Vero Energy Inc T.VRO

News! Earnings increase of 591%, yet shares price

[opsd1]

2008 Highlights

- Net earnings for the year increased 591% over 2007 to $21.9 million
resulting in $0.67 (basic and diluted) per share.

- Increased average daily production by 34% to 6,295 boe/d.

- Cash flow was 83% higher in 2008 at $75.6 million ($2.31 per diluted
share).

- Increased operating netback by 31% to $35.86 per boe and cash flow
netback by 37% to $32.82 per boe.

- Drilled 34 wells (26.7 net) with a 98% success rate. 14 (12.2 net) of
these wells were horizontals.

- Constructed a strategic gas facility at Pine Creek to handle new
volumes in a significant growth area.

- Increased undeveloped land by 126% to 171,183 net undeveloped acres.


https://www.globeinvestor.com/servlet/story/CNW.20090309.C6980/GIStory/

[Capharnaum]

I liked the 2009 update, which answers the debt questions we were asking:2009 UPDATE-  Entered into a new banking syndicate commitment that has our credit   facility increasing 64% to $115 million from $70 million at the end   of 2007.-  Expansion completed on Vero's operated gas plant in Edson from   20 mmcfd to 35 mmcfd.-  Revised exploration and

[filefish]

One unanswered question is regarding their hedging.Still dont know if they have hedged forward any gas production for 2009 and beyond.Last report had all hedges expiring at 12/31/08.Anyone know? Maybe someone will discuss at Wed. presentation.  The extention of their credit facility is comforting, but still would like to see a publically stated debt reduction

[davwal]

i dont know,but i would assume if they hedged any amount,we would of heard about it,when prices drop,companies just love to say  what they have hedged,it makes the board look good ,though i wouldnt be surprised if they have good hedges in place,they operate tight. i gotta call 50/50 they do or they dont have those hedges.

[filefish]

A question did come up at the end of their presentation today about hedging.The short answer is that they do not have any hedges in place at this time.They claim to have missed the opportunity in the summer when they normally set these up but  with gas prices as they are now , they believe that now is not the time to write new ones.I think they made another error when the missed the