|By Marketwired .||
|May 30, 2014 09:11 AM EDT||
CALGARY, ALBERTA -- (Marketwired) -- 05/30/14 -- Americas Petrogas Inc. ("Americas Petrogas" or the "Company") (TSX VENTURE:BOE) announces its first quarter 2014 results.
Summary Financial and Operational Highlights
Selected financial and operational information is outlined below and should be read in conjunction with the Company's interim consolidated financial statements and the related Management's Discussion and Analysis ("MD&A") for the quarter, which have been filed on SEDAR under the Company's profile at www.sedar.com and are also available on the Company's website at www.americaspetrogas.com. All amounts are in Canadian dollars unless otherwise stated.
($ in thousands, except share, per share, and per barrel amounts) Three months ended March 31 ------------------------------ 2014 2013 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Gross oil sales revenue $ 9,108 $ 16,450 Net revenue(1) $ 7,763 $ 14,347 Operating netback (including Oil Plus benefits)(2) $ 4,094 $ 13,167 Operating netback (including Oil Plus benefits) per barrel(2) $ 36.73 $ 60.88 Operating netback (excluding Oil Plus benefits) per barrel(2) $ 36.73 $ 47.70 Net income (loss) attributable to owners of the Company(3) $ (24,557) $ 4,338 Earnings (loss) per share- basic and diluted $ (0.12) $ 0.02 Funds flow from operations(4) $ 2,047 $ 9,874 Per share - basic $ 0.01 $ 0.05 Per share - diluted $ 0.01 $ 0.05 Weighted average number of common shares outstanding(5) Basic 212,572,440 212,760,484 Diluted 214,139,198 216,952,633 Cash flow from operating activities $ 8,860 $ 5,465 Capital expenditures $ 10,948 $ 27,296 Average barrels sold per day 1,238 2,403 Average selling price per barrel $ 81.72 $ 76.06 ($ in thousands) March 31, 2014 December 31, 2013 ---------------------------------------------------------------------------- ---------------------------------------------------------------------------- Cash and cash equivalents $ 15,217 $ 18,334 Working capital(6) $ 14,746 $ 21,687 Equity outstanding Common shares 212,572,440 212,572,440 Stock options 17,946,093 17,946,093
1. "Net revenue" is an additional GAAP measure because it is presented in the consolidated statement of income (loss). Net revenue is gross revenue less royalties. The Company uses "net revenue" as an indicator of operating performance. 2. "Operating netback" is a non-GAAP measure and is calculated as revenues from oil sales less royalties and production costs. Operating netback is used as an indicator of operating performance, profitability and liquidity. "Operating netback (excluding Oil Plus benefits)" excludes any Oil Plus benefits credited to production costs. "Operating netback (including Oil Plus benefits)" is net of any Oil Plus benefits credited to production costs. Operating netback does not have a standardized meaning prescribed by IFRS. It is unlikely for non-GAAP measures to be comparable to similar measures presented by other companies. For the three months ended March 31, 2014, operating netback was $4.1 million (calculated as gross oil sales revenue of $9.1 million less royalties of $1.3 million and production costs of $3.7 million). For the three months ended March 31, 2013, operating netback was $13.2 million (calculated as gross oil sales revenue of $16.5 million less royalties of $2.1 million and production costs of $1.2 million). 3. The net loss in 2014 includes a non-cash foreign exchange loss of $17.97 million associated with the Company's USD intercompany loans. See note 16(c) of the Company's condensed interim consolidated financial statements for the three months ended March 31, 2014 and section "1.4 Results of Operations -- Foreign Exchange Gain/Loss and Other Comprehensive Income/Loss" of the Company's MD&A for the quarter. 4. "Funds flow from operations" is an additional GAAP measure because it is presented in the consolidated statement of cash flows. Funds flow from operations and funds flow from operations per share are used to analyze operating performance and liquidity. Funds flow from operations is calculated as net cash generated from (used by) operating activities (as determined in accordance with IFRS) before changes in non-cash balance sheet operating items. Funds flow from operations per share is calculated by dividing funds flow from operations by the weighted average number of shares outstanding. Funds flow from operations should not be considered an alternative to, or more meaningful than net cash generated from (used by) operating activities as determined in accordance with IFRS. Funds flow from operations per share should not be considered an alternative to, or more meaningful than earnings (loss) per share as determined in accordance with IFRS. 5. Diluted weighted average number of common shares outstanding is computed by adjusting basic weighted average number of common shares outstanding for dilutive instruments. The number of shares included with respect to options, warrants and similar instruments is computed using the treasury stock method, which assumes any proceeds received by the Company upon exercise of the in-the-money instruments would be used to repurchase common shares at the average market price for the period. For the three months ended March 31, 2014, 1,566,758 (three months ended March 31, 2013 - 4,192,149) common shares were deemed to be issued for no consideration in respect of options. 6. Working capital is a non-GAAP measure and is calculated as current assets less current liabilities. Working capital is used to assess liquidity and general financial strength. Working capital does not have a standardized meaning prescribed by IFRS. It is unlikely for non-GAAP measures to be comparable to similar measures presented by other companies. Working capital should not be considered an alternative to, or more meaningful than current assets or current liabilities as determined in accordance with IFRS. -- Net loss: The loss for 2014 of $24.6 million is primarily attributable to a non-cash, foreign exchange loss of $17.97 million on intercompany loans between the Canadian parent company and its Argentina subsidiary, which arose primarily due to an approximate 20% decline in the Argentina Peso against the US dollar in January 2014. For the three months ended March 31, 2013, net income was $4.3 million. -- Cash position: $15.2 million of consolidated cash and cash equivalents as of March 31, 2014. In May 2014, the Company announced that it had executed an underwriting agreement to raise gross proceeds of $15 million. For additional information, see "Highlights and Recent Activities" below. -- Oil Plus benefits: during the first quarter of 2014, the Company did not recognize any Oil Plus benefits, though $7.3 million of Oil Plus benefits (recognized in 2013) were collected in January 2014. During the year ended December 31, 2013, the Company recognized $25.5 million of Oil Plus benefits (related to production and reserve increases). As of the current date, a total of $26.8 million of Oil Plus benefits have already been collected. An additional $16.2 million has been applied for and remains to be collected.
Highlights and Recent Activities
-- In May 2014, the Company entered into an underwriting agreement with a syndicate of underwriters to raise $15 million in gross proceeds (the "Offering"). The Company has filed a preliminary short form prospectus in connection with the Offering, which is being conducted in all provinces in Canada (except Quebec) and outside of Canada where permitted under applicable securities laws. The Offering consists of 16,666,666 units (the "Units") of the Company at an offering price of $0.90 per Unit, with each Unit consisting of one Common Share and one- half of one Common Share purchase warrant (each whole Common Share purchase warrant, a "Warrant"). Each Warrant is exercisable for a period of 36 months following closing at an exercise price of $1.125 per Common Share. The Company has granted to the underwriters an over-allotment option which entitles the underwriters to acquire up to an additional 15% of the Units distributed in the Offering at the Offering price at any time up to 30 days following the closing of the Offering. The Company expects to close the Offering on or about June 6, 2014, subject to satisfaction of customary closing conditions. In connection with the Offering, the underwriters will receive a cash commission equal to 6% of the gross proceeds raised under the Offering and non-transferable compensation options entitling the Underwriters to acquire up to 500,000 Units (575,000 Units if the over-allotment option is exercised in full) for a period of 12 months from the closing date of the Offering at $0.90 per Unit having the same terms as the Units comprising the Offering. -- On September 19, 2013, Americas Petrogas announced a strategic review, which commenced a process to review strategic alternatives for maximizing shareholder value. The Company engaged Jefferies LLC as its sole financial advisor to assist management in evaluating a range of strategic alternatives. The strategic review is ongoing and the Company continues to evaluate a range of alternatives. -- So far in 2014, as the Company reduces its capital expenditures in an effort to preserve its cash position while the strategic review with Jefferies is ongoing, oil sales volumes in 2014 have been lower in comparison to 2013. Sales volumes during the first quarter of 2014, including oil sales from testing unconventional wells, averaged 1,238 bopd (net), a decrease over the average daily production during the same period in 2013, which was 2,403 bopd (net). -- As of January 2014, the Company successfully completed and brought on- stream its own power generation facility at Medanito Sur using associated gas from oil production. This now allows substantially all of the operations at Medanito Sur to be powered via the produced gas. This, in turn, has reduced the need for rental generators and associated diesel and labour costs. Management estimates that it will be able to power approximately 400 pump jacks and associated surface process facilities using this system. -- In April 2014, the Company began a gas reinjection program, injecting approximately 1 million cubic feet per day (mmcfd) of produced gas into the top of the El Tordillo formation at the easternmost updip area of the El Jabali Field. The total gas treatment and injection capacity is 7 mmcfd. -- In May 2014, the Peruvian state-owned company Activos Mineros S.A.C. and the Executive Director of ProInversion executed the transfer agreement formally granting the Bayovar Property to APPSA, Americas Petrogas' Peruvian subsidiary. -- The Company obtained an extension until September 2015 of its exploration contract terms for the Totoral, Yerba Buena and Bajada Colorada Blocks while returning to the government a total of approximately 1,510 square kilometers in the three blocks, leaving the Company with 3,048 square kilometres or 753,200 acres gross (2,743 square kilometres or 677,880 acres net). Ryder Scott Company estimated (updated as of March 31, 2014) that the Company has 7.56 billion BOE P50 Best Case Unrisked Prospective (Recoverable) Resources (27% oil/condensate and 73% gas) in the Company's nine unconventional shale oil and shale gas properties. The original estimates (8.3 billion BOE P50 Best Case Unrisked Prospective (Recoverable) Resources) were included in a report prepared as of June 30, 2013 but, subsequently, the estimates were amended to account for the aforementioned return of lands to the government on the Totoral, Yerba Buena and Bajada Colorada Blocks. The Ryder Scott estimates only considered the Vaca Muerta, Agrio and Los Molles shales. The report did not consider additional zones of interest such as the Mulichinco, Quintuco, Tordillo, and other prospective formations.
For further information regarding the Company's financial results, financial position and related changes, please see the interim consolidated financial statements and the related MD&A.
About Americas Petrogas Inc.
Americas Petrogas Inc. is a Canadian company whose shares trade on the TSX Venture Exchange under the symbol "BOE". Americas Petrogas has conventional and unconventional shale oil and gas and tight sands oil and gas interests in numerous blocks in the Neuquen Basin of Argentina. Americas Petrogas has joint venture partners, including ExxonMobil and YPF, on various blocks in the shale oil and gas corridor in the Neuquen Basin, Argentina. Americas Petrogas also owns an 80% interest in GrowMax Agri Corp., a private company involved in the exploration for near-surface potash, phosphates and other minerals, and potential development of a fertilizer project in Peru. Indian Farmers Fertiliser Co-operative Limited (IFFCO) owns a 20% interest in GrowMax Agri Corp. For more information about Americas Petrogas Inc., please visit www.americaspetrogas.com.
Forward Looking Information
This Press Release contains forward-looking information including, but not limited to, the Company's goals and growth, estimates of reserves and resources, production and cash flows, reviewing various strategic alternatives, exploration, appraisal and development activities related to conventional and unconventional oil and gas, other exploration, development and production activities in respect of the projects in Argentina and Peru, and closing of the Offering. The recovery and resources estimates for the Company's properties described in this Press Release are estimates only and there is no guarantee that the estimated resources will be recovered. The actual resources for the Company's properties may be greater or less than those calculated. Additional forward-looking information is contained in the Company's Annual MD&A and Annual Information Form for the year ended December 31, 2013, and reference should be made to the additional disclosures of the assumptions, risks and uncertainties relating to such forward-looking information in those documents.
Forward-looking information is based on management's expectations regarding the Company's future growth, results of operations, production, future capital and other expenditures (including the amount, nature and sources of funding thereof), competitive advantages, plans for and results of drilling activity (including the timing, location, depth and the number of wells), environmental matters, business prospects and opportunities and expectations with respect to general economic conditions. Such forward-looking information reflects management's current beliefs and assumptions and is based on information, including reserves and resources information, currently available to management. Forward-looking information involves significant known and unknown risks and uncertainties. A number of factors could cause actual results, performance or achievements to differ materially from any future results, performance or achievements expressed or implied by the forward-looking information, including but not limited to, risks associated with the oil and gas industry (e.g. operational risks in development, exploration and production, delays or changes to plans with respect to exploration or development projects or capital expenditures; the uncertainty of reserve estimates; the uncertainty of geological interpretations; the uncertainty of estimates and projections in relation to production, costs and expenses and health, safety and environment risks, extensions of concessions and commitments), the risk of commodity price and foreign exchange rate fluctuations, the uncertainty associated with negotiating with foreign governments and third parties located in foreign jurisdictions and the risk associated with international activity and the risk of being unable to raise significant funds on terms acceptable to the Company to meet its capital and operating expenditure requirements in respect of its properties.
Although the forward-looking information contained herein is based upon assumptions which management believes to be reasonable, the Company cannot assure investors that actual results will be consistent with this forward-looking information. This forward-looking information is made as of the date hereof and the Company assumes no obligation to update or revise this information to reflect new events or circumstances, except as required by law. Because of the risks, uncertainties and assumptions inherent in forward-looking information, prospective investors in the Company's securities should not place undue reliance on this forward-looking information.
The term BOE (barrels of oil equivalent) is used in this press release. All calculations converting natural gas to BOE have been made using a conversion ratio of six thousand cubic feet (six "Mcf") of natural gas to one barrel of oil, unless otherwise stated. The use of BOE may be misleading, particularly if used in isolation, as the conversion ratio of six Mcf 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. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different from the energy equivalency of 6:1, utilizing a conversion on a 6:1 basis may be misleading as an indication of value.
Prospective Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from undiscovered accumulations by application of future development projects. Prospective resources have both an associated chance of discovery and a chance of development. Uncertainty Ranges are described by the COGEH as low, best, and high estimates for reserves and resources. The Best Estimate is considered to be the best estimate of the quantity that will actually be recovered. It is equally likely that the actual remaining quantities recovered will be greater or less than the best estimate. If probabilistic methods are used, there should be at least a 50 percent probability (P50) that the quantities actually recovered will equal or exceed the best estimate.
In the case of undiscovered resources or a subcategory of undiscovered resources, there is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources. For undiscovered hydrocarbons, the term 'unrisked' means that no geologic or chance of discovery ("play risk") has been incorporated into the hydrocarbon volume estimates.
The estimates of resources for individual properties may not reflect the same confidence level as estimates of resources for all properties, due to the effects of aggregation.
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 THE RELEASE.
In this strange new world where more and more power is drawn from business technology, companies are effectively straddling two paths on the road to innovation and transformation into digital enterprises. The first path is the heritage trail – with “legacy” technology forming the background. Here, extant technologies are transformed by core IT teams to provide more API-driven approaches. Legacy systems can restrict companies that are transitioning into digital enterprises. To truly become a lea...
Sep. 28, 2016 08:15 PM EDT Reads: 305
IoT is fundamentally transforming the auto industry, turning the vehicle into a hub for connected services, including safety, infotainment and usage-based insurance. Auto manufacturers – and businesses across all verticals – have built an entire ecosystem around the Connected Car, creating new customer touch points and revenue streams. In his session at @ThingsExpo, Macario Namie, Head of IoT Strategy at Cisco Jasper, will share real-world examples of how IoT transforms the car from a static p...
Sep. 28, 2016 07:00 PM EDT Reads: 1,623
Cloud computing is being adopted in one form or another by 94% of enterprises today. Tens of billions of new devices are being connected to The Internet of Things. And Big Data is driving this bus. An exponential increase is expected in the amount of information being processed, managed, analyzed, and acted upon by enterprise IT. This amazing is not part of some distant future - it is happening today. One report shows a 650% increase in enterprise data by 2020. Other estimates are even higher....
Sep. 28, 2016 06:45 PM EDT Reads: 4,147
From wearable activity trackers to fantasy e-sports, data and technology are transforming the way athletes train for the game and fans engage with their teams. In his session at @ThingsExpo, will present key data findings from leading sports organizations San Francisco 49ers, Orlando Magic NBA team. By utilizing data analytics these sports orgs have recognized new revenue streams, doubled its fan base and streamlined costs at its stadiums. John Paul is the CEO and Founder of VenueNext. Prior ...
Sep. 28, 2016 06:30 PM EDT Reads: 3,100
One of biggest questions about Big Data is “How do we harness all that information for business use quickly and effectively?” Geographic Information Systems (GIS) or spatial technology is about more than making maps, but adding critical context and meaning to data of all types, coming from all different channels – even sensors. In his session at @ThingsExpo, William (Bill) Meehan, director of utility solutions for Esri, will take a closer look at the current state of spatial technology and ar...
Sep. 28, 2016 06:15 PM EDT Reads: 276
The Internet of Things can drive efficiency for airlines and airports. In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect with GE, and Sudip Majumder, senior director of development at Oracle, will discuss the technical details of the connected airline baggage and related social media solutions. These IoT applications will enhance travelers' journey experience and drive efficiency for the airlines and the airports. The session will include a working demo and a technical d...
Sep. 28, 2016 06:00 PM EDT Reads: 1,768
What happens when the different parts of a vehicle become smarter than the vehicle itself? As we move toward the era of smart everything, hundreds of entities in a vehicle that communicate with each other, the vehicle and external systems create a need for identity orchestration so that all entities work as a conglomerate. Much like an orchestra without a conductor, without the ability to secure, control, and connect the link between a vehicle’s head unit, devices, and systems and to manage the ...
Sep. 28, 2016 05:15 PM EDT Reads: 234
Businesses are struggling to manage the information flow and interactions between all of these new devices and things jumping on their network, and the apps and IT systems they control. The data businesses gather is only helpful if they can do something with it. In his session at @ThingsExpo, Chris Witeck, Principal Technology Strategist at Citrix, will discuss how different the impact of IoT will be for large businesses, expanding how IoT will allow large organizations to make their legacy ap...
Sep. 28, 2016 05:15 PM EDT Reads: 242
The many IoT deployments around the world are busy integrating smart devices and sensors into their enterprise IT infrastructures. Yet all of this technology – and there are an amazing number of choices – is of no use without the software to gather, communicate, and analyze the new data flows. Without software, there is no IT. In this power panel at @ThingsExpo, moderated by Conference Chair Roger Strukhoff, panelists will look at the protocols that communicate data and the emerging data analy...
Sep. 28, 2016 05:00 PM EDT Reads: 1,722
As ridesharing competitors and enhanced services increase, notable changes are occurring in the transportation model. Despite the cost-effective means and flexibility of ridesharing, both drivers and users will need to be aware of the connected environment and how it will impact the ridesharing experience. In his session at @ThingsExpo, Timothy Evavold, Executive Director Automotive at Covisint, will discuss key challenges and solutions to powering a ride sharing and/or multimodal model in the a...
Sep. 28, 2016 04:45 PM EDT Reads: 376
SYS-CON Events announced today that Commvault, a global leader in enterprise data protection and information management, has been named “Bronze Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Commvault is a leading provider of data protection and information management solutions, helping companies worldwide activate their data to drive more value and business insight and to transform moder...
Sep. 28, 2016 04:30 PM EDT Reads: 2,810
Creating replica copies to tolerate a certain number of failures is easy, but very expensive at cloud-scale. Conventional RAID has lower overhead, but it is limited in the number of failures it can tolerate. And the management is like herding cats (overseeing capacity, rebuilds, migrations, and degraded performance). Download Slide Deck: ▸ Here In his general session at 18th Cloud Expo, Scott Cleland, Senior Director of Product Marketing for the HGST Cloud Infrastructure Business Unit, discusse...
Sep. 28, 2016 04:15 PM EDT Reads: 2,436
Whether they’re located in a public, private, or hybrid cloud environment, cloud technologies are constantly evolving. While the innovation is exciting, the end mission of delivering business value and rapidly producing incremental product features is paramount. In his session at @DevOpsSummit at 19th Cloud Expo, Kiran Chitturi, CTO Architect at Sungard AS, will discuss DevOps culture, its evolution of frameworks and technologies, and how it is achieving maturity. He will also cover various st...
Sep. 28, 2016 04:15 PM EDT Reads: 1,872
SYS-CON Events announced today that eCube Systems, a leading provider of middleware modernization, integration, and management solutions, will exhibit at @DevOpsSummit at 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. eCube Systems offers a family of middleware evolution products and services that maximize return on technology investment by leveraging existing technical equity to meet evolving business needs. ...
Sep. 28, 2016 04:15 PM EDT Reads: 1,494
All clouds are not equal. To succeed in a DevOps context, organizations should plan to develop/deploy apps across a choice of on-premise and public clouds simultaneously depending on the business needs. This is where the concept of the Lean Cloud comes in - resting on the idea that you often need to relocate your app modules over their life cycles for both innovation and operational efficiency in the cloud. In his session at @DevOpsSummit at19th Cloud Expo, Valentin (Val) Bercovici, CTO of So...
Sep. 28, 2016 04:00 PM EDT Reads: 1,485