Bankers Petroleum Announces 2012 Third Quarter Financial and Operational Results
Bankers Petroleum Announces 2012 Third Quarter Financial and Operational Results
Record Quarter of Production and Cash Flows
CALGARY, Nov. 12, 2012 /CNW/ - Bankers Petroleum Ltd. ("Bankers" or the "Company") (TSX: BNK, AIM: BNK) is pleased to provide its 2012 third quarter financial and operational results. The complete reporting package, consisting of Management's Discussion and Analysis along with the Financial Statements and Notes, is posted on the Company's website www.bankerspetroleum.com and on SEDAR: www.sedar.com.
Results at a Glance (US$000, except Three months ended Nine months ended as noted) September 30 September 30
2012 2011 Change 2012 2011 Change
Oil revenue 115,054 93,650 23% 316,309 251,570 26%
Net operating
income 58,159 44,898 30% 158,882 131,976 20%
Net income 12,274 13,696 (10%) 31,292 35,715 (12%)
Per - basic
share ($) 0.049 0.055 (11%) 0.124 0.145 (14%)
- diluted
($) 0.048 0.054 (11%) 0.123 0.140 (12%)
Funds generated
from operations(
(1)) 48,308( ) 42,099 15% 139,539 115,267 21%
Per - basic
share ($) 0.191 0.170 12% 0.554 0.467 19%
Capital
expenditures 53,526 65,147 (18%) 168,859 186,465 (9%)
Average sales
(bopd) 15,715 13,667 15% 14,393 12,578 14%
Average price
($/barrel) 79.58 74.48 7% 80.21 73.26 9%
Netback
($/barrel) 40.23 35.71 13% 40.29 38.43 5%
(1) Includes a $3.9 million payment for a financial commodity contract
in August 2012.
September 30 December 31 September 30
2012 2011 2011
Cash and cash on
deposits 40,112 54,013 53,243
Working capital 106,537 80,282 73,491
Total assets 810,017 661,216 612,348
Long-term debt 97,016 46,692 20,187
Shareholders'
equity 471,907 412,679 405,955
Highlights for the quarter and nine months ended September 30, 2012 are:
-- For the third quarter of 2012, oil sales averaged 15,715 bopd,
an increase of 15% compared to 13,667 bopd for the same period
in 2011 and an increase of 11% compared to 14,169 bopd for the
preceding quarter. For the nine months ended September 30,
2012, oil sales increased 14% to 14,393 bopd from 12,578 bopd
for the comparable 2011 period.
-- Revenue for the third quarter of 2012 increased by 23% to
$115.1 million ($79.58/bbl) from $93.7 million ($74.48/bbl) in
the same period of 2011. Revenue for the third quarter of 2012
represented 73% of the Brent oil price of $110/bbl. Revenue
for the nine month 2012 period totalled $316.3 million
($80.21/bbl), an increase of 26% from $251.6 million
($73.26/bbl) for the same period of 2011.
-- Royalties to the Albanian Government and related entities were
$23.3 million and $18.5 million for the third quarter of 2012
and 2011, respectively (both representing 20% of total
revenue). Total royalties were $59.6 million and $45.3 million
for the nine months ended September 30, 2012 and 2011,
respectively.
-- Operating, sales and transportation costs in the third quarter
of 2012, originating from Albanian-based companies and their
employees, were $33.6 million, compared with $30.3 million for
the third quarter of 2011.
-- The Company recorded net operating income (netback) of $58.2
million ($40.23/bbl) in the third quarter of 2012, an increase
of 30% compared to $44.9 million ($35.71/bbl) in the same
period of 2011. For the nine months ended September 30, 2012,
net operating income totalled $158.9 million ($40.29/bbl), a
20% increase from $132.0 million ($38.43/bbl) for the same
period in 2011.
-- Funds generated from operations for the third quarter of 2012
were $48.3 million, a 15% increase compared to $42.1 million
for the third quarter of 2011. For the nine months ended
September 30, 2012, funds generated from operations were $139.5
million as compared to $115.3 million for the nine months ended
September 30, 2011. Included in funds generated from operations
is a payment of $3.9 million for a financial commodity contract
in August 2012.
-- Capital expenditures in the third quarter of 2012 were $53.5
million. The Company drilled 34 wells during the quarter,
comprised of 31 horizontal wells, one lateral re-drill
sidetrack well, and two core wells in the southern area of the
field. Re-activation and re-completion work continued during
the quarter. During the same period of 2011, capital
expenditures were $65.1 million. For the nine months ended
September 30, 2012, capital expenditures totalled $168.9
million, a reduction of 9% from $186.5 million for the
comparable 2011 period.
-- During the third quarter of 2012, Bankers participated in the
bid evaluation process for the privatization of the Albanian
national oil company "Albpetrol Sh.A". Although Bankers'
participation was unsuccessful, the winning bid value of EUR
850 million attributed to Albpetrol's assets enhances Bankers
oilfields' valuation and also demonstrates the Company's
commitment to expand its business activities in Albania.
-- At September 30, 2012, total deposits and prepaid expenses were
$29.2 million compared to $17.5 million at the end of December
2011, of which $16.6 million and $1.2 million, respectively, is
paid to the Albanian court as deposits for procedure purposes
on several legal cases. The recoverability of these amounts is
dependent on the outcome of these cases. As of September 30,
2012, these amounts were considered recoverable.
-- The Company is in the process of challenging assessments from
the Albanian Government Tax Director negating the previous
exemption relief from carbon and circulation taxes on diluent
imports. These assessments represent a total of $15 million
covering the last five years. The Company was successful in
setting aside a recently introduced separate excise tax
assessment amounting to $8 million on the Company's importation
and use of diluent. Other audits have also resulted in an
additional assessment of previously exempted Value Added Taxes
for some of Bankers' subcontractors. Bankers has urged the
Government of Albania to re-consider its position before
proceeding with implementation of this assessment and is
hopeful that these contractual exemptions will continue to be
applied.
-- The Company continues to maintain a strong financial position
at September 30, 2012 with cash of $40.1 million and working
capital of $106.5 million. Working capital for December 31,
2011 and September 30, 2011 was $80.3 million and $73.5
million, respectively.
Financial Update
Bankers has commenced discussions with EBRD and IFC, its reserve-based
lenders, for an increase to its $110 million credit facility and a term
extension that would extend existing repayments, currently scheduled to
commence in October 2013. The existing 2009 facility was based on 2008
year-end reserves; subsequent reserve increases have significantly expanded
the Company's borrowing base.
Operational Update and Outlook
The average fourth quarter 2012 production to date from the Patos-Marinza
oilfield in Albania was 16,100 barrels of oil per day ("bopd"), 3% higher than
the third quarter average.
The Company has made several improvements to address operational challenges
associated with mature heavy oilfield development including interference from
old well bores, sand production, and water disposal capacity. Five (5)
previously drilled wells that were shut-in due to liner failure in late 2011
have been re-drilled with a lateral sidetrack through the cased section of the
wellbore and a new higher grade steel liner with redesigned slot configuration
for additional strength has been run in the new lateral legs. The wells were
successfully completed and are currently producing at a cumulative production
rate of 500 bopd (average of 100 bopd per well). Additional candidate wells
are being prepared for lateral re-drilling and installation of improved
tubulars with three (3) re-drill sidetracks planned for the remainder of the
fourth quarter and several more in the first half of next year to restore
shut-in production from similar wells that have demonstrated good production
capability, but are restricted due to liner failure concerns.
The Company continues to be pleased with the results of the horizontal
drilling program, along with the results of lateral section re-drills
initiated in the third quarter and continuing into the fourth quarter and
first part of 2013.
For additional information, please see an updated version of the Company's
November corporate presentation on www.bankerspetroleum.com.
Bankers Petroleum is expanding and has several exciting career opportunities
available for both Calgary and Albania. Please visit our website for full
details on these career opportunities and to see how to apply.
BANKERS PETROLEUM LTD.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Unaudited, expressed in thousands of US dollars, except per share
amounts)
Three months ended Nine months ended
September 30 September 30
2012 2011 2012 2011
Revenues $ 115,054 $ 93,650 $ 316,309 $ 251,570
Royalties (23,259) (18,457) (59,627) (45,274)
91,795 75,193 256,682 206,296
Unrealized gain (loss) on (1,085) 4,998 (4,050) 2,982
financial commodity
contracts
90,710 80,191 252,632 209,278
Operating expenses 20,229 17,328 56,699 43,562
Sales and transportation 13,407 12,967 41,101 30,758
expenses
General and 3,999 3,536 11,617 9,974
administrative expenses
Depletion and 15,644 9,591 43,388 26,983
depreciation
Share-based payments 1,953 2,515 7,636 9,487
55,232 45,937 160,441 120,764
35,478 34,254 92,191 88,514
Net finance expense 3,732 146 8,449 4,050
Income before income tax 31,746 34,108 83,742 84,464
Deferred income tax (19,472) (20,412) (52,450) (48,749)
expense
Net income for the period 12,274 13,696 31,292 35,715
Other comprehensive
income (loss)
Currency translation 820 (2,626) 821 (373)
adjustment
Comprehensive income for $ 13,094 $ 11,070 $ 32,113 $ 35,342
the period
Basic earnings per share $ 0.049 $ 0.055 $ 0.124 $ 0.145
Diluted earnings per $ 0.048 $ 0.054 $ 0.123 $ 0.140
share
BANKERS PETROLEUM LTD.
CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(Unaudited, expressed in thousands of US dollars)
ASSETS
September 30 December 31
2012 2011
Current assets
Cash and cash $ 21,695 $ 49,013
equivalents
Restricted cash 18,417 5,000
Accounts receivable 75,646 56,006
Inventory 11,912 14,412
Deposits and prepaid 29,162 17,463
expenses
Financial commodity 2 3,684
contracts
156,834 145,578
Non-current assets
Financial commodity 3,530 -
contract
Property, plant and 649,653 515,638
equipment
$ 810,017 $ 661,216
LIABILITIES
Current liabilities
Accounts payable and $ 48,808 $ 52,109
accrued liabilities
Current portion of 1,489 13,187
long-term debt
50,297 65,296
Non-current liabilities
Long-term debt 97,016 46,692
Decommissioning 15,360 13,561
obligation
Deferred tax liabilities 175,437 122,988
338,110 248,537
SHAREHOLDERS' EQUITY
Share capital 332,450 318,021
Warrants - 1,540
Contributed surplus 63,877 49,651
Currency translation reserve 7,230 6,409
Retained earnings 68,350 37,058
471,907 412,679
$ 810,017 $ 661,216
BANKERS PETROLEUM LTD.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited, expressed in thousands of US dollars)
Three months ended Nine months ended
September 30 September 30
2012 2011 2012 2011
Cash provided by (used
in):
Operating activities
Net income for the $ 12,274 $ 13,696 $ 31,292 $ 35,715
period
Depletion and 15,644 9,591 43,388 26,983
depreciation
Amortization of - - - 734
deferred financing
costs
Accretion of long-term 1,239 845 3,565 1,593
debt
Accretion of 211 115 608 309
decommissioning
obligation
Unrealized foreign 328 (77) 448 1,267
exchange (gain) loss
Deferred income tax 19,472 20,412 52,450 48,749
expense
Share-based payments 1,953 2,515 7,636 9,487
Unrealized (gain) loss 1,085 (4,998) 4,050 (2,982)
on financial commodity
contracts
Cash premiums paid for (3,898) - (3,898) (6,588)
financial commodity
contracts
48,308 42,099 139,539 115,267
Change in non-cash (16,153) (15,352) (28,767) (18,011)
working capital
32,155 26,747 110,772 97,256
Investing activities
Additions to property, (53,526) (65,147) (168,859) (186,465)
plant and equipment
Restricted cash (13,417) - (13,417) (5,000)
Change in non-cash 736 5,095 (3,373) 15,637
working capital
(66,207) (60,052) (185,649) (175,828)
Financing activities
Issue of shares for - 54 12,177 5,347
cash
Financing costs - - (750) (30)
Increase in long-term 290 6,579 36,107 14,519
debt
Share issue costs - (167) - (167)
290 6,466 47,534 19,669
Foreign exchange gain 160 (1,347) 25 (973)
(loss) on cash and cash
equivalents
Decrease in cash and (33,602) (28,186) (27,318) (59,876)
cash equivalents
Cash and cash 55,297 74,929 49,013 106,619
equivalents, beginning
of period
Cash and cash $ 21,695 $ 46,743 $ 21,695 $ 46,743
equivalents, end of
period
Interest paid $ 253 $ 197 $ 1,975 $ 1,349
Interest received $ 43 $ 80 $ 321 $ 443
BANKERS PETROLEUM LTD.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Unaudited, expressed in thousands of US dollars, except number of common shares)
Number of Currency
common Share Contributed translation Retained
shares capital Warrants surplus reserve earnings Total
Balance at 244,794,990 $ 309,379 $ 1,597 $ 28,135 $ 6,094 $ 1,062 $ 346,267
December
31, 2010
Share-based - - - 19,166 - - 19,166
payments
Options 2,721,779 8,303 - (2,956) - - 5,347
exercised
Share issue - (167) - - - - (167)
costs
Net income - - - - - 35,715 35,715
for the
period
Currency - - - - (373) - (373)
translation
adjustment
Balance at 247,516,769 $ 317,515 $ 1,597 $ 44,345 $ 5,721 $ 36,777 $ 405,955
September
30, 2011
Share-based - - - 5,319 - - 5,319
payments
Options 6,667 45 - (13) - - 32
exercised
Warrants 174,333 461 (57) - - - 404
exercised
Net income - - - - - 281 281
for the
period
Currency - - - - 688 - 688
translation
adjustment
Balance at 247,697,769 $ 318,021 $ 1,540 $ 49,651 $ 6,409 $ 37,058 $ 412,679
December
31, 2011
Share-based - - - 14,938 - - 14,938
payments
Options 553,945 1,833 - (719) - - 1,114
exercised
Warrants 4,672,991 12,596 (1,533) - - - 11,063
exercised
Warrants - - (7) 7 - - -
expired
Net income - - - - - 31,292 31,292
for the
period
Currency - - - - 821 - 821
translation
adjustment
Balance at 252,924,705 $ 332,450 $ - $ 63,877 $ 7,230 $ 68,350 $ 471,907
September
30, 2012
Caution Regarding Forward-looking Information
Information in this news release respecting matters such as the expected
future production levels from wells, future prices and netback, work plans,
anticipated total oil recovery of the Patos-Marinza and Kuçova oilfields
constitute forward-looking information. Statements containing forward-looking
information express, as at the date of this news release, the Company's plans,
estimates, forecasts, projections, expectations, or beliefs as to future
events or results and are believed to be reasonable based on information
currently available to the Company.
Exploration for oil is a speculative business that involves a high degree of
risk. The Company's expectations for its Albanian operations and plans are
subject to a number of risks in addition to those inherent in oil production
operations, including: that Brent oil prices could fall resulting in reduced
returns and a change in the economics of the project; availability of
financing; delays associated with equipment procurement, equipment failure and
the lack of suitably qualified personnel; the inherent uncertainty in the
estimation of reserves; exports from Albania being disrupted due to unplanned
disruptions; and changes in the political or economic environment.
Production and netback forecasts are based on a number of assumptions
including that the rate and cost of well reactivations and well recompletions
of the past will continue and success rates and production rates will be
similar to those rates experienced for previous well recompletions and
reactivations; continued availability of the necessary equipment, personnel
and financial resources to sustain the Company's planned work program;
continued political and economic stability in Albania; the existence of
reserves as expected; the continued release by Albpetrol of areas and wells
pursuant to the Plan of Development and Addendum; the absence of unplanned
disruptions; the ability of the Company to successfully drill new wells and
bring production to market; and general risks inherent in oil and gas
operations.
Forward-looking statements and information are based on assumptions that
financing, equipment and personnel will be available when required and on
reasonable terms, none of which are assured and are subject to a number of
other risks and uncertainties described under "Risk Factors" in the Company's
Annual Information Form and Management's Discussion and Analysis, which are
available on SEDAR under the Company's profile at www.sedar.com.
There can be no assurance that forward-looking statements will prove to be
accurate. Actual results and future events could differ materially from those
anticipated in such statements. Readers should not place undue reliance on
forward-looking information and forward looking statements.
About Bankers Petroleum Ltd.
Bankers Petroleum Ltd. is a Canadian-based oil and gas exploration and
production company focused on developing large oil and gas reserves. In
Albania, Bankers operates and has the full rights to develop the Patos-Marinza
heavy oilfield and has a 100% interest in the Kuçova oilfield, and a 100%
interest in Exploration Block F. Bankers' shares are traded on the Toronto
Stock Exchange and the AIM Market in London, England under the stock symbol
BNK.
Abby Badwi President and Chief Executive Officer (403) 513-2694
Doug Urch Executive VP, Finance and Chief Financial Officer (403) 513-2691
Mark Hodgson VP, Business Development (403) 513-2695
Email: investorrelations@bankerspetroleum.com
Website: www.bankerspetroleum.com
AIM NOMAD: Canaccord Genuity Limited Henry Fitzgerald-O'Connor +44 20 7050 8000
AIM JOINT BROKERS: Canaccord Genuity Limited Henry Fitzgerald-O'Connor +44 20
7050 8000
Macquarie Capital Advisors Paul Connolly +44 20 3037 5639
SOURCE: Bankers Petroleum Ltd.
To view this news release in HTML formatting, please use the following URL:
http://www.newswire.ca/en/releases/archive/November2012/12/c6921.html
CO: Bankers Petroleum Ltd.
ST: Alberta
NI: OIL ERN
-0- Nov/12/2012 13:00 GMT
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