TSX-V: ORC.A, ORC.B
TORTOLA, British Virgin Islands, Nov. 16, 2016 /CNW/ - Orca
Exploration Group Inc. ("Orca" or "the Company") announces that it has filed its condensed consolidated interim financial
statements and management's discussion and analysis for the three and nine month periods ended 30 September
2016 with the Canadian securities regulatory authorities.
Operating and Financial Highlights
- Revenue for quarter increased 11% to US$17.7 million from US$15.9
million in Q3 2015 and increased 26% to US$48.1 million over the nine months ended
30 September 2016 compared to US$38.2 million for the comparable
prior year period. Additional Gas Sales for the quarter increased to 46.6 MMcfd from 46.4 MMcfd in Q3 2016 and decreased by 5% to
44.4 MMcfd from 46.7 MMcfd over the nine months ended 30 September 2016. The fall in sales volumes
for the nine months ended 30 September 2016 has been substantially offset by a 5% increase in the
weighted average gas price to US$4.72/Mcf from US$4.48/Mcf for the
comparable prior year period.
- Funds flow from operating activities in Q3 2016 was US$11.6 million, or US$0.33 per share diluted, a 22% increase compared to US$9.5 million or
US$0.27 per share in Q3 2015, primarily the result of a higher revenue and a higher Cost Gas
entitlement during the period. Funds flow for the nine months ended 30 September 2016 was up 65% to
US$29.7 million, or US$0.85 per share, compared to US$18.1 million or US$0.52 per share for the comparable prior year period. The
increases were primarily the result of higher revenues during the respective periods.
- Net income for Q3 2016 was US$5.3 million, or US$0.15 per share
basic and diluted, as compared to income of US$6.1 million, or US$0.18 per share basic and diluted in Q3 2015. Net income for the nine months ended 30 September 2016 was US$1.1 million, or US$0.03
per share, as compared to net income of US$8.0 million, or US$0.23
per share, for the comparable prior year period. The relative decrease in net income for the periods is a consequence of the
increased provision against the receivable from the Tanzanian Electrical Supply Company ("TANESCO") of US$12.4 million for the first three quarters of 2016 (first three quarters of 2015: US$ nil).
- Total capital expenditures for the quarter were US$ nil compared to US$8.3 million in Q3 2015.
The capital expenditures for the nine months ended 30 September 2016 were US$16.8 million compared to US$13.9 million for the comparable prior year period.
The capital expenditure in Q3 2015 related to workovers of SS-5, SS-7 and SS-9 for the Offshore Program. The capital expenditures
for the nine months ended 30 September 2016 included the drilling of well SS-12 which was started
in December 2015 and completed in February 2016.
- Working capital as at 30 September 2016 increased 71% to US$67.6
million compared to US$39.7 million as at 30 September 2015.
The increase is primarily a result of an increase in cash to US$74.1 million as at 30 September 2016 from US$49.5 million as at 30 September 2015. Cash
increased as a result of an increase in long-term debt of US$58.4million, a portion of which was
used to fund the Offshore Program.
- At 30 September 2016, TANESCO owed the Company US$81.2 million
excluding interest (of which arrears were US$74.4 million) compared to US$69.7 million (including arrears of US$61.9 million) as at 31 December 2015. During the quarter, the Company received a total of US$8.6
million (Q3 2015: US$4.0 million) from TANESCO against sales invoices totaling US$10.2 million (Q3 2015: US$10.4 million). Current TANESCO receivables as at
30 September 2016 amounted to US$6.9 million (Q4 2015: US$7.8 million). Since the quarter end, TANESCO has paid the Company US$3.7
million, and as at the date of this report the total TANESCO receivable is US$80.8 million
(of which US$74.2 million has been provided for). The amounts owed do not include interest billed
to TANESCO of US$9.7 million. The Tanzanian government is currently working on financing solutions
with the World Bank to address government debts, a portion of the funding is to be allocated to resolving TANESCO
arrears.
The complete condensed consolidated unaudited interim financial statements and management's discussion & analysis for the
three and nine month periods ending 30 September 2016 may be found on the Company's website www.orcaexploration.com or on the Company's profile on SEDAR
at www.sedar.com.
Orca Exploration Group Inc.
Orca Exploration Group Inc. is an international public company engaged in natural gas exploration, development and supply in
Tanzania through the wholly-owned subsidiary PanAfrican Energy Tanzania Limited, as well as oil
and gas appraisal in Italy. Orca trades on the TSX Venture Exchange under the trading symbols
ORC.B and ORC.A.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Abbreviations
Mcf
|
thousand cubic feet
|
MMcfd
|
million cubic feet per day
|
Reader Advisory
The Company discloses several financial measures herein that do not have any standardized meaning prescribed under International
Financial Reporting Standards ("IFRS"). These financial measures include funds flow from operating activities and funds flow
per share.
Funds flow from operating activities represents cash flow from operations before working capital changes and demonstrates the
Company's ability to generate cash necessary to achieve growth through capital investments. Funds flow from operating activities
per share is calculated on the basis of funds flow from operating activities divided by the weighted average number of shares
outstanding. Management believes that these financial measures are useful supplemental information to analyze operating performance
and provide an indication of the results generated by the Company's principal business activities. Investors should be cautioned
that these measures should not be construed as an alternative to net income or other measures of financial performance as
determined in accordance with IFRS. The Company's method of calculating these measures may differ from other companies, and
accordingly, they may not be comparable to similar measures used by other companies. Please see the Company's management's
discussion and analysis, which is available at www.sedar.com for
additional information about these financial measures.
This news release contains forward-looking information. More particularly, this news release contains statements and information
concerning, but not limited to, the Tanzanian government's work with the World Bank on financing solutions to address government
debts, including the expectation that a portion of such financing would be allocated to resolving TANESCO arrears. Such
forward-looking information involves substantial known and unknown risks and uncertainties, certain of which are beyond Orca's
control, and many factors could cause the actual results to differ materially from those expressed or implied in the
forward-looking information, including, but not limited to, risk that financing solutions are not implemented by the Tanzanian
government and the World Bank; risk that any financing provided by the World Bank will not be allocated to resolving TANESCO
arrears; risk that Orca is unable to collect amounts owing from TANESCO; the impact of general economic conditions in Tanzania; changes in laws and regulations including changes in how they are interpreted and enforced; and
risks associated with negotiating with foreign governments. Readers are cautioned that the foregoing list of factors is not
exhaustive. Actual results, performance or achievements could differ materially from those expressed in, or implied by, the
forward-looking information and, accordingly, no assurances can be given that any of the events anticipated by the forward-looking
information will transpire or occur, or if any of them do so, what benefits Orca will derive therefrom. As a consequence, actual
results may differ materially from those anticipated in the forward-looking information. The forward-looking information contained
in this news release is made as of the date hereof and Orca undertakes no obligation to update publicly or revise forward-looking
information, whether as a result of new information, future events or otherwise, unless so required by applicable securities
laws.
SOURCE Orca Exploration Group Inc.