Baytex Reports Q2 2016 Results Baytex Reports Q2 2016 Results and Board Appointmentless than 1 minute ago by Marketwire Canada - NFD CALGARY, ALBERTA--(Marketwired - Jul 28, 2016) - Baytex Energy Corp. ("Baytex") (TSX:BTE) (NYSE:BTE) reports its operating and financial results for the three and six months ended June 30, 2016 (all amounts are in Canadian dollars unless otherwise noted) and a board appointment.
"Our operating results for the second quarter were consistent with our expectations and demonstrate the commitment we have made during this downturn to deploy capital efficiently, maintain strong levels of financial liquidity and reduce costs in all facets of our business. Importantly, our funds from operations exceeded capital expenditures during both the second quarter and first half resulting in a reduction in net debt. We remain well positioned to benefit from a rising oil price environment with strong capital efficiencies across our three core resource plays," commented James Bowzer, Chief Executive Officer.
Highlights
Generated production of 70,031 boe/d (77% oil and NGL) in Q2/2016;
Delivered funds from operations ("FFO") of $81.3 million ($0.39 per share) in Q2/2016;
Reduced net debt by $39 million in Q2/2016 as funds from operations exceeded capital expenditures;
Realized an operating netback (sales price less royalties, operating and transportation expenses) in Q2/2016 of $14.39/boe ($18.13/boe including financial derivatives gain);
Reinitiated production from heavy oil wells shut-in during the first quarter due to low oil prices; at June 30, approximately 6,500 boe/d of the 7,500 boe/d previously shut-in had been re-started;
Reduced operating expenses by 12% to $9.42/boe in the first half of 2016, as compared to $10.70/boe in the first half of 2015;
Maintained strong levels of financial liquidity with a Senior Secured Debt to Bank EBITDA ratio of 0.86:1.00; and
Entered into an agreement to dispose of our operated assets in the Eagle Ford for approximately $55 million.
Three Months Ended Six Months Ended June 30, 2016 March 31, 2016 June 30, 2015 June 30, 2016 June 30, 2015 FINANCIAL (thousands of Canadian dollars, except per common share amounts) Petroleum and natural gas sales $ 195,733 $ 153,598 $ 342,803 $ 349,331 $ 626,186 Funds from operations (1) 81,261 45,645 158,050 126,906 318,270 Per share - basic 0.39 0.22 0.77 0.60 1.70 Per share - diluted 0.39 0.22 0.77 0.60 1.70 Net income (loss) (86,937 ) 607 (26,955 ) (86,330 ) (202,871 ) Per share - basic (0.41 ) 0.00 (0.13 ) (0.41 ) (1.08 ) Per share - diluted (0.41 ) 0.00 (0.13 ) (0.41 ) (1.08 ) Exploration and development 35,490 81,685 106,010 117,175 253,439 Acquisitions, net of divestitures (37 ) (9 ) 1,170 (46 ) 2,720 Total oil and natural gas capital expenditures $ 35,453 $ 81,676 $ 107,180 $ 117,129 $ 256,159 Bank loan(2) $ 347,083 $ 290,465 $ 192,255 $ 347,083 $ 192,255 Long-term notes(2) 1,544,181 1,540,546 1,493,013 1,544,181 1,493,013 Long-term debt 1,891,264 1,831,011 1,685,268 1,891,264 1,685,268 Working capital deficiency 51,274 150,332 137,243 51,274 137,243 Net debt (3) $ 1,942,538 $ 1,981,343 $ 1,822,511 $ 1,942,538 $ 1,822,511
Three Months Ended Six Months Ended June 30, 2016 March 31, 2016 June 30, 2015 June 30, 2016 June 30, 2015 OPERATING Daily production Heavy oil (bbl/d) 22,423 24,807 35,397 23,615 37,302 Light oil and condensate (bbl/d) 21,894 24,489 25,899 23,191 26,971 NGL (bbl/d) 9,834 10,109 8,232 9,971 8,228 Total oil and NGL (bbl/d) 54,151 59,405 69,528 56,777 72,501 Natural gas (mcf/d) 95,281 98,220 91,456 96,750 91,234 Oil equivalent (boe/d @ 6:1) (4) 70,031 75,776 84,770 72,902 87,707 Benchmark prices WTI oil (US$/bbl) 45.60 33.45 57.94 39.53 53.29 WCS heavy oil (US$/bbl) 32.29 19.22 46.35 25.76 40.14 Edmonton par oil ($/bbl) 54.78 40.80 67.72 47.80 59.84 LLS oil (US$/bbl) 46.20 33.24 62.38 39.73 56.47 Baytex average prices (before hedging) Heavy oil ($/bbl) (5) 30.09 12.54 44.59 20.87 36.21 Light oil and condensate ($/bbl) 52.42 37.97 65.11 44.79 58.50 NGL ($/bbl) 13.28 18.38 15.78 15.86 17.55 Total oil and NGL ($/bbl) 36.07 24.02 48.82 29.76 42.39 Natural gas ($/mcf) 1.94 2.40 3.06 2.17 3.14 Oil equivalent ($/boe) 30.52 21.93 43.34 26.06 38.30 CAD/USD noon rate at period end 1.3009 1.2971 1.2474 1.3009 1.2474 CAD/USD average rate for period 1.2885 1.3748 1.2294 1.3317 1.2353 COMMON SHARE INFORMATION TSX Share price (Cdn$) High 9.04 5.39 24.14 9.04 24.87 Low 4.85 1.57 19.24 1.57 16.03 Close 7.50 5.13 19.43 7.50 20.03 Volume traded (thousands) 466,201 483,311 80,572 949,511 202,752 NYSE Share price (US$) High 7.14 4.15 20.10 7.14 19.99 Low 3.67 1.08 15.42 1.08 13.14 Close 5.79 3.97 15.58 5.79 15.80 Volume traded (thousands) 198,514 154,052 44,497 352,567 68,710 Common shares outstanding (thousands) 210,715 210,689 206,193 210,715 206,193
Notes: (1) Funds from operations is not a measurement based on generally accepted accounting principles ("GAAP") in Canada, but is a financial term commonly used in the oil and gas industry. We define funds from operations as cash flow from operating activities adjusted for changes in non-cash operating working capital and other operating items. Baytex's funds from operations may not be comparable to other issuers. Baytex considers funds from operations a key measure of performance as it demonstrates its ability to generate the cash flow necessary to fund capital investments and potential future dividends. For a reconciliation of funds from operations to cash flow from operating activities, see Management's Discussion and Analysis of the operating and financial results for the three and six months ended June 30, 2016. (2) Principal amount of instruments. (3) Net debt is a non-GAAP measure which we define to be the sum of monetary working capital (which is current assets less current liabilities (excluding current financial derivatives and assets held for sale)) and the principal amount of both the long-term notes and the bank loan. (4) Barrel of oil equivalent ("boe") amounts have been calculated using a conversion rate of six thousand cubic feet of natural gas to one barrel of oil. The use of boe amounts may be misleading, particularly if used in isolation. A boe conversion ratio of six thousand cubic feet of natural gas to one barrel of oil is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. (5) Heavy oil prices exclude condensate blending. Second Quarter Results