands, except per share and where noted) Three months ended Dec. 31, 12 months ended Dec. 31, 2014 2013 2014 2013 Petroleum and natural gas sales $194,994 $119,970 $815,689 $459,110 Funds from operations 139,089 66,640 486,775 278,801 Basic ($/share) 0.55 0.39 2.10 1.86 Diluted ($/share) 0.54 0.39 2.08 1.84 Net income (loss) 166,116 (1,469) 453,141 40,428 Basic ($/share) 0.66 (0.01) 1.95 0.27 Diluted ($/share) 0.65 (0.01) 1.94 0.27 Dividends paid or declared 47,525 26,847 169,594 92,978 Per share 0.19 0.16 0.73 0.61 Total payout ratio (%) 69 73 101 102 Development capital expenditures 48,144 21,988 323,836 189,994 Property acquisitions 135,788 88,011 950,856 407,422 Property dispositions (104,257) (34,194) (273,547) (35,602) Corporate acquisitions 205,209 - 602,691 66,450 Net debt outstanding 798,290 401,177 798,290 401,177 Operating Average daily production Crude oil (bbl/d) 24,752 12,585 20,796 11,870 NGLs (bbl/d) 2,979 2,159 2,596 1,713 Natural gas (Mcf/d) 59,580 43,902 54,395 37,117 Total (boe/d) 37,661 22,061 32,458 19,769 Average realized price Crude oil ($/bbl) 72.45 81.44 89.54 88.39 NGLs ($/bbl) 34.17 53.64 46.73 49.51 Natural gas ($/Mcf) 3.77 3.72 4.62 3.34 Total ($/boe) 56.28 59.11 68.85 63.63 Netback ($/boe) Petroleum and natural gas sales 56.28 59.11 68.85 63.63 Realized hedging gain (loss) 7.29 (2.32) (2.29) (1.63) Royalties (7.42) (8.46) (9.19) (8.28) Operating (expenses) (10.79) (10.05) (10.95) (9.96) Transportation (expenses) (1.25) (1.40) (1.47) (1.30) Operating netbacks 44.11 36.88 44.95 42.46 General and administrative (1.48) (1.61) (1.49) (1.67) Interest and financing (2.49) (2.44) (2.37) (2.15) Cash netbacks 40.14 32.83 41.09 38.64
Message to shareholders
"We are very pleased to report our operational and financial results for 2014 which have exceeded our initial full year projections. Two thousand fourteen completes our second successful year as a sustainable dividend-paying growth company. As a result of our team's ability to deliver strong operational results, and enhanced by our value-added acquisitions, we were able to once again provide shareholders with per-share growth in excess of our targeted 3 to 5 per cent on a fully diluted basis. Funds from operations (FFO) per share increased 13 per cent to $2.08/share, production per share increased 7 per cent and reserves per share increased 14 per cent. In addition, shareholders received an annual dividend of 73 cents/share, all within a total payout ratio of 101 per cent, demonstrating our team's commitment to financial and operational discipline.
"Our 2014 capital program included $323.8-million in development capital expenditures, which was $6.2-million lower than we were forecasting to spend. We were also able to generate FFO of $486.8-million ($2.08/share) for the full year and $139.1-million (54 cents/share) for the fourth quarter, which was $5.6-million higher than our fourth quarter forecast. The 2014 development drilling program was 100 per cent successful with the drilling of 169 (142.5 net) wells. In the fourth quarter, we drilled a total of 28 (20.0 net) oil wells, including 22 (15.4 net) Viking horizontal wells in west-central Saskatchewan, four (three net) Dunvegan horizontal wells in the Peace River Arch area of northwest Alberta, one (0.9 net) Cardium horizontal well in the West Pembina area of Alberta and one (0.7 net) vertical Nisku well at our recently acquired Elnora property in Alberta.
"In addition to the 2014 organic drilling program, our team was actively strengthening the long-term sustainability of Whitecap's dividend-paying growth model through internally generated business development initiatives. We completed $1.6-billion of strategic acquisitions, primarily in our core operating areas, which increased our light oil drilling inventory to 2,351 low-risk light oil development locations providing for future production and cash flow per share growth. Whitecap was also able to monetize certain non-core assets totalling $273.5-million at attractive disposition metrics, further improving our financial flexibility and providing us with a strong balance sheet in this low-commodity-price environment.
"Our total net capital program provided strong returns for our shareholders increasing our proved reserves by 64 per cent to 155.0 million barrels of oil equivalent (76 per cent oil and natural gas liquids) and proved plus probable reserves by 66 per cent to 219.3 million boe (75 per cent oil and NGLs), at a finding, development and acquisition (FD&A) cost of $19.56/boe, including future development costs (FDC), resulting in a recycle ratio of 2.3 times and replacing 833 per cent of our 2014 production.
"We highlight the following accomplishments in 2014:
- "Achieved record fourth quarter production of 37,661 barrels of oil equivalent per day, 71 per cent higher than the fourth quarter of 2013 (15 per cent per fully diluted share). Production growth of 64 per cent year over year to 32,458 boe/d (7 per cent per fully diluted share);
- "Increased fourth quarter FFO by 109 per cent to $139.1-million (54 cents/fully diluted share) compared to $66.6-million (39 cents/fully diluted share) in the fourth quarter of 2013. FFO growth of 75 per cent year over year to $486.8-million (13 per cent per fully diluted share);
- "Realized strong fourth quarter cash netbacks of $40.14/boe, 22 per cent higher than the fourth quarter of 2013 despite crude oil prices deteriorating 25 per cent quarter over quarter. Increased cash netbacks 6 per cent year over year to $41.09/boe, including cash general and administrative of $1.49/boe;
- "Continued to systematically layer on incremental crude oil and natural gas hedge positions with currently 53 per cent of forecasted 2015 crude oil production hedged at a fixed price of West Texas Intermediate $98.00/barrel and 25 per cent in 2016 at a fixed price of WTI $97.71/bbl. For natural gas, 55 per cent of 2015 forecasted production is hedged at a fixed price of $3.58/thousand cubic feet and 14 per cent in 2016 at a fixed price of $3.79/thousand cubic feet;
- "Invested $323.8-million in development capital expenditures in 2014 drilling 169 (142.5 net) wells with a 100-per-cent success rate including 116 (97.9 net) horizontal Viking oil wells in west-central Saskatchewan, 16 (14.8 net) horizontal Cardium oil wells in Pembina, 26 (20.9 net) horizontal Cardium wells in southwest Alberta, and 11 (8.9 net) wells in northwest Alberta and British Columbia;
- "Continued to increase our oil and NGL weighting to 74 per cent in the fourth quarter compared to 67 per cent in the fourth quarter of 2013;
- "Business development initiatives include the closing and successful integration $1.6-billion of accretive, oil-weighted, high-netback property and corporate acquisitions in addition to portfolio rationalization of non-core assets totalling $273.5-million;
- "Increased proved plus probable reserves by 66 per cent year over year (14 per cent per fully diluted share), replacing 833 per cent of 2014 production, after acquisitions and divestments, at a FD&A cost of $19.56/boe, including FDC which results in a recycle ratio of 2.3 times;
- "Significant proved plus probable reserve additions of 27.8 million boe from our development capital program at a finding and development (F&D) cost of $13.79/boe, representing a recycle ratio of 3.3 times;
- " Increased our monthly dividend 19 per cent from $5.25 cents/share at the end of 2013 to currently 6.25 cents/share, while maintaining a strong balance sheet (fourth quarter 2014 net-debt-to-FFO ratio of 1.4 times) and achieving a total payout ratio of 101 per cent in 2014 without the use of a dividend reinvestment plan (DRIP).
"Subsequent to year-end 2014, we elected to increase our credit facility to $1.2-billion, providing us with further financial flexibility in the weak-commodity-price environment we are experiencing.
"Outlook
"We anticipate continued commodity price volatility for the remainder of 2015 and believe we are well positioned to withstand the challenging environment that our industry is currently facing. With our light-oil-focused asset base and our strong commodity hedges in place for 2015 and 2016, we continue to generate robust cash flow netbacks. The foregoing, in combination with a low base production decline rate of 23 per cent, and our team's commitment to financial and operational discipline, allows us to grow production by 11 per cent (1 per cent per share), maintain our current monthly dividend of 6.25 cents/share, all within a total payout ratio of less than 100 per cent in 2015. Our balance sheet is expected to remain strong with a net-debt-to-FFO ratio of 2.0 times in the current low-commodity-price environment.
"Once again our management team and board of directors would like to thank you for your ongoing support of Whitecap."
We seek Safe Harbor.
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