Calgary, Alberta – LEUCROTTA EXPLORATION INC. (TSXV: LXE) (“Leucrotta” or the “Company”) is pleased to announce its financial and operating results for the three months and year ended December 31, 2019. All dollar figures are Canadian dollars unless otherwise noted.
FINANCIAL RESULTS | |||||||||||||||
Three Months Ended December 31 | Year Ended December 31 | ||||||||||||||
($000s, except per share amounts) | 2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||||||
Oil and natural gas sales | 6,870 | 7,113 | (3 | ) | 27,645 | 32,048 | (14 | ) | |||||||
Cash flow from operating activities | 2,098 | 3,764 | (44 | ) | 10,465 | 16,249 | (36 | ) | |||||||
Per share – basic and diluted | 0.01 | 0.02 | (50 | ) | 0.05 | 0.08 | (38 | ) | |||||||
Adjusted funds flow (1) | 2,316 | 2,875 | (19 | ) | 10,266 | 15,949 | (36 | ) | |||||||
Per share – basic and diluted | 0.01 | 0.01 | – | 0.05 | 0.08 | (38 | ) | ||||||||
Net loss | 6,140 | 161 | 3,714 | 5,529 | 43 | 12,758 | |||||||||
Per share – basic and diluted | 0.03 | – | 100 | 0.03 | – | 100 | |||||||||
Capital expenditures and acquisitions | 4,160 | 10,665 | (61 | ) | 14,997 | 36,680 | (59 | ) | |||||||
Proceeds on sale of equipment (2) | – | 2,729 | (100 | ) | 4,767 | 2,729 | 75 | ||||||||
Working capital | 125 | 2,102 | (94 | ) | |||||||||||
Common shares outstanding (000s) | |||||||||||||||
Weighted average – basic and diluted | 200,525 | 200,525 | – | 200,525 | 200,520 | – | |||||||||
End of period – basic | 200,525 | 200,525 | – | ||||||||||||
End of period – fully diluted | 226,646 | 227,082 | – |
(1) See “Non-GAAP Measures” section.
(2) The sale of equipment for proceeds of $4.8 million is exclusive of $2.7 million deposit received in Q4 2018.
OPERATING RESULTS (1) | Three Months Ended December 31 | Year Ended December 31 | ||||||||
2019 | 2018 | % Change | 2019 | 2018 | % Change | |||||
Daily production | ||||||||||
Oil and NGLs (bbls/d) | 765 | 850 | (10) | 820 | 954 | (14) | ||||
Natural gas (mcf/d) | 12,392 | 14,115 | (12) | 13,347 | 15,574 | (14) | ||||
Oil equivalent (boe/d) | 2,830 | 3,202 | (12) | 3,044 | 3,550 | (14) | ||||
Revenue | ||||||||||
Oil and NGLs ($/bbl) | 51.26 | 44.78 | 14 | 51.80 | 59.46 | (13) | ||||
Natural gas ($/mcf) | 2.86 | 2.78 | 3 | 2.49 | 2.00 | 25 | ||||
Oil equivalent ($/boe) | 26.39 | 24.14 | 9 | 24.88 | 24.74 | 1 | ||||
Royalties | ||||||||||
Oil and NGLs ($/bbl) | – | (0.60) | (100) | – | 1.45 | (100) | ||||
Natural gas ($/mcf) | – | – | – | – | – | – | ||||
Oil equivalent ($/boe) | – | (0.16) | (100) | – | 0.39 | (100) | ||||
Net operating expenses (2 | ||||||||||
Oil and NGLs ($/bbl) | 8.43 | 5.95 | 42 | 8.34 | 6.67 | 25 | ||||
Natural gas ($/mcf) | 0.80 | 0.78 | 3 | 0.85 | 0.82 | 4 | ||||
Oil equivalent ($/boe) | 5.77 | 5.00 | 15 | 5.95 | 5.40 | 10 | ||||
Net transportation and marketing expenses (2 | ||||||||||
Oil and NGLs ($/bbl) | 1.35 | 1.17 | 15 | 1.34 | 1.54 | (13) | ||||
Natural gas ($/mcf) | 1.46 | 0.82 | 78 | 1.11 | 0.52 | 113 | ||||
Oil equivalent ($/boe) | 6.74 | 3.92 | 72 | 5.25 | 2.69 | 95 | ||||
Operating netback (2 | ||||||||||
Oil and NGLs ($/bbl) | 41.48 | 38.26 | 8 | 42.12 | 49.80 | (15) | ||||
Natural gas ($/mcf) | 0.60 | 1.18 | (49) | 0.53 | 0.66 | (20) | ||||
Oil equivalent ($/boe) | 13.88 | 15.38 | (10) | 13.68 | 16.26 | (16) | ||||
Depletion and depreciation ($/boe) | (9.65) | (9.29) | 4 | (9.56) | (9.38) | 2 | ||||
Asset impairment ($/boe) | (22.41) | – | 100 | (5.25) | – | 100 | ||||
General and administrative expenses ($/boe) | (4.76) | (5.48) | (13) | (4.30) | (4.05) | 6 | ||||
Share based compensation ($/boe) | (0.20) | (0.84) | (76) | (0.51) | (2.81) | (82) | ||||
Gain on sale of assets ($/boe) | – | – | – | 1.30 | – | 100 | ||||
Finance expense ($/boe) | (0.47) | (0.42) | 12 | (0.36) | (0.26) | 38 | ||||
Finance income ($/boe) | 0.04 | 0.10 | (60) | 0.03 | 0.21 | (86) | ||||
Net loss ($/boe) | (23.57) | (0.55) | 4,185 | (4.97) | (0.03) | 16,467 |
(1) See “Frequently Recurring Terms” section.
(2) See “Non-GAAP Measures” section.
Selected financial and operational information outlined in this news release should be read in conjunction with Leucrotta’s audited financial statements and related Management’s Discussion and Analysis (“MD&A”) for the year ended December 31, 2019, which are available for review at www.sedar.com.
PRESIDENT’S MESSAGE
In Q4 2019, Leucrotta’s capital was spent predominantly on the upgrade of the recently acquired Two Rivers Facility and related infrastructure. All other capital was restricted pending completion and start-up of the facility in March 2020.
Production remained relatively stable at 2,830 boe/d for the quarter as wells continue to outperform expectations and resulted in positive reserve revisions. Production increased in late March 2020 with the start-up of the Two Rivers facility and is estimated to average approximately 3,000 boe/d for 2020.
Leucrotta maintained positive net working capital at end of Q4 2019 but is estimated to have approximately $5.0 million of debt at the end of Q1 2020. Capital spending will be limited on a go-forward basis until there is more clarity on commodity prices. Leucrotta will look to reduce debt through cash flow and sale of non-core properties and equipment.
We look forward to reporting on further business developments in the near future.