Baytex Energy Corp T.BTE

For X

[dllscwbysfn]

I can never figure out what is in the best interest for bte. Last q they complained about a weak CDN$ hurting there debt repayments. So does that mean Q4 will do much better as the CDN$ as strengthened considerably?

[riski]

I agree, it is confusing. The accounting report will look better with the CAD strength since it's reported in CAD dollars, but a stronger CAD dollar reduces revenue in terms of CAD which is how they report revenue as well. So it's good and bad.

[masfortuna]

 The 3d quarter of 2022 and the 3rd quarter of 2023 were both low andthe reason given was the strength of the US dollar inhibiting the debt repayment.  The only problem I have with this explanation, and it's a big red flag for me, is that they didn't seem to have an issue with this in the other 6 quarters. Apparently it only affects the 3rd quarter"s" of evry fiscal

[dllscwbysfn]

It is a little weird . I just looked at a fx chart and Q1 looks very similar to Q3 but yet there was no problem in the Q1 report. Has BTE ever really come out and told us what is better for the company? If not, why haven't they. Can somebody ask?

[riski]

US denominated debt is reported in terms of CAD dollars on the report. So their US debt just got 5% cheaper than it was a few weeks ago even if they didn't pay a penny toward it. That's the good. The opposite happened in Q3 the last two years - CAD/USD went from 0.78 to 0.72 in 2022 and 0.75 to 0.72 in 2023. That makes the US denominated debt higher in terms of CAD dollars independent of

[red2000]

Hi Riski ! But WTI$ increase when US$ go down !!! At the end, it's good for Baytex ! No ?  5% of 2B$ it's 100M$ not bad ! 

[riski]

Yes, good point red. WTI and USD tend to move inversely, though the correlation is far from perfect.

[ABCorp]

Hundreds of ways to tweek the reporting to come up with the desired outcome... 

[jleer42]

Oil is sold in USD. Canadian operations have costs in CAD. Overall a lower CAD is a positive. 

[JohnnyDoe]

This is a bit of a complex issue for Baytex given the amount of US denominated debt. They've obviously got finance guys there that do all the calculations and I'd imagine there's some complexity to the equations. Maybe I'll write Brian in the New Year and ask about this. I'll also try fooling around with excel over the holidays to simulate some scenarios 

[jleer42]

The US denominated debt is more of a balance sheet issue. We pay down US debt, but when reported on financial statements in CAD the debt can go up if the Candian dollar falls. This is what got peoples knickers in a knot recently.  The reverse will be true if the Canadian dollar appreciates. What really matters is cash flow; and earnings are in USD and US debt is paid in USD, so it is a wash.

[dllscwbysfn]

Thanks everyone for the input. I'm off on a little Mexican holiday. Wishing you all a Merry Christmas , ya even Cobalt and Snowman wherever he is. Cheers to the new year!!